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LIBERAL
A Social Security
Safety Net
The Liberal and National Parties' Social Security Policy
z February 1996
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COALITION POLICY FOR SOCIAL SECURITY
TABLE OF CONTENTS
Executive Summary 1
The History of Coalition Social Reform 5
The Story Under Labor 6
The Coalition Approach 7
Unemployment Assistance 7
Youth Homelessness 8
Retirees 10
Concession Cards 14
Age Discrimination 14
Disability Related Payment 15
The Wife Pension 15
Widows 16
Carers 16
Families 17
Rent Assistance 20
Reciprocal Agreements 20
Consultative Bodies 20
Emergency and non-Government Welfare Relief 21
Delivery of Social Security Services 21
Prevention of Fraud 23
Benchmarking of Payments 25
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SOCIAL SECURITY
EXECUTIVE SUMMARY
A Coalition Government will maintain the real value of pensions, payments to families, including to sole parents and all other social security benefits and entitlements.
Unemployment Assistance
Under a Coalition Government all unemployment payments will be made by the Department of Social Security to remove the current meaningless distinction between younger people and other people who are unemployed.
A Coalition Government will allow people aged over 50 who are on unemployment benefits to undertake an unlimited number of days voluntary work without losing their entitlement.
Youth Homelessness
The Coalition will introduce a two year Youth Homeless Pilot Program which will receive $8 million in additional funding (as announced in our Youth Policy) and will put a greater emphasis on voluntary mediation and early intervention.
Retirees
Under a Coalition Government the pension benchmark of at least 25% of Average Weekly Earnings will be maintained. The real level of payments will be maintained by continuing the current system of twice yearly indexation in accordance with the CPI.
The Coalition will allow people of pension age to defer taking up their pension entitlement for up to five years in return for receiving an increased pension at a later date.
The Coalition will extend the pension tax rebate to self funded retirees with incomes which are equivalent to those of pensioners who are eligible for the rebate.
The Coalition will convene meetings with all State and Territory governments to discuss and negotiate uniform concessions and reciprocity of concessions for older Australians between the States and the Territories.
The Coalition will review the application form for the Commonwealth Seniors Health Card and will take steps to ensure more information relating to the Card is supplied to potential recipients.
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The Coalition will legislate to abolish compulsory retirement in areas of Commonwealth responsibility.
People with Disabi lities
The Coalition will ensure that the real level of payments to those with a disability including the disability support pension, the disability wage supplement, the child disability allowance and the mobility allowance is maintained.
The Coalition will ensure that supported employment remains a viable option for those who choose it and will not withdraw support for Section 13 services commonly known as sheltered workshops.
Widows
The Coalition will extend the widow allowance to persons over the age of 40 who have been widowed, divorced or separated over the age of 40.
Carers
The Coalition will rename the carer pension the carer payment.
The Coalition will increase the number of days which a carer may temporarily cease providing care without losing their payment from 42 to 52 days in any particular year.
The Coalition will extend the hours a carer may work without losing eligibility from 10 hours a week to 20 hours a week.
Families.
The Coalition will maintain the real value of all family payments.
The Coalition will introduce a family tax initiative to assist families with the cost of raising children.
The Coalition supports and will maintain the real value of the maternity allowance.
The Coalition will maintain the existing qualifications for the sole parent pension and will ensure that the real value of the pension is maintained
Consultative Bodies
The Coalition proposes that the current Social Security Advisory Council be constructed on a more decentralised and regional basis. Membership of the Council will be expanded to include bodies from a regional, state and national level.
Delivery of Social Securit y Services.
The Coalition is committed to ensuring that the Department is as efficient as possible and will use the recommendations of the Efficiency Audit Report undertaken by Australian National
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Audit Office, as a basis for improving the Department's performance in the delivery of services.
Performance Standards
The Coalition is committed to putting greater emphasis on ensuring that the Department of Social Security meets, and wherever possible, exceeds its performance targets.
Complexity of the Social Security System
In Government, the Coalition will examine the complexity of the social security system with the aim of developing a more rational, cost effective and integrated social security system.
Prevention of Fraud
A Coalition Government will maintain but fully review the operation of the Data-Matching Program with the dual objectives of maximising its effectiveness and addressing concerns about the privacy of social security recipients and taxpayers.
In Government, the Coalition will rewrite the Department's objectives to ensure that all staff appreciate the importance of ensuring payments are made in accordance with the legislative regime.
Benchmarkin ` of Payments
The Coalition is committed to maintaining the current benchmarks which apply to the age pension and family payments.
The Coalition will continue the current benchmarking studies and will assess the results upon their completion.
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COALITION
POLICY FOR SOCIAL SECURITY
Australia remains one of the richest nations in the world. We have unequalled physical resources. We have a stable and democratic political environment. We have a healthy, well educated and motivated population.
Notwithstanding our enormous potential and capabilities as a nation, the current reality is that a prolonged period of economic hardship has engendered a widespread feeling of uncertainty and insecurity in the Australian community.
The Coalition is dedicated to restoring confidence and preserving the social fabric of this nation.
To achieve these goals, the Liberal and National Parties believe that the Federal Government, in partnership with the Australian community, has a responsibility to assist those who are in need or disadvantaged.
A Coalition Government will not erode the safety net that underpins our social security system.
On the contrary, the Coalition believes that a strong and secure safety net is essential.
A Coalition Government will maintain the real value of pensions, payments to families, including sole parents, and all other social security benefits.
