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Thursday, 28 March 1968

Mr WEBB (Stirling) - The fact that no increase was provided in the last Budget for the age and invalid pensioners indicates, in my view, a callous disregard by this Government for those in the community with the greatest needs and the smallest means. The last increase in pensions was in the Budget of 1966. This was 18 months ago. It looks as though there will be no chance of the pension being increased till the next Budget which means that these pensioners will have to wait 2 years before the next increase in pensions. Since the time of the last increase prices have risen considerably. I draw attention to the consumer price index of lune 1966. Just prior to the 1966 Budget the index figure was 136.5. The last consumer price index available was that for December 1967. This showed that the index figure had jumped to 142.9 which simply means that there has been an increase in the cost of living of over 6%. I pose this question to the Minister for Shipping and Transport (Mr Sinclair) and the Minister for Social Services (Mr Wentworth) who are both at the table: Would they agree that pensioners are now getting less purchasing power in their pension than the pensioner did in 1966? The Minister nods his head - he agrees that this is so. If he agrees that this is so should not he adopt the suggestion that was made by the honourable member for Watson (Mr Cope) and introduce a supplementary Budget to bring the pension up to a reasonable standard? What sort of a Government is it that can ignore the miserable circumstances of many thousands of pensioners during a period of rising prices?

The Minister for Shipping and Transport has pointed out how advances in medical science and knowledge have led to an improved standard of health, with the result that people are now living longer than they used to, and that as a consequence the proportion of aged people in the community is increasing. What we should be concerned about as a Parliament is the way in which these aged people are living. If thousands of our aged people, our invalids and our widows are living in poverty and are in dire straits then this is a reflection upon our society and upon the Government that allows such a situation to continue.

The Government claims that this is a prosperous country. It is when compared to many other countries. The Treasurer (Mr McMahon) corrected the Minister for Labour and National Service (Mr Bury) in a statement he made a few days ago in which he said that real wages, meaning wages considered in terms of purchasing power, had risen in 1966-67 at a rate in advance of the rate of increase in productivity. The Treasurer referred to average weekly earnings and pointed out that in the decade to 1966-67 real wages - defined as average weekly earnings - had risen by 2.6% per annum. I suggest to the Minister that if average weekly earnings are to be used as a yardstick to measure the purchasing power of wages and the prosperity of the community, then surely the same yardstick can be used to measure the purchasing power of pensions.

The former Minister for Social Services when answering a question by the Leader of the Opposition (Mr Whitlam) on 19th May 1967, gave some interesting figures relating the age pension to average weekly earnings from June 1947 to June 1966. These figures showed that in June 1947 the age pension represented 23.2% of average weekly earnings. I may say, incidentally, without wishing to bring politics into the argument, that that was under a Labor Government. In 1955, under a Liberal Government, the proportion reached its lowest level, when the age pension was 19.6% of average weekly earnings. In 1963 the proportion had increased to 21.1%. That was the last year in which all pensioners were receiving the same rate of pension. In other words, that was the year in which a change was made and married pensioners were given a pension at a rate different from that paid to single pensioners. In 1 966, the last year in the table, the standard rate pension had dropped so that it then represented a proportion of only 20.8%. The married rate, however, had dropped to 19.1%.

Average weekly earnings in September 1967 stood at $63.40. The standard rate pension was then at a new low of 20.5% of average weekly earnings, and the married rate pension was down to 18.5%. It is true that at times the pension is compared with the basic wage, but these days we cannot do this because the basic wage has been pegged since 1953. It has been adjusted occasionally but it never stabilised to a standard rate from 1953 until it was abolished in 1967. So we cannot very well make a comparison with the basic wage over those years. However, it is interesting to compare the pension with the minimum wage which now applies in all Commonwealth awards. The amount is now $37.55, which is paid to a labourer who was previously on the basic wage. When we compare the pension with the new minimum wage we find that the single pensioner gets a pension which represents 34.62% of that minimum wage, while the rate for a married pensioner is 31.29% of the minimum wage.

As I have said, however, I do not believe that this is a valid comparison. If we are living in what we claim to be a prosperous community, everybody is entitled to share in that prosperity, and so the comparison should be with average weekly earnings. That is the comparison I have made and which I believe is the valid one. The honourable member for Sturt (Mr Wilson) had the colossal hide to state during his remarks that pensioners have shared in the increased prosperity of the country. I have shown that they have not shared in any increased prosperity because the proportion of average weekly earnings represented by their pensions has declined.

The present Minister for Social Services when he was on the Government back benches came out quite strongly for reforms in our social service structure, and we are anxiously waiting to see whether his performance will be in line with his promises. We will be only too pleased to co-operate with him in anything he wants to do to improve the position of pensioners. I would like to ask him whether he has anything in mind for an age or invalid pensioner's wife who has not reached the age of 60 years. Labor's policy provides for such a woman to get a full pension. Now she gets an allowance of $6 a week if her husband is an invalid or if he is an age pensioner permanently incapacitated. This means that an invalid pensioner and his dependent wife have to live on $19 a week instead of the full pension of $23.50.

Former ministers for social services have adopted the view - I am not saying that the present Minister has also adopted it - that a woman in these circumstances can go out and earn income at the allowable rate. But such a woman may have been out of industry for 20 years or more. Her husband may be so ill that she has to stay at home and look after him. This is one of the kinds of situations that I hope the Minister will scrutinise closely when he gets the opportunity.

About 2 years ago the Government made quite a song about the increase it made in the amount of allowable income. It set the figure then as $10 a week for a single pensioner and $17 for a married couple. This was the first increase in the allowable income since 1954, and the new maximum figures did not represent the value, in terms of purchasing power, that the $7 allowable income represented in 1954. Because of the increased cost of living over the last 2 years the purchasing power of the allowable income has been further reduced.

The new Minister suggested several times, from his former position on the back bench, that the means test should be abolished. We are anxiously waiting to see what will he his attitude towards this very important reform now that he is in a position to have some influence in this matter and to do something about it. I have received complaints in Western Australia during the last few weeks about workers who have just retired and who have received increases in their superannuation benefits; because of these increases, for which they have contributed over the years, their pensions have been reduced. The superannuation increases have caused the level of allowable income to rise. I suggest to the Minister that this is one very important matter that should be looked at.

The Labor Party has a definite policy in regard to the abolition of the means test. We believe it is a practical proposition over the period of the life of two parliaments. We intend to have our economic planning committee cost the proposition and outline a working programme for means test abolition. We believe in justice to the retired. These people are suffering when the standard of living of the community is, in actual fact, inclined to be progressing. The abolition of the means test would assist the many thousands of loyal public servants who have compulsorily contributed large amounts of money to superannuation funds. These people are being forced to pay twice. They have had to contribute to the National Welfare Fund through income tax, but because of the means test they cannot draw from that Fund. In addition they have been compelled to take out units in superannuation funds according to their salary levels. This is another matter that I ask the Minister to scrutinise closely.

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