Deborah O'Neill (Robertson, Australian Labor Party) Share this | Link to this | Hansard source

I am speaking in support of the Families, Housing, Community Services and Indigenous Affairs and Other Legislation Amendment (Further Election Commitments and Other Measures) Bill 2011. In essence, for those who are listening and just picking up this debate which is a continuation from yesterday evening, the matter under discussion is really the provision of flexibility for families seeking an advance on their family benefit payments.

I am very proud to support this reform because it represents this government's strong and proud record of sensible and practical reforms to the welfare system. This flies in the face of the general criticisms by those opposite. They are strident in their false claims that this government has not succeeded with a reform agenda, that positive economic and welfare reform cannot be achieved and that reform cannot occur in this parliament. As the Minister for Infrastructure and Transport and the Leader of the House put on the record last Thursday, 26 May, as at 1.30 pm last Thursday the Gillard Labor government had passed 112 pieces of legislation through this House in eight months. This compares with 108 bills passed in the first 12 months of the Howard government. Apart from productivity and efficiency, however, this legislation reveals our Labor government's commitment to improving life outcomes for all Australians.

I represent an electorate with a high proportion of young families on low to middle incomes. Robertson is an electorate with a high residential population, many of whom make the daily commute to Sydney or Newcastle. One of my great ambitions as the member for Robertson is to see the level of youth employment and participation increase. I will always seek improvement in this area because sustained and stable employment is vital for young families with mortgages and tight budgets. Quite often these families, some of whom are on a single income, rely on welfare payments when balancing their family budget, and balancing the family budget can be a critical element of enabling young people to continue in education and in training. I am also confronted with these concerns when I meet constituents while I am doorknocking through my electorate. This legislation is a step towards assisting regular Aussies who need a bit of flexibility to manage the challenges that life throws at all of us from time to time. Recently I attended an event named the Peninsula Links Day. This event was organised by the Peninsula Links steering committee. It was an innovative project brought together by great leadership from our local Centrelink agency. The vision for the day was to link customers, clients and companions to various agencies within the Central Coast. I am proud to represent an electorate where the charitable and community organisations are strong, well organised and have great support throughout the community. This was demonstrated at the Peninsula Links Day where a variety of community organisations were present to meet the different needs of the community and discuss the real and pressing concerns of many of our local families. Many of these local organisations operate on a not-for-profit basis and provide a great support to our local community. This extends to legal services, problem gambling and financial advice, which is critical to this bill.

Community organisations and charities can play an indispensable role in providing support to those who cannot afford or access it. But I am not one who believes that community organisations in any way supplant or remove the obligations of the Australian government in providing a strong and efficient system of practical welfare. Whilst I believe that there are limits to what welfare can achieve—and that obviously welfare must be provided efficiently and effectively—welfare must not be determined according to arbitrary ideological factors. Rather it needs to be able to respond to the complex realities of ordinary lives. Our eyes remain focused on the practical need for welfare to support families.

I will now address the second component of this legislation before the House this evening and that is the Healthy Start for School initiative. This initiative will implement a condition upon the family tax benefit part A for parents and carers of four-year-olds. The condition is that children of four years of age go through a basic health assessment check such as the Healthy Kids Check. This will fulfil an important objective to ensure that children are healthy, physically and emotionally, and also socially healthy when they commence school and that they are prepared for learning. Health checks can also have the aim of helping with the detection of early lifestyle risk factors, delayed development and illnesses. These are varied and include illnesses such as vision and hearing problems in addition to intellectual, social and emotional delays.

It has been demonstrated quite clearly that health checks and the guidance that they provide and the opportunities for early intervention and access to support can provide incredibly powerful positive results for low-income families and children being brought up in those contexts. This is in no way meant to criticise parents on low incomes. Income is not an indication of love, or care, or ingenuity or a capacity to manage on a limited budget. This legislation does recognise that in many cases guidance in relation to healthy lifestyles and early intervention is, really, a very important thing.

I passionately believe that education is the primary means for enabling patterns of disadvantage to be broken down and to enable more Australians to access and thrive in the mainstream Australian economy. There is nothing to gain by leaving some of our fellow Australians behind. Indeed, it is a core Labor value that a quality system of public education is provided to enable the disadvantaged to access mainstream economic and social life. What we must always understand is that the early childhood years can be the most important in providing the foundations of a quality education and a good life. It is also in early childhood that academic, emotional and social concerns are very easily addressed.