For the 1996/97 year, the Government estimates it will spend over $36 billion or over a quarter of the entire Federal Budget on social security.
While maintaining its commitment to those in need, the Coalition recognises that the social security system must provide individuals with positive incentives to enhance their financial and personal independence.
An honest appraisal of the underlying problems of inequality and poverty must be a central element of any comprehensive and pro-active social security system. The Coalition is committed to addressing the two principal causes of inequality and poverty in Australia, namely unemployment and family breakdown.
Unlike our political opponents, the Coalition does not accept that there is anything inevitable about the current shortage of employment. We remain finely committed to the goal that everyone who wants a job should be able to get one.
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The causes of persistently high levels of unemployment in Australia are largely the result of flawed
domestic policies.
Rather than callously shifting people off unemployment benefits onto other welfare payments to massage the statistics, the Coalition is committed to a genuine reduction in unemployment by implementing economic reforms that will create real sustainable jobs.
We will unleash the economic potential of small and medium size businesses which are without doubt the engine room of sustained jobs growth in Australia. We will significantly reduce the tax and regulatory burden on business which is a major impediment against further investment and employment. Our industrial relations system will give employers and employees the choice to negotiate arrangements which are directly relevant to their individual workplaces. We will scrap Labor's unfair dismissal laws which have stopped many small businesses from taking on new employees, and replace them with laws which give a fair go all round. We will ensure that labour market and training programmes are more closely linked to real jobs and the real needs of business enterprises.
It is indisputable that the families which are most likely to be dependent on income support are those where family breakdown has already occurred.
Government has a clear responsibility to assist families who are in need.
However, there must be a decisive shift from merely assisting the victims of family breakdown, towards policies which also address the causes of family breakdown. A Coalition Government will put greater emphasis on education in human relationships, conflict resolution and marriage and parenting education.
THE HISTORY OF COALITION SOCIAL REFORM.
Previous Coalition Governments have a record of past achievement in the vital area of social policy which we are determined to build upon in government.
The Coalition and its political antecedents have been responsible for many of the major social reforms in this country.
In 1908, Alfred Deakin was the first to introduce an old age and invalid pension.
The years of the Menzies Government was a period of concerted ongoing social reform.
The Child Endowment Act was introduced, war pensions were made exempt under the income test, restrictions on the eligibility of Aboriginal people for special benefits were removed and a pensioner medical and free medicines program was introduced.
The three Coalition Governments of Holt, Gorton and McMahon produced a number of additional, important social reforms.
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These included assistance for deserted wives, the introduction of a tapered means test, assistance for Meals on Wheels, introduction of rent assistance, increases in the rates and scope of child allowance and assistance for people with mental illness.
Between 1975 and 1983, the Fraser Government was responsible for some of the most important social security reforms since Federation.
The most notable of these reforms was the replacing of child endowment with the family allowance system. Other reforms included the automatic indexation of pensions, the abolition of estate and gift duties, replacing the means test on pensions with a simpler income test and the introduction of a new pensioner housing scheme.
THE STORY UNDER LABOR
The gap between the rich and the poor has widened considerably under Labor.
There are many studies and statistics that clearly demonstrate the extent of the inequitable social divide that exists in this country.
After 13 years of Labor, it is estimated that there are now 1.9 million people in Australia who are living in poverty, including nearly 600,000 children aged under 15 years.
Between 1976 and 1992, the number of households in Australia earning between $22,000 and $72,000 a year declined from 65 to 40 per cent,
During the same period, the number of households earning more than $72,000 rose from 20 to 30 per cent while the number of people earning less than $22,000 doubled from 15 to 30 per cent.
These damning statistics tell the story of a nation with a long held egalitarian tradition being transformed in less than two decades into a society of "haves and have nots".
Unemployment is one of the principal causes of the growing levels of poverty and social inequality in our society. Labor has provided Australia with a legacy of high unemployment and totally unacceptable levels of youth unemployment and long term unemployed. It is patently clear that the goal of 5 per cent unemployment by the year 2000 is not achievable under Labor's current policies
and that, if Labor stays in power, this commitment would go the same way as its earlier promise that no child would live in poverty by 1990.
Labor also stands condemned for failing to provide incentives for people to make provision for themselves in retirement, for its discrimination between age pensioners and self-funded retirees, and for its lack of compassion towards widows and middle-aged women.
In the area of social welfare, as in so many other areas, Labor has been deceitful.
It has broken promises and introduced measures immediately after elections without seeking any mandate from the electorate for these changes.
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Nowhere is this more evident than the promise to take all age and service pensioners out of the tax system by 1995. The Labor Party deceitfully made this promise in successive election campaigns and then abandoned it only days after the 1993 election.
After the 1993 election, Labor introduced no less than ten new changes to the social security system which had not been announced before the election.
Some of these measures included:
⢠reducing the income ceiling and assets value for the basic family payment (leading to an estimated 118,000 families being excluded from the basic family payment); ⢠raising the pension age for women from 60 to 65 years over time; ⢠including foreign payments in the income test for families; ⢠applying the income and assets test to student parents; and ⢠changing the rules relating to the payment of overseas pensions;
THE COALITION APPROACH
Unemploy ment Assistance
The Coalition believes it is essential that the social security system provides support for the genuinely unemployed members of our community. This must entail income support and labour market and training assistance to help an unemployed person enter or return to the work force.
A Coalition Government will maintain the real value of all unemployment payments.
At the moment, unemployment payments are fragmented between the Department of Social Security and the Department of Employment, Education and Training. The youth training allowance is paid by the Department of Employment, Education and Training and the rest of the unemployment payments are made by the Department of Social Security.
