Andrew Wallace (Fisher, Liberal Party) Share this | Hansard source

Forty-six per cent of the people who live in my electorate of Fisher are over the age of 55. Twenty-nine per cent are already retired. For most of my constituents, the issue of how they are to support a healthy, long and active retirement is a live and critical question. In living on the Sunshine Coast, they have chosen to make Australia's most beautiful and welcoming lifestyle destination their home. However, they have chosen also to make their home in a location where the cost of living can be a challenge for many. According to the well-known cost-of-living comparison website numbeo.com, consumer prices in Sydney are 21 per cent higher than those on the coast, but the average purchasing power in Sydney is 46 per cent higher. Relatively speaking, for many it is as difficult—if not more difficult—to get by in my community as it is in our nation's most expensive city.

Many of my constituents, especially many of those who are older and retired, are finding it hard to make ends meet. They are not alone. According to a December 2017 OECD report, 26 per cent of Australian retirees are living below the relative income poverty line, which the OECD defines as half of the national average wage. The coalition has listened to the concerns of older Australians, and this bill is part of our suite of measures to help.

In my own electorate, I have convened the Fisher Seniors Council. This group of older residents living in my community gathers three or four times each year to discuss the issues that they face on the Sunshine Coast and to give me feedback on our government's policy ideas. When it comes to the cost of living, one of the messages that this group have given me loud and clear is that older people in Fisher want more flexibility in retirement. One of the members of the Fisher Seniors Council, Mr Frank Gower, continues to press me to ensure that we have an age pension that keeps up with the rising cost of living. This government has delivered that with an increase of more than $100 a fortnight since the coalition's election in 2013.

Most of all, seniors in my electorate don't want more handouts. They have worked to support their families all of their lives, and they want to continue to live independently. Seniors on the Sunshine Coast want the flexibility from government that they need to help support themselves. That flexibility to use their skills and their assets to support themselves is exactly what this bill delivers in two key areas.

Firstly, schedule 2 of this bill increases the work bonus to allow retirees to work more hours and earn more money without impacting their other entitlements. As people live longer and healthier, many are finding that they do not want to give up work entirely. I'm sure many of us in this place employ retired members of our community in our offices on a part-time basis, just as I do. They bring a wealth of experience and an unrivalled knowledge of our local areas that can be invaluable in any parliamentarian's team. In a great many sectors of our economy, from retail to agriculture, the experience of decades, the old-fashioned work ethic and the calm wisdom that many of our retirees can contribute would be welcomed by employers. My Fisher Seniors Council consistently tell me that they want the choice to work more to supplement their income but that the resulting reduction in their other entitlements is a substantial disincentive. This bill reduces that disincentive by increasing the work bonus to $300 earned per fortnight.

Further, this bill provides flexibility in responding to the changing nature of work. For retired people, self-employment or contract work can be particularly appropriate, allowing them to fit their employment around their other family and often, as is the case, their volunteer commitments. However, until now none of that work was covered by the work bonus. This does not reflect the nature of the modern workforce nor of the particular needs of working seniors, and this bill rectifies that situation.

This bill also addresses one of the issues that my older constituents most often bring to my attention. Many older residents of Fisher are relatively asset rich but income poor. The government has already taken steps to provide more flexibility for these constituents by allowing them to make a non-concessional contribution of $300,000 into their superannuation from the proceeds from downsizing their homes. But this bill goes further, giving more seniors another option of releasing equity from their homes and increasing their income in retirement.

The Pension Loans Scheme allows older Australians who own their own home to, in effect, take out a type of reverse mortgage with the Commonwealth government. Existing part-rate pensioners and self-funded retirees who are currently precluded from the pension by the asset test have the option to receive additional payments, up to the maximum rate of the full fortnightly age pension, by progressively borrowing against the value of their home from the Commonwealth at a competitive rate of interest, which is currently set at 4.25 per cent. This debt can be repaid at any time, and is usually repaid from the individual's estate.

However, there are many retirees who are not currently able to benefit from this scheme. Schedule 3 expands the Pension Loans Scheme to include those who are already receiving the maximum rate of pension and self-funded retirees who do not have sufficient assets to preclude them from the age pension. The bill also increases the total amount which can be borrowed under the scheme to 150 per cent of the maximum fortnightly pension. This will give flexibility to those who need a higher income to support their active retirement. Just a few days ago I spoke with a constituent in my electorate, Mrs Margaret Little, about how she would dearly love to have taken advantage of just this sort of a scheme but previously hadn't been able to access it. Now, as a result of these amendments, she will be able to. So that is, indeed, very good news for Mrs Little and people like her.

