Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Link to this | Hansard source

This bill implements the adopted recommendations of the Campbell review of military compensation arrangements. The review was a 2007 Labor election commitment. Regrettably, it has taken six long years—or 120 days until the election—for Labor to conclude this. Clearly, veterans are not a great priority for this government. The review made 108 recommendations and the Labor government has adopted 94 of them. A further two will be enhanced. The total package is worth about $39 million over the forward estimates, at a net cost to the Commonwealth of about $17.4 million. There are 16 schedules, 13 of which deal directly to 13 recommendations of the review that require legislative amendments.

The Campbell review was chaired by former secretary of the Department of Veterans' Affairs Mr Ian Campbell PSM. It principally investigated compensation arrangements for the Military Rehabilitation and Compensation Act, the MRCA. By way of background, regrettably, in March 1996 outside of Townsville an Army training accident involving a Blackhawk helicopter led to the death of 18 personnel and the serious injury of a further 12. At the time it was found that the death and ancillary compensation arrangements for peacetime training accidents were inadequate. It followed the Tanzer review, which recommended a new modern compensation scheme be adopted for military personnel wounded, injured or incapacitated during their Defence service.

The previous coalition government consulted extensively about the legislation. It was tabled in parliament in 2003. At the time of its introduction former Minister for Veterans' Affairs Ms Vale said that the new bill combined the very best elements of the older Veterans' Entitlements Act 1986, the VEA, and the Safety, Rehabilitation and Compensation Act 1988. The new legislation placed a heavy focus on rehabilitation, encouraging those able to do so to re-enter the workforce following acceptance of conditions under the legislation. Unlike the older VEA, which pays a pension for life, the MRCA gave affected ex-service personnel and their families the choice of a lump-sum payment or enabled a mix of a lump-sum and weekly payments. Under this legislation eligible ex-service personnel continue to have their health care covered at Australian government expense. That is the history. That is where we came from.

In the election campaign in 2007 Labor promised to review the MRCA. However, despite their good intentions in 2007, suffice to say that the process has been slow. The review process began in 2008, and in February 2011 the government was handed the outcome. They did not formally respond until the May 2012 budget, and the introduction of the legislation in March 2013, five sitting weeks before the scheduled dissolution of parliament, is disappointing in the extreme.

When asked about the government's proposed time line, Parliamentary Secretary for Defence Senator David Feeney told Senate estimates that the pursuit of a non-existent budget surplus was more important than delivering improvements to military compensation sooner. It is disappointing for everyone.

We are pleased to see the review and that it has found that MRCA is operating soundly and is in need of only minor improvements. The improvements being made in this legislation are important. They have our support. Following the introduction of the legislation the coalition quite rightly initiated a Senate inquiry to ensure that the veterans and ex-service community, and indeed the wider community, had an opportunity to comment on this important legislation and its review. The wider the comment, the sounder the outcome. That is a lesson we should all learn. Submissions acknowledged that the proposed legislation mirrored the recommendations adopted by the government and for the most part supported its passage.

Our concerns—and they should be tabled—are that it has taken the government until now to partially adopt recommendation 25.1 regarding the extension of non-liability mental health care treatment to veterans and ex-service people. We also note that this entitlement will not be available until 1 July next year. Recommendation 25.1, and the position preferred by the Department of Veterans' Affairs, by Defence and by the independent analysis from Peter Sutherland, said that the government should consider providing non-liability health cover under MRCA for certain psychiatric conditions to all former members of the ADF and part-time reservists who have served after 1 July 2004. Typically, Finance, Treasury and DEEWR preferred a wait-and-see approach, saying that more information was required before a final decision was taken. You have had only six years: how much more information do you want? This occurred over the last 12 months and resulted in an announcement on 3 May in the Defence white paper of a limited increase in entitlements back to 1994, but only when the ex-service personnel had a minimum of three years equivalent full-time service. This $14.6 million extension, whilst welcome, is at odds with the original recommendation from DVA and Defence, and further information will be sought through the Senate estimates period coming up shortly. Similarly, the budget does not provide any funding for additional advocacy funding support, which unfortunately continues Labor's neglect of grassroots veterans advocacy in the community.

