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Friday, 15 May 1942

Mr RYAN (Flinders) .- The bill should meet with universal approbation. It provides a long-felt want to widows who have been, to some degree, out of the minds of parliaments for some time. It is true, as the Prime Minister (Mr. Curtin) has said, that Australia has fallen behind other countries in caring for women and children. Social service schemes have been in operation in Great Britain, the United States of America, New Zealand, France, Germany, Denmark and Scandinavia for many years. In practically all the schemes in those countries the underlying principle has been one of contribution. The population as a whole has contributed and I believe that must be the underlying principle of any scheme of widows' pensions or plan for the betterment of social services in Australia. I have little criticism to offer about the details of the scheme. I am a member of the Joint Committee on Social Security and my name is subscribed to the recommendations of the committee. The bill follows closely the recommendations of the Joint Committee on Social Security, and in one instance has gone slightly beyond its recommendations. There arc three points that I think might be taken into consideration. The first point, to which reference was made by the honorable member for Parramatta (Sir Frederick Stewart), relates to the loss of the pension by widows in mental homes. It is not necessary to enlarge upon the very clear statement of the position by that honorable member. The second point is that the practice of adding 6d. a week to the invalid and old-age pension rate for every 21 points by which 'the cos* of living index figure rises above the base figure of 1053 is not to be followed in connexion with a widow's pension. I can see no reason for differentiation between a pension paid to a widow and one that is paid in respect of invalidity and old age. This matter should be taken into consideration before the bill is passed. The third point is one about which I am not quite clear. I believe that, as the bill stands at present, a widow with two children will receive the full pension of 30s. a week, plus the pension in respect of each child under the age of sixteen years, until the younger child reaches that age, when she is suddenly to lose not only the pension for the child, but also the pension paid on her own behalf. There should be some provision that would prevent this sudden change from the receipt of a pension to the non-receipt of financial aid.

I wish to touch upon some of the broader aspects of this subject. There are in this country quite a number of persons who have certain misgivings as to whether it is appropriate at present to introduce such a measure. Others have misgivings as to whether such legislation should be passed at all. Those who hold the long-range view are of the opinion that, by reason of such big extensions of social services, we are undertaking a liability which, sooner or later, will drive us into bankruptcy; that we are raising a race of pensioners who will look to the State for everything; that the cost will mount year by year until it- will become so great that we shall not be able to meet it without detriment to our economic position. I have held that view. I purpose quoting some figures, because there is a good deal of ignorance in this country as to the actual degree of our obligation in respect of social services. The first of Australia's social services was introduced in 1906-7. when the social expenditure for the States amounted to £5,600,000, corresponding to 11.7 per cent, of the combined expenditure from loan and revenue funds. By 1913-14, this expenditure had reached £12,000,000, which represented 13.2 per cent, of the combined expenditure of £91,000,000. These figures, I should say, include the costs of the maintenance of law and order, in addition to ordinary pensions, and other social services such as education. After 1914, the expenditure on social services mounted very rapidly, and was increased by two economic depressions, the first of which occurred just after the war, and the second during the years 1930-33. In the year 1939-40- in which, as we know, there was a large amount of war expenditure - there was a record expenditure on social services of £57,300,000, or 22 per cent, of the gross expenditure from revenue and loan funds.

Mr Jolly - Including repatriation.

Mr RYAN - It included everything. The figures in relation to national income were not regularly available up to 1920-21; but between that financial year and .1939-40 the expenditure on social services rose from 4.1 per cent, to 6.6 per cent, of the national income, which itself had increased by 50 per cent, over the same period. The principal increase, up to 1939-40, was in respect of invalid and old-age pensions, which then amounted to £16,500,000, or 30 per cent, of the total expenditure on social services; the expenditure on education was £12,300,000, and on unemployment relief £10,500,000. Since then, child endowment has .been introduced. It was estimated to cost £13,000,000, but the amount was subsequently proved to be slightly less than that figure. It may be thought that, because of this large expenditure, Australia is holding its own in respect of social service.?, compared with other countries; but, as has been pointed out by the Minister for Social Services (Mr. Holloway) and the Prime Minister (Mr. Curtin), we still lag a, long way behind certain other countries. The expenditure per capita on social services in Great Britain is considerably in excess of ours. Great Britain has four different kinds of social services. The first is what might be termed consumptive community services, which consists of education, health and medical services, and the welfare of people who are sub-normal and destitute. These services are available to every body; no question of contribution or insurance is involved. En the second category are subsidized services, which are restricted to people who are destitute or have a low income. These include the provision of milk for mothers and children, the supplies in some instances being free, the cost being defrayed from general revenue. In the third category is social insurance, which includes insurance in relation to health, unemployment, old-age and invalidity, and widowhood. In the fourth category are social assistance services, which cover all the services that are not included in the insurance schemes. These embrace supplementary pensions for those widows and other persons who do not receive sufficient from insurance schemes, and include additional unemployment assistance and poor relief. The gross cost of all these services for 1936-37 was £455,000,000, or 10 per cent, of the national income. The net cost to public funds was £305,000,000, or 32 per cent, of the aggregate expenditure of the central and local governments. There has been some increase since the war began. If the costs of our social services of a similar nature be placed on a comparable basis, it will be found that they represent only 6 per cent, of the national income and 20 per cent, of the aggregate expenditure by the Commonwealth and the States. Recently in this House an honorable member stated that he looked forward to the time when the national expenditure on social services would approach £100,000,000. That aroused astonishment on the part of some people, both inside and outside this chamber. As we now have a national income of about £1,000,000,000, the raising of £100,000,000 for social services should not have a serious effect on the economic stability of the country. If Great Britain expends 10 per cent, of its national income for that purpose, surely Australia could do so.

