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Wednesday, 1 September 1993
Page: 799


Senator KNOWLES (5.23 p.m.) —I would like to say a few words on the report of the Senate Standing Committee on Community Affairs on the proposed treatment of unrealised capital gains and losses on listed securities under the income test for pensioners. As a former member of the committee up until 17 August, I have been very closely associated with this matter, and also from a portfolio perspective in terms of dealing with people from the ethnic communities who have been as concerned about this matter as the wider pensioners groups and advisers.

  I am amazed to see the recommendations of this committee. I am delighted to see that there is a dissenting report from the four senators who are trying to act responsibly towards the older community in this matter. That the Australian Labor Party can ultimately try to bring down a report that simply recommends a postponement of this frightful measure until June 1994 and not act upon the legislation that is before it in the House of Representatives is nothing short of a disgrace.

  It was fascinating to go to most of those hearings and to find that there was only one Labor senator out of the whole committee who was prepared to attend. For example, in Adelaide four Liberals were prepared to turn up, plus Senator Lees, and yet only the Labor chairman was prepared to attend. That is an indication of how much the Labor Party sees this as a problem. The same thing happened in Melbourne the very next day. Only one Labor senator was prepared to go and listen to the evidence.

  I have not been to public committee hearings before where there has been such an enormous response to an issue as we received on the community affairs committee. The response was such that people turned out in their hundreds to protest. Public hearings are normally very orderly meetings, witnesses are heard in silence and they are simply questioned by the committee. The onlooker participation was something that I have never seen before in a public hearing.


Senator West —Don't exaggerate.


Senator KNOWLES —Isn't it interesting! Senator West, the chairman of the committee, tells me not to exaggerate. I just hope that all of those people who turned up in their hundreds to those committee meetings and voiced their opinions—


Senator West —They were orderly and well behaved and did not carry on the way you are now.


Senator KNOWLES —Senator West should clean her ears out. I did not say that they were not orderly and well behaved. They were exceptionally orderly and well behaved. If Senator West had a feather to fly with she would understand that what I was saying is that I have never been to a public committee hearing before on any issue that has brought about a public response in the numbers—


Senator West —Maybe you should do more committee work.


Senator KNOWLES —Isn't that funny! Senator West says that maybe I should do more committee work. Where were the Labor senators on this committee?


Senator West —Doing other committee work.


Senator KNOWLES —They were not even there for this committee hearing. But to make it crystal clear, because obviously Senator West is not bright enough to understand what she saw and what I have just said, the fact of the matter is that those old people travelled hundreds of miles in many instances to be at those hearings. They put in some very good information. Many of those people had actually written to the committee, as Senator Patterson just said. Over 2,000 letters were received by the committee, to say nothing of the letters that were received in senators' and members' offices, yet the Labor Party did not see it as a sufficiently serious issue to even attend the hearings of the committee in its proper numbers. I think that is quite disgraceful.

  So the whole responsibility to make sure that there was a quorum was left to the coalition committee members and to Senator Lees. Let us face it, it is quite often the case that if the opposition parties did not provide a quorum—along with Senator Lees, whose attendance, I must say, is exemplary—the committee meetings would not even be able to go ahead. I just find it extraordinary to say that we will just duckshove this report off when, if the government acted now, today or tonight, as Senator Patterson said, and fixed this thing once and for all, it would be a very different kettle of fish.

  Interjections that were heard earlier on in question time in response to Senator Patterson's very sensible question accused us of voting for it last year. Let me put on the record quite clearly that, yes, we did vote for it last year. But let me state once and for all so that Senator West may cease misrepresenting our position—I do not hold out much hope for that, I might add—that the government did with that legislation last year exactly what it wants to do with the budget legislation this year; that is, lump a whole lot of unrelated things in together.

  If we had not voted for that legislation, the necessary benefits for pensioners that were included in it would have gone by the board. That is the reason; let me state it quite unequivocally. As I say, I hold out no hope whatsoever that the Labor Party will tell the truth on that or any other issue. One cannot blame me for being cynical after what we saw leading up to the last election.

  Let me also put on the record in crystal clear terms that we in the opposition parties gave an unequivocal commitment that we would review this measure in government. The sad part is that not quite enough people voted for us. Maybe those 1,500 people who did not vote for us and who could have changed the result will now see that we are the people who would have protected their interests. That is what I find enormously sad and that is what a lot of those pensioners said at those public hearings—`If we had understood the truth and the reality behind your policies, we would have voted for you, but we got bamboozled by the lies that we now know are lies'. That is the reality of it.

  We have wasted a huge amount of time and money because the number of financial advisers and accountants who have contacted me and, needless to say, lots of other senators and members, have spent an enormous amount of time for which they cannot charge their clients, because the clients are pensioners who are simply seeking advice. Those people have lost a lot of money. They have been trying to advise them on an issue that has been up in the air. The government has been run by press announcements, as opposed to being run by legislation, and the Prime Minister has yet again made sure that his little apparatchiks delay this thing until he can make some announcement; this is just inadequate. Let me ask another question. I would like to know how many public servants have been involved in all of this.


