Jenny Macklin (Jagajaga, Australian Labor Party, Shadow Minister for Families and Payments) Share this | Link to this | Hansard source

I am pleased to be speaking on the Social Services Legislation Amendment (Cost of Living Concession) Bill 2015. This new cost-of-living concession bill has arisen because the South Australian Labor government has provided welcome support for pensioners, concession card holders and other low-income Australians. It consists of a $200 per year payment to help pensioners and concession card holders with cost-of-living pressures. This bill introduces a measure to exclude the cost-of-living concession payment made by the South Australian government from being assessed as income under the social security and veterans' affairs income tests—so Labor supports this bill. We support the bill because it is good for South Australian pensioners.

Let me say on the record today that we very much welcome the South Australian Labor government's decision to stand up for pensioners and vulnerable Australians. We know that this Liberal government certainly never would. We know the Liberal government here in Canberra has cut money to pensioners, and this is the reason why this new payment is being made to pensioners in the first place. Let us get the facts right about South Australia.

Mr Williams interjecting—

Let us let us get the facts right about what this member, in South Australia, actually voted for. He voted for a cut to the indexation of the pension. Thank you to the member for Hindmarsh for his interjections, so I can remind all of the voters in Hindmarsh that he voted for a cut to the pension that would have amounted to an $80-a-week cut over 10 years. That is what the member for Hindmarsh voted for. That is exactly what he voted for. He also voted to increase the age pension age to 70. I hope the voters in Hindmarsh are listening and that they know that the member they voted for at the last election broke the promise that was made before the election that there would be no changes to pensions. The pension indexation cuts were voted for by each and every member of the Liberal and National parties, including the member for Hindmarsh.

The reason we are here today is that the Liberal government's 2014 budget, which was supported by the member for Hindmarsh, included a cut of $1.3 billion—$1.3 billion ripped out of the pockets of pensioners. We know what that would have meant if the South Australian Labor government had not helped pensioners out. It would have meant a cut to the concessions that pensioners rely on for essential services like electricity, gas, transport fares and council rates. All pensioners would have been worse off because of the Abbott-Turnbull government's cuts in the 2014 budget that the member for Hindmarsh supported. I see that the member has gone a bit quiet.

Matt Williams (Hindmarsh, Liberal Party) Share this | Link to this | Hansard source

You aren't worth listening to!

Jenny Macklin (Jagajaga, Australian Labor Party, Shadow Minister for Families and Payments) Share this | Link to this | Hansard source

He wants another go! Keep interjecting, because I will keep reminding people what you voted for—that you wanted each and every one of the pensioners in Hindmarsh to be $80 a week worse off. The recent cut in the assets test also went through this House with the vote of the member for Hindmarsh. There was no warning before the last election. That was yet another broken promise by the member for Hindmarsh. Don't worry: all the pensioners in Hindmarsh know all about it.

Last year, we had a different Treasurer who liked to go on about lifters and leaners. No doubt the member for Hindmarsh agreed with the previous Treasurer that somehow the pensioners in Hindmarsh were leaners and deserved to have their pension concessions cut. The South Australian Labor government did not agree with that view. Labor did not agree with that view. We think that pensioners deserve support. That is why Labor governments do things to help pensioners and not the reverse.

Everybody here wants to try to forget that the Liberals tried to cut $1.3 billion from pensioner concessions. But I remind the member for Hindmarsh and every single member of the Liberal and National parties that pensioners have not forgotten. They have not forgotten. They know that each and every Liberal and National Party member of this parliament voted for the $80-a-week cut to the pension over the next 10 years with reductions to pension indexation. Pensioners will not forget that. They will not forget that this government wants to increase the age pension age to 70, which would mean that this country had the oldest pension age in the developed world.

Pensioners also will not forget that this Liberal government tried to cut the deeming thresholds for pensioners, which is another way to cut the pension. The member for Hindmarsh voted for that as well. Pensioners certainly will not forget the latest Liberal Party betrayal, which was the cut to the pension assets test. Three hundred and thirty thousand pensioners across Australia, quite a few of them in the member for Hindmarsh's electorate, are all going to be worse off because of this latest cut to the pension.

Labor opposed these measures. We understand how important it is to support pensioners. We understand just how critical it is, wherever pensioners are living. Whether it is Hindmarsh or in other parts of Australia, pensioners know that the only party that they can rely on is the Labor Party. It was the Labor government that delivered the most significant increase to the pension since the age pension was first introduced, more than 100 years ago, and it is only Labor that will make sure that pensioners are better off.