I believe that the Healthy Start for School is a fundamental part of this package to reduce disadvantage in our community. It is also much more economically and socially effective to address these issues at an early stage of life. The reforms about which I have spoken are important in terms of giving all Australians access to the opportunities of a great economy. They also provide families with the necessary flexibility to manage their own finances at times when things happen such as the washing machine breaks down or when somebody in the family becomes unwell. I commend the bill to the House.

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

I speak in support of the Families, Housing, Community Services and Indigenous Affairs and Other Legislation Amendment (Further Election Commitments and Other Measures) Bill 2011. There are three main measures here, all in fulfilment of election commitments that the government made. The first measure of better access to family payments with more flexible advance payments of the family tax benefit will improve the lot of 1.5 million Australians. The Healthy Start for School initiative will affect 92,000 children and strengthening compliance child support, as estimated by Treasury, will benefit the Australian taxpayer by reducing family tax benefit payments by $78.6 million as child support payments increase and as people fulfil their parental responsibility to care for their children, regardless of whether they are married or separated.

Family tax benefit A and B is an initiative of the Commonwealth government. Family tax benefit A is the main payment designed to help with the costs of raising children. It is payable to a parent, guardian or approved care organisation for a child under 21 years or a dependent full-time student between 21 and 24 years of age. Family tax benefit B is designed to provide assistance to families who have one main source of income including sole parent families with a dependent full-time student up to the age of 18 years.

In August 2010 under our election package, Better Access to Family Payments, the Australian Labor Party committed to simplifying and making more flexible access to family tax benefits for unexpected costs such as the TV or freezer breaking down and where people needed to get access to money. It is already possible for people to get access to family tax benefit and to get an advance, but we wanted to make sure that this would help families in unexpected circumstances.

This is an important reform and it will go a long way to making flexible arrangements that people need as their circumstances change. For instance, in my electorate of Blair, which represents most of Ipswich and the Somerset region, many families, thousands in fact, have been flood affected. Their circumstances are such that they require assistance from social security, and many people lost furniture and household items such as TVs, fridges and freezers. More flexible advance payment of family tax payments would assist those people with these unexpected costs. Many of these people simply did not expect to be flood affected and so the benefits here will assist. The maximum amount of advance payment will be linked to a family's rate of payment and generally a maximum of 7.5 per cent of a family's rate of payment could be advanced. For a family with one child under 12 years of age it is around $312. For a family with two children under 12 years of age it is $625. Overall a maximum amount of $1,000 will apply. Advances will only be approved if Centrelink is satisfied that it will not cause financial hardship. This is a good initiative. It will help my electorate as it recovers from the flood. It means that families will have that capacity to provide for the recovery and reconstruction of their lives. I support it.

The second initiative, Healthy Start for School, is a commitment the Gillard Labor government made during the last election campaign. It is a measure for family tax benefit recipients on income support payments. It will make the payment of the family tax benefit A supplement for a child turning four in a particular income year conditional on the child undertaking a health check, such as a Healthy Kids Check provided on the Medicare benefits schedule or checks conducted by state or territory maternal and child health services.

The objective here is to identify whether children have hearing loss or a problem with their eyes, whether they are suffering from some illness or condition, and to treat and identify it early so that steps can be undertaken to give that child every chance in life, to prevent learning difficulties and to make sure that child gets appropriate and adequate medical treatment. I do not resile from the conditionality of this initiative. I think it is important. We want to make sure that children get every chance in life and this is an opportunity to do so. This initiative is helpful to children.