A Coalition Government will remove this meaningless and discriminatory distinction between younger people and other people who are unemployed, by making all unemployment benefits payable and administered by the Department of Social Security.
Labour market training programs for unemployed persons will continue to be under the auspices of the Department of Employment, Education and Training.
While income support is paid by the Department of Social Security, an unemployed person is required to fulfil their job search obligations through the Commonwealth Employment Service which is administered through the Department of Employment Education and Training. A Coalition Government will ensure there is maximum co ordination and co operation between the Departments.
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The mature age allowance is a non activity tested payment which is paid to unemployed persons over the age of 60. A Coalition Government will maintain this payment.
It is essential that the social security system does not in any way, prevent or discourage an individual from entering or re-entering the work force or from taking additional part time work.
To assist people to find employment, the Coalition will maintain the lump sum advance system. Under this scheme, unemployment recipients are able to receive a lump sum advance of their allowance to help them seek and obtain work or enter self employment.
To assist people to make the transition from being unemployed to work or education, the Coalition will maintain the current employment and education entry payments.
People who are unemployed should be given every incentive to work. If a person is not able to find fill time work, he or she may be able to obtain part time work. Part time work will supplement the person's income, provide employment skills and assist the transition back into the full time work frce. The earnings credit scheme will be retained by a Coalition Government.
Voluntary work benefits the community and enhances the skill level and self esteem of participants.
Under the activity test, if a person over the age of 50 does more than 65 days voluntary work per year, that person is classified as employed and is not entitled to benefits.
The Coalition will allow these people to undertake an unlimited number of days of voluntary work in a year without losing entitlement for unemployment benefits.
The Coalition will actively promote the ability of social security recipients to undertake voluntary work by ensuring that they are made fully aware of the relevant voluntary work provisions in the Social Security Act.
In Government, the Coalition will examine the feasibility of further expanding the voluntary work provisions which apply to recipients aged under 50.
Youth Homelessness
It is estimated that some 20,000 young Australians are homeless.
In a country with the wealth and physical attributes of Australia, it is deeply disturbing that we have such a high level of youth homelessness.
The Coalition recognises there are circumstances in which young people have every reason to leave home. Equally, there are legitimate concerns expressed by some parents and community organisations that the existing system places too little emphasis on family reconciliation.
As a result of these concerns and pressure from the Coalition, the House of Representatives Standing Committee on Community Affairs undertook an inquiry into youth homelessness and its report was released in May 1995.
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Unfortunately the Labor Government's response to the report was exceedingly tardy, demonstrating the relatively low priority that it gives to issues relating to one of the most disadvantaged groups in our society. From its belated response to the Report, it is obvious that Labor believes its efforts to date are all that is required to address this continuing problem.
The Coalition will simplify the current system for the payment of income support to young homeless people.
Currently, the Department of Social Security makes payments at the independent rate to young recipients of special benefits and sickness benefits while the Department of Employment, Education and Training makes payments at the independent rate to recipients of youth training allowance, Austudy and Abstudy.
Under a Coalition Government, the independent rate youth training allowance will be paid by the Department of Social Security, with recipients being able to access the full support functions of the Department of Social Security, including social workers and youth service units.
This will lead to less duplication and lower administrative costs.
Homeless recipients of Austudy and Abstudy will continue to be paid by the Department of Employment, Education and Training but the Coalition will ensure that the resources of the Department of Social Security which are designated for homeless young people will be available to those students.
Youth Homeless Pilot Project
The Youth Homeless Pilot Project, which will be run in conjunction with voluntary welfare organisations, will ensure that young people in need receive adequate income support and will put renewed emphasis on the importance of voluntary mediation and early intervention.
The Coalition will also seek the assistance of all relevant State government agencies in the development and implementation of the pilot.
Under the pilot, a young person who applies for a homeless payment will be initially assessed for eligibility by a departmental officer. If there is a prima facie case for eligibility he or she will be given a six week temporary payment. One of the conditions of the payment will be that the person will be required to report to a participating voluntary agency.
One of the principal roles of the agency will be to provide counselling and wherever possible mediate a reconciliation between the young person and his or her family or guardian.
The agency will prepare a detailed report on the person's circumstances. The report will include an assessment of the possibility of reconciliation in the short and in the long term and a recommendation as to whether the person should continue to receive the payment after the six week transitional period.
The final decision as to entitlement will rest with the Department but will be based primarily on the report of the agency.
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If it is considered that the young person is genuinely homeless, a comprehensive support plan will be worked out between the young person and the agency. It will include matters such as finding short and long time accommodation, access to education and/or training, ongoing reconciliation
efforts, management of financial affairs, developing networks and where necessary, assistance in relation to substance abuse.
The agency will monitor compliance with any obligations and responsibilities under the plan, will make recommendations as to the ongoing eligibility for payments and will provide a back stop if the young person returns home.
The young person's family or guardian will be fully informed about the person's circumstances at all times unless there is overwhelming evidence that the young person is likely to be in danger if such information is divulged or there is a record or clear evidence of child abuse.
The pilot program, which will run for two years, will be initiated in a number of urban and regional locations. It will contain a significant research element which will have the purpose of establishing the most effective means of assisting young homeless people to participate fully in society. The pilot will also be subject to a detailed evaluation and, at the end of the two years, an assessment will
be made as to whether it should be expanded.
As announced in our Youth Policy, a Coalition government will provide an additional $8 million over two years for its Homeless Youth Pilot Program.