With this bill, the coalition is listening to senior Australians and providing them with more options for increasing their income and security in retirement. It is only the latest in a series of decisions made by this coalition government to support older people to live longer, healthier and more active lives. Since the coalition government was elected in 2013, pensions have increased by $107.90 a fortnight for individuals and $162.60 a fortnight for couples. We've used the proceeds of the strong economy that this government has helped to build to avoid the need to increase the qualification age for the pension to the age of 70. That same strong economy has allowed us to avoid repealing the energy supplement, thereby ensuring that individual pensioners have another $366.60 more in their pockets every year.

All of this could not stand in more stark contrast to the policies of the Labor Party. I met a man in my electorate office recently—his name is Adrian—who, like me, was a builder. He came to Australia from his native Italy with very little, and he has worked extremely hard ever since he came here. Adrian is a perfect exemplar of the benefits that Australia can derive from ambitious people born overseas who want to come to our country to get ahead and to help build our community. Adrian worked hard, and he invested the money that he earned to create a secure retirement for himself and a future for his family. Some of his investments were successful; some were not. But, when times were tough, Adrian got back on the tools, and he's worked his way back like many migrants and small-business people in this country. Throughout his life, everything that Adrian had he had earned for himself. He's rightly proud of that achievement and he rightly expects to enjoy the modest fruits of that labour in his retirement. He, like so many Australians, has saved enough to give him a comfortable but by no means extravagant income in retirement. But when Adrian came to my office, he was furious about what the future may hold for him and his family under a Shorten Labor government.

Adrian had looked into the Labor Party's retiree tax. He'd explored what their proposal to end retirees' dividend imputation credits, pulling the rug out from under millions of hardworking Australians, would mean for him. For Adrian, the ill-judged, punitive policy of members opposite would result in the loss of 60 per cent of his income. It would take him from a secure retirement to a life filled with doubt and uncertainty about the future. Adrian knows what all Australian seniors know—that this huge, new retiree tax proposed by Labor is fundamentally unfair. It constitutes a massive cash grab by a Labor Party so desperate to fund its unsupportable, fantastical spending promises that it is willing to take the livelihoods of some of society's most vulnerable people to do it, because it's not simply Adrian who would be affected by Labor's retiree tax. Nationwide, around 900,000 Australians stand to lose an average of $2,200 every year. Australians with self-managed super funds are set to lose an average of $12,000 every year. Labor's tax will affect Australian shareholders who are on incomes of less than $65,000, self-funded retirees, self-managed super fund trustees, small APRA-regulated funds, large retail APRA-regulated funds and retired small-business owners alike. Interestingly, yet unsurprisingly, it will not affect the industry super funds.

Labor's tax will cost retirees and small businesses almost $5 billion per year and, in total, will rip $45 billion out of our nation's hard-earned savings. In my electorate alone, 7,200 older Australians will be directly and immediately affected by Labor's tax. Thousands more of my constituents who have not yet reached retirement age will have their potential income in retirement slashed by this extra taxation. Contrary to the misleading statements of the Leader of the Opposition, the hardest hit will be those on the lowest taxable incomes. Eighty-four per cent of the hundreds of thousands of people who will be hurt by Labor's policy have a taxable income of less than $37,000. This tax will hurt hundreds of thousands of ordinary people who have done the right thing and saved just enough for their retirement.

Like many others in my electorate, Adrian is passionate about trying to do something about this unfair and ruinous new tax. He's determined to do what he can to stop the Leader of the Opposition and the Labor Party from bringing about this disastrous new reality for Australian seniors. Members opposite should take note: if they continue to insist on this damaging tax, they will find themselves facing passionate opposition from some of our society's most experienced, engaged and active citizens. For their own good, let alone for the good of the people of Australia, I would counsel them to beat a path to the Leader of the Opposition's door and convince him to abandon this unjust assault on our older Australians.

This legislation demonstrates once again that it is the Liberal and National parties who respect the contribution of Australia's older people and who will put forward the measures they need to support an active and fulfilling retirement. It will make a difference to thousands of senior Australians. I commend the bill to the House.

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