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Monday, 24 November 2008
Page: 19

Senator SHERRY (Minister for Superannuation and Corporate Law) (9:20 PM) —I am summing up on behalf of the Rudd Labor government the package of legislation, known as the Economic Security Strategy, that the Senate has before it. It is traditional in these appropriation debates to range far and wide, and I am going to respond to a couple of points that Senator McGauran in particular made. He ranged so far and wide that he did not speak from his own seat. I will get to some specific contributions shortly.

However, I do want to congratulate Senator Fielding. I think he made a very thoughtful contribution. It went to one of the underlying causes of the credit crisis that we have seen—known colloquially as the US subprime housing crisis—and the importance of ensuring that we have a responsible lending regime, unlike the US. That was the base cause of the US economic crisis that now confronts the global community. It is in response to that economic crisis, which has its cause in the United States—about which I have spoken on a number of occasions in this place—that the government has taken a range of decisive actions, and the appropriations legislation we are considering is one of those decisive actions. It delivers a $10.4 billion Economic Security Strategy to strengthen the Australian economy and to support Australians through these difficult times.

The Economic Security Strategy provides relief to those in the community who have been struggling in the past couple of years to meet rising costs of housing, petrol and food, particularly those on low incomes or with children and other family members to support, and I think very deservedly so, not as Senator McGauran described, ‘They’re throwing money at these people.’ It was a particularly derogatory description, Senator McGauran, of people who really do it tough at the best of times and who, in the current economic turmoil facing the world, deserve priority consideration. I appreciate that, in debates such as this, that there is a wide-ranging contribution on all manner of issues, but I thought your reference to people in that almost sneering throwaway line that they were not deserving of support was particularly unfortunate.

The Social Security and Other Legislation Amendment (Economic Security Strategy) Bill 2008 will assist some four million pensioners and two million families, Senator McGauran—I am glad you are here to hear just who is being assisted. The bill will deliver a $4.8 billion down payment to pensioners, leading up to comprehensive reform of the pension system. Effectively, this is additional support before essential long-term reforms are made by this Labor government in the context of the 2009-10 budget.

Essential reforms to our pension system, Senator McGauran and members of the Liberal-National Party, that were not carried out in your almost 12 long years of office. You did nothing for pensioners. And I will get to one of the claims that you made, and this is where you really did lose touch—

The ACTING DEPUTY PRESIDENT (Senator Forshaw)—Senator Sherry, I remind you to address your remarks through the chair.

Senator SHERRY —Through you, Mr Acting Deputy President, the argument is made by members of the former Liberal-National Party government that they introduced indexation of the aged pension to MTAWE—male total average weekly earnings. Firstly, Senator McGauran, I would suggest if you are going to use jargon, use jargon that the general population can understand. This is a real example just how out of touch those opposite became in those almost 12 long years. The indexation of the aged pension to male total average weekly earnings rather than to the old CPI, the lesser value index consumer price index, was introduced by the Hawke Labor government. That was one of the first actions it took in 1983 when it took office. It introduced it then, Senator McGauran, through you, Mr Acting Deputy President. The Liberal-National Party thought it was some magnificent coup to enshrine this policy in law and it did that, but that did not increase the indexation pension at all. You enshrined it in law, but it was actually the Hawke Labor government which introduced the policy. It delivered the extra money.

The Liberal-National Party kid themselves and fool themselves into believing—unfortunately, they probably got convinced by either the former Prime Minister or the Treasurer—that they had actually done something real for pensioners, when in fact the legislation itself did not deliver one cent extra to pensioners. It had already been delivered. They believe that they made some major monetary improvement for aged pensioners when in fact they had not delivered the action or the money increase—they delivered the legislation. I just think that is another typical example of how out of touch they became, convincing themselves that they had actually done something meaningful.

The social security bill provides a further $3.9 billion, targeted at Australian families whose family budgets are already stretched by financial pressures flowing from the current global economic difficulties. The package of payments provided by the bill to pensioners and families will be made over the fortnight starting on 8 December and most payments will be made automatically. People who received one of a range of social security and veterans entitlements qualifying payments on 14 October 2008 will receive these economic security strategy payments. These include people—and these are the sorts of people that Senator McGauran referred to in such a derogatory fashion—receiving age, disability support, wife, widow B and veterans service pensions; income support supplement; carer payment; and partner, widow and bereavement allowances. I hope Senator McGauran, in particular, is taking note of just who these payments are to go to. For the first time, disability support pensioners, along with other customer groups, will receive a lump sum payment. The government recognises that disability support pensioners are just as much under financial pressure as other pensioners.