Retirees
Labor's deceit
In 1989, Labor made a commitment to remove all age pensioners and service pensioners from the tax system by 1995. This policy was then renewed in Labor's 1993 election policy statement. Less than a week after the election, this promise was abandoned.
During the 1993 campaign Labor strongly criticised the Coalition's proposal to increase the pension age for women from 60 to 65 and clearly indicated it would not introduce any such change.
At the time, the Labor Minister for Social Security described the Coalition's policy to increase the age as "premature, ill-considered, extremely harsh and unfair." He also said "it's the sort of two-card trick you wouldn't expect anyone to play on the elderly."
When Labor was re-elected, it hypocritically introduced legislation to increase the qualifying age.
The Challenge Ahead
Australia faces a major challenge now and in the years to come. We have a population which is ageing.
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It is estimated that the number of Australians aged 65 and over will rise from just over 2 million today to some 4.8 million in the year 2031.
The Coalition is committed to a comprehensive retirement incomes policy which will ensure that the increasing number of older people in our country have financial security in their retirement. The building blocks of a genuine retirement incomes strategy are not in dispute. They are:
a stable and predictable environment in which to plan one's retirement.
2 security and dignity in retirement;
incentives to encourage financial independence;
4 better integration of the tax and social security systems; and
the guarantee of a government safety net for those who need it.
The Coalition is dedicated to each of these objectives.
Maintaining the real value of the age pension is a guaranteed commitment of the Coalition.
The Coalition will maintain the pension benchmark of at least 25% of Average Weekly Earnings. We will continue to index the pension and all relevant thresholds to the Consumer Price Index.
The Income and Assets Tests
The Labor Government has made repeated changes to the social security system affecting age pensioners. This has lead to a high level of confusion amongst recipients.
The Coalition will ensure that changes to the pension income and asset test, are kept to a bare minimum. This will allow people to plan for their retirement with security and certainty.
The assets test will be administered to ensure that people in genuine need are not precluded from the age pension.
In particular the Coalition recognises that the assets test applied by the Department of Social Security may act to discriminate against primary producers due to the fact that farmers may be "asset rich" but "income poor".
In view of this, the Coalition, when in Government, will review the assets test as it applies to primary producers.
In particular, the Coalition will examine the current hardship provisions to ensure that farming families are not disadvantaged and will review the application of the assets test to people who wish to retire on their family farm which they intend to pass on to their immediate relations who are already working on the farm.
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The Coalition gives an absolute guarantee that it will not include the family home in the assets test for the purpose of the pension. This is part of the Coalition's commitment to encouraging people to make greater provision for their own retirement, rather than relying heavily on the age pension.
Unrealised Capital Gains
In 1993 the Government introduced inequitable and ill considered changes to the income test for assessing the impact of unrealised capital gains on the value of pensioner investments on pension entitlement.
Under these rules, as the value of a person's investments changed, the amount of his or her pension rose and fell in line with the changes even though the person had not realised and in some cases could not realise the change in the value of the asset.
This method of assessing income acted as a disincentive against self-provision in retirement. It undermined security in retirement and confused pensioners who were trying to plan and manage their retirement income.
When the Senate Committee on Community Affairs examined the unrealised capital gains legislation, it found it to be unfair and discriminatory.
Yet, the Labor Government refused to take the logical course of action and support Coalition amendments to repeal the measure at that time.
Labor has now belatedly moved to repeal this method of assessing income and replace it with an extended deeming system.
Under the latest rules, the first $30,000 of financial investments for single people (and the first $50,000 for couples) will be deemed to earn income of 5% regardless of the actual income earned. Above this threshold a standard deeming rate of 7% will apply.
The Coalition will monitor on an ongoing basis the impact on pensioners of the new deeming legislation after its commencement in July 1996.
Pension Bonus Plan
A Coalition Government will allow people of pension age to defer taking up their pension entitlement in return for receiving an increased pension at a later date.
Under our Pension Bonus Plan a person may defer their pension for up to five years. For each year that a person defers their pension he or she will receive a bonus of 8% on top of their pension.
To take advantage of the Plan a person would be required to satisfy the eligibility criteria for the age pension. In the case of a couple, both would need to meet the basic eligibility requirement.
Applicants will need to be entitled to the pension at the time they apply for a deferral and annual reviews will take place to check on continuing eligibility.
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Given the Coalition's commitment to abolishing compulsory age retirement, it is appropriate that there is an incentive to encourage people to continue working. The Coalition Pension Bonus Plan will provide people with the flexibility to continue working and then receive a higher annual pension when they retire.
Self funded Retirees.
Many older Australians are either entirely self funded and do not rely on the age pension at all or are partially self funded and receive a part age pension.
Australia faces a major challenge now and in years to come due to the ageing of our population.
With a greater proportion of older people in the community, the importance of individuals making provision for their own retirement is greater now than ever before.
The contribution of self funded and part self funded retirees has not been fully appreciated by the Labor Government. Many part pensioners have been subject to frequent and confusing changes to the pension income and assets tests.
Self-funded retirees receive little or no assistance through the taxation or social security systems.
As a result of the pensioner rebate, single pensioners with non-pension income of up to $45 per week and married pensioners with non pension income of up to $78 per week pay no income tax. This results in an effective tax free threshold of $10,720 for single pensioners and $9,020 for each
member of a pensioner couple.
Under Labor, all persons funding their own retirement pay tax on all income earned over $5,400 a year.