Pensioners understand that they have been completely lied to by Liberal Party and National Party members, including the member for Hindmarsh, who told them before the last election that they would have no changes to their pension. Plainly, that is not true. Pensioners in South Australia are very pleased that the South Australian Labor government has provided this new $200 payment to pensioners. Labor, in the federal parliament, welcomes this measure and it also welcomes the exclusion of this income from the means test for social security and veterans' affairs payments.

Tony Zappia (Makin, Australian Labor Party, Shadow Parliamentary Secretary for Manufacturing) Share this | Link to this | Hansard source

I support all of the comments made by the member for Jagajaga in respect of this matter. I welcome the opportunity to speak about the Social Services Legislation Amendment (Cost of Living Concession) Bill 2015. As the member for Jagajaga has just pointed out, Labor will be supporting this bill. The bill, effectively, excludes the cost-of-living concession payment made by the South Australian government from being assessed as income under the social security and veterans' affairs income test.

As has just been pointed out by the member for Jagajaga, and write quite rightly so, in their first budget after the 2013 election, the coalition government abolished the National Partnership Agreement on Certain Concessions for Pensioner Concession Card and Seniors Card Holders. They did so without, at any time in the lead up to the 2013 election, telling pensioners across Australia that they would be doing that. They did so after having told pensioners and given them the assurance that there would be no changes made to pensions in this country. Yet, on coming to office, one of the first things they did was cut payments and support measures for pensioners in a range of areas—which I will get to in a moment—particularly with respect to the national partnership agreement that had been in place since 1993.

This was an agreement that had been honoured in the past not only by Labor governments but also by the Howard government throughout all of its term in office and, at no stage, had the Howard government suggested that it should not honour that agreement. Yet this coalition government, on coming to office, not only walked away from the agreement but also, in doing so, walked away from pensioners and hid behind the pathetic excuse that the concessions funded were state government responsibilities. The member for Hindmarsh, which the member for Jagajaga quite rightly alluded to, not only supported the cuts made but also stood up here and defended the cuts being made, saying that these were responsibilities of the state governments. It is notable that there is no single member of the coalition that even wants to speak to this bill.

Let me go to the background of where the $1.3 billion that was cut by the coalition arises from, because the national partnership agreement, as I said a moment ago, goes back to 1993. The origins of it are this—and these are not my words, these are the words of the Parliamentary Library:

The NPA had its origins in a decision by the Australian Government to extend access to the Pensioner Concession Card (PCC) to all pensioners, including part-rate pensioners, from 1993.Eligibility for concessions provided by the state and territory governments is linked to the PCC. Therefore the cohort of pensioners eligible for concessions expanded. Recognising this, the Australian Government agreed to provide funds to the states and territories to cover some of their increased costs from 1993. The formal 1993 agreement allocated set amounts to each state and territory, to be indexed and adjusted for growth in state pensioner populations over time. The Australian Government funding would be in the form of a Specific Purpose Payment, requiring states and territories to provide an agreed set of concessions on essential services to all pensioners.

That makes it absolutely clear that the payments were made to the states because the federal government wanted to expand the program.

In wanting to expand the program, the states quite rightly said, 'We are happy to do that if the federal government funds the expansion.' The federal government at the time did so and the states secured that commitment through an agreement—and 20 years later, this coalition government is the first government to walk away from that agreement. It is a shameful act given that this was a clearly set out and negotiated arrangement between the federal government and the states. For members like the member for Hindmarsh, and other South Australians who have come into this place, to try to claim that these were state government responsibilities not only shows that they were prepared to walk away from the pensioners of South Australia but shows their complete ignorance of the background to this concession payment.

The South Australian government, to its credit, introduced a $200-a-year payment to offset the federal government's cuts. The payment will offset cost-of-living pressures such as council rates and electricity, gas and water bills. Previously, council rate support was provided through a direct concession that appeared on council rate notices each year—an amount of $190. In its first year, the cuts meant a hit of about $28 million for South Australia, with that amount projected to rise each subsequent year. The state government decided that a better way of managing this matter would be to provide a direct payment of $200 to the eligible recipients each year and allow them to manage their finances as they saw fit. If a person has a pensioner concession card, a Veterans' Affairs card, a low-income healthcare card or a Commonwealth seniors healthcare card, they will be able to access the $200—or part thereof, depending on their income. It will also go to people who are on Newstart allowance, sickness allowance, widow allowance, youth allowance, partner allowance, parenting payment, bereavement payment or special benefits, as well as to Community Development Employment Program recipients, ABSTUDY recipients, Austudy recipients and people who are on the New Enterprise Incentive Scheme. That is my understanding of who may be eligible for the $200-a-year payment.

