Bernie Ripoll (Oxley, Australian Labor Party, Shadow Minister Assisting the Leader for Small Business) Share this | Hansard source

I rise to speak on the Social Services and Other Legislation Amendment Bill 2013 and I note at the outset that this is a bill which contains a very large number of changes and amendments, most of which are unrelated. They do relate in some part to social security, to welfare, to families and to small business and cut across a whole range of services. These are services that are provided not only to individuals but to families and small businesses and that have a very large impact on the way that families will have future benefit from a range of government services, as would individuals, students and small businesses and the way that these services are administered. Labor has made it clear that, unlike the government in opposition, we are not going to be oppositionalist. We will support good changes where they have a benefit to the community. We will very much support changes to small business areas where they are of benefit. We will support the government where there is a need for those changes, particularly where Labor in government were already making those changes or moving down that path. We certainly will not support changes which hurt families, hurt small business, hurt individuals, hurt students, diminish the capacity of families to provide for their young students or in any other material way do not benefit the community—do not have a benefit to the people they are intended to support.

There is an enormous difference between the way we will act and the way this government acted in opposition: opposition just for opposition's sake. You will not find that from us, and it will be demonstrated through these bills today. We will support the good elements of these bills because we believe that, where there is good being done, it should be supported. But we also believe that, where there needs to be amendments, oppositions should play their part and should do a good job of it. A good democracy, it is often said, works best when you have a strong government and a strong opposition. It does not work when one side is not operating as they ought to be.

This bill contains many measures, and I want to run briefly through what those measures are and then what our positions are on those particular changes. As I said at the start, this bill contains a very large number of mostly unrelated measures which include continuing income management as part of the Cape York welfare reform. The bill amends the Social Security Act 1999 to enable a two-year continuation of income management as part of the continuation of the Cape York welfare reform. It also contains a number of family tax benefit part A eligibility rules, particularly in terms of the eligibility for family tax benefit for children age 16 years and over. Currently, the FBTA can be paid for children age 16 to 17 years who are undertaking or have completed secondary study and dependant full-time secondary students until the calendar year when they turn 19. These amendments limit eligibility for family tax benefit part A to families with children age 16 to 19 years. There are also a number of exemptions that apply to children who cannot work. The schedule also removes the child cut-out amount or income limit.

There are also changes to the period of Australian working life residence. As a result of the measures contained in this bill, from 1 January next year age pensioners and certain other pensioners with unlimited portability will be required to have been Australian residents for 35 years during their working life from the age of 16 to pension age to receive their full, means tested pension after 26 weeks absence from Australia. The current requirement is for 25 years. This will not apply, of course, to agreements outside of Australia that we have with Greece and New Zealand. Pensioners who are living overseas immediately before 1 January will continue to be paid under the current 25-year rule.

This also contains a number of interest changes to apply to certain welfare debts—in particular, how this applies to Austudy payments, fares allowance, youth allowance payments to full-time students and apprentices, ABSTUDY living allowance payments and right across a range of those payments. The rate of the interest charge will be based upon the 90-day bank accepted bill rate plus an additional seven per cent, as is currently applied by the Australian Taxation Office for other debts in this area. In the last four years, this rate has averaged 11.07 per cent and currently stands at 9.6 per cent. These are significant changes which will have a deep impact.

There are also significant changes to the Pension Bonus Scheme. From 1 March 2014 the bill will end late registrations for the closed Pension Bonus Scheme. The scheme provides a lump sum payment to people who have qualified for the age pension, the age service pension or the partner service pension after reaching pension age or qualifying for the income support supplement. This will also have a marked impact.

There are also changes to the extension of indexation pauses for family tax benefit A, family tax benefit B and family tax benefit supplements. The bill will extend the indexation pauses on certain higher income limits for three further years, until 30 June. This limits the amount of growth that people would have otherwise had in this area. This will apply to the family tax benefit part B primary earner income limit. As you can see, these are significant changes.

There are a range of changes to the rules for receiving payments from overseas, and deeming rules will be extended to account based income streams. The bill will align the income test treatment of account based superannuation income streams for products assessed from 1 January 2015, with the deemed income rules applying to other financial assets. It will change the way that government accounts for the purposes of being eligible for the age pension—how other assets are counted. There are a range of other amendments that go to debt recovery, certain provisions for lodging tax returns, and funding under the National Disability Insurance Scheme, regarding a person's account.

While the Labor Party will support elements of these bills, because we believe they are a step in the right direction and they provide some enhancements, there are a range of areas that are of great concern. Labor will always support sensible savings measures, because that is what we did in government and that is what we would expect the new government to do. We will be lending our support to a number of the measures in the legislation, but not all the measures in this legislation are sensible. Where we believe they are not sensible, we will move to omit those measures and we will oppose those on the basis that they are not sensible, on the basis that they do not provide for families, individuals or small business or where we believe the measures make unwarranted and unfair cuts at a cost, particularly to Australian students and their families.

