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Friday, 13 September 1985
Page: 528


Senator FOREMAN —My question is directed to the Minister for Finance. I refer the Minister to his answer to a question from Senator Cook during Question Time on Tuesday in which the Minister said that a cut in Budget outlays of four percentage points of gross domestic product-a cut apparently supported by the Leader of the Opposition-would require government spending to be cut by more than $8 billion on last year's outlays figure. Can the Minister advise the Senate what effect the abolition of the assets test would have on that figure?


Senator WALSH —On this year's estimates, the abolition of the assets test would add about $136m to government expenditure. I note that although the Opposition habitually calls for welfare payments to be targeted on the needy, it then contradicts that policy by promising to repeal the assets test. Mr Howard, in particular, habitually calls for welfare to be provided on a needs basis. We know, of course, that Mr Valder does not believe that, but unfortunately Mr Valder has been less successful up to date in changing Liberal Party policy than he has been in changing Liberal Party leadership. It is fair to note that the present Leader of the Opposition has equivocated about the assets test. In a television interview last week he was asked about that particular policy-


Senator Messner —Mr Kerin thinks it is unfair and unjust.


Senator WALSH —Which has been enthusiastically and irresponsibly endorsed by Senator Messner, of course. Asked about the Liberal Party promise to abolish the assets test, Mr Howard equivocated by saying that that was a policy which he had inherited. He did not say that he endorsed it. I welcome the equivocation, but what I would really like to see is a rush of honesty to the head by Mr Howard and a prompt repudiation of the irresponsible promises by the former Leader of the Opposition, and Senator Messner, among others, to abolish the assets test. That policy is absolutely incompatible with the other line the Opposition tries to run simultaneously; that is, that welfare spending should be needs based.

By way of a trade-off on the effect on government outlays, the savings from the assets test in this year have provided sufficient money to fund the Government's welfare package in this year's Budget. That welfare package included an increase of $2 a week in the additional benefit for dependent children of pensioners and beneficiaries; a $2 a week increase in family income supplement-that is for the very low income unemployed families; a $10 a week increase in the income test free area for unemployment and sickness beneficiaries; and a $3 a week increase in the single adult unemployment benefit rate. Instead of doing those things, it is quite apparent that, up to date, the Opposition would abolish the assets test and not target any additional assistance at all to those very needy groups I have identified. I trust that Mr Valder and the other faceless men of the Liberal Party will ultimately be as successful at changing Liberal Party policy as they have been at changing Liberal Party leadership.