In the past, because the state government directly funded the concession through the $190 that went to council rates, the $190 was not assessed for income purposes for the recipients of that payment. Because it is now a direct payment, we need to ensure that that continues to be the case. In other words, recipients should not be penalised for receiving the support as a direct payment when it is replacing a cut made by the federal coalition government to support that was previously not considered as income. This bill does exactly that and of course we support it.

The bill also goes to the heart of the attack on pensioners by this government. As I mentioned, the member for Jagajaga has quite rightly pointed out the range of cuts this government has tried to introduce—in most cases unsuccessfully—since coming to office with a direct impact on the income of pensioners in this country. For South Australia this is an important issue, because South Australia has an ageing population. The figures suggest that there are more older people in South Australia than in most other states. This is especially true of Hindmarsh. I am well aware, through my discussions with my good friend and former colleague, the former member for Hindmarsh, Steve Georganas, that the pensioner community in Hindmarsh is considerable—and they were very concerned about this cut when it was made.

It was not just the pensioner concessions. If it were, the government might have been able to sweep it under the carpet. The truth is, this was a government that tried to balance its budget on the back of the lowest income families in this country, and that includes pensioners, many of whom really found it tough to make ends meet. The $190 cut to their council rates has now been replaced by the $200 a year payment from the state government. I have spoken with some of those people in my own electorate at a one-on-one level, and they are very genuine when they say that it will make a difference to their income levels. I can recall the debate in South Australia when the state government decided to make the payment and the welcome relief that was clearly evident across the pensioner sector as a result of the state government having agreed to make the payment. In the first year the South Australian government simply funded the $190, but then they introduced the payment as an ongoing measure, and that brought the relief that people were looking for.

This goes to the heart of how pensioners have been treated in this country, and certainly in South Australia, by the federal coalition government. We not only saw the cuts made as a result of the $1.3 billion being slashed from the states for this purpose but then we saw this government try to increase the Medicare co-payment, starting at $7 and then going to $5, and then it put a freeze on the doctors' MBS payments. All of these measures go to the heart of the income of pensioners. We acknowledge time and time again in this place that our pensioners, for one reason or another, quite legitimately have to go to the doctor on a regular basis. Every time they do, these additional costs impact on their ability to continue to make ends meet, yet this government decided that that was something it wanted to do. Then by changing the assets test, supported by the Greens, some 330,000 current pensioners also had their incomes affected. Again, I have had people contact my office, and my constituents have contacted me, saying that this is not fair and it will affect their income.

We have a government which, whichever way you turn, has decided that pensioners are easy pickings. Can I say to the members opposite, to the Member for Hindmarsh, who is sitting in the chamber right now, that I am sure he knows full well that the pensioners in his electorate are not happy with the way this government has treated them. They are not happy with the fact that, prior to the election, they were told that there would be no cuts made and ever since we have seen one form of cut after another being made; they are not happy with the fact that they are being asked to tighten their belts to find cuts out of their meagre income each year whilst the big end of town is allowed to go scot-free and continue in many cases to make huge profits and pay very little tax; and they are not happy with the fact that this government is playing off one sector of the community against another.

I want to conclude with this comment: the state government in South Australia, the Weatherill government, to its credit worked through this issue methodically and carefully. There was a long debate about it at the time—it went on for several months—and the state government decided that it would best manage this program by allocating a direct payment of $200. It did so because it knew that there were some current anomalies in the system of who was entitled to council concession rates and who was not, particularly with respect to those people who might have been living in what we call housing trust homes in South Australia. It came to the conclusion that the fairest way to support pensioners, concession card holders and welfare recipients in South Australia was to give them a direct payment of $200 and allow them to choose how they would use it to offset their cost-of-living expenses. Of course it is a direct payment to them, and the thing we do not want to see is that money being treated as income, which in turn will affect their income. If it is assessed as income it will affect the income they might receive as their pension payment and the like. As the member for Jagajaga has quite rightly said, we support this measure because it simply puts into effect the intent of the $200 payment.