Labor's decision two years ago to strip $4 million from the BEST funding will only make it more difficult for younger veterans and their families to access independent advice and support for making claims. The government's announcement of additional taxpayer funds to reduce administrative process times in the department is surely an admission that their cuts to the BEST program and advocacy funding have had an impact on the timely determination of compensation claims, and I fail to see how it can be taken any other way.

The gaping hole in this budget was, however, the lack of commitment by this government to fair indexation. It is a fair point and it should be made. For those veterans and ex-service personnel and their families listening to this or reading it, let me reaffirm the coalition's commitment: we will deliver fair indexation in the coalition's first budget. The Leader of the Opposition has signed that pledge twice, first at the Bendigo RSL and second at Queanbeyan only one or two months ago, where I joined him for the signing, and personally signed myself to it.

If there is a change of government, the unfair, unjust and inequitable indexation arrangements facing DFRDB and DFRB military superannuants aged 55 and over will also change. This can only happen with a change of government. If elected on 14 September, in next May's budget we will deliver fair indexation—no ifs, no buts. Under our changes, on 1 July next year the pensions of those in DFRB and DFRDB will increase by the same factor as age and service pensions.

Having gone through the history of the bill and some of its flaws, and having reaffirmed the coalition's position on the indexation of military superannuation, it is important to look at the 16 schedules, 13 of which relate to adopted recommendations of the review.

As I said at the start of this, the coalition will provide the minister with support for the bill. Schedule 1 is on rehabilitation and transition management. The amendments enhance rehabilitation services and transition management. Chapter 7 of the review dealt with transition management between Defence and DVA. It found that a greater consistency in transition across the services is more likely if the CDF was coordinating transition rather than leaving it, as is the case, to the chiefs of each individual service. The amendments will also give part-time reservist personnel access to transition management assistance for the first time under any legislation, which is a good thing. These amendments will redesignate the responsibility of the service chiefs for the rehabilitation of our soldiers, sailors and airmen and airwomen to the CDF.

Schedule 2 is on compensation for permanent impairment. The amendments in schedule 2 make the date of effect for periodic impairment compensation to be on the basis of each accepted condition rather than all accepted conditions and to incorporate a lifestyle factor in the calculation of interim permanent impairment compensation. Under the current arrangements, compensation is paid only once all claims for compensation have been assessed. This has been found to be a somewhat lengthy process. By paying compensation from the date at which liability for each condition is accepted, compensation will flow to members and former members of the ADF presumably much sooner.

The schedule also relates to compensation offsetting arrangements. This amendment will grant those already assessed under the old offsetting formula the ability to have their compensation reassessed under the new compensation offsetting formula methodology. This is supported by the veteran and ex-service community and clearly by the coalition.

Schedule 3 will see expanded lump sum options for wholly dependent partners. The amendments expand the options for lump sum compensation for wholly dependent partners of deceased members. Chapter 9 of the review dealt with the death benefit provisions of MRCA. It recommended the simplification and streamlining of current arrangements. Currently, where a member's death is service related his or her wholly dependent partner is eligible to receive a lifetime periodic payment, a war widow or war widower pension, an additional death benefit, a repatriation health card for all conditions—let us call it a gold card—and a range of other benefits, depending upon their circumstances. This amendment simplifies the payment arrangements by combining the current age based lump sum, an actuarial calculation of the war widow or war widower pension against life tables and the additional death benefit to create a new combined lump sum, making the package simpler and demonstrably easier to understand. It will also give partners a choice of converting their pension into a lifetime lump sum or into 25 per cent, 50 per cent or 75 per cent as a lump sum, with the balance a weekly pension.

