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

I too rise to support the Social Security Amendment (Liquid Assets Waiting Period) Bill 2009. As many speakers have said before me, this is a time of global financial uncertainty and Australians really need to know that their government is acting. We are making amendments where necessary so that many people who face unforeseen circumstances—people who may never have been unemployed before, as has been pointed out—and actually need some assistance from government get some financial support without having to spend all their savings—their cash in the bank, their shares—or clean out their term deposits just to make ends meet. We on this side of the House are really quite concerned about that, because in times of global uncertainty it is really important that the government do what governments are expected to do and take care of those people, particularly those people, as I have said, who have never been unemployed before. The government want to reverse the decision made by those opposite in the 1996-97 federal budget, because we think it is a fair thing to do. On this side of the House we do not want to put any extra burdens on those people who are already doing it tough, who have found themselves out of a job, possibly for the first time in their lives.

Let us have a look at what these amendments will actually change. The proposed changes will affect people applying for Newstart allowance, youth allowance, Austudy and sickness allowance. Those with limited liquid assets will now access income support more readily due to these amendments to lift the liquid assets waiting period thresholds. Liquid assets include cash, shares, term deposits, moneys due and able to be paid by the person’s former employer, and any other readily available assets. Under the existing rules introduced by those opposite, people seeking income support who have liquid assets above the threshold amount of $2,500 for singles without dependants or $5,000 otherwise would generally serve a waiting period known as the liquid assets waiting period. As we have heard, this could be from one week up to 13 weeks. During times of financial uncertainty, we think it is a fair and reasonable thing to relax liquid asset waiting periods—to loosen the restrictive nature of that which was put in place by the former government.

This amendment proposes to double the threshold of liquid assets to $5,000 for singles without dependants and to $10,000 for others for a two-year period from 1 April 2009 to 31 March 2011. We are doubling it. We are taking it back to what it was in September 1997 when these changes came into effect. But what we have also done is important. We have said that this measure will be reviewed after one year. The former government had no method of review when they chopped it in half, no adjustment to the CPI and no other form of review—and, as we all know, things have changed dramatically since 1997.

Currently, people who are single cannot receive income support payments unless they have less than $2,500 in assets—sources of money available to them. When your income stream ceases, your payments and expenses do not. We need to change these rules to help people, because I do not think that that is okay. Imagine the pressure felt by someone when they get the call from Centrelink to tell them they have to wait for help—that they have to wait for financial support from their government in this time of global uncertainty. This currently applies to a single person facing difficult times, but this unfair rule also applies to couples and people with dependants. They are not eligible to receive income support until they have less than $5,000 in liquid assets. They must wait one week for every $1,000 they have over $5,000 up to a maximum of 13 weeks. These people need to be supported financially, particularly when, in the global uncertainty, there is a great deal of fear, anxiety and worry. We have to do what we can to help them, because they still have to pay their rent, their mortgages, their rates, their insurance policies and their school fees and put food on the table.

Doubling the liquid asset thresholds, going back to the pre-1997 levels, is fair and reasonable and is really an appropriate response when we face such challenging financial times. It makes it really easy for me to stand here today to support this bill. If I have helped people in my electorate, that is a good thing to do at this particular time. This amendment will provide quicker access to payments and, equally importantly, will allow claimants to retain some of their savings in this time of global uncertainty.

The amendments proposed in this bill also seek to change a particular issue we have heard other members talk about, and that is the surrender value of life insurance policies. We on this side of the House once again fall back to the default position of delivering fair legislation—fair to the people of Australia, for those falling on challenging times. As it stands today, there is an expectation that people who hold life insurance policies will have to cash in their policy in order to support themselves and/or their families before being able to access income support. This bill seeks to change this unfair act. As many of my parliamentary colleagues have already argued today, it is completely unreasonable to expect a person to cancel their policy voluntarily. To use the equity value in their policy is a big disadvantage for that person, but there is also a snowball effect. Not only is the policyholder disadvantaged; so, too, is the future of their family or other beneficiaries who might have benefited from that protection. It puts a weight around the shoulders of that family and that individual, a weight they do not need in globally uncertain times.

As I keep saying, we are all aware of the global financial recession and the effects it will have on all Australians, young and old. During these extraordinary financial times, the government has a responsibility to assist Australians who need support, whether that is through responsible policy to help support jobs and small businesses or sound social policy that makes it a little easier for those people who need it and find themselves in difficult circumstances. The Rudd government continues to act quickly and decisively through a number of economic measures such as the $10.4 billion of support payments to carers, pensioners, veterans and people requiring assistance, provided in December last year, and the $42 billion second stimulus package which got through parliament just recently. These measures have been designed to cushion the Australian economy against growing global recession. Unfortunately, we know that unemployment will rise during the global recession and Australia cannot be immune from this. So we have to do what we can to help those who find themselves in difficult circumstances.

What has truly astounded me is the reaction of those opposite during this global financial crisis. I am astounded that to date they do not have a plan to do anything; their plan is to wait and see. We on this side of the House have not really seen that as an appropriate way to act in a time of global recession. As I said, we have had our two stimulus packages. We are trying to provide direct support to individuals but we are also building community infrastructure. Two-thirds of the $42 billion is for infrastructure in local communities, supporting local families and local jobs. That is very important during a global financial crisis. People would have seen recent media reports of the Treasurer overseas at the G20 meeting. Many G20 countries have provided support packages to stimulate their economies. That is what is needed in this time of global financial uncertainty. To do nothing, to sit by, to wait and see what happens or to let the market correct itself is really not an appropriate response.

I was pleased to hear those opposite say that they would support this bill, albeit with a but. It is a very good bill and I am really pleased and proud to be part of a government introducing this measure. We are providing some support to those who need it. I am really pleased we are doing this, but this is not all we are doing. As well as the stimulus packages, we are also changing some of the employment services so that, rather than having to wait at least three months to receive intensive personalised assistance, any Australian worker who is made redundant will now receive immediate and personalised assistance to help get them back into the workforce—another important measure the government has introduced. We have also committed $75 million for an extra 10,000 productivity places, to assist newly retrenched workers needing training and education. The government are acting decisively to assist people in this time of great financial uncertainty. I commend the bill to the House.

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