As the value of the pension rebate continues to rise with the indexation of the free area, the gap between the tax treatment of pensioners and self funded retirees continues to rise.
The Coalition believes that it is inequitable that those who have provided for their own retirement are disadvantaged under the tax system.
All retirees with the same income should be treated equally under the tax system, be they pensioners or not.
Under a Coalition Government the pensioner rebate will be extended to self funded retirees who have incomes below the level where the rebate shades out. This means that single self funded retirees with incomes of up to $10,720 a year, and each member of a couple with incomes up to $9,020 a year, will pay no tax under a Coalition Government. In addition, single self funded
retirees with incomes up to $19,232 a year, and each member of a retiree couple with income up to $14,812 a year, will receive a partial rebate.
As announced earlier in the election campaign, it is estimated that the cost of this measure will be $70 million per year.
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Concession Cards
Many social security recipients and some low income earners have access to a number of different concessions from the State and Commonwealth Governments. These include; pharmaceutical concessions, dental concessions, reductions in property and water rates, reductions in energy bills, reduced fares on public transport and a wide range of recreational benefits.
Many of the concessions provided by the States and Territories vary depending on the policies of individual State or Territory governments. In addition, these concessions are often not reciprocal so a card holder travelling in a different State or Territory is unable to receive concessions.
The Coalition will maintain all current Commonwealth concessions.
In addition, a Coalition Government will convene meetings with all State and Territory governments to discuss and negotiate uniform concessions and reciprocity between the States and the Territories.
Where a person is eligible under the income test to claim an age pension, but is excluded due to the assets test or residency requirements, he or she is able to obtain a Commonwealth Seniors Health Card.
The Government estimated that there would be approximately 200,000 non age pensioner retirees who would take up the Seniors Health Card but the number of applicants has fallen well short of the mark. To the end of the last financial year there were only 32,002 cards issued.
The low numbers of claimants have been largely blamed on the excessively complicated and intrusive nature of the application form.
Upon coming into government the Coalition will, as a matter of urgency, review the application form for the Seniors Health Card and will take steps to ensure more information relating to the Card is supplied to potential recipients.
Age Discrimination
The Coalition believes that age should no longer be a barrier to continued employment.
Older Australians are justifiably outraged by the existence of age discrimination. To be denied employment opportunities solely on the basis of age without regard to ability, qualifications or experience is no less offensive than discrimination on the basis of sex, race or religion.
The Coalition has led the way in pushing for the abolition of compulsory retirement in areas of Commonwealth employment. A Coalition Government will ensure that legislation abolishing compulsory retirement is passed in all areas of Commonwealth responsibility.
We will also take the necessary action to remove age discrimination from all employment. In addition, we will allow persons aged 65 to continue contributing to a regulated superannuation fund where they maintain a bona fide role within the work force.
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This commitment will be complemented by the Coalition's Pension Bonus Plan.
Disability related payments
The Coalition will ensure that the real level of all payments to those with a disability including the disability support pension, the disability wage supplement, the child disability allowance and the mobility allowance is maintained.
We will not force people who are eligible for the disability support pension onto unemployment or other benefits.
The Coalition recognises that people with disabilities often have added costs as a result of those disabilities.
The Coalition supports and will maintain the current Commonwealth payments which are made to people with disabilities to assist with these costs.
For example, the mobility allowance is paid to a person with a disability who is in employment or training and is unable to use public transport without substantial assistance due to their disability. The Coalition recognises that it is essential that people with a disability who choose to work or study be assisted with this choice.
The Coalition firmly believes that people with disabilities must not be denied opportunities to develop their self esteem and make their contribution to society through paid employment.
People with disabilities are much more likely to be long term unemployed than other people. Nevertheless, participation in the work force by people with severe disabilities is over 40 per cent.
The Coalition will work with people with disabilities, their families and carers, employers and advocacy groups to maximise the employment opportunities of people with disabilities. We will also work to encourage innovation and community involvement in the development of programs and services.
People with disabilities should have real choice as to the type of employment they wish to pursue, whether it is open or supported employment. This choice should be respected. The Coalition will ensure that supported employment remains a viable option for those who choose it and will not withdraw support for Section 13 services commonly known as sheltered workshops.
The Wife Pension
In the 1995-96 Budget, the Government announced that from 1 July 1996, the wife pension would only be paid to recipients aged 40 and over at 1 July 1995. This would have resulted in some wife pensioners losing their social security entitlements, some receiving a reduced entitlement and all
losing their entitlement to pensioner concessions.
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In reaction to Coalition pressure and in fear of an electoral backlash, the Government has since resiled from this position.
The Coalition will ensure that all existing recipients of the wife pension who meet the current criteria for payment will remain on the pension.
Widows
As of 1 January 1995 the Government introduced the widow allowance.
Its introduction was a direct result of pressure from the Coalition after the Government moved to phase out the widow B pension. The widow B pension had been introduced at a time when women were less likely to provide financially for themselves in their middle age.
When it introduced the widow allowance, Labor deemed that a woman must be over 50 years of age, and have become widowed, divorced or separated (including a separated de facto) after turning 50 years of age to be eligible for the allowance.
The treatment of widows by the Government has been confusing and inadequate. To provide greater equity and dignity in the social security treatment of widows, the Coalition will extend the widow allowance to persons over the age of 40 who have been widowed, divorced or separated over the age of 40.
Carers
There are over 2 million people in Australia who care for someone in their own home or in someone else's home. Some 70% of carers are women and a quarter of all carers list caring as their principal occupation.
