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Wednesday, 19 April 1972
Page: 1805


Mr HAYDEN (Oxley) - Our purpose is to see that this Bill is passed tonight so there will be no delays in the provision of these increases in pensions, little as they are. Certainly there is a strong case for a more substantial reward for our retired people in the late stages of their life in recognition of the contribu tions which they have made to the development of this country, contributions which the Minister for Social Services (Mr Wentworth) frequently and quite forthrightly acknowledged in his days in the back benches. For some reason he seems to approach the subject from time to time with considerably more restraint now that he is a Minister than he did when he sat in the back benches.

Tonight I want to talk about some of the changes in attitudes and some of the developments which have in fact taken place within social services during his term as Minister. He made some reference to the general improvement that had taken place in social services under his administration. I guess that it is possible to develop all sorts of statistics to fit an argument. If a person is so inclined he can ignore the ones that do not suit his argument and use those that do suit his argument. More often than not he does not worry much about relevance, and I would suggest that there was not too much relevance in some of the statistics which were used tonight to bolster in some way what is a pretty sagging sort of performance by the Government in social services.

Let me quote some statistics to indicate that it is a sagging performance, that it is one that does need bolstering. The honourable member for Melbourne Ports (Mr Crean), who is in the House, in the usual penetrating way in which he sets questions up set one up for the Government which was a trap for it. He asked about Commonwealth Budget allocations and cash benefits to persons as a proportion of gross national expenditure for 1961-62 and 1970-71. The question was answered at pages 1753 and 1754 of the parliamentary debates for the 18th instant. It shows that in 1961-62 allocations as a percentage of gross national product were 2.44 per cent. That means in very ordinary terms that of every $100 wealth created in the community in those days we spent $2.44 on age and invalid pensions. But in 1970-71, which has just concluded, the Government was spending only $2.12 out of every $100 on these pensions. What is more interesting is a footnote at the bottom of the table which points out that in 1961-62 the average number of aged pensioners was 5.43 per cent of the mean population. In 1970-71 that figure had jumped to 6.28 per cent. So here we see a significant increase in the proportion of aged people in the population. At the same time there has been a very substantial diminution in the effort which the Government is prepared to contribute in its allocations to supporting pensioners who are aged and retired. In 1961-62 we had available $2.44 in every $100, and that figure dropped to $2.12 in 1970-71.

Let us take child endowment. Of every $100 we had available in total wealth in this community in 1961-62 we set aside 90c for the young children in the community. Our Government believed that families were worth while. In 1970-71 that amount had dropped to 60c in every one hundred dollars, a one-third drop over that period. Yet in that period the average number of endowed children. as a percentage of mean population, increased from 31.75 per cent to 32.52 per cent. It is quite clear that in the past decade there has been a deterioration in the overall standard of welfare in this country under this Government. At page 1754 of Hansard, in the question asked by the honourable member for Melbourne Ports, we find that under the subject of welfare, which covers all the social service benefits, expenditures had fallen from S3. 84 in every $100 in 1961-62 clown to $3.20 in 1970-71. So one finds a rather blemished record - to say the least - on the part of the Government in its achievements in welfare.

The Minister spoke about the rate of benefit as percentage movement forward and related it to the percentage movements in the cost of living. Of course, he was very selective. He did not care to go back a considerable period. Let me quote a figure which 1 frequently quote. The standard rate of pension was 26 per cent of average weekly earnings at the end of the last World War. On the last December quarter figures il was down to about 19 per cent of average weekly earnings. There has been a substantial deterioration. Surely this is the sort of relationship one must use to gauge what are the real, comparable standards of prosperity for the people in the community. They should be measured in comparison with the average standard of prosperity which is allegedly available within the community. Given increasing rates of productivity, there should be greater disposable income being distributed in the community, and the rate of increase in this should be going ahead at a faster rate than prices are going ahead - a fact which arises from increased productivity.

So it is unreal merely to talk about price movements. It is even more unreal to restrict those price increases and use a system of measurement over a very short period, as the Minister did. As the Institute of Applied Economics and Social Research in Melbourne pointed out, people's living standards should be measured in comparison with the average living standard which is being provided by the community. When we do that we find, rather distressingly, that many of these social service benefits are considerably less than reasonable. The standard rate of pension, according to the up-dated Melbourne poverty survey, is about $5.35 below the poverty level. In fact the degree to which it is below the poverty level is even greater now than it was at the time of the last Budget, in spite of the increase which has been proposed by the Government. So there is no room for satisfaction on the part of the Government for the way in which it is treating pensioners in the community.

