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Monday, 17 September 1973
Page: 1071

Mr BOURCHIER (Bendigo) - The Repatriation Bill (No. 3), the Compensation (Australian Government Employees) Bill and the Seamen's War Pensions and Allowances Bill (No. 2) are being considered cognately. Like the previous speakers on this side of the House I support these Bills as one must commend action that is to the benefit of any particular section of the community. The benefits provided in these Bills apply to exservicemen, ex-servicewomen and servicemen and servicewoman currently serving. We must applaud the Bills. But in applauding them I have some reservations, as have the previous speakers from this side of the House.

The proposal to admit civilian patients to repatriation hospitals in case of emergency, as I understand, can only do some good. But 1 would mention of course that at present most hospitals no longer have a special repatriation ward and that repatriation patients are accepted into general hospitals in the intermediate ward section. So I think that perhaps balances the budget on that side. The proposal to supply artificial limbs to amputees can only be commended, and I do so. However, this Repatriation Bill, like the social security Bill presented previously which it follows closely, has a few hidden and very nasty surprises. The honourable member for Barton (Mr Reynolds) mentioned that the Government was carrying out the same actions in this Repatriation Bill as in the social security Bill, but that is not quite as good an operation as he might think. I will explain that shortly.

Before getting onto these particular points I would like to follow up what was said by the honourable member for Herbert (Mr Bonnett) about the repatriation problem concerning the ex-serviceman going back for a check-up for the purpose of his disability allowance. I have found, as obviously have other members of this House, that the ex-serviceman goes back to the Repatriation Board for a check-up and finds not only that his application for an increase is rejected but also that quite often he gets a reduction in his disability allowance. I have had this happen to several people in my electorate who are over 65. It is rather amazing that a man's war disability can improve when he is over 65. I suggest to the Minister for Repatriation (Senator Bishop) that, whilst the Government is bringing in a no means test pension for people who are aged 75 and over or who served in the Boer War and persons in other categories, consideration should be given to allowing the disability pension of a person who is over 60 years of age and who is eligible for a service pension to stay with him to be automatically increased rather than have him faced with the embarrassment of having it decreased. This has happened many times. If this principle were followed there would not be any need for such people to front up to a tribunal; it would be a decision of the Repatriation Department and a standing rule. This is something the Minister could look at.

I now turn to the partial abolition of the means test and the taxing of pensions. It is in this area that this Bill is not quite the bed of roses that was presented by the honourable member for Barton and other speakers from the Government side. Firstly, I point out that the taxing of pensions does not affect those who are in receipt of war service pensions only and have no other source of income. The benefit that they receive from the increase in pensions is good. But let us look at the people who have other sources of income, perhaps superannuation. Firstly, I will deal with those to whom the means test does not apply and then with those who are still under age of 75 and who are subject to a means test. In the case of the person to whom the means test does not apply, if he has a superannuation income of $4,082 - there are many former public servants and others who have that sort of superannuation payment - and provided he is over 75 years of age, he can now receive a full pension of $1,053 a year. This brings his income to $5,135. His deductions normally are assessed at somewhere around $380. In a case I know of they were $388; so this man's taxable income is $4,747. He gets no rebate allowance because the $156 allowance cuts out once his taxable income is in excess of about $2,600. He cannot claim his wife as a deduction because she is getting the pension. Therefore the tax he pays on this amount will be approximately $830. Last year, with the benefit of the age allowance and being able to claim a part deduction for his wife, he paid $130. This person will be indebted to the Government for making him pay a further $700. So much for this great increase in pensions.

The net increase in pension to a person over 75 - in the case I mentioned the wife is 71 and does not get an increase in pension - means that this man gets an increase in his part pension of $317; but he is paying an increase in taxation of $700. In other, words, it will cost him $383 to receive the benefit of this Government's generosity. In the case of a person with an income of $3,664, which is only $72 a week - that is including a part pension - tax this year will be $518. Last year it was $128 with an age allowance and other deductions. This year tax will be increased $390. If he is subject to a means test he will get no increase in pension and therefore will be down $390. I have further examples which I would like to present to the House but it would take up to much time to give all the details of individual expenses under the various items set out on the taxation form. 1 would ask leave of the House to have them incorporated in Hansard. I would say that they are relevant mainly to age pensions but I think they are quite relevant to the current Service pensions.

Mr DEPUTY SPEAKER (Mr Scholes)Order!Is leave granted? There being no objection, leave is granted. (The document read as follows) -

When Labor came to power on 2 December 1972 an increase in Age Pension was granted from the first pay-day thereafter, 14 December 1972. The increase for married couples was $1 . 50 per week per person, bringing the pension to $37.50 per fortnight.


The Husband received $876.78 in a full year. His wife received $876.78 in a full year.





Mr BOURCHIER - Thank you, Mr Deputy Speaker. I must thank a very concerned pensioner from my electorate for providing me with these figures which I have verified and I will now briefly present them. The full details will he recorded in Hansard. I ask honourable members to note this case. It concerns a man aged 65 and his wife aged 60, in receipt of public service superannuation, each in receipt of a part pension of $877 for the 1972-73 income year. The man received $1,650 in superannuation and had allowable taxation expenses of $285 which brought his taxable income down to $1,365. That was for last year. With the age allowance provisions he did not pay tax because pensions were free of tax. For the year 1973-74 his superannuation increases from $1,650 to $1,790. His pension amounts to $1,068. In declaring bis income he put down bank interest of only $12', making a total of $2,870 income for the year. With the normal deductions of $206 his taxable income for this year will be $2,664. His rebate portion comes to $54. His tax on $2,664 amounts to $288 less a rebate of $54 which gives a net tax of $234. With the age allowance provisions tax on that amount of income would have been $82. The net extra cost to this pensioner will be $153.

The increase in pensions over 1973-74 will hit these two pensioners in another way. In this case the total pension increase will be $337 for both, but the tax payable will be $234 which means they will get a net gain of $103 which is only about $2 a week for the married couple or something like a 7 per cent rise. They will receive not $3 a week as was mentioned in the Budget but about $2 a week. This is nothing but a con trick which is being put over every aged person. They will realise the full impact of this and vote accordingly the next time the election comes around. Under the new provisions there will be no weekly deductions from pensions. Pensioners will have to pay out a lump sum according to the assessment at the end of the year. I would ask you, Mr Deputy Speaker, and anybody who is in this House to consider how these people will be able to save up $700 or $800 to pay out in taxation.

There is one minor matter - it may appear to be minor but to these people it is a matter of great concern - and that is the proposal to increase the excise duty on brandy. Many pensioners, both service and ordinary age pensioners, like to have a bottle of brandy at home. Under this Budget they are being hit by an increase of $2 a bottle. This is only one of the small items which have accelerated in cost. These increases are reacting against the so-called generosity which is provided by this Government. I am sure that the aged new taxpayers of this country will remember this Government's action which takes away their money rather than giving it to them.

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