Cory Bernardi (SA, Liberal Party) Share this | Hansard source

Although, I do not get a pension. But that is not the point. The point I would make is that there were going to be less people working to sustain an ageing population. That means that we have got to look at how we can make important reforms to make the pension and other benefits available sustainable. Without policy reform, the cost of the aged pension is projected to increase by over 70 per cent for the next decade. That means it is going to go from around the $40 billion figure that I told you today to around $68 billion in 10 years' time.

It is worth reminding ourselves that when the aged pension was instituted in 1909, it had an eligibility age of 65. At that point, the average life expectancies for Australians were 55 years for men and 59 years for women. The aged pension kicked in after about 10 per cent extra on life expectancy. Over the past century, I am very thankful that the average Australian life expectancy has lengthened by about 25 years. But with that has come an assortment of more people being on the aged pension for a longer period of time than ever was conceived of in 1909. Also, it adds significantly to our medical bills. They contribute enormously to our quality of life and the general fabric of society, but we cannot deny the realities that with all the benefits comes a substantial amount financial cost. No-one I know wants to rein in the benefits of medical technology, but all of these things need to be put on a sustainable footing.

That is what this bill seeks to do. The budget does not actually cut the aged pension. It is going to continue to increase twice a year to keep up with the cost of living. I think that is absolutely important. But there are structural changes and these are sort of far-sighted, visionary changes that I think are truly important to the future of the country. That is because we need to make sure that payments of this type are viable into the future.

I would just like to touch on some of the changes that have been incorporated into the Social Services and Other Legislation Amendment Bill. They are far-reaching, which is why there is such a substantial amount of debate on this. Firstly, there are some changes to indexation and payment rates. This bill contains several measures that make changes to the indexation of government benefits. There is a lot of toing and froing and hopping and puffing about these sorts of things, but ultimately these changes are designed to help reduce debt.

That is meant to help put Australia back on a more sustainable economic and fiscal footing without reducing payments. That is a very important thing for the Australian people to understand. It is designed to help reduce debt, but not reduce your payments. There are income and asset free areas for all working age allowances and parenting payments, with the exception of student payments. They are going to remain at their current levels for three years. Once again, it is important measure of sustainability.

Also, there are certain family tax benefit income thresholds that are going to remain at their current levels for three years. That is, until 2017. Once again, we are asking people to absorb some of the pain in the interests of making things sustainable. The bill also ensures that single parenting payments are indexed because the consumer price index. This will deliver savings, but at the same time it is going to ensure that payments for single parents do keep up with the cost of living. These measures alone—the changes to indexation and payment rates—will ultimately save the budget nearly $1.2 billion over the forward estimates. They are not without some inconvenience for people, because the cost of living does continue to rise. If you freeze benefit payments, it is going to impact people. But we are asking everyone to shoulder a little bit of the burden so that no one group has to shoulder a heck of a lot of it.

There is no more important group—it is always a risk saying that. My sympathy and empathy does not go out to any group as much as it does to those who are living with a disability. I think that goes for many in this place. It is incredible to think of the hardship that they endure themselves, as well as what their carers endure. The benefits that so many deserve have been redressed or addressed in this place through the work of Senator Fifield, as the former shadow Minister for Disabilities, and the National Disability Insurance Scheme and others. We recognise it is very important thing.

But there are some changes to the disability support pension, which will help support young people with disabilities to enter the workforce if they are able to do so. I think that is a very, very good aspiration to have. That is because the government, to their credit, recognises that people with disability who are able to participate in the workforce have better long-term outcomes if they do actually engage in work. The social, economic and health benefits of active participation should never be understated. That is why compulsory work-focused activities—such as work experience, education, training and job searching—will help some DSP recipients, those principally aged under 35, to find and keep a job. What an important experience that is.

Some DSP recipients aged under 35 will also have their work capacity reassessed and their eligibility reviewed. They will be supported to the maximum possible level to help them maximise their work capacity. This simple, prudent change and this important measure is going to cost the government $46 million over five years. But it is going to actually deliver better outcomes for those DSP recipients who will be able to gain meaningful work as a result of this. We are investing in people's dignity and we are investing in people's futures. That is because we recognise that one of the best things that anyone can have in this country is a job, working to the maximum of their own capacity.

There are also some changes to student payment portability. I would refer to them as common-sense amendments to portability rules for student payments. Students can continue to claim their income support payments while they are holidaying overseas for up to 6 weeks. It does not mean they are taking a gap year and getting student payments; it means that for up to 6 weeks they can continue to receive benefits from being a student, because we believe that investment in education is in the interests of the individual.