Mathias Cormann (WA, Liberal Party, Minister for Finance) Share this | Hansard source

The question that Senator Siewert is asking cannot actually be answered because it depends, in all sincerity, on a range of factors that we do not know about, including what happens to a family's take home pay over that period. What I can say is that no family will receive less as a result of this saving than they are currently receiving. Every family will at least get the same amount they are currently receiving for the next two years, all other things being equal. If they end up earning more money, the means test obviously will kick in. If they earn less money they might qualify for a higher rate of payment. If their kids grow older, as kids do, then obviously progressively they are entitled to a higher payment. So there are various factors that come into play, and I am not able to assist Senator Siewert with the specific question she is asking.

The point I would make again is that in terms of achieving savings in this space there is a reason Labor did this in government before. Senator Wong quite unfairly criticised Senator Hanson for her contribution. Senator Hanson was quite right. Labor in government froze the indexation of family tax benefit A and family tax benefit B supplement payments not for two years but for six years, and saved about $1 billion on that. In 2009-10 Labor delinked the indexation of all family tax benefit A payments from the pension indexation arrangement, saving, in 2009-10 dollars over the then forward estimates, about $1 billion. Of course, $1 billion in 2009-10 is significantly more now.

That is what Labor decided to do at a time when we were, quite frankly, compared to now, in a higher inflation environment. We are in a low-inflation environment. To pause indexation in the current circumstances, we believe, is a fair and reasonable way to release the necessary savings in order to be able to invest in the very high-priority childcare reforms, which are of course geared to provide better, more targeted support and more flexible and affordable access to child care for working families.