Finally, I will say this: not one of the coalition members opposite has decided to come in and speak on this motion. I am not surprised about that because the truth of the matter is that they would be speaking on a matter which they instigated and which they are responsible for—a $1.3 billion cut to pensioners across this country. But it also highlights, in my view, the fact that, whilst they might publicly say they care about pensioners, they do not even have the courage to come in here and speak about pensioners or take a stand on behalf of them, and that is shameful. With those comments, once again, we support this measure.

Christian Porter (Pearce, Liberal Party, Minister for Social Services) Share this | Link to this | Hansard source

This Social Services Legislation Amendment (Cost of Living Concession) Bill 2015 will exclude the cost-of-living concession payment made by the South Australian government from being assessed under the social security and veterans' affairs income test. I thank all the members opposite for their contributions and for their admonitions that someone courageously speak, which I am very happy to do. But I would note that, as a preliminary matter, this a beneficial measure for certain people—

Jenny Macklin (Jagajaga, Australian Labor Party, Shadow Minister for Families and Payments) Share this | Link to this | Hansard source

Minister, you have to.

Christian Porter (Pearce, Liberal Party, Minister for Social Services) Share this | Link to this | Hansard source

Well, indeed, but it still takes a bit of courage. This is a beneficial measure for certain people who will be receiving new payments. You might have been confused, Mr Deputy Speaker, as to whether this is a beneficial measure, after hearing members opposite, but it is indeed a beneficial measure. If I might, just by way of summing up, explain why.

From September 2015, the South Australian government is introducing a new cost-of-living concession payment. That payment will replace the South Australian council rates concession, which was previously a discount on rates bills. That measure ceased on 1 July 2015. Under the old South Australian council rates concession, eligible people received a $190 per annum rates discount. Now, the new cost-of-living concession payment that will be operative in South Australia will be a direct payment to eligible people rather than offering, as was the case under the old system, a discount off people's rates bills, which was the previous way the South Australian council rates concession operated.

There are two elements to the new South Australian cost-of-living concession payment. The first element of the cost-of-living concession payment provides an annual $200 direct payment per household to pensioners, other income support recipients and low-income earners who are homeowner-occupiers. Self-funded retirees in receipt of a Commonwealth seniors card will receive an annual $100 direct payment per household under the cost-of-living concession payment in South Australia. The second element of the South Australian cost-of-living concession payment is that support has been extended to include tenants, whereas the previous council rates concession was solely limited to homeowner-occupiers. Under the cost-of-living concession payment, pensioners, other income support recipients and low-income earners who are tenants will be able to receive an annual $100 per household direct payment. So, well done to South Australia in undertaking its obligations in this regard.

The Commonwealth, providing this income test exemption, the subject of the present bill, is consistently acting with the income test exemption that was put in place for the Western Australian cost-of-living rebate scheme in 2012—in fact, a scheme I remember well because it was enacted by an excellent Treasurer at the time!

Jenny Macklin (Jagajaga, Australian Labor Party, Shadow Minister for Families and Payments) Share this | Link to this | Hansard source

Self-praise is no recommendation!

Christian Porter (Pearce, Liberal Party, Minister for Social Services) Share this | Link to this | Hansard source

I think, members opposite, it was actually Mike Nahan, at that stage, so don't get too excited. If an income test exemption was not granted for the cost-of-living concession payment then some recipients of the payment, in particular part-rate pensioners, could be disadvantaged compared to current arrangements. They could receive the similar level of assistance from the South Australian government via direct payment rather than as a discount off their rates bills, but the Australian government pension would be reduced. So, essentially, the bill exempts the new payment from being assessed as income for social security and veterans' affairs entitlements purposes.

If I might just roughly summarise: the previous South Australian system, being a discount, never fell into the assessable category of income for social security and veterans' affairs entitlements purposes, that having been transformed into a direct payment could possibly have been assessed as income; this bill ensures that it will not be and is thereby a beneficial bill to pensioners in South Australia. The bill ensures that people's social security and veterans' affairs income support payments are not affected by receipt of the new payment and, therefore, that they receive the full benefit of the cost-of-living concession payment that the South Australian government has enacted. Again, I thank all the members opposite for their contributions to this debate.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.