Schedule 4 is about weekly compensation for eligible young persons. The amendments put in place a one-time increase in the rate of periodic compensation payable for dependent children so that the rate aligns with similar payments under SRCA. In 2004, the rates of payment under MRCA were the same as those under SRCA. However, changes made in 2008 to SRCA broke this nexus, if we can call it that, and they increased dramatically. Currently, SRCA payments are about $130.89 a week, whereas the MRCA payment is about $87.57 a week. Aligning these makes sense.

Schedule 5 is about compensation for financial advice and legal advice, with the new limit rising to $2,400. In schedule 6, the amendments expand the eligibility rate for special rate disability pensions. The expanded criteria will include a person who would otherwise meet the criteria in section 199 of MRCA except for the person having received a lump sum incapacity payment under section 138 or for the person receiving a nil rate of incapacity payment because the amount of the incapacity payment is fully offset by Commonwealth superannuation. Schedule 6 does not relate to a specific recommendation of the review but rather an observation found in paragraph 11.43. The ex-service community strongly endorses these changed arrangements and they certainly make some sense.

The amendments in schedule 7 make changes to certain superannuation provisions so they apply equally to both serving and former members and amend the definition of 'Commonwealth superannuation scheme'. Chapter 12 of the review considered the interoperation of military superannuation and the military compensation arrangements. The committee noted that this was not an in-depth analysis but 'did note the complexities of administration of invalidity and death benefits' and recommended an analysis across government of how to streamline the administration of these arrangements. The government accepted this recommendation. But no information about the progress of this analysis has been forthcoming. Suffice to say, Minister, we will further examine it at Senate estimates. I ask the minister for further details on the progress on this particular recommendation.

Schedule 8 is about the remittal powers of the Veterans Review Board. They provide the Veterans Review Board with an explicit power to remit a matter to the Military Rehabilitation and Compensation Commission for needs assessment and compensation. The streamlining of the claims appeals process is certainly welcomed by the veteran and ex-service community. It will make it easier for veterans to appeal decisions about their compensation and give veterans with claims under MRCA largely the same appeals system as those under the VEA.

Schedule 9 amendments increase the membership of the Military Rehabilitation and Compensation Commission from five members to six. We note that the review recommends that the additional appointee be someone like the Director of Joint Health Command. Our view is that this would be for the most part a sensible appointment and we look forward to the government confirming this particular appointment to the compensation commission.

The amendments in schedule 10 require all claims for conditions accepted under the VEA and aggravated by Defence service after 1 July 2004 to be determined under the VEA rather than there being a choice offered between the VEA and MRCA, which is currently the case. We agree with all of that.

The amendments in schedule 11 will enable the issuing of repatriation health cards for specific conditions to part 11 Defence related claimants under SRCA—let us call them white cards. This initiative is intended to achieve consistency in treatment arrangements for all former Defence Force members. SRCA members with an injury accepted under SRCA as being related to SRCA—let us call that a SRCA related injury—will be entitled to treatment for a SRCA injury either under MRCA or the VEA in accordance with arrangements established under those various acts. This change is supported in principle. Concerns have been raised about the operation of these proposed new arrangements. Similarly, providers are worried that they will be forced to charge lower rates for services that they are currently providing at higher rates. DVA has informed us that the consultation with the industry is ongoing and this will be pursued at Senate estimates, Minister, to alleviate our concerns on exactly how this would operate. It sounds all right. The devil, as in many cases, will be in the detail.

The amendments in schedule 12 define Defence members undergoing career transition, personnel holding honorary ranks and authorised representatives of philanthropic organisations as members under MRCA. That is fair enough. The amendments in schedule 13 clarify the appropriation of costs for certain aged care services between VEA, the Australian Participants in Nuclear Test Treatment Act and MRCA and the Aged Care Act 1997 and the Aged Care (Consequential Provisions) Act 1997. That is fair enough.

The amendments in schedule 14 will extend the entitlements for travelling expenses to the partner of certain eligible persons under certain conditions. The VEA currently only provides for the veteran to be paid a travelling allowance when attending medical appointments to treat accepted conditions. In circumstances in which the veteran's attendant, a carer, needs to accompany the veteran, travelling expenses may be met.