I will quickly deal with a range of issues contained in here which I think are very important, particularly paid parental leave changes. I note for the record that it was Labor that introduced the first Paid Parental Leave scheme, which has been upheld in high regard right across the community and has served an enormous benefit. It has already benefited some 300,000 women who have accessed the Paid Parental Leave scheme that Labor introduced since January 2011. In fact, so successful has this policy been that we saw the opposition, now the government, extend it much further, to a level we believe is unwarranted, but that is a debate for another time.

What we did in our policy in the lead-up to the last election was very much understand and hear the voice of small business in this area, particularly small businesses with 20 employees or fewer. There would be a benefit if they had an option to not administer the Paid Parental Leave scheme themselves but to have that done by Centrelink. We think that is a good idea. That was our policy and we continue to have that policy. In here there are a number of changes in that particular area that we cannot support.

When it comes to the things that are contained in this bill, it is important to note that there are a whole range of issues for small business. This is not some single dimension or single-layer set of changes for families, in terms of how they are supported through their children attending higher education, or whether it is just the education system itself, or support through family tax benefit A or B—measures that are in place to provide cost-of-living relief to parents, cost-of-living relief to families and relief from cost-of-living pressures on individuals. It is very much needed support that Labor in some cases introduced but in a lot of cases enhanced. Labor is very cognisant of the way that this support interacts with the tax system and the further benefit to the whole community by helping to further educate young people so that they can provide not only for themselves and their families but also to the greater good of the economy.

Some of the support that was directly laid out under a Labor government was the instant asset write-off—a very much appreciated and applauded measure that Labor put in place which allowed a small business to write off for taxable purposes a proportion of the value of an asset that cost less than 6½ thousand dollars. This was widely used, to the tune of almost $3 billion, as the cost to the taxpayer, but it derived enormous benefit to small business. It helped them deal with cost-of-living increases, the cost of utilities and a whole range of other things. It helped them in a very difficult period over the past five years, coming out of a global depression, a global recession, a global financial crisis, and helped them deal with the fallout domestically in Australia. We saw the very good benefit of that. This government, unfortunately, will be penalising small business and taking that away. The government makes no secret of it and the government does not run away from that, but it ought to be held to account. Whatever other good they say they are doing—even if it is, as they say, a reduction in red tape—they have still taken away the most direct piece of assistance that Labor put in place for small business. It was a little bit over $5 billion worth of assistance in totality, if we look right across the board. The instant asset write-off was an uncapped, unlimited, $6½ thousand direct bonus for small business. That is now gone and I cannot see a time when a Liberal government will reinstitute making a direct payment to small business to help them deal with the pressures of doing business.

We do understand small business. We understand small business directly. We understand that, if you are going to be more than just a mouthpiece for small business, talking the talk and spruiking the rhetoric, you actually have to put some money on the table as well. One of the best ways you can do that is by providing direct assistance to help them help themselves. Where they buy assets, where they invest in their own business, government should be there to lend them a hand—a hand up, not a handout.

In the run-up to the election, our policy was to move from the $6½ thousand in assistance to small business that we put in place—up from the $1,000 that was there under the previous Liberal government—to $10,000. That will now be wound back to just $1,000 again. That is an enormous hit to small business and, in my book, it does not sound like the government understands or is listening to small business. It is not us saying this. It is the small business representative bodies, the Australian Industry Group and a whole range of people—the voices of small business right across the board. Dr Peter Byrne from AIG said that the instant asset write-off reduces costs for small business and the amount they have to pay to their accountants. I could go on for quite some time about the benefits the instant asset write-off has brought to small business.

I also note the loss carry-back. This Labor initiative meant that, for the first time in Australia's history, businesses could retrospectively apply a current loss to regain tax they had paid in the past. This was of enormous benefit to small businesses in allowing them to arrange their expenditures and cash flows in order to be able to make a claim, up to the value of a million dollars, against taxes paid in the past. This was not just about a business making a loss but was also about how a business was then able to take account of this benefit—perhaps arranging asset purchases or other financial decisions in order to maximise the benefit to their current financial position. This is another example of Labor not only listening to small business but delivering for small business. This benefit will be taken away by this government.

I cannot go through all the details—there is just so much in this bill—but this bill does damage to students and makes things harder for them, it makes changes to family tax benefit A and family tax benefit B, and it makes life a little bit more difficult for families and for small business. There are elements of this bill that we believe are good, but there are elements we cannot support. (Time expired)

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