It is sad but true that some parents do not necessarily consider that the health of their child is a high priority. Regrettably that is a very common occurrence for those people who are struggling in circumstances where they are under pressure. They might have mental health or psychiatric problems. This does not occur in most families across the country but we want to make sure that even in those difficult circumstances children are healthy and fit and ready to learn when they start school. This can only happen if parents really take that initiative. So the parents will need to confirm with Centrelink that the check has been done. The checks are serious checks. They are not simply a tick-a-box thing that someone decides they might go down the road for. They have to consult a medical specialist. It gives the opportunity for parents to get guidance in terms of a healthy lifestyle and what early intervention strategy can be undertaken if a child is suffering from some adverse health condition. This will break down patterns of disadvantage and socioeconomic hardship for families. If we can break that intergenerational cycle of poverty and disadvantage, which is so evident by postcode across this country, that will be a benefit from the Torres Strait right down to Tasmania.

It is important that children are able to participate in community life, get access to every educational opportunity and therefore provide financial security for themselves and their families by getting a good education. If they are suffering from some form of disability or illness, that needs to be identified early. I support that initiative. I think that is a worthy cause to undertake and it is important that we encourage parents on income support payments to ensure their children receive their health checks before they start school.

The third initiative deals with the area of child support. This is a vexed problem for many families across the country. Most people do not get charged with criminal offences, they do not have car accidents, they do not contact the legal system of the country, but many people across the country live in separated households. Their relationships have broken down, whether they have been married or otherwise, and generally children are born from those relationships. What happens in those circumstances is that those children need to be financially supported. If the parents are not fulfilling their statutory and common-law obligations to provide primary care for their children financially, then the taxpayers take up that cause. That is exactly what happens in circumstances where mothers or fathers fail to pay child support.

Child support has been the system in this country since 1989 and is paid under the Child Support (Assessment) Act and collected under the Child Support (Registration and Collection) Act. There is a formula in place and people should know their obligations. It is very much dependent on the payment of tax and people lodging tax returns. If they do not lodge tax returns it makes it difficult for the child support system to assess how much is payable. Therefore people can make arrangements to avoid paying child support. In my previous life as a lawyer practising in family law I met many people who adjusted their financial affairs to evade paying child support and was involved in literally thousands of cases in courts, family courts, federal magistrate courts or other aspects of the jurisdiction, where I was attempting to encourage people to pay child support and fulfil their obligations.

We are trying here to get a more accurate system of payment of child support. We are strengthening compliance. A more accurate default arrangement will be introduced that uses a parent's previous taxable income instead of a low default income—that is two thirds of MTAWE—in cases where they have not lodged a tax return. Sadly what happens is they say, 'I am not going to lodge my tax return', particularly if it is a situation where they see they are going to be paying more child support and be in a higher tax bracket. They arrange their financial affairs in a way that they do not lodge their tax return so we do not get the accurate figure and they end up with a lower default income under the legislation. This amendment will ensure a more accurate child support assessment and it removes the almost accidental disincentive for a parent on a higher income to avoid paying child support and getting a lower child support assessment based on the formula that has been established, the lower default income assessed support. The amendments in this legislation make a difference. This means that people's real income or, more likely, their more accurate income will be used for the calculation of child support and, therefore, they are more likely to pay a higher child support payment. The consequences of that are that we, the taxpayers—the taxpayers across the country—are more likely to pay less money to that particular family, as the payer, usually a male, will pay higher amounts of child support. That is good common sense. It is good that we require parents to take on their financial responsibility for their children. It also adds to the integrity of the tax system by making sure that parents fulfil that responsibility and that all of us pay less taxation payments to that particular family. Again, this is a good initiative. It is another federal Labor government initiative. We have stood up for families.

I am also proud to be part of a government that has cut income tax for three years in a row. That has made a big difference. Someone on $30,000 a year is now paying $750 less in tax than in 2007-08. Someone on $80,000 a year is paying $1,400 less in tax than in 2007-08. I am most proud of the fact that we have increased the childcare rebate from 30 to 50 per cent. That has had a big impact in my electorate. Since June 2008, we have seen more than 5,600 local families benefit from the additional childcare rebate payments. There is $3.143 million in additional assistance being paid to people in Ipswich and in the Somerset region as a result of our reforms. Unlike those opposite who, after they came to power in 1996, ripped $1 billion out of the childcare system, we are investing a massive amount of money in the childcare system across this country. We are providing $20 billion over four years for early childhood education and child care. That is a whopping $12.8 billion more than was provided in the last four years of the Howard government. We are providing $16.4 billion to help 800,000 Australian families annually with the cost of child care.

