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
Tuesday, 12 June 1984
Page: 2800

Senator WALTERS —My question also is directed to the Minister for Social Security. I refer to the answer he gave to Senator Messner. As his answer points out, a pensioner couple with more assets can receive a lower income than a couple with fewer assets earning the same rate of return. Is this an example of how the application of either the income or assets test, depending upon which allows the least amount of pension, will discriminate against thrift and self- provision for retirement? On what equity grounds does the Minister endorse such a proposed system which can reduce pensioners' total income due to the higher taper imposed?

Senator GRIMES —I believe it is generally accepted, except by some members of the Opposition, that to have a means test which does not include assets, which ignores the presence of assets, with the exception of the family home, is not a fair means test. I point out that there are actually members of the Liberal Party who believe this, such as Mr Elliott, the Treasurer of the Victorian branch, and Mr Alex Downer, who until fairly recently was a member of the staff of the Leader of the Opposition. I presume he was a member of the staff of the Leader of the Opposition when the Opposition believed in a needs-based pension system. If Senator Walters will take the trouble to read the report of Professor Gruen and the Panel of Review of Proposed Income and Assets Test, if Senator Walters will take some notice of those people on the conservative side of politics in this country, and chambers of commerce, I believe she will get a much clearer picture than she obviously has now.

I remind Senator Walters that the levels of assets which pensioners may hold before their pensions will be affected are very considerable considering that the family home is exempted. Those owning their own home are allowed $100,000 and those who are renting a home are allowed $150,000 in assets; it is from those points that the pension starts to cut out. If Senator Walters considers that it is penalising thrift to include for the purpose of assessing pension eligibility the sort of assets that people are capable of realising on, I do not understand her logic. I assume from Senator Walters's logic that we would exclude from any sort of means test someone who had a couple of million dollars' worth of assets but we would include someone getting the sum of $35 a week or, in the case of a married couple, $55 or $60 a week. If there is any equity in that, I do not understand it and neither do most people in the community. I suggest that Senator Walters look at those reports and at the legislation when it comes forward and then get up and make her points about equity and penalising thrift.

Senator WALTERS —Mr President, I ask a supplementary question. The Minister referred to the Gruen report. Does he acknowledge that Professor Gruen said in that report that the assets test, even though it excludes the family home, is iniquitous and would not be equitable at all?

Senator GRIMES —I find it a great admission from Senator Walters that, if she has read the Gruen report, she does not understand it at all. Professor Gruen pointed out that it is very difficult to make a perfect test which includes assets in the same way as it is very difficult to make a perfect test which includes only income. But I do not accept that Professor Gruen said anywhere in his report that the introduction of an assets test is iniquitous or inequitable as Senator Walters said. If Senator Walters has problems with that I would be pleased if she were to speak to Professor Gruen or one of the other members of his Panel who wrote the report which all members of the Panel signed.