Other Australians who will also receive an economic security strategy payment include those who, on 14 October 2008, were of age pension age and received parenting payment, special benefit, Austudy payment or Abstudy living allowance. Self-funded retirees who, on 14 October 2008, held a current Commonwealth seniors health card and holders of a Veterans’ Affairs gold card who were eligible for seniors’ concession allowance on that date will not miss out. They will also be eligible for an economic security strategy payment.

If any pensioners and seniors were not actually receiving a qualifying payment on 14 October 2008, but had claimed the qualifying payment by that date and later had their qualifying payment backdated to cover that date, they will still get the economic security strategy payment. Similar backdating arrangements will apply for qualifying card holders.

Senator McGauran, in one part of his contribution, derided the current Treasurer, Wayne Swan, for suggesting that individuals should check their entitlements with Centrelink. These are the same entitlements that the Treasurer, Mr Swan, was drawing their attention to—and rightly so. I am a little taken aback by the criticism levelled by members of the Liberal and National parties with respect to retired individuals—retirees, part-pensioners—who are actually entitled to a part-pension payment or may become entitled to a full pension payment if their financial circumstances have changed. Members of the Liberal and National parties seem to think that they should not claim it. They paid their taxes and they are perfectly entitled, and it should be publicly drawn to their attention to go and check on their entitlements. And, as I understand, many have done so—hundreds of thousands. How dare Senator McGauran, on behalf of the Liberal and National parties, suggest that the Treasurer, Mr Swan, was wrong in drawing this to the attention of people who have paid their taxes and retired and suggest that they should not inquire as to their eligibility for payments. Just how out of touch is Senator McGauran?

Senator Sterle —You’re being kind; I could think of a lot of other words.

Senator SHERRY —I am being kind, am I? I have only just started. The Economic Security Strategy payment—

Senator McGauran —Madam Acting Deputy President, I rise on a point of order. Littered—and I mean ‘littered’—throughout the whole speech of Senator Sherry has been two points that he has made with regard to my presentation.

The ACTING DEPUTY PRESIDENT (Senator Troeth)—What is the point of order, Senator McGauran?

Senator McGauran —Utter, complete, comprehensive, deliberate, outrageous, mischievous misrepresentation.

The ACTING DEPUTY PRESIDENT —That is not a point of order.

Senator SHERRY —Through you, Madam Acting Deputy President, if that is the case, Senator McGauran, I do not know what your contribution represented to the debate before the chamber. The Economic Security Strategy payment for this group of Australians will be $1,400 for singles, $2,100 combined if both members of a couple receive a qualifying payment and $1,050 if only one of the couple does.

There will be a special Economic Security Strategy payment for people receiving a non-means-tested social security income supplement—carer allowance. People who were receiving a carer allowance on 14 October 2008 will be paid $1,000 for each eligible person in their care. If the carer allowance for one care receiver is shared between two or more carers, the Economic Security Strategy payment will be shared on a similar basis. People who were receiving the carer allowance on 14 October 2008 will be paid $1,000 for each eligible person they care for. If the carer allowance for one care receiver is shared between two or more carers, the Economic Security Strategy payment will be similarly shared.

The Economic Security Strategy payments provided by the Social Security and Other Legislation Amendment (Economic Security Strategy) Bill 2008 will also give immediate financial support to around two million Australian families with dependent children. A payment of $1,000 will be made for each child eligible for family tax benefit part A at 14 October 2008. In addition, $1,000 will also be paid for each dependent child who, at 14 October 2008, was either eligible for or received youth allowance, Abstudy living allowance or an education allowance under the Veterans’ Children Education Scheme or the Military Rehabilitation and Compensation Act. If any of these qualifying payments for families is shared between two people under the usual rules for that payment, the payment will be similarly shared. Families will receive these payments even if the qualifying payment is not actually being received on 14 October 2008 but is later backdated to cover that date. For example, the small number of families who claim their family tax benefit part A annually as a lump sum will receive their Economic Security Strategy payment when their 2008-09 income assessment has been finalised and their family tax benefit lump sum is paid.

