Steve Fielding (Victoria, Family First Party) Share this | Hansard source

It is with pleasure that I rise to speak in this debate. It is with great honour that I stand here to support the Defence Force Retirement and Death Benefits Amendment (Fair Indexation) Bill 2010. The issue of fair indexation for military superannuation is something that Family First has been campaigning on for some time now. In November 2009 I rose here to speak on the issue, and later also raised this issue with the former Minister for Veterans Affairs, Mr Griffin. Last year, I began a petition calling on the government to fix the unfair indexation of military superannuation on my web site. In just a matter of days it attracted thousands of signatures, highlighting how many people feel strongly about this matter. It is an issue I have followed closely, because it is something that I care about deeply.

Last year, I travelled to Afghanistan to see our diggers in action first hand, and witnessed the tough conditions they are forced to endure on a daily basis. Service in the Australian defence forces is no ordinary job. It is unique service which deserves special recognition. It is unique because when you sign up to the Australian defence forces you give the state, or the nation, the authority to send you overseas in a role where your life is at risk 24/7. We send our soldiers into dangerous areas that will put them in harm’s way. We ask our soldiers to follow through with their orders, even when they know that this may mean they might never see their family or friends again. It is an incredible situation to put oneself in, and it takes incredible people to do this. Given these circumstances and the uniqueness of their role, we as a society have an obligation to give them our full support and respect.

Unfortunately, when it comes to retirement and death benefits, both the former Liberal government and the current Labor government have not, I believe, honoured this obligation in the way we should. The current indexation arrangements for their retirement and death benefits are inadequate and put our military pensioners further behind community income standards. This bill seeks to rectify this inequality through a fairer indexation regime. At the moment, the Defence Force and superannuation pensions are only indexed to CPI, which is not always the best index. Even the Australian Bureau of Statistics has said:

The CPI is not a purchasing power or cost-of living measure.

CPI is just a measure of changes in the price of a basket of goods and services and should not be used as the only measure to index military pensions of our former servicemen and servicewomen. This is an outdated way to index pension payments because at the moment the true value of those military pensions is falling compared to the rising incomes of the general population. Even the government has admitted that CPI is not an appropriate measure for indexing the pension and has reformed other government pensions which were previously indexed to the CPI. These include the age pension, the wife pension, the disability support pension, the widows pension, the parenting payment, the carer payment, the services pension, the partner service pension, the income support pension and the war widows pension.

In the 2008 budget the government recognised that many seniors were concerned that their cost of living may rise faster than the consumer price index and to address this concern the government announced:

… the Government will guarantee that the Age Pension will increase in line with the higher of the consumer price index, increases in male total average weekly earnings or the living cost index for age pensioner households. These arrangements will ensure that the Age Pension keeps pace with increases in prices and improvements in community living standards.

So clearly the government has recognised this issue about indexation. I believe that our veterans should have their superannuation treated in a similar way. The military pension payments must be linked to the average wage, similarly to the way it is done for others, so that they do not slip below a certain percentage of any increase in the average wage.

This method of indexation makes a lot more sense and it is ridiculous that the government has not been prepared to budge on this issue. The current indexation arrangements have meant that military superannuation pensions are 35 per cent lower than they would have been if they had been linked to wage based indexation, such as the male total average weekly earnings, 20 years ago. This gap of 35 per cent works out to be an enormous amount of money and it would make a real difference to veterans. By not changing it, we not only seriously erode the standard of living for people relying on the payments but also send a terrible message that this is the way the government treats people who have given their all for Australia. This bill is about giving a fair go to those Australians who have put their lives on the line.

Now here is a key question: why should politicians have their superannuation payments indexed more generously than our veterans? I will say that again. Why should politicians have their superannuation payments indexed more generously than our veterans? Why should Federal Court judges have their pension payments indexed to increases in judicial salaries but military personnel have their payments linked only to CPI? Why should veterans be worse off compared to others? How does this possibly make sense? Clearly the sensible thing is for military superannuation pensions to keep pace with community income standards.

I understand from talking to others in the Senate that clearly the numbers are not going to be there to support this bill and I do not want to see this bill go down. There is a proposal for this bill to be sent to a committee, which may gain further support. I will reluctantly support an inquiry into this bill, hoping that we can then get the numbers to support this bill once the inquiry has finished and the committee has reported back to the Senate.