Don Farrell (SA, Australian Labor Party, Shadow Minister for the Centenary of ANZAC) Share this | Hansard source

Why do I say that? One very obvious reason is that the rating agencies which tend to downgrade governments that have a genuine budget crisis continue to give the Australian government a AAA rating. If we were in a budget crisis, Acting Deputy President, I know that you would know that our rating would be downgraded. When you compare our deficit situation compared to GDP with any of the other countries which ordinarily you would make comparisons with, we are just not in the same league. We do not have a debt crisis the way some of these other countries do. I know that you know that. I suspect the rest of the government knows that. But you have made up this manufactured story in order to put through what I think are ideological changes.

As you know, for the next couple of weeks my job is to represent veterans in my shadow capacity as spokesperson for veterans' affairs and the Centenary of Anzac. As part of those duties, I have been running around the countryside talking to veterans. I went down to Launceston with the RSL. I went up to Coffs Harbour with the RSL. I have been over to Ingleburn with the Vietnam veterans. At every one of these meetings, do you know what these veterans, these people who have risked their lives for this country, have said to me? I will tell you. I can see you. The camera cannot record that you shook your head, but you said no. I will tell you what they are saying to me. They say, 'We're not opposed to this two per cent temporary levy on high-income earners. It doesn't affect any of our people so we're not opposed to it. But do you know what the government is proposing to do to us and in particular to our veterans pension? From 1 September 2017 they're proposing to remove the concept of fair indexation.' What is the concept of fair indexation?

In the past, pensions were indexed based on CPI and it was generally believed, certainly by the former government, that that did not necessarily reflect the costs associated with the basket of goods that pensioners would buy. So in government the Labor Party broadened the measure by which pensions would be indexed. We looked at three potential measures or guides to determine it. CPI was obviously one of them, average male weekly earnings was another and a separate basket of goods which more closely reflected the sorts of things pensioners buy was the third. The structure we put in place in government was that we said that in the twice-yearly indexation of pensions we would look at those measures and pensioners would then get the highest of those. As an aside, you might be interested to know that the CPI would only be the highest of those three measures once in 10 times. The rest of the time, the other two measures would be higher. So pensioners would get the benefit of that higher rating. So over a five-year period with two increases each year there would be only once when the CPI would be the measure. From 1 September 2017 that is all that pensioners and in particular people who are recipients of veterans pensions are going to receive by way of the increase.

How many people are we talking about? I notice you are shaking your head again, Deputy President Bernardi. I asked this question of Mr Lewis, the secretary, at the estimates two weeks ago. The answer is this. There are roughly 330,000 veterans pensions paid to 280,000 veterans—a very significant number of Australians who have put their lives on the line to defend their country. I noticed on the weekend that Mr Abbott is talking about going back into the Iraq.