The payments made under the bill will not generally need to be claimed. They will not count as income for social security, family assistance and veteran entitlements purposes and will be tax free. The bill also provides for relevant ministers to establish, by legislative instrument, administrative schemes to provide payments in circumstances where the statutory regime does not produce an appropriate result.

The Appropriation (Economic Security Strategy) Bill (No. 1) 2008-2009 provides for an investment of over $117 million to create 56,000 additional productivity job seeker places in 2008-09. This funding will effectively double the places from 57,000 to 113,000 in 2008-09. These new places will take the Rudd government’s total commitment to the program to more than $2 billion, with over 700,000 new training places created over five years. By expanding the Productivity Places Program, the government is building on a program that has already proved its worth. This bill also provides funding to the Department of Veterans’ Affairs to facilitate payments under the Social Security and Other Legislation Amendment (Economic Security Strategy) Bill 2008. Funding will also be provided to conduct a public information campaign to ensure that those eligible recipients for the Economic Security Strategy payment and the first home owners boost are advised about their entitlement.

Appropriation (Economic Security Strategy) Bill (No. 2) 2008-2009 will strengthen the Australian housing market by providing $1.5 billion over two years through the first home owners boost. In addition to the first home owners grant, first home owner-buyers who purchase established homes will receive an extra $7,000 to take their grant to $14,000. First home buyers who purchase a newly-constructed home will receive an extra $14,000 to take their grant to $21,000. The first home owners boost will be available to eligible first home buyers who enter into a contract between 14 October 2008 and 30 June 2009.

The Economic Security Strategy and the measures in these bills show this government’s determination to strengthen the Australian economy and support Australian pensioners and families through the global financial crisis. The Economic Security Strategy will provide a substantial increase in skills and training places, build a stronger Australian housing market and make home ownership accessible to more Australians. I do not think I heard anyone from the Liberal-National Party specifically oppose any of these measures, although it was often very difficult to work out in their contributions whether they were supporting or opposing the appropriation, given the tenor of their comments on this particular legislation. As has been mentioned, we face the most significant financial crisis since the 1920s and 1930s.

Senator McGauran —You made it worse.

Senator SHERRY —Senator McGauran interjects again. For Senator McGauran—through you, Madam Acting Deputy President—we have seen the collapse of some 30 banks. I do not know what has happened to Citibank; they are in the process of being bailed out. Around the world, some 30 banks have been nationalised, force-merged and bailed out, principally in the US and Europe. No banks collapsed in Australia. For students of economic history, it was not the collapse of the equities market in the 1920s—the great crash of 1929—that caused the world depression. It was the collapse of banks and the collapse in faith that business and individuals had in the banking system that led to the economic collapse. This government makes no apologies for acting decisively with our bank guarantee and wholesale guarantee. We make no apologies for that.

Senator McGauran —You ought to.

Senator SHERRY —We needed to act decisively—to members of the Liberal-National opposition. In these sorts of circumstances, you need to get in there, recognise there is a serious problem and attempt to head the problem off with decisive action. Again, there are a number of governments around the world which are taking similar actions to our economic stimulus package. Unfortunately they are not in the same budget position as this government is, after its fiscally responsible, indeed conservative, budget was handed down in May. It was a very strong budget with a strong surplus that we built up. I must say that, unfortunately, the now Liberal-National Party opposition has been very negative. They have opposed bill after bill in this Senate chamber and have not recognised the seriousness of this economic crisis and the necessity of ensuring that we had a substantial fiscal surplus as a buffer in these turbulent economic times.

A number of speakers opposite have referred to the number of inquiries. Yes, we have had inquiries, but we have taken action. I will give a couple of examples. Under the former Liberal-National Party government, there were five inquiries to transfer the regulation of financial services from the states and territories to the national government, creating one national financial regulator—all the more important because of what has happened in the US. They had five inquiries in 12 years, and the former Liberal-National Party did nothing. They did not act on those five inquiries. We have had one inquiry and we have acted. We decided: one single national standard financial market regulation and supervision in Australia. That is one example of a positive outcome from the cooperation between the states and the Commonwealth. It is not the bleak picture that Senator McGauran and others opposite have painted. This stimulus package is appropriately targeted to help those who need help most in the current environment. (Time expired)

Question put:

That the amendment (Senator Bob Brown’s) be agreed to.