The combination of an ageing population, de-institutionalisation and early hospital discharges has put .a greater demand on carers. Conversely, factors such as changing family composition and social attitudes, as well as the increased work force participation of women are likely to reduce the
number of available carers.
The Coalition strongly supports the vital, but often unheralded contribution that carers make to our society and is committed to tackling a wide range of existing Government provisions which act as disincentives against carers.
In government, the Coalition will implement a National Carer Action Plan, in which carers themselves and their needs - not the service providers and the funding authorities will be the focus.
The main elements of the National Carer Action Plan will include:
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Carer Payment
The carer pension paid by the Department of Social Security provides income support for certain carers. Many recipients of the pension feel that the description "pension" is inaccurate as it does not truly reflect the service that the carer is providing for the community. The carer pension will be renamed the carer payment by a Coalition Government.
To assist carers the Coalition will increase the number of days which a carer may temporarily cease providing care without losing their payment from 42 to 52 days in any particular year. This will give an average of one day respite every week.
Currently recipients of the carer pension may only work 10 hours per week without losing eligibility. The Coalition will extend this to 20 hours per week. This will allow an easier transition for carers when they are able to return to full time work. Carers will continue to be supported back into the work force via the Jobs, Education and Training (JET) program.
Carer needs assessment, information and advice
Under the National Carer Action Plan, carers will have ongoing access to adequate information and advice on what it means to undertake the caring role, as well as information on the services and other assistance available to them as carers.
Respite Care
For many carers the responsibility of caring is a full time job. By far the most frequently expressed concern by carers is the lack of affordable and accessible respite care. Existing Commonwealth funded respite care arrangements are ad hoc, piecemeal, disorganised and very much focused on
the respite care provider rather than the needs of the carer.
A Coalition Government will introduce a National Respite for Carers Program. This program will integrate the relevant elements of the Home and Community Care program, the existing Commonwealth Respite for Carers program and residential respite care funding. We will also provide an additional $6 million per year for respite care.
Further details of these initiatives are contained in the Coalition's National Carer Action Plan.
Families
Families play a unique role in the social fabric of Australia. A loving, supportive and stable family environment continues to be the best and most enduring system of social support there is.
Unfortunately, many families are struggling.
The families most likely to be in poverty are those where family breakdown has occurred and where a sole parent is struggling to make ends meet.
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The former Prime Minister, Mr Hawke promised there would be no child living in poverty by 1990 and yet in 1995 it was estimated that 592,000 Australian children were in poverty.
The Coalition recognises there are costs entailed in raising children and acknowledges that the responsibility for caring for our children is one that must be jointly shared between families and the government.
A Coalition Government will work to maintain and strengthen the central role of the family in our society. In particular, the Coalition will focus on the needs of low and middle income families.
The real value of social security payments and assistance to families including family payments, the parenting allowance, rent assistance payments, the child disability support pension, and the double orphan pension will be maintained. We are committed to maintaining the current benchmark for family payments.
Family Tax Initiative
The centrepiece of the Coalition's family package is a two-pronged initiative to cut the burden of tax on families with children, including couples and sole parents.
First, families with a total taxable income of up to $70,000 per annum in the previous year will receive an increase in their tax-free threshold of $1,000 per annum on behalf of each dependent child. The income test will increase by $3,000 for each additional child.
This means that a family with two children will be eligible to receive $400 per annum provided that family's income is less than $73,000 per annum.
Families with taxable incomes of less than $20,700 will be entitled to an equivalent upfront payment. The income threshold for the upfront payment will increase by $1,000 for each additional child.
Second, single income couple families and single parents with at least one child under the age of five, will also receive an increase in their tax-free threshold of $2,500 per annum.
This will provide these families with an additional $500 of tax relief per annum.
This additional benefit is subject to two income tests. The principal income test is that the breadwinner's taxable income in the previous year was less than $65,000 and this income test increases by $3,000 for each additional child irrespective of age. The second income test,
which will apply to the non-working spouse in a couple family, will be set at $398 per week, based on current income and excluding any government benefit payments.
Families with taxable incomes of less than $20,700 will be entitled to an equivalent upfront payment. The income threshold for the upfront payment will increase by $1,000 for each additional child.
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Together, these initiatives will provide greater recognition of the costs entailed in child raising. They are deliberately targeted to lower and middle income earners, many of whom are finding it increasingly difficult to make ends meet under Labor.
It will mean that a single family with three children on average weekly earnings, with at least one child under five, will receive a tax cut of $1,100 a year.
The additional increases in the tax-free threshold for single income families will provide families who have young children with a greater opportunity to choose between having both parents in the work force or having one parent at home in a full-time child rearing capacity.
The Coalition will retain all existing family payments including the parenting allowance, the guardian allowance for single parents, a non-means tested child care cash rebate and the current system of child care assistance.
Maternity Allowance
In Accord Mark VII in 1994, the ACTU negotiated and obtained a promise for a paid non means tested maternity allowance for private sector workers for a period of 12 weeks. This was obtained as a trade off for a lower "safety net" pay increase.
In the 1995 Budget the Government announced the introduction of a means tested maternity allowance of $840.60 falling far short of the promised 12 week payment.
The Coalition is committed to the maternity allowance and will maintain its real value.
The Coalition also supports the recent decision by the Industrial Relations Commission to allow workers to take up to five days per year family leave to care for sick members of their family or household.
Sole Parents
Study after study have revealed that sole parent families are the family type most likely to be living in poverty. In a recent study it was found that one in five sole parent families are living in poverty.