The amendments in schedule 15 will clarify and streamline the administrative arrangements for the payment of pensions, compensation and other pecuniary benefits under the VEA and the MRCA into appropriate bank accounts. The amendments in schedule 16 include a minor and consequential amendment to the Social Security Act 1991 that clarifies which payments made under MRCA are excluded income for the purposes of the Social Security Act.

Suffice to say, the coalition is happy to support the passage of this legislation through the House. It will go to the Senate and be further considered at the end of June. We will not in any way seek to hold up the passage of the legislation, which we believe provides benefits to veterans, ex-service personnel and their families. We look forward, Minister, to the swift passage of the legislation through the House and the Senate, noting that there are only four and a little bit weeks left, of which two weeks are for the Senate estimates, which literally leaves only two weeks for legislation to be passed in the Senate. I will leave that to you, Minister, to sort through.

Jane Prentice (Ryan, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Veterans’ Affairs Legislation Amendment (Military Compensation Review and Other Measures) Bill 2013. This bill is a further step in implementing the recommendations of the Campbell review of military compensation agreements. It has taken two terms of this Labor government to conclude. That review was commissioned to investigate compensation arrangements under the Military Rehabilitation and Compensation Act 2004. The last coalition government tabled the legislation as a measure to improve previous legislation that covered military compensation—namely, the Veterans' Entitlements Act 1986, the VEA; and the Safety, Rehabilitation and Compensation Act 1988. The then coalition government consulted extensively about the legislation, which was tabled in parliament in 2003. At the time of its introduction, former veterans' affairs minister Danna Vale said that the new bill combined the very elements of the older Veterans' Entitlements Act 1986 and the Safety, Rehabilitation and Compensation Act 1988. The new legislation placed a heavy focus on rehabilitation, encouraging those able to do so to re-enter the workforce following acceptance of conditions under the legislation.

The most recent review process began in 2008 and has been very slow. In February 2011, the government was handed the outcome but did not respond formally until the May 2012 budget. I understand that the total package of amendments is worth over $39 million over the forward estimates, with a net cost to the Commonwealth of $17.4 million. This bill contains 16 schedules, 13 of which deal directly with the 13 recommendations of the review that require legislative amendment.

I have spoken several times before in this House on many issues that affect the veteran community. Although today's bill comprises mainly minor amendments, it is worthy of our consideration. I note that this particular bill was only introduced on 20 March 2013 and the coalition initiated a Senate inquiry to ensure that the veteran and ex-service community and the wider community had an opportunity to comment on the legislation.

I would also like to take this opportunity to thank the many constituents in my electorate who work tirelessly with ex-service organisations to get a better deal for veterans. This has been an ongoing issue for the veteran community across several ministers. For more than 12 years, Roderic Thompson in my electorate has held voluntary positions within both the RSL and the Veterans Support and Advocacy Service Australia. He has been a level 4 practicing advocate and has held the national executive position of National Entitlements Officer for the Australian Peacekeeper and Peacemaker Veterans Association.

One important measure is the adoption of recommendation 25.1 of the Campbell review regarding the extension of non-liability mental health care treatment to veterans and ex-service people, which will not be available until 1 July next year. In relation to today's bill, I know that Rod continues to have concerns about how we treat veterans who may fall under different versions of veterans compensation legislation—for example, whether a service man or service woman falls under MEA, SRCA or MRCA. This relates to recommendation 25.1 regarding the consideration of providing non-liability health cover under MRCA for certain psychiatric conditions to all former members of the ADF and part-time reservists.

Today I want to reaffirm my commitment and that of the coalition to fair indexation. The Leader of the Opposition first announced our commitment to fair indexation on 27 July 2010, more than two years ago and prior to the last election. Since then, the coalition in the Senate has introduced legislation so that we could finally and effectively deal with this issue. That was on 18 November 2010. On 16 June 2011, in what can only be called a day of disgrace for the Senate, the Labor Party and the Greens combined to vote down the coalition's fair indexation legislation. On that day, the Australian Labor Party and the Greens demonstrated that they do not care about the lives of military superannuants and their families.

