Alan Griffin (Bruce, Australian Labor Party) Share this | Link to this | Hansard source

Today in question time the Prime Minister once again sought to try to justify the government's position on pension indexation by saying that the pension will not be cut. But let us be really clear about what that means and what the real answer is in this area. Pensions at the moment are indexed against three different indicators: male total average weekly earnings, the consumer price index and a thing called the PBLCI, the pensioner and beneficiary living cost index. Governments of both persuasions have always accepted the view that you accept whichever one provides the best outcome when you do the review, which is done on a six-monthly basis.

As we all know, the cost of living increases over time but the level of increase may vary. What that means is that you need to maintain the value of pensions in order to take into account that growth. No-one says the pension gets cut, but the value of the pension will be cut, because the value of the pension will fall out of kilter with the changes in the cost of living—and the figures that have been put forward by organisations in the community say it will be by as much as $80 a week over the next few years. Also, according to the government's own report, the pension's current value, of 28 per cent of male total average weekly earnings, will go down to 16 per cent of male total average weekly earnings. This is a disaster for pensioners and those who rely on benefits in our country. (Time expired)