Senator Reid —Lots in Social Security.


Senator KNOWLES —Exactly. Lots and lots of public servants in Social Security.


Senator Bell —All those training programs that they had to go to.


Senator KNOWLES —All the training programs that they had to go to.


Senator Bell —And they still do not know anyway.


Senator KNOWLES —Precisely, they do not know anyway. What is the cost? How many more public servants were put on to this issue? How many forms were sent out? How many letters were sent? How many telephone calls were received and made? What is the total cost of this wasteful exercise?

  Here is the government trying to save money by terrorising pensioners at the same time as spending money hand over fist. This Labor Party cannot understand that, in many respects, the measure was going to actually force a lot of people on to the pension, so the cost was going to be even greater. But we cannot get out of this Labor Party what the costs of implementation were going to be, and have already been, because they must be enormous.

  I challenge Senator West to tell the Senate what the total administrative cost of this has been. As chairman of the committee, surely she would have made it her business to find out the total cost of this exercise, but I doubt it. As the Labor chairman of this committee she has direct access to Mr Beddall—


Senator West —Mr who? You have just changed the ministry.


Senator KNOWLES —Sorry—whoever the minister is. Quite frankly, I could not give a hoot who the minister is because he has shown as little interest in this as Senator West has. So who cares who the minister is? That is irrelevant. The fact of the matter is that Senator West has done nothing about it. Does Senator West know the cost of this exercise to Social Security? I will let it show on the record that Senator West is shaking her head. She does not know the cost; that is the situation. She should know the cost because it has been astronomical. But we do not know what the cost is in human terms; it has been enormous.

  Let me talk from the point of view of those who have English as a second language—those people whose English is not particularly good, who have come to this country and have attempted to make themselves financially secure and have gone out and made investments. Suddenly, through the grapevine, through their associations or through the mail, they get information that frightens the living daylights out of them because they cannot quite understand what is going on. Little or no effort was made to make them understand. In those instances where they did understand they, too, were terrified like every other pensioner. I think it is despicable to do that to older people. The dissenting report states:

The effects of constant chopping and changing in government policy regarding pension eligibility are particularly apparent on people who are ill or disabled or have no one to help them with their finances. It is important that measures affecting pensioners not be retrospective. It is particularly unfair that older people should be subjected to unpredictable changes in their entitlement.

What many people have said to us in evidence, in correspondence and personally is that they had planned their portfolios to make themselves financially secure and now the government throws them into absolute and total chaos. Where do they go from there? The sad reality of it also—Senator Patterson made reference to this—is that many of those people, out of fear, have already sold their shares. So the security they have built up has disappeared and now they are left in limbo again.

  Why does the government not act? Why does this Labor Party not act? We do not even know what budget we are dealing with now. We do not know whether it is the August budget; we do not know whether it is the ACTU budget. We know how the pensioners feel. We are trying to legislate for this country and we know exactly how they feel because there is constant indecision.

  Mr Acting Deputy President, I am delighted to note that you are the deputy chair of this committee. You have certainly played a significant part, with your colleagues Senator Lees, Senator Macdonald and Senator Troeth, in ensuring that a very clear position is put in the dissenting report. I can assure you that were I still a committee member this day, I would have signed this dissenting report as well. The committee did, as the report says, receive so much evidence from organisations with considerable experience in investment, in the stock market and in financial advising, as well as from pensioners themselves, yet this government still cannot make a decision.

  What more does it need? So much evidence was put before us that this issue was bad, bad, bad even though it might have been law, law, law, yet the government still cannot change its mind. What more evidence does it need? How much longer is it going to dillydally and go on in this way?

  Mr Acting Deputy President, what your dissenting report said was quite right. There appeared to be an issue of policy and program administration costs which indicated a need not only for the postponement of implementation of the shares measure, but also for an adequate period of time for all these matters to be considered by a small group comprising experts in both financial and investment matters, and experts from community organisations with an overview of the range of pensioner needs.

  Community consultation is essential. I found it most distressing—I suppose that is the best way to put it—during the committee hearings to find out that so many of the organisations representing pensioner interests, and the pensioners themselves, had, in fact, only heard of this issue on the grapevine. There was no actual formal notification a long way in advance to warn people of what was happening. The grapevine had to work. That is another classic example of the maladministration of this administration—this Labor government.

  Those pensioners now know that they are going to be constantly in this Labor government's sights. It is quite clear that they are in the government's sights. There is this issue and there is the issue of raising indirect taxes affecting pensioners. Where is the compensation for raising those indirect taxes? Where is the compensation for raising the cost of their fuel? Most pensioners do not drive around in the latest BMW. They drive around in cars that are fairly old and use leaded petrol. There is no reasonable compensation whatsoever for these pensioners contained within this budget, yet here we are with a situation where the government is totally ignoring the findings of a committee. The government can act, it should act and I wish it would get off its tail and do it pronto.