Since then, the coalition has maintained its strong commitment to fair indexation. Last year, I signed the coalition's pledge to deliver fair indexation. This pledge has also been signed by the Leader of the Opposition on two occasions, the shadow minister for veterans affairs and many other members of the coalition, including my colleagues here today. That pledge says: 'The coalition will ensure DFRB and DFRDB military superannuation pensions are indexed in the same way as age and service pensions. All DFRB and DFRDB superannuants aged 55 and over will benefit.' This a firm coalition commitment and will occur in the first term of any incoming coalition government. The coalition will support the passage of this legislation through the House of Representatives. It will then go to the Senate and be further considered at the end of June. The coalition does not seek to hold up the passage of this legislation because it provides benefits to veterans, ex-service people and their families. I therefore commend the legislation.

Michael McCormack (Riverina, National Party) Share this | Link to this | Hansard source

It is always a pleasure to follow the member for Ryan, who I know has such a passion for and commitment to Defence people, not just within her electorate but also of all other electorates. I commend her for her work with the Boer War memorial commemoration. I know she is a descendant of a Boer War soldier, and full credit to her for pursuing that very noble cause. And her son is coming back from Afghanistan today, she tells me. That is wonderful news, and we wish him all the very best as he returns to Australia after such important work on behalf of our nation.

I rise to speak on the Veterans' Affairs Legislation Amendment (Military Compensation Review and Other Measures) Bill 2013. This bill implements the adopted recommendations arising from the Review of Military Compensation Arrangements. The review, a 2007 Labor election commitment, was finalised in early 2011 and the government responded in the 2012-13 budget. This is important, because our defence is critical to our nation. As the minister is here, I would like to note the $25 million in last night's budget for health services for veterans. That provision is for returned servicemen and women, for peacekeepers as well as for people engaged in humanitarian relief efforts. It is very important that the government has set aside $25 million to help meet this need in the 2013-14 budget. That is commendable.

Not commendable is the fact that in last year's budget $5½ billion was stripped out of the military, and I know what effects that had in my electorate. I come from the tri-service city of Wagga Wagga, where every soldier recruit goes through the Blamey Barracks at Kapooka. We also have a Royal Australian Air Force base at Forest Hill at which there is also a Navy base, even though we are a good 350 kilometres from the nearest drop of seawater. It is a very important naval institution and training base, working in coordination with the very important Army and Air Force bases in Wagga Wagga. May their work long continue.

As I said, in 2007 Labor promised a thorough review of military compensation arrangements, specifically focused on the Military Rehabilitation and Compensation Act 2004. This review, which was chaired by the then Secretary of the Department of Veterans' Affairs, Mr Ian Campbell PSM, found that 'the objectives of the MRCA are sound.' It also confirmed that the unique nature of military service justified rehabilitation and compensation arrangements specific to the needs of the military. The military is a unique organisation; it is a unique sector, as we all know. The review made 108 recommendations, of which 94 were adopted in full or with modification enhancement, with a further two recommendations replaced with favourable outcomes. Nineteen of the recommendations need legislative amendment and are covered by 13 schedules in this bill. The bill has a net cost of $17.4 million. The total package of reforms will cost $39.6 million, offset by savings of $22 million through the provision of treatment cards to SRC Act clients.

The coalition supports this. We did, however, insist that a Senate inquiry into the legislation be conducted. The coalition requested that all members of the Ex-Service Organisation Round Table be contacted about the review and invited to make a submission, because we felt that was necessary. We also know that all too often this Labor government rushes legislation through this parliament without the proper consultation of industry, without the proper consultation of stakeholders.

The committee has reported to the Senate. Submissions were received from the Royal Australian Air Force Association, the Returned and Services League of Australia, the Australian Peacekeeper and Peacemaker Veterans Association, the Defence Force Welfare Association, the Department of Veterans' Affairs, the Office of the Australian Information Commissioner, the Financial Planning Association of Australia, Slater & Gordon Lawyers, KCI Lawyers, Mark Raison and John Goldsworthy.