The Coalition will maintain the existing qualifications for the sole parent pension and will ensure that the real value of the pension is maintained
Sole parents will also gain significantly from the Coalition's family tax initiative which will provide the equivalent of $200 per year for each child and an additional $500 per year if the sole parent has a child aged under five.
A Coalition will continue to assist sole parent families through the Jobs Education and Training (JET) program.
We are committed to maintaining a non means tested child care cash rebate and will maintain the current system of child care assistance.
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In addition, we are committed to ensuring that custodial parents receive their child support entitlements through the Child Support Agency in a timely and efficient manner.
Rent Assistance
Rent assistance is a supplementary payment designed to assist people in need who are renting in the private sector. The payment was first introduced by John Gorton in 1970 for long term recipients of sickness benefits who were renting.
The Coalition recognises the vital role of the payment in reducing after housing poverty. A Coalition Government is committed to maintaining the real value of rent assistance.
Reciprocal Agreements
Australia has entered into a number of reciprocal social security agreements with other countries. These agreements enable Australians who are visiting and living in those countries, to continue to receive their social security payments. They also allow people from overseas counties to receive benefits when they are in Australia.
The Coalition will enhance the current level of consultation with community groups who are affected by the current agreements and potential new agreements. This increased interaction will ensure that agreements that are entered into by the Coalition are as beneficial as possible to both the recipients and to the Government.
The Coalition will continue to negotiate the expansion of current agreements and the establishment of new agreements. The objective of the Coalition is to obtain the maximum benefits possible both for Australian income support recipients while they are overseas and for overseas born Australian residents.
In particular, the Coalition will actively pursue the unfinished negotiations with Greece to ensure an agreement is finalised as soon as possible and passed into law. The Coalition will use its best efforts to speed up the process of negotiations which appear to have stalled under Labor.
Consultative Bodies
In order to construct sound social security policy, input is needed from many areas, most importantly from non government bodies who are involved in delivering social services.
These welfare organisations are responsible for delivering services at the ground level. Their contribution, which is often underestimated, is both vital and unique.
The Coalition proposes that the Social Security Advisory Council be constructed on a more decentralised and regional basis. Membership of the Council will be expanded to include bodies from a regional, state and national level.
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The Council will consult with a Coalition Government on a wide range of issues pertaining to social policy and administration and their impact on income support recipients.
Emergency and non-government welfare relief
The Department of Health and Human Services provides funding for non government bodies to provide emergency relief to assist people in need.
In the 1995-96 Budget, the Government announced that total funding to all emergency relief organisations would be reduced by 24% in the 1995-96 financial year.
After concerted pressure from the sector, the Government made up some of the shortfall, but funding is still over $2 million less than the $19.5 million granted last financial year.
The Coalition believes there are major shortcomings in calculating the funding allocation for emergency relief on the basis of the projected national unemployment rate for the financial year.
We accept that as a crude measure of distress, unemployment rates can be an indicator of need. However, any effective measure must focus on need in local or regional areas, rather than on a purely national basis.
In Government, the Coalition will review the current emergency relief criteria to provide greater focus on local and regional needs rather than national trends and needs. We will also examine whether factors in addition to raw unemployment rates should be taken into account in determining allocations.
This review will be undertaken in consultation with emergency relief service providers.
Delivery of Social Security Services
The primary function of the Department of Social Security is to provide income support and associated services to those in need. In many ways the Department of Social Security is no different from any other service provider. To a large extent its performance is judged on its ability to assist its clients effectively and within a reasonable time.
There is ample recent evidence that the Department of Social Security is not as efficient as it should be. Efficient practices reduce spending and most importantly result in recipients receiving a faster and better service.
There clearly needs to be a greater emphasis on the efficient delivery of services by the Department of Social Security.
The Australian National Audit Office's efficiency audit of the Department of Social Security in October 1995 included a large number of recommendations to improve the efficiency and productivity of the Department.
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These recommendations include: adopting private sector models of management, reviewing the use of meetings, reviewing half day closures of some offices, focusing on problems caused by a computer system that is not fully integrated, standardising best practices across the offices
and reviewing the method of delivery of instructions.
The Coalition is committed to ensuring that the Department is as efficient as possible and will use the recommendations of the Report as a basis for improving its performance in the delivery of services.
Teleservice Centres
In 1992 the Department introduced specialist telephone inquiry services known as Teleservice Centres.
The Australian National Audit Office has undertaken a performance audit of the Centres and a report was tabled in Parliament in November 1995. The report has revealed that the standard of delivery of services by the Centres is very disappointing. There was evidence that in some areas the Teleservice Centres have been unable to meet Departmental performance standards.
A Coalition Government will examine the recommendations of the report with the objective of improving the performance of the centres.
As part of this process, the Coalition will assess the viability of concentrating resources in areas of major deficiency, by establishing regionally based Department of Social Security "help desks."
Performance Standards
The Department has been set a number of performance standards it is required to meet.
In many cases the Department has failed to meet these standards and in some cases its performance in meeting these standards is deteriorating rather than improving over time.
For example, the Department has a target that 85% of the calls received at its Teleservice Centres will be dealt with within one minute. In 1993-94 there was a success rate of 57% and in 1994-95 this was met in only 38% of cases.
Similarly the Department has a target that 90% of letters to the Minister will be answered within 28 days. In 1993-94 this was met in 68% of the cases but in 1994-95 it was only met 65% of the time.