We have the runs on the board with respect to families. This budget has of course made a big impact on families in my electorate: 5,600 families in Blair benefited from an extra $4,200 per child aged between 16 and 19 years under changes to the family tax benefit system. This was on top of Australia's first paid parental leave scheme. We have extended education tax refunds to cover uniforms as well. You can see what this government has done with respect to helping families—and not just that, there is $16.4 billion for education. And there is almost a doubling of funding for health. This is after the coalition ripped $1 billion out of the health system when the Leader of the Opposition was the federal minister for health. They capped GP training places and disinvested in the health and hospital system—all of which was vital to Australian families and their interaction with the health and hospital system in order to care for their young children. When the opposition were in power they never had the wit nor the wisdom to make the reforms that we have to help Australian families.

We have also invested in our local schools through BER projects: $109 million in the electorate of Blair. Those wonderful projects provided the halls that acted as evacuation centres for flood affected families in my electorate and across the Brisbane valley. Those opposite can carp and snipe and whinge about what we are doing but they are hopeless, helpless and hapless when it comes to Australian families.

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

I will start where the previous speaker finished, with 'hopeless, helpless and hapless'. Yes, the opposition certainly demonstrated to us on this side of the House that that is exactly what they are. They have demonstrated their lack of care for families. When the member for Blair talked about health and hospital reform, I could not help but go back to the days when the Leader of the Opposition was the health minister and remember the pain he inflicted upon Australians when bulk-billing declined. He constantly stood up in this House and said, with a smirk on his face, that he was the best friend that Medicare ever had, while, at the same time, he slashed benefits and undermined the effectiveness of Medicare.

It makes such a difference when you have a government in power that actually delivers on the promises that it made in the election. This is a really good-news piece of legislation. I can understand why members on the other side of the House get quite upset when I point out to them how we are delivering for families in Australia. We are delivering in a big way for families—something that they did not do. Those opposite took from families and made it difficult for them to visit their doctors, because doctors had stopped bulk-billing. People had difficulty in purchasing their medicines. What we have done on this side of the House is deliver better access to family payments and provide more flexible advanced payments of family tax benefits. A Healthy Start for School is a component of this legislation as well as a strengthening of compliance in child support, thereby making it easier for families.

I did not mention at the beginning of this contribution that I was rising to speak on the Families, Housing, Community Services and Indigenous Affairs and Other Legislation Amendment (Election Commitments and Other Measures) Bill 2011. This legislation delivers to the Australian people and to the people of Shortland. It is really, really good news. This legislation makes some pretty important changes to family tax payments. They are changes that will make it easier for families. This will provide for more flexible advance payments of the family tax benefit. Families need flexibility. Families will be able to receive a larger and more flexible advance of their family tax benefit entitlements to help meet unexpected costs. Anyone who has had children themselves or who has a young family knows how those unexpected costs arise. Everything is going along swimmingly and the car breaks down, the fridge blows up or the washing machine breaks down. Labor is recognising the fact that there are unexpected events in the lives of families and that not all families have a constant stream in their lives.

The maximum amount of advance payment will be linked to a family's rate of payment. Generally, a maximum of 7.5 per cent of a family's rate of payment could be advanced. For a family, with one child under the age of 12, this will be around $312. We all know that, if you have a problem with your car, $312 is a big help towards having that car fixed. For a family, with two children under age 12, it will be $625. An overall maximum amount of $1,000 will apply. Advances will only be approved where Centrelink is satisfied that the advances themselves will not cause financial hardship.

There will be one minimum rate for all payment advances, which will be set at an indexed amount of around $160. Some families on the base rate of FTB A will have access to a smaller advance because of their smaller existing entitlements. Families who receive an advance will then have their subsequent fortnightly entitlements over six months adjusted to recover the advanced amount. Currently, the maximum advance is fixed at $324, and this can only be advanced twice a year—on 1 July and 1 January. This is a very inflexible arrangement. As I highlighted earlier in my contribution to this debate, these payments can be used for those unexpected events—the car, the washing machine or the refrigerator breaking down. Unfortunately, for families, those events do not happen on 1 July and 1 January each year. These events are unexpected. These changes are designed to incorporate those sorts of events into a family's life. It is about flexibility and it is based on the needs of families; it is not about an unexpected event happening on 1 July or 1 January each year.

