Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Current HansardDownload Current Hansard   

Previous Fragment    Next Fragment
Monday, 23 March 1987
Page: 1350

Mr GEAR(10.40) —I was invited by the Deputy Whip to say a few words tonight. The first thing that came to mind was a story I read today in the Australian of a leaked report from the Liberal Party which indicated that if the Opposition were to be elected $2,000m would be slashed off government spending, rising to $5,000m. This matter was canvassed pretty well in Question Time today. However, I believe it needs a little more elaboration, particularly as the Minister for Social Security (Mr Howe) is in the chamber tonight. Some of the points made in Question Time today by the Minister need going over. When we talk about equity in terms of social security provisions we should consider--

Mr Downer —The mastermind of the assets test.

Mr GEAR —I will allude to the assets text because the honourable member for Mayo, of all people, should know about the assets test. He was the gentleman who talked about supporting the assets tests before he came into this place and then did a U-turn-a real Liberal. One cannot say much more about the Liberal Party than that its members support an assets test before getting into Parliament but then, as soon as they get here, toe the line. So much for principles. The honourable member's leadership qualifications were greatly enhanced by that.

Social security provisions should go to people in need. In the cynical document that was leaked to the Press the Leader of the Opposition (Mr Howard), when talking about social security provisions, indicated that he is quite prepared to make sure that pensioners in need will have their pensions reduced by not allowing consumer price index increases to flow through to pensions. At the same time he will abolish the assets text and allow those people who have substantial assets once again to gain access to pensions. This stands in stark contrast to what this Government has been saying, which is that social security benefits should go to people in need rather than to those who, by definition, are driven by greed.

The fact is that in the past people with substantial assets could organise their finances in such a way that not only did they have access to the rich assets they had but also they gained the pension. In many cases those people had built up their assets by taking advantage of the provisions of the taxation Act which gave tax-free status to the superannuation provisions they had availed themselves of while they were employed. So the old double-dipping arrangements were used. While they were employed they took advantage of the taxation system to defray taxation that was due by them by taking out superannuation. They then cashed it in and got a lump sum, paying virtually no tax at all. In fact about one per cent tax was all they paid. They invested that money and asked for the pension. What a ludicrous situation. Not only was it bad but it got to the stage where many pensioner magazines were openly touting these schemes. They were asking people to invest their money in these schemes which were guaranteed to give them no income but a high capital gain-there was no capital gains tax-and also allowed them access to the pension. In many cases millionaires were fighting for scarce social security dollars against people in real need. So I was very struck by this provision in the Liberal Party policy. I am looking forward to the next election campaign when the Opposition gets out there again and starts talking about the assets test. The assets test has now been in operation for three years.

Mr Peter Fisher —It is an absolute disaster.

Mr GEAR —I have had only one person in three years contact me about the assets test and I have been able to get the matter resolved. That just shows what an impact the assets test has had in the electorates. By the time of the next election people will have had experience of the assets test. We are quite happy to have it in operation. Fiscal responsibility says that we have to have it. When the times comes I am sure that the Australian people will agree with the Government.

Madam SPEAKER —Order! The honourable member's time has expired.