Let us look at the situation of many of these pensioners. There is the standard rate pension. Surely these are the people we ought to be moving towards, trying to help in a much more generous way than we are at the moment. We ought to be identifying priorities. Human needs are one of the highest priorities that we must identify. If this means that we should suspend, moderate or not accept our commitment in some areas because human need is so demanding, then let it be that way. The rights of human beings are the fundamental things for which a society is created. Unfortunately, the sorts of societies in advanced western cultures tend to forget this and to dominate people and to be interested in people and to reward people only while they are producers, while they can be harnessed as productive inputs for the system and while they can be exploited in this category. This is completely unreasonable. People who cease to be producers are still human beings. They are still entitled to human respect, to dignity and to treatment which accords with these basic values.

By and large, standard rate pensioners certainly do not receive this sort of treatment. 1 have indicated that their level of pension is below the poverty level. According to the Melbourne survey, one in every 4 aged persons was living in poverty. That gives us some appreciation of the very critical situation in which so many of these people find themselves. The annual report of the Department of Social Services points out that one in 3 standard rate age pensioners and 7 in 10 invalid pensioners on the standard rate have no means as assessed by the Department. The report points out that every second age pensioner has no home of his own and 3 out of 4 invalid pensioners have no homes of their own. That is a terribly distressing situation to find oneself in, because rental costs are a very pressing cause of aggravation of poverty for these people. I remember only within the last couple of weeks in this House the Minister glorifying the housing situation of so many aged people within the community. Yet, on the evidence, we can see many aged people obviously living in poverty because of their independence on a pension level below the up-dated poverty level. Many of these people are without their own form of housing and are therefore forced to pay rents, often at high rates - because of their particularly vulnerable situation in the market - for inferior quality housing.

Even the married couples are not particularly well off. They are receiving about 35c a week above the up-dated poverty line. They were below the poverty line until the recent increase was proposed. They are now a mean 35c a week above the poverty level, which is about the price of a pie with peas back in my home town. That is not much generosity to be giving these people.


Mr Daly - It is good for this Government.


Mr HAYDEN - It is generous for this Government indeed, as the honourable member for Grayndler points out. The way in which the Minister has performed today and the self-glorification with which he has endeavoured to give his Government a mantle, indicates that the values of the Government go as far as that and no further. Let us look at the so-called minibudget which has been put up to test the generosity, the priorities and the sense of equity and moral and social justice in the community. The Government - the Opposition does not want to be associated with this at all - is going to give the standard rate pensioner an increase of $52 a year so that he will have a pension which is 22.6 per cent below the poverty level. But a single chap earning $160 a week, without any dependants at all, who is doing very well in our community, is going to receive $54.34 a year cash in his pocket as a rebate on the taxation that he has to pay. That is the sort of justice we receive under the sort of welfare principles that the Government espouses.

Why has the increase been proposed? Has it come from any sense of compassion or sense of social and economic justice? Has it come in recognition of the basic rights of people? Of course it has not. It has come for one reason and one reason alone. The Treasurer (Mr Snedden) said:

These benefits should have a direct impact some few months earlier than otherwise on the level of consumer spending.

So the 35c a week above the poverty level - the price of a pie and peas - for a married couple is the sort of stimulation that the Government wants to give to the economy. It is not worried about personal dignity or human self-respect. It is not worried about any of these things at all. It is not worried about the basic rights and freedoms in a society; and you cannot have basic rights and freedoms in our sort of society unless you have at least the minimum economic adequacy to support yourself. The Government is using these people as pawns in its economic policy, just as it used the unemployed as pawns for the slaughter in the course of the sort of economic policies which it was applying until fairly recently and which it cannot really fully reverse at this point. I would like to ask some questions of the Minister for Social Services. Why is it that there is no proposal to increase the unemployment benefit? That has not been referred to specifically in this legislation. Is it proposed to increase the unemployment benefit?


Mr Wentworth - It was increased about 2 or 3 months ago.


Mr HAYDEN - 'But there have been substantial increases in costs since then. However, let us put that argument to one side as a quibble and let us take up the real argument, lt seems to me to be a matter of commonsense and to be rational action to provide those people who are suddenly cast into a situation which seems to require equal need - for example, those laid off work through sickness or invalidity or those who are unemployed - with equal benefits given equal sorts of conditions. Yet here we have a situation where the Government is making a distinction. The Government is distinguishing between the unemployed and these other people. The unemployed are not as worthy financially as these other people insofar as this Liberal-Country Party Government is concerned. They are going to get less than those who are sick invalided or widowed. I ask: What evidence is there to substantiate that sort of peculiar principle?

The situation of an unemployed man with a wife and 2 or 3 dependent children is in fact much more serious than the situation of many of these other people in that, with a meagre income and often with the sort of economic background related to work of so many of the people who find themselves unemployed, unemployment represents a monumental crisis because not only will he get a lesser return in benefits but also he will be involved in additional costs which the others would not have. Such a person has to be mobile because the Government demands that he approach so many employers every week, record their names and report - like little boys reporting to the school prefect - on them to the Government to prove that be has chased up work. A builder's labourer who was seeking construction work and who had to travel from, say, the western suburbs of Sydney to the other side of Sydney would be involved in a fair bit of expense, regardless of whether he travelled by public transport or by his own means.

