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
Thursday, 1 March 1984
Page: 258


Senator WALTERS(8.00) —On behalf of Senator Messner, and at his request, I move:

That the Senate notes that-

(a) the introduction of Medicare will cause an artificial reduction in the Consumer Price Index; and

(b) this will adversely affect the millions of pensioners and beneficiaries whose income is linked to the Consumer Price Index;

and condemns the Government for its failure to recognise this fact and to take remedial action.

In considering this matter we should look at what was promised to the pensioners during the last election campaign. The Prime Minister (Mr Hawke) said unequivocally at the time that he would not be touching the pensioners' pay packets. You will remember, Mr President, that there was considerable debate about this aspect of the election campaign because the previous Prime Minister, as has been proved right, said that pensioners would be better off with their savings under their beds. Let us look at what Mr Hawke promised. We were told not only by Mr Hawke but also by Dr Blewett that pensioners would not be any worse off under Medicare, that they would still have their health cards and would be in exactly the same position as they were under the previous Government . However, that is far from the fact. Because of Medicare this Government has said to the people of Australia: 'You no longer have the right to insure yourself. Therefore, we will stop you taking money out of one pocket to pay your contributions to your private health fund but we will take it from you in tax. We will still be taking the money from you but it will be out of the other pocket so that it will not add to the consumer price index'. Indeed, it will lower the CPI. It will not stop payment of money by the general public; it will just be paid in a different fashion. As a result, the consumer price index will go down by 2.6 per cent.

We know that the consumer price index takes into account money paid by individuals for health insurance along with many other costs but it does not take into account taxation. Because of that, the consumer price index will go down by 2.6 per cent even though the cost of goods and services will rise with inflation. How does this affect the pensioners? It is very obvious. When we were in government we brought in automatic rises in pensions in line with the rises in the consumer price index. Twice a year the consumer price index rises and pensions went up as a result. Now they will not go up by the full amount of the inflation rate, the rate by which the price of normal goods rises. The consumer price index will be reduced artificially by 2.6 per cent. I do not think anybody on the Government benches will claim that it is anything but an artificial reduction in the consumer price index. But the pensioners will still pay the increases in their food prices, in their rents and in everything else on which the consumer price index relies. They will not get relief from the costs of Medicare. They don't have to pay for that but as a result of the lowering of the CPI a married couple will be denied $3.90.


Senator Grimes —When?


Senator WALTERS —When the consumer price index no longer takes account of that 2 .6 per cent. Mr Hawke assured the Tasmanian people on a talk-back program recently in Hobart that the pensioners would not get this 2.6 per cent pension increase. He tried to convince the population of Hobart that that really would not matter because the reduction in the consumer price index would eventually flow through and result in cheaper goods. What do the pensioners do in the meantime? I do not think even Senator Grimes would suggest that the 2.6 per cent reduction in the consumer price index is not an artificial reduction.


Senator Grimes —I am not suggesting that it is.


Senator WALTERS —Senator Grimes said no. It is admitted. But a pensioner married couple losing out on $3.90 will still have to pay higher prices for their goods. Mr Hawke promised that he would not disadvantage pensioners and the beneficiaries who also get that automatic increase. Indeed, unemployed people and low income earners will also be disadvantaged by that artificial reduction in the consumer price index because they will lose out on the increase in their benefits or wages. I wonder what the unions will say about that. I wonder whether Norm Gallagher will let the Government get away with it. I wonder whether, when the time comes, Norm Gallagher will say: 'It is an artificial 2.6 per cent reduction but we builders labourers will take the cut'. I will be very interested to see what happens. I wonder what the other unions will say and what the Australian Council of Trade Unions will say. Indeed, I wonder what the pensioners will be saying. I also wonder whether Mr Hawke will say: 'Oh dear, I am sorry. We have made another mistake. But then we did say to the country that we would make mistakes. But I am big enough to stand up and tell you that I have made a dreadful mistake, or at least my Minister has made a dreadful mistake'-as he did on the assets test.


Senator Grimes —He didn't say that at all.


Senator WALTERS —He did say 'We have made a mistake'.


Senator Grimes —No.


Senator WALTERS —Senator Grimes said no. He said at the National Press Club luncheon: 'We made a mistake. I told you of course that we would make mistakes and we have done so, but to err is human'. It is no use Senator Grimes saying that was not said because it floated across the airwaves of every station in Australia. People know that Mr Hawke said that it was a mistake. The people know that he bared his soul and said: 'We are human. I told you we would make a mistake and we have. The assets test was a mistake'.


Senator Missen —That is the only promise he has kept.


