Don Farrell (SA, Australian Labor Party, Shadow Special Minister of State) Share this | Link to this | Hansard source

I move:

That the Senate take note of the answer given by the Minister for Families and Social Services (Senator Ruston) to a question without notice asked by Senator Farrell today, relating to the age pension.

I am a little bit surprised at the answers that we got from Senator Ruston in respect of the questions that I asked regarding her statement that the pension is too generous. This was an opportunity for the minister to come clean and say that she made a mistake about the generosity of the pension and to apologise to those pensioners, particularly in her home state of South Australia.

As you would know, Deputy President, South Australia, per capita, has the highest number of pensioners in the country. Senator Ruston's comments were quite offensive to those pensioners, many of whom are struggling and doing it hard. The opportunity that Senator Ruston had was to say to those pensioners in South Australia and the rest of the country: 'Look, I made a mistake. The pension is not too generous and I'm going to apologise for saying that to those pensioners.'

Instead, the best we got was that she wanted to 'clarify' her comments. I don't think the comments needed clarification; we knew exactly what the minister was saying. She was saying to all those pensioners out there, 'Your pension is too generous'. What pensioners wanted, and what the community wanted, to hear the minister say was, 'Yes, I was mistaken; the pension is not too generous and I apologise for those comments.'

Then, in the second question I asked the minister, I said, 'Look, have you spoken to the Treasurer or any other member of the government about these comments?' Again the minister had an opportunity to tell the Australian people about the conversations that she's had with the Treasurer and other members of the government with regard to her comments about the generosity of the pension. But we didn't get an answer. I know it will surprise you that we didn't get an answer, but we didn't get an answer. There was an opportunity for Senator Ruston to say, 'Yes, I have spoken with the Treasurer, he has acknowledged the pension is not too generous and I agree with him in respect of that.' But again we missed that opportunity from Senator Ruston. So we still don't know who is right in the government. Is it Senator Ruston, the minister responsible for pensioners in this government, saying one thing, or is it Minister Frydenberg saying another thing? What is the position of the government? I'm sure you'd like to know that answer, Deputy President.

My third question related to a statement by Mr Ian Henschke. Ian Henschke is quite a famous South Australian. He was a famous, great broadcaster and an even better winemaker. But, on this occasion, he was talking in his capacity as an advocate for seniors. He got the ball rolling on the deeming rate and he nailed the government on this issue, because the government has been secretly squirrelling away money that ought to have been in the pockets of pensioners. How is the government doing that? Well, while the RBA was reducing interest rates, the government kept the so-called deeming rate way, way above the level that the RBA has set. Now, you might say that interest rates dropping are a good thing, but the reality is that, if you're trying to rely on those interest rates to supplement what is not a generous pension, of course you're struggling. More importantly, I think, it's worth noting that dropping interest rates are not the sign of a good economy, they're a sign of an economy in trouble. Of course, that's what we know is happening in this country at the moment. But, thanks to Mr Ian Henschke, he got the ball rolling on this and he nailed the government. They were squirrelling away money that should've been in in pockets of pensioners and keeping it for themselves. (Time expired)

James Paterson (Victoria, Liberal Party) Share this | Link to this | Hansard source

Well, you have to give them points for chutzpah. You have got to give the Labor Party points for chutzpah. There's only one political party in this chamber—maybe two if you include the Greens—who have an actual plan to cost retirees and pensioners money. There's only one political party or political movement proposing to take money away from retirees and to make their retirement less financially secure, and that is the Labor Party. By contrast, the Liberal and National parties, through a successful election victory, have saved 900,000 older Australians from a severe financial hit to be perpetrated by those opposite if they were successful at the election.

You took a policy to the election proposing to take away from 900,000 Australians the franking credits they had planned their retirement for and upon. They were reliant on those franking credits for their security in retirement, they made their plans when the rules were set and you planned to pull the rug from under them. You didn't even have the decency to protect those who are currently in retirement and well advanced in their years, who have no capacity to change their financial affairs to accommodate these changes, by grandfathering it. You didn't even have the decency do that. You wanted to smash and grab their bank accounts—raid their bank accounts for your own spending plans. We won't be taking any lectures from a political party that was proposing that 84 per cent of the people to be affected should earn $37,000 aa year or less and could lose up to a third of their retirement income.

By contrast, the Liberal and National parties under Prime Minister Morrison are actually improving the retirement security and financial security of older Australians. We have announced in just the last fortnight that older Australians who are on a part pension and who have investments will now be assessed as having received a lower deeming rate. That means real money into the real pockets of real Australians on the pension. They will be better off financially as a result of a decision this government has made, not as a result of any rhetoric you have brought into this chamber. That's a million Australians who can be up to $800 a year better off if you're a single, and up to $1,000 better off for couples.