None of the things we have before us and none of the things we have had in the little over 12 months since the McMahon Government came into office is anywhere near in accord with the promises which were made by the Prime Minister in March 1971 when, in relation to pensions, he said:

We will follow this immediate increase in pension rates with a fundamental review of social services and related pensions and also of methods of adjusting such benefits. This review, which has already been commenced, will be under consider ation in the near future with the object of bringing emerging decisions into effect for the year 1971-72.

There is no evidence to this point that any of that has been done. Some rather tantalising pieces of gossip have been moving about in the Press. There will be a belated sort of a conclusion - if there is in fact a conclusion - to a promise which was supposed to be fulfilled last year and not this year.

Let me deal very quickly with the record of the Minister for Social Services. As a member he fought valiantly against the means test from the back bench of the Parliament and he argued that it should be eliminated within 3 years. He has been a Minister for more than 4 years, but we still have the means test. In fact, we have more than 'the' means test. We have the means test about which we are talking on pensions; we have a special means test for the unemployment benefit: we have a subsidised medical insurance means test; we have a pensioner medical service means test; we have a means test for radio and television licences; and we have a means test for telephone services. We are also going to have a special means test for migrants who want to go overseas. They will have to live here for 20 years before they can take their pension rights overseas, and then there will be qualifications about the equivalent or reciprocal arangements wilh other countries. A migrant who has a pension right after having been here for 10 years and who draws on the pension for 5 years and then goes home for sound family reasons - perhaps there is some crisis back home and he has to go and see his close relations, which could happen with the southern Europeans in particular - will lose his pension unless some arrangement is negotiated. He will have to come back if he wants to continue to receive his pension. The proliferation of means tests on those sorts of things indicates the mentality of the Government. AH I can say is thank God we got rid of the McMahon means test - the means test on the so-called grey area of the pension.

Perhaps we ought to approach an appreciation of the means test from a different angle to the one we normally use. As honourable members know, a $400 exempt assets and $10 a week income allowance is applied to the maximum pension for the standard rate and a $800 exempt assets plus $17 a week income allowance is applied in the case of the married rate. Let us put to one side the effect of the tapered means test for a few seconds. I will look at it later. What is significant, in the first place, is that the levels have been unchanged for some years. For instance, the $400 exempt assets level was set back in October 1954. The income level of $10 for the standard rate and $17 for the marriage rate was set back in 1967, if 1 remember correctly. So although they have been in existence for some years they have not been moved forward.

Where would they be if they had been moved forward in accordance with an appropriate index? The Minister for Social Services likes to quote indices. Let me quote from one and ask him to discuss it to some extent if he has the time to do so. If the $400 exempt assets allowance had been moved forward according to movements in inflation - that is, if an inflationary index had been worked out using gross national product movements at real prices vis-a-vis at current prices - it would now be $650. If the $10 a week single rate allowable income had been increased according to average weekly earnings it would now be $15.50. The married rate would have gone from $17 to $26.34. What does that mean in cash terms or in terms of assets? It means that about $8,700 would be allowable and one would still be entitled to the maximum single rate pension. About $14,997- nearly $15,000- would be allowable for the full rate of the married pension. In each case there should have been an increase of over 900 per cent in the amount allowed. Even if an allowance were to be made for the tapered means test, which would bring in different considerations altogether - the sort of thing I am putting here is a basic right - there would still be a requirement for a substantial movement forward of something like 450 per cent to maintain some sort of parity with the standards which were established so many years ago.

Why have these things not been improved in the interim and why have the pensioners not been given a better deal? Is that not what we should be talking about instead of about all these things? Should we not be talking about a better deal for the people who have retired? We should scrap the whole sorry system of pensions and the distinctions which are made between payment of the various forms of pensions to people in the community. We should also scrap the proliferation of means tests. Surely some fundamental decisions will have to be made about making a person's basic rights and entitlements consistent with his self-respect and economic self-sufficiency. That would have to be related to the capacity of this community to pay, and pay much more generously than it has, and to the standards of prosperity in the community. Those are the basic principles that should be the basis on which we develop our whole approach to welfare services. Accordingly, the Australian Labor Party is proposing the scrapping of the age pension and the introduction of national superannuation on a universal system. Voluntary systems are hopeless. Sixty per cent of the members of the public are not covered by those sorts of systems. One could scarcely call a system which forces people who are not covered to become covered a voluntary system. There are quite a number of other approaches which ought to be looked at and which, frankly, I would like to discuss a little closer to the next general election than now. I conclude by saying that the Opposition does not oppose the Bill because it wants the money - as little as it is - to reach the pensioners, but that the Opposition is most unhappy about the complete inadequacy of what has been proposed on this occasion.

Question resolved in the affirmative.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.







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