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Monday, 22 April 1985
Page: 1622

Mrs SULLIVAN(10.08) —I would have been impressed by the call to bipartisanship of the honourable member for Perth (Dr Charlesworth) a little more if he had not spent so much of his speech scoring empty partisan points on the subject of youth employment, as attractive as his speech was. We have agreed to reduce our speaking time this evening. I speak on a subject that I am surprised has not been raised or commented on by more members of the Government in the last few days. I refer to the proposal to make changes in the next Budget, or under the aegis of the Cabinet Expenditure Review Committee, to the family allowance scheme. Michelle Grattan, reporting in the Age newspaper of 16 April 1985, along with a number of other journalists, said:

Government sources said that family allowances were the only significant social security area under threat from the Cabinet razor gang.

A number of newspaper reports spoke of potential changes to the family allowance scheme. They have covered a very wide range. When one reads a newspaper report, under a Labor government, stating that government sources say something, one can be sure that it could come from anyone from the Prime Minister down. Without a doubt the Cabinet Expenditure Review Committee has been considering a number of potential changes. I warn the Government that if it undertakes any of the changes that have been outlined so far it will stir up a hornet's nest for itself that will make the controversy surrounding the assets test on age pensions look like a tea party.

The principles involved in the family allowance are very profound. I look forward to comments that some of the women members of the Government might make on the subject of the principles of the family allowance as a payment to women for the role of mothering. It is not a welfare payment. It never was described as such and it never was intended to be such. The proposals for change fall into five categories. One is that the family allowance be taxed. Another is that it be means tested. A third is that there be a flat rate, that is the same rate for every child in the family regardless of the number of children. A fourth suggestion is that it might be removed for dependent student children over the age of 16 years. The fifth proposal is that the first child may not qualify for the family allowance. I will take the last point first.

It was back in 1951 that the Menzies Government extended child endowment to the first child in the family. That was welcomed at the time. It has never been suggested that it was anything other than a proper move. Now, 34 years later, a Labor government is looking at turning back the clock. Of course, it should be remembered that it was not Federal Labor governments that introduced or extended child endowment. In the first place it was introduced under a Menzies Government. In the second place it was extended to the first child in the family by a Menzies Government. The very substantial reform of family allowances happened in 1976 under the Fraser Government. One of the reforms that took place in 1976 was the extension of the family allowance to dependent student children between the ages of 16 and 25 years. It is interesting that that is an option the Government is considering. What is very clear is that the Government is targeting this allowance. It is targeting it strictly in the context of a welfare payment.

Mr Braithwaite —It is not a welfare payment.

Mrs SULLIVAN —As the honourable member for Dawson says, it is not a welfare payment. I shall return to previous views of government members on this subject as recorded in Hansard of time past. Those honourable members seem to have forgotten it. Certainly there are a number of Government members who appear to be unaware that they were views ever expressed by members of the Labor Party in this Parliament. I shall remind them of it shortly. If time does not permit me to do that this evening I shall do so when the debate resumes.

The first point that should be made about the family allowance is that it is paid to the mother of children. There are some exceptions where, for example, the mother is dead or, if the parents of the children are divorced, the father has custody. Overwhelmingly the allowance is paid to the mother. It was introduced as some recognition-not a full recognition-of the value of the mothering role and the contribution that anyone who is rearing children makes to society. I hasten to add that when I use the term 'mothering role' I use it in its broadest possible sense and obviously I extend it to fathers who are raising their children without the support of the children's mother. The first issue--

Mr Slipper —Is it a sexist term?

Mrs SULLIVAN —I do not consider it to be a sexist term but a useful non-generic term. The first point concerns the issue of taxing. This is where the Government will stir up a hornet's nest for itself. The great issue that arises in relation to any proposal to tax family allowances is to decide against whose income it is to be taxed. Is the family allowance to be taxed only according to the income of the person receiving it? As I have said, in most cases that is the mother and in most cases the mothers of dependent children either earn no other income or else earn a small income. The percentage of married women with dependent children in the work force who derive a full income and a substantial income from working is very small indeed. Most have a very small income. I am aware that this proposal was looked at by the Fraser Government. The figures were done. The information that came forward was that--

Government members interjecting-

Mrs SULLIVAN —I am stating a fact which Government members need to know about because otherwise they will proceed in total ignorance. Perhaps they ought to ask some of their Ministers about this in their Caucus. The facts are that if the family allowance were taxed according only to the income of the person receiving the family allowance the reduction in expenditure that the Government would incur would be negligible. That is no way to reduce the Budget. However, a very serious anomaly arises in relation to this. It is possible in the case of large families for a woman in receipt of only the family allowance in fact to cross the tax threshold by virtue of the payments she receives under that allowance. Therefore, a payment which is not considered excessive and which, on all the principles on which it was established and has been continued-that is a payment for the mothering role-is to be reduced simply because that woman is the mother of a large number of children. That is totally iniquitous.

Debate interrupted.