So, the stakeholders have been consulted; the committee has reported to the Senate; the coalition is giving in-principle support; and, finally, while the minister is present and whilst I have acknowledged that there is $25 million for the mental health welfare of returned servicemen and women, and others, I would again implore this government in the weeks and months remaining to look at a fair indexation legislation for our returned veterans. They put their life on the line for this nation. They are not being properly indexed. The coalition has said that it will properly and fairly index DFRB and DFRDB recipients. They need to be indexed to the same level as aged and service pensions. They are not at the moment. It is a disgrace—indexation is necessary.

I know how much Robert Bak, who lives in Bethungra in my electorate—he is the head of the Integrated Service People's Association of Australia—wants this particular fairness to be enacted for the veterans who he serves. And I know how passionate he is—like the member for Ryan—about our veterans and the efforts they have gone to on behalf of this country. All too often when they return to Australia the financial aspect of their life is ignored by this government. We look forward to a coalition government, hopefully after 14 September, which will properly index those veterans' superannuation entitlements.

Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Link to this | Hansard source

I thank all of those who have made a contribution to this debate. I know that there is uniform support for this legislation—I will go to the comments on military indexation at a later part—but I want to make an observation about the reference to the Senate committee. There was a very extensive consultation around the review and during the course of the review. DVA met with the ESAs in March of this year to discuss the outcome of the review and this legislation. There has been considerable discussion through the process and whilst we have no difficulty with having a Senate committee, in terms of the requirement for additional consultation, it is not necessary.

Having said that, the measures in this bill, as others have said, will enhance the repatriation system in providing access to compensation and health care for our Australian Defence Force members, former members and their families. The bill will achieve this mainly through amendments to the Military Rehabilitation Compensation Act 2004 otherwise called, in short, the MRCA. The MRCA provides rehabilitation and compensation for injuries, diseases and deaths caused by all types of military service on or from 1 July 2004. These amendments will ensure that the MRCA, as the act covering all contemporary defence service, continues to best meet the needs of our members and former members now and into the future.

These amendments are the result of an extensive Review of Military Compensation Arrangements and involve comprehensive consultation with the defence and veterans communities. The report concluded that the objectives of MRCA are sound. Importantly, it also confirmed that the unique nature of military service justified rehabilitation and compensation arrangements specifically to the needs of the military.

The initiatives in this bill form part of the government's response to the Review of Military Compensation Arrangements. The introduction of a repatriation health card for specific conditions, known as the white card, will benefit former members of the Australian Defence Force with conditions accepted under the Safety, Rehabilitation and Compensation Act, or SRCA, needing long-term treatment. SRCA members issued with a white card will no longer need to claim reimbursement for treatment costs related to their SRCA injury or ask their healthcare provider to invoice the Department of Veterans' Affairs. This measure will streamline arrangements for treatment for SRCA members and will result in a consistent method of access for all former members of the Australian Defence Force with long-term treatment needs.

The bill will give wholly dependent partners of deceased members more flexible options for the compensation payments provided under the MRCA. Instead of a single choice between receiving ongoing compensation payments or a lump sum payment, from 1 July 2013 wholly dependent partners will be able to choose to convert 25 per cent, 50 per cent, 75 per cent or indeed 100 per cent of their periodic compensation amount to an age based lump sum payment. This increased flexibility will enable a wholly dependent partner to better meet their immediate and long-term financial priorities and applies to the future partners and existing partners who are yet to make their choice as to how to receive their compensation.

The amount of compensation paid for financial advice will be increased for those persons who are required to make a choice under the MRCA about the nature of the benefits they receive. The maximum compensation available will increase from $1,592 to $2,400 and legal advice related to that choice can be also covered within the new limit. There will be a one-off increase to the rate of ongoing compensation for eligible young persons under the MRCA to match the rate payable for a dependent child under the SRCA—an anomaly we are pleased to have fixed.