The other component of this legislation that I am particularly excited about is the measure that will make the payment of family tax benefit part A supplement for a child turning four in a particular income year conditional on that child undertaking health checks, such as the Healthy Kids Check on the Medicare Benefits Schedule.

I have a grandson, who is now aged five. When he turned four, I actually took him to the doctor and he had that Healthy Kids Check. I was very impressed with the health check that he went through. The doctor measured him, weighed him, tested his hearing and eyesight and went through a full medical history of young Sam. After about 15 or 20 minutes he was given the all clear. It was very beneficial. I walked away from there knowing that he was a healthy young boy who could play sport, who could hear, who could read and who should have no problems with his learning. A child who has a hearing deficit, a sight deficit or some other deficit that is not picked up can end up having problems when they start school. The height-weight ratio is a very important index. In this era where we are confronted with an obesity epidemic it is important to ensure that our children's weight and height are right for a child their age and that their weight correlates with their height. One of the biggest problems that we have in our society today is an increase in obesity. That obesity is starting at a younger age, and it leads to chronic diseases such as diabetes. Type 2 diabetes is now being identified and diagnosed in quite young children and adolescents. The Healthy Kids Check is important. If something such as obesity is identified, then the doctor can work out a healthy eating plan, an exercise plan and can talk through the issues with the parents. That can improve that child's health outcomes and, I suppose, their future—the choices that they will have in their life. Because, unless you are healthy, you have so many restrictions placed on you. If you are obese, it becomes a vicious circle. You find it harder to exercise and, because you find it harder to exercise, you do not exercise and when you do not exercise you put on more weight. And so it goes on. By the time that four-year old reaches puberty he or she is quite obese and by the time they are young adults the problem has been exacerbated.

I really want to emphasise how important the Healthy Start for School measure is and to encourage all families throughout Australia to recognise its importance and have their child undergo the Healthy Kids Check—not only the children who are covered by this legislation but all children—because it is about their child's future and also about the long-term health of our nation. The requirement in the legislation we have before us applies to families where either of the parents or their partners have been on income support at any time during the financial year in which the child turns four. Income support families who do not meet the new requirements will have their family tax benefit A supplement withheld, as the objective is to ensure that all children have a health assessment. Families who take their children to a health check within two years of the end of the financial year will be able to claim the supplement. This measure is about putting in place an incentive to encourage all families to ensure that their children have this health check. As I have already mentioned, this is vital not only for that child, not only for its family, not only for the community but for the long-term health of Australian society.

There are two other issues in this legislation. One is strengthening compliance in the child support system. The current system will be replaced by a more accurate process. Each and every member of this House knows about the issues that surround the child support system and about the issues around compliance. The process that will be put in place following the introduction of this legislation will help with a number of the problems that exist at the moment with child support. The other component of this legislation, one that I particularly embrace, is streamlining the notification process for compensation recipients. This is a measure in the 2010-11 budget which will streamline the process of notifying Centrelink when payments are made by payers of compensation, such as insurers. In other words, if a person is to receive a compensation payment, it places an obligation upon the insurance company, or whoever it is, to pay compensation as quickly as possible. As somebody who has worked in rehabilitation and with people who have received compensation payments, I know just how much of a problem it is if people do not receive the payment quickly. They are unaware of it. They end up with a debt to Centrelink and, as well as that, they can miscalculate or be unable to calculate their financial circumstances for the next 12 months, two years, three years—or however long their preclusion period is—before they are entitled to receive Centrelink benefits.

This is excellent legislation. It is a Labor government delivering to the people what, before the last election, they promised they would deliver. This, along with the education tax rebate being extended to uniforms, the childcare rebate going from 30 to 50 per cent, the payments of childcare rebate being made on a fortnightly basis and the Paid Parental Leave scheme, is great news for Australian families. (Time expired)

Julie Collins (Franklin, Australian Labor Party, Parliamentary Secretary for Community Services) Share this | Link to this | Hansard source

Can I begin by thanking both sides of the House for their contributions on this bill. This bill brings forward three further election commitments to improve support for Australian families. The 2010-11 budget measure and also some minor clarifications to family payments are introduced by the bill.