The Coalition is committed to putting greater emphasis on ensuring that the Department of Social Security meets, and wherever possible, exceeds its performance targets.
Complexity of the Social Security System
To a large extent, the inefficiencies in the Department are caused by a social security system which is excessively complex.
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This is the clear message from the 1993-94 Annual Report of the Commonwealth Ombudsman.
The Ombudsman reported that in the 12 months prior to the issue of the report there had been a 30% increase in the number of complaints received by her office about the Department of Social Security and its administration.
There was a total of 4,487 complaints.
The recurring theme throughout the Report was the complexity of the social security system.
The most common complaints related to mistakes by departmental officers due to the complexity of the system, the lack of available information leading to confusion by recipients made worse by the complexity of the benefit being sought, lack of communication between different parts of the Department and difficulties arising from the division of benefits between the Department of Social Security and the Department of Employment, Education and Training.
The social security system has now become so complex that recipients often do not fully understand their entitlements and responsibilities. In many cases, staff also do not fully understand the system and are therefore unable to assist members of the public to the extent that they should.
Labor's policies over the past thirteen years have failed to produce an understandable social security system which is attuned to the needs of Australians who require and are eligible for income support.
In a frank admission, the Minister for Social Security in his paper, "Beyond the Safety Net", recently stated "it is becoming more difficult to manage an increasingly complex system."
The Government's best, but inadequate response to date, has been to merge the basic and the additional family payments into one payment and re-join the newstart and the jobsearch allowances. These are little more than name changes and no real attempt has been to alter or simplify the payments in any way.
With finite Government resources, it is essential that the social security system works to its maximum efficiency.
In Government the Coalition will examine this unsatisfactory situation with the aim of developing a more rational, cost effective and integrated social security system.
Prevention of Fraud
Social security fraud is an issue that concerns many members of our community. With an annual budget of over $36 billion a year it is imperative that this money is spent wisely and that payments are only paid to genuine recipients.
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The Coalition is committed to taking all possible steps to prevent fraud. This commitment does not involve a hidden agenda to remove people from payments.
It is about ensuring that only those who are eligible under the Social Security Act are receiving those payments. If the legislation is not adequate in a particular area and does not assist all of those in need, that is a separate issue which needs to be addressed in a different context. However, it is essential that the integrity of the legislation is maintained by ensuring that payments are made only to people with a lawful entitlement.
In 1991 the Government introduced the Data-Matching Program. The program aims to detect dual payments and undeclared and under declared income.
The program originally received support from the Parliament on the basis that it would lead to savings of $300 million per year. When the Auditor General's office examined the program it was only able to find savings of $17.3 million for the 1992-93 year.
There has also been debate relating to the privacy of recipients as a result of the use of tax file numbers in the program.
In light of these doubts, the Coalition has twice prevented the Government from removing the sunset clause, most recently maintaining the clause to January 1998 to ensure the program continues to be closely monitored.
The Government has argued that everything that can be done to detect fraud is being done. Yet each time it puts renewed emphasis on the detection of fraud, it finds more and more inappropriate payments and additional savings.
The Government has relied heavily on the Data-Matching Program which has not realised the Government's full expectations.
A Coalition Government will maintain but fully review the operation of the Data-Matching Program with the dual objectives of maximising its effectiveness and addressing concerns about the privacy of social security recipients and taxpayers.
Within some sections of the Department, there is not sufficient resolve to comprehensively deal with the question of fraud by some recipients of benefits. An example of this, recently revealed by the Coalition, was the estimated total $7 million incorrectly paid to prisoners.
The development of more effective fraud control procedures is an issue which needs to be addressed at all levels of the Department.
It is imperative that the Department, not only concentrate on ensuring benefits are paid promptly, but also on ensuring that those who receive payments are correctly entitled to them.
For example, the Coalition will address the situation where a person receives undeclared income from full or part time work, often in cash, and also receives a social security benefit to which he or she is not entitled. This example of fraud is not easily detected by the data-matching system.
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In Government, the Coalition will rewrite the Department's objectives to ensure that all staff appreciate the importance of ensuring payments are made in accordance with the legislative regime.
There is an enormous amount of information provided to the Department by third parties relating to allegations of social security fraud.
Under privacy legislation, meaningful responses to information provided to the Department cannot be provided to the informant. A Coalition Government will require the Department to provide the Parliament with comprehensive and regular generic reports on the results of such information.
These reports will be framed in global terms, and will include details of the number of reports received from third parties, the payments to which the reports relate, the outcome of investigations of the reports and the numbers of persons removed from such payments as a result of such investigations.
These reports will not refer in any way to individual cases and will not compromise the privacy of any individual.
Activity Test
The Coalition recognises that the vast majority of recipients of unemployment benefits are genuinely out of work and genuinely seeking work. However, the fact remains that activity testing is often undertaken in a most cursory way by the Department of Social Security. The Coalition considers that if the activity test was properly applied it would produce very different outcomes.
The Coalition does not intend to increase the penalties for minor breaches of the requirements of receiving payments, but will ensure that only those people genuinely entitled to a benefit, receive payment.
As well as ensuring that the technical requirements of the activity test are properly administered, a Coalition Government will put greater emphasis on identifying recipients who are earning undeclared income, requiring recipients to take up work which is offered and auditing activity test-related information which is provided to the department.
Benchmarking of Payments
The Coalition is committed to maintaining the current benchmarks which apply to the age pension and family payments.
The Government is currently undertaking a number of studies into the benchmarking of social security payments. The Coalition will continue these studies and will assess the results upon their completion.
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