Bruce Billson (Dunkley, Liberal Party, Minister Assisting the Minister for Defence) Share this | Link to this | Hansard source

I move:

That this bill be now read a second time.

This bill provides the legislative basis for several 2007 budget measures in the Families, Community Services and Indigenous Affairs portfolio, building on other recent budget legislation for older Australians and families with children.

Older Australians in retirement are again among the beneficiaries of this new bill, as the government continues to spend more on age pension than on any other single program—around $24 billion next financial year in pension payments to around two million people.

The pension bonus scheme recognises the important role played by older Australians in the workforce, and supports their choice to participate. The scheme gives an incentive for people who choose to defer claiming age pension, or the veterans’ entitlements equivalent, and keep working. The incentive takes the form of a one-off, tax-free payment of up to around $32,000 for a single person and $27,000 for each member of a couple, which is paid when they eventually claim and receive age pension.

This bill will make the pension bonus scheme even better and more flexible in several ways. For example, scheme members who take certain types of leave from work will be able to stay in the scheme as non-accruing members for up to 26 weeks without failing the work test. Also, if people do fail the work test, there will be greater discretion for the usual 13-week claim lodgement period to be extended, so special circumstances such as serious illness of a close family member can be taken into account if a person claims late.

A new pension bonus ‘top-up’ will be allowed if a person’s pension rate increases within 13 weeks after being granted because their income or assets have decreased. This will help people whose retirement investments are not settled until shortly after grant of their age pension and bonus, to get the most out of their bonus. Lastly, new rules will allow the bonus accrued, but not claimed, by a scheme member who dies, to be paid to their surviving partner.

In a further measure targeted at older Australians, the existing social security income and assets test exemption threshold for funeral bonds will be increased from $5,000 to $10,000. The new threshold will be indexed in line with inflation so that it maintains its real value. This measure is also designed to allow individuals or couples to have a second funeral bond subject to the exemption, so that those with existing bonds can take advantage of the new threshold. This initiative will help Australians make better provision for their funeral arrangements without seeing their income support payments affected.

Families with higher order multiple births—triplets, quadruplets, or larger birth sets—will benefit from the extension by this bill of multiple birth allowance. Multiple birth allowance is an additional component of family tax benefit part A for families with three or more children born together. That is a troubling thought, isn’t it? It is worth over $3,000 per year for triplets and over $4,000 for quadruplets and larger birth sets. Our thoughts are very much with those mothers. Multiple birth families face a significantly increased financial burden over most other families, both in the direct costs of raising their children and in the indirect costs of reduced workforce participation. Multiple birth allowance aims to relieve some of this financial pressure and recognises the particular challenges and demands on these families.

The allowance currently stops when the children turn six. However, the government has listened to families, who have pointed out that this is one of their most expensive times, with the need to buy multiple school uniforms and supplies, and not having the capacity of many other families to save costs—through hand-me-downs, for example. This pattern of financial pressure continues throughout their schooling. Therefore, multiple birth allowance will now continue to be paid until the children turn 16 or generally until the end of the year in which they turn 18 if they remain full-time students. Over 1,000 Australian families will benefit from this extension. Some will continue to receive the allowance past the children’s sixth birthday, when it would otherwise have stopped, and many others not currently being paid the allowance will start to receive it.

Crisis payment is a one-off payment, equal to a week’s worth of income support, for people in severe financial hardship in certain circumstances. People recently released from prison, victims of domestic violence, and people affected by extreme circumstances such as a natural disaster currently may receive a crisis payment. This bill adds newly arrived humanitarian entrants to Australia to that list, to give extra support to refugees managing the immediate costs of settling into the Australian community, especially in finding long-term accommodation. Under this measure, around 6,800 humanitarian entrants will be assisted by crisis payment each year.

An assurance of support is a form of guarantee that allows people who are at higher risk of requiring income support to migrate to Australia if an assurer promises to provide financial support for the person for two years after arrival, or 10 years in the case of parent migrants. The assurance of support program protects public outlays while not interfering overly with the migration program for financial reasons. This bill will improve and simplify the scheme’s operation. For example, the bill will remove the existing capacity for an assurer to withdraw an assurance of support after a visa has been granted to the person covered by the assurance.

The measures in this bill will commence on 1 January 2008. I commend the bill to the House.

Debate (on motion by Mr McClelland) adjourned.