Rehabilitation and transition management services under the MRCA will be enhanced to improve consistency across the three branches of the Defence Force and increase flexibility and rehabilitation management. Improved consistency will be achieved by giving the Chief of the Defence Force overarching responsibility for rehabilitation of serving members, which we think is fundamental. Transition management services will also be made available to part-time reservists.

The bill will allow payment of compensation for permanent impairment for claimants with more than one condition accepted under the MRCA. Additionally, DVA will make greater use of the payment of interim permanent impairment compensation and will be able to include a payment for an imputed lifestyle effect when determining the level of interim compensation payable, which will result in increased compensation payments.

From 1 July 2013 the eligibility criteria for special rate disability pension under the MRCA will be expanded to include certain persons who are not currently eligible because the person converted their incapacity compensation payments to a lump sum or because the incapacity payment is fully offset by Commonwealth superannuation. As a result of this measure, the person will also be entitled to additional benefits that are associated with the eligibility for special rate disability pension including a gold card, education assistance for eligible young persons and a MRCA supplement.

Amendments in the bill will simplify the claims process for conditions accepted under the Veterans Entitlement Act that are aggravated by service covered under the MRCA. Currently, a person must choose whether to claim the aggravation under either the VEA or the MRCA. If this sounds complicated, it is. Currently, they must make a choice.

The existing process is complex, resulting in confusion for clients and is administratively resource intensive. From 1 July 2013 a simplified arrangement will be introduced resulting in all such claims being determined under the VEA. The initiatives in this bill are the result of a comprehensive review of our modern repatriation system and will result in improved outcomes for many in the defence and veteran communities. They clearly demonstrate the Australian government's support and high regard for our Defence Force members. It is a credit to successive governments that the review concluded that our repatriation system required only relatively minor legislative adjustments to meet the ongoing needs of veterans and serving and former members and their families. These changes will continue this country's proud tradition of caring for those who served and the families of those who have fallen.

Briefly, I will refer to the comments which have been consistently made about indexation of military pensions. The first observation is that people are linking a superannuation payment—an entitlement as part of their employment—to income supplements or income support payments as a pension, which they are not. They are in no way equivalent to a pension; they are a superannuation benefit. I think people are either deliberately obfuscating or confusing the two issues.

I am not going to go to the merits of the arguments because I do not agree with them, but I do want to make one observation. I think the member for Riverina gave the impression that this proposal for indexation was about the impact on the lives of people who are currently serving. In fact, nothing could be further from the truth. This will not impact at all on at least 150,000 serving men and women who are under the current MSBS superannuation scheme. They will not be impacted at all.

I had a meeting quite recently with a senior, very venerable returned serviceman who was in discussion with a very venerable serving man who has recently come from Afghanistan. The retired veteran said to me, 'What are you doing about our pensions?' I said, 'We're not doing anything about your pensions.' He said, 'Well, you need to.' I said, 'Why?' He said, 'It's all about these young blokes.' This young serving veteran said, 'No, it's not. It has no impact upon us at all.' Let us understand what is happening here.

This is about dealing with a retirement benefit which people could take after 20 years of service. Many took it in their early 40s, got a lump sum and an annuity for the rest of their lives, and they are now asking the Commonwealth to index that lump sum to the equivalent of a pension, which it is not. Let there be no confusion here. I am surprised at the dishonest way in which this debate has been repeated around the country by some elements of the returned services community and promoted by the opposition as if in some way it is going to impact upon current serving veterans. It is just really dishonest. I would say to them: I have no problem with you having the argument but let us be clear about the intent, who it is meant to address and who it is going to exclude. We do not agree with you. You have got every right to promote your view, but let us do it in a way which actually demonstrates very clearly who you are talking about rather than confusing the discussion about this indexation as if it is going to impact upon people who are MSBS members because it will not. That is all I have to say, and I am pleased that the opposition has chosen to support the legislation.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.

Ordered that this bill be reported to the House without amendment.