Julie Collins (Franklin, Australian Labor Party) Share this | Hansard source

I rise this evening to commend the member for Kingston for moving this important motion and to acknowledge the points made by my colleagues on this side of the House. After hearing the contribution from the previous speaker, the member for Boothby, one thing that I think we can all agree on is that a reciprocal arrangement between the Australian and United Kingdom governments does need to include provision for the indexation of British pensions. I think the previous speaker actually admitted in his contribution that when they terminated the agreement they removed the ability to continue negotiations, which is what we are asking the governments to do. By my calculations, 2001 to 2007 means there were another six years in which they could negotiate and they did not.

To give a bit of history on this issue, UK pensioners living in Australia have been paid at the same rate since the date they became entitled to receive contributions from the UK government, and there is currently no entitlement or provision for an annual increase in their retirement pension.

Earlier this month I received a letter from a married couple living in my electorate of Franklin who are approaching retirement age. They have lived in Australia for the past 25 years and are British expatriates. These are their concerns, and I read directly from their letter:

We were horrified to discover recently that when we claim our British pensions, which we have continued to pay for while living in Australia, they will be frozen from the first payment. That is to say, if things remain as they are now, the British State age pension we will receive from the British Government will not be indexed.

My constituents are really concerned that there is no universal approach to the indexation of UK pensions. For example, British expatriates living in the USA or any country in the European Union benefit from the indexation of their British pension, as do retirees in Britain. The married couple in my electorate are set to lose thousands of pounds that other British expatriates receive as a matter of course. In this instance, the decision not to index their pensions is based solely on where these British citizens choose to reside. Currently, over 500,000 British expatriates who call Canada, New Zealand, South Africa or Australia home do not receive any annual increase—no indexation.

I support this motion to reform the status quo and to bring about a more equitable arrangement for all British expatriates, no matter where they live. Many British pensioners, like the married couple who wrote to me, have made substantial contributions to the United Kingdom’s national insurance system throughout their working lives. They did this to ensure that they would have access to adequate funds for when they decide to enter a new chapter of their lives and begin retirement. What they did not bank on was frozen pension payments. This has had real financial implications for them during their retirement, or in their pending retirement, as the pensions payments will fail to keep up with the cost of living. These people have made significant financial contributions—in many cases over decades—and should rightly have access to indexed social security payments to ensure their pensions keep stride with the rising costs of living. The Australian government is concerned about the UK’s indexation policy, which I believe is inequitable and adversely affects 250,000 UK pensioners in Australia.

The purpose of this motion is to seek rectification of a former social security agreement with the UK government so that it includes provision for indexation. The previous government—that is, the Howard government—had a window of opportunity to address this issue for, as I said earlier, more than six years but they failed to do anything about it. The Rudd Labor government is taking a keen interest in this serious matter. We have already re-established communication channels with the UK government representatives and concerned UK pensioners now living in Australia. In fact, earlier this year the Minister for Families, Housing, Community Services and Indigenous Affairs, the member for Jagajaga, wrote to her counterpart in the UK to raise the matter again and to suggest that officials meet to discuss the possibility of a new social security agreement. I have been assured that the Australian government will, at every opportunity, continue to press these matters with the UK government. In July this year the minister also met with UK pensioner representatives in Australia to discuss the matter and we are considering what other action the government might take. We are also monitoring the legal actions mentioned by previous speakers. A case is expected to be heard at the end of 2008 or early in 2009, and I am sure we all await that outcome.

As you can see, the Australian government and UK pensioners are seeking to change what I and they believe is an unfair and inequitable social policy. In supporting the member for Kingston’s motion, I feel that it is important we move forward to commence negotiations for a new social security agreement that includes provisions for the indexation of pensions. The Australian culture is underpinned by a fair go for all, and we want a fair go for all, including the British expatriates. I commend the motion to the House.

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