Mr Stacey - Before the war, that was the amount for which the government of the day budgeted.

Mr RYAN - Conditions have changed since then. Up to the present, a. great deal of the social insurance now proposed to be given effect by legislation has been provided by charitable institutions or private individuals. We have long passed the times when elderly or useless members of the community were knocked on the head and put away, and when unwanted children were disposed of. Certain psychological factors should be taken into account, but, from the economic point of view, it does not matter much whether the funds required for social services are provided by private individuals and institutions or are taken from the coffers of the State. In reply to those who contend that the cost of social services is mounting so rapidly that we are drifting towards national bankruptcy, I point out that both here and in Great Britain social services have been provided by governments for many years, yet, up to the beginning of the war, we were better off than 20 or 30 years ago.

I shall now refer to what I call the short view of this matter. It has been said, and I myself have said it, that this is not an appropriate time to bring in measures of this kind, because all of our resources are required for war purposes. It is claimed that, as this country has been populated by Britishers for 150 years without pensions being granted to widows, this measure should not be introduced at a time when the whole of our resources should be concentrated upon the war effort. I had grave doubts on the matter, but, having considered it carefully, I am in full agreement with the Government that this is an appropriate time to introduce widows' pensions. My first reason for holding that opinion is that the granting of this pension has been made possible by the fact that the cost of the child endowment scheme has proved to be about £1,600,000 less than was anticipated. That sum will be sufficient to cover the proposed expenditure on widows' pensions.

Mr Francis - Why not reduce the tax?

Mr RYAN - There is another way. I see no reason why one section should be neglected, while benefits are given to the rest of the community. Honorable members may object to a general scheme of national insurance which would entail heavy expenditure and seriously diminish the funds available for Avar purposes, but I contend that there is ample justification for granting assistance to widows and children. The widows themselves have a trusteeship for the future, because they have the responsibility of caring for the future citizens of this country. Why should we not provide at least a reasonable standard of living for them? Many thousands of young men and women are now earning from £5 to £7 a week in the munitions and other factories, and many of them have no family responsibilities whatever. These workers are able to enjoy life, and it would be most unfair to compel widows to fend for themselves, or be dependent on private charity, or charitable institutions.

The proposed pension is to be granted on a non-contributory basis. That, I believe, is wrong.

Mr HOLLOWAY (MELBOURNE, VICTORIA) - The Joint Committee on Social Security, of which the honorable gentleman was a member, recommended granting a pension.

Mr RYAN - I was not in favour of a pension provided on a non-contributory basis. The only objection I have to the introduction of the pension in the form proposed in this bill is that I do not desire to see a wrong precedent established. It is high time a plan was set on foot to place the whole of our social services upon a contributory basis. Two important principles ought to be considered. They are fundamental. The first is that no person capable of working should be allowed to remain idle, either because of laziness or voluntary unemployment; the other, which proceeds from the first, is that every body should have the right to be maintained in a reasonable standard of living commensurate with the resources of the country. Therefore, I believe that the time has come when we should change the whole basis upon which old-:age pensions and other social benefits rest, and bring in as soon as possible some kind of contributory scheme in which every one will participate. Private persons have obligations as well as rights, and I believe it to be proper that every individual should contribute directly to the fund, from which he or she hopes ultimately to benefit. This would impress them with a sense of their responsibility, and of their position as integral units of the social structure. If a man expects, in certain circumstances, to be helped by the community, it is up to him to contribute directly to the fund from which he is to be helped, rather than rely upon receiving assistance from an amorphous, intangible thing like the Consolidated Revenue Fund. Therefore, I hope that, before very long, it will be possible to review the whole of our social legislation with a view to placing it upon a better basis.

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