Senator WALTERS —That and the dam are the only two promises he has kept, but I had better not mention the dam in the presence of Senator Missen. Let us look at the other promises that Mr Hawke made to pensioners and those that he has already broken. He said very clearly in March that he would not be touching the pensioners' cheques. What happened as soon as he got into power? He immediately said: 'We will enforce a strict means test on the over-70 pensioners.' As you will be aware, Mr President, pensioners who are over 70 have worked very hard to make Australia what it is today. All those over-70s who were getting a paltry $ 51 because they were over the income test limit had worked very hard. When they were younger and were saving, their motto was: 'We will put away for a rainy day ; we will look after ourselves'. Indeed there was nothing for which they could put out their hand. They were forced to look after themselves. As you, Mr President, would know, because you are roughly the same age as I am, the idea in those days was to put money away for a rainy day. That was the general philosophy of those who are now over 70. These people had looked after themselves, so when we were in government we said: 'We will abolish the means test for those people over 70' and give a small amount, $51, to those whose income is over the means test.


Senator Grimes —Who abolished the means test?


Senator WALTERS —It was originally Mr Whitlam who abolished it, and it was continued by our Government.


Senator Grimes —Who introduced the new one? I thought that it was your Government.


Senator WALTERS —It was abolished by the present Government.


Senator Grimes —I thought that your Government introduced the means test.


Senator WALTERS —I went around campaigning shortly after the Government abolished it. As I went around, the general consensus amongst this group of pensioners was: 'But why would they do it to us at this age?' It seemed to them that a rather sensible thing to do would be to have said: 'Any pensioner turning 70 from now on will be fully means tested, but we will allow those pensioners who have already organised their finances, to keep that $51. From now on anyone turning 70 will no longer get the $51'. But, no, that was not to be. Many of the pensioners to whom I spoke said: 'But my son has organised my finances. I am in the sort of accommodation that I can now afford, but with that money taken from me by the Government it means that I shall have to change my accommodation'. At their time of life, that is a cruel way of going about matters. As I have said, we have Mr Hawke's promises being broken many times.

Another area of the pensioners promises broken category is the superannuation promise. That affects many pensioners. Many pensioners relying on superannuation and on getting lump sums believed Mr Hawke when he said that he would not touch them. They believed, a week before the election and immediately after it, that he would not be touching the lump sum payments. Because that man promised it, many of them voted for him. They have learnt to their sorrow that a promise by Mr Hawke really does not mean anything. Not only did they find that their lump sums were taxed, but those who were over 70 also found that their money was taken from them. I just wonder what those pensioners are now thinking. I often wonder what Mr Hawke thinks of himself as he lies in his bed at night as regards these elderly people, because there is tremendous concern in the community.

Many elderly people have no idea where the Labor Government will hit them next. They have worried since August about the assets test that was introduced. Indeed , Senator Grimes had assured them, in terms of one syllable, that it would definitely be introduced. Many of them have altered their finances in anticipation of that. One pensioner came to me about this matter. Her only assets had been some shares. She did not even own a house. Before she came to see me she had sold the shares and decided to buy furniture because she had heard that Senator Grimes had said: 'You can have furniture'. She invested in furniture so that she could leave something to her children. I told her that that action was a bit premature, but she had already done that on the say-so of Senator Grimes. She had already said to herself 'Senator Grimes said that I cannot have that sort of money in shares but I can invest it in furniture', and she had sold her shares.

What will the Government do about re-compensing such elderly people? They are people who, as I am sure everyone in this chamber will admit, are very concerned about their finances when they are in their 70s and 80s. For them to be misled by the Government into the sort of shenanigans that the assets test involved was an absolute crime.


Senator Robert Ray —I raise a point of order, Mr Acting Deputy President. I realise that there may be some relationship between the consumer price index, Medicare and the assets test, but Senator Walters is going on at great length about an issue that is not related to the motion.


Senator Chipp —Why don't you give her a fair go.


The ACTING DEPUTY PRESIDENT (Senator Elstob) —There is no point of order.


Senator WALTERS —I thank Senator Chipp for his great concern in protecting me. Many other honourable senators want to talk on the motion. Senator Haines is anxious to speak. I believe that I have made the points of particular concern to pensioners. I am sure that we shall find that Mr Hawke will admit another dreadful mistake. I hope that he gives the extra $3.90 to the pensioners, to the unemployed, to the low incomes earners. I am not so worried about Norm Gallagher , but if Mr Hawke gives it to the groups who are not able to pressure him as Norm Gallagher is pressuring him, I shall be very pleased. I shall be interested to see whether Mr Hawke succumbs to the pressure that the pensioners are and will be applying to him.