The first election commitment is an overhaul of the arrangements for advance payments of family tax benefit to better meet families' needs. Families will get a more flexible system, with more scope to choose the size and timing of their advanced payments. The new system, starting on 1 July 2011, will help families meet unexpected household costs such as having to replace a broken-down fridge or a damaged school uniform. Some families may find the new, more flexible system means they can avoid high credit card bills or high-interest small loans. Other families might find they manage their budget better around unexpected expenses like car registration. Families will choose how much they get in an advance payment, subject to set minimum and maximum amounts. The minimum amount will be 3.75 per cent of the maximum standard rate for a child aged under 13. This comes to around $160 as the minimum advance amount for all families. The maximum amount will differ between families depending on their usual rate of payment. Generally, a maximum of 7.5 per cent of that rate will be available for advance payment. For example, if the family is not receiving rent assistance and has one child under 13, the maximum advance amount would be around $320. If the family is not receiving rent assistance and has two children under 13, it would be around $640. A family that is receiving rent assistance would have a higher maximum advance. An overall maximum will apply. This will be $1,000 in 2011-12 and it will be maintained at the same percentage of the maximum standard rate for one child under 13 as in the first year. Families will have their ongoing fortnightly family tax benefit part A entitlement adjusted to repay their advance. Under new arrangements, families will no longer be limited to receiving and repaying advances within two set periods of the year, those being 1 January to 30 June and 1 July to 31 December. Families will be able to request more of their entitlement in advance at any point in the year and the advance will be recovered in the following six months. Importantly, though, Centrelink will not approve advance payment requests if financial hardship would be likely to result. Also, families making repeated requests will be assessed to see whether financial advice or financial counselling will be of any benefit.

The second of the election commitments introduced by this bill is to establish a new requirement for income support recipient parents or carers of four-year-olds. This is aimed at giving their children a healthy start to school. Under this new requirement, family tax benefit part A supplement, which is paid to families at the end of the financial year, will become conditional on the kids in these families going through a health assessment. The Healthy Kids Check is such an assessment. A health assessment at this age will help ensure that children are healthy, fit and ready to learn when they start school. In particular, it will help with the early detection of lifestyle risk factors and delayed development, and illness such as vision and hearing problems.

The health check will also offer families guidance on healthy lifestyles and early intervention strategies. We know from research that opportunities such as these will be especially important for disadvantaged families, for a good education is so important in helping to break down patterns of disadvantage. The Healthy Start for School initiative will apply from 1 July 2011. Parents will need to confirm with Centrelink that the health check has been done. In exceptional circumstances, the new requirement may be waived—for example, when the child has severe disability or terminal illness.

The third and last election commitment in the bill will introduce a new, more accurate process for assessing income for child support purposes in place of the current policy that applies when a parent fails to lodge or is late with his or her tax return. Currently, the child support assessment for a parent in these situations is based on a figure equal to two-thirds of the male total average weekly earnings, a process that often leads to an understatement of the parents' actual income. The new process will achieve a more accurate child support assessment and, therefore, better support for children in separated families by generally using the assessment of the parents' last known taxable income, indexed by the growth in average wages. However, if the current process based on two-thirds of male total average weekly earnings would lead to a higher income, that process will be used instead.

In a measure from the 2010-11 budget, this bill will streamline the notification process when payments are made by compensation payers and insurers. These compensation payers and insurers will now need to tell Centrelink before compensation payments are made to compensation recipients or their partners. The new requirement will apply to lump-sum payments as well as to ongoing periodic payments. It will help to simplify the notification process to Centrelink and will help to make sure that people are paid their correct entitlements and avoid unnecessary overpayments.

Amendments will be moved to this measure as a result of consultation with the insurance sector. These amendments will avoid any risk of conflict with state and territory compensation laws surrounding grants and payment of workers compensation and will make the new arrangements easier for the industry to manage. The bill currently provides for Centrelink to be notified at least 14 days before the payment is made. The amendments will allow the secretary and the compensation payer to agree on an alternative period within which notice must be given. Lastly, some minor clarifications within existing policy will be made to several family assistance and child support provisions.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.