I want to address one other question from question time today. That was by Senator Gallagher on the question of superannuation. She mentioned me in her question. It's entirely appropriate that the government has commissioned a retirement incomes review as a recommendation of the Productivity Commission. The Productivity Commission rightly recognised that it is no good putting more money into superannuation if that superannuation system is broken, as we believe it currently is. My good friend and colleague Senator Hume will be presenting legislation to this chamber soon to help fix some of those problems. I hope that in this parliament, in contrast to the last one, the Labor Party and the crossbench are more willing to work with the government to fix those problems, and that they're more willing to work with us to make sure that fees don't eat up the low balances of many Australians' superannuation. I hope they're willing to work with us to make sure that inappropriate insurance isn't given to people in their superannuation accounts, which also eats up their meagre balances. The government is rightly acting on the advice of the Productivity Commission on that.

I also think it's worthwhile for the government and for the retirement incomes tribunal to examine the wisdom of increasing the compulsory superannuation contribution from 9.5 per cent to 12 per cent. We know that when those opposite were previously in government the Treasury department under secretary Ken Henry advised against increasing the superannuation guarantee because, they advised, it would hurt the take-home pay of working Australians. That research has been replicated again in recent weeks by the Grattan Institute. I have to confess that I'm not always a fan of the work of the Grattan Institute. It was founded by Kevin Rudd and John Brumby with $30 million of taxpayers' money. Nonetheless, in this instance, I think they've done some very compelling work. Unlike the group that Senator Gallagher quoted in question time, they're not a vested interest that stands to gain from increasing superannuation contributions. The truth is that in this game, whether it's industry super, retail super, any super, they and their associations are not good sources of independent advice because they seek to reap the rewards of billions of dollars of more money of Australians' retirement savings. The truth is that we need to very carefully consider whether it's a good idea for Australians to potentially receive lower take-home pay, and maybe not even receive a higher retirement benefit as a result. The government will take no lectures at all from the Labor Party on the question of protecting the interests of older Australians.

Carol Brown (Tasmania, Australian Labor Party, Shadow Assistant Minister for Infrastructure and Regional Tourism) Share this | Link to this | Hansard source

That was a very interesting contribution, because I think someone listening to that contribution wouldn't really understand what we were debating here today, what we're taking note of here today. We're taking note of the question from Senator Farrell to Minister Ruston around her comments on the radio interview with 3AW's Neil Mitchell, where she described the age pension as generous. Not once in Senator Paterson's contribution did we hear him trying to support her or defend her in any way. Because everyone in this chamber knows it is indefensible. Her comments were completely out of touch with what is going on in Australia and what is happening to people on the aged pension. Senator Ruston, in her response to Senator Farrell, refused to apologise. Let's get that on the record: she refused to apologise. You have to ask yourself why it is so hard to apologise for comments that were so obviously wrong, so obviously offensive, to hundreds of thousands of aged pensioners in Australia. Why is it so hard to apologise? Senator Ruston refused to apologise. She did accept that pensioners were doing it tough.

Now, the Treasurer, Mr Frydenberg—just like Senator Paterson did in his contribution—refused to endorse Senator Ruston's characterisation of the pension. We are talking about $66 a day. That's what we're talking about. That's the amount of money that age pensioners receive that Senator Ruston calls 'generous'. The Treasurer refused to endorse the comment. In fact, he said—and it's worth repeating, as it was part of Senator Farrell's question to Senator Ruston:

"I understand pensioners have challenging times, a number of pensioners do it really, really tough," …

That was in response to being asked about whether he supported Senator Ruston's comments about the pension. Of course he, using one of Senator Cormann's phrases, wibble-wobbled around that and refused to support those comments. And you can't blame him. You can't blame him for refusing to endorse those comments, because they were wrong and they were out of touch. We're talking about $66 a day.

We also have enough reports, evidence and research, some of which have been funded by the minister's own department, on poverty and people living in poverty on the age pension. Some of that research has been funded by the minister's own department. Maybe the problem is that this is a government that has had six or seven ministers in this area since they came to government six years ago. What does that say? What does that say to Australians? It says that this government does not have an interest in the community services area. It has had six ministers, including the Prime Minister. The government should be ashamed. The minister should be ashamed. (Time expired)

Zed Seselja (ACT, Liberal Party, Assistant Minister for Finance, Charities and Electoral Matters) Share this | Link to this | Hansard source

I'm very pleased to respond to Senator Farrell's motion in relation to the question he asked of Minister Ruston. I'll deal firstly with some of Senator Brown's contribution, where she talked about what Senator Ruston had to say.

Senator Ruston has made it very clear that what she was referring to was, of course, the fact that as a nation we rightly make a decision to prioritise the largest part of our budget to the welfare of our nation. Many Australians benefit from those welfare payments, and no-one is suggesting anything other than that those who are on a pension, or any other payment, are doing it tough. That is why we see the twice-yearly increases in the age pension, and, of course, why we look to lower cost of living pressures for Australians across the board. Whether they're pensioners, whether they are low- or middle-income earners, we are always on the side of those who are doing it tough, those who have worked very hard over their working lives and who are now seeking to enjoy their retirements, be they pensioners or self-funded retirees. That is fundamentally what the Liberal and National parties have stood for, for generations.

Conversely, we just had a federal election where the Labor Party sought to punish a portion of the Australian community, namely retirees, to pay for their promises. These are people who the Labor Party and the former Labor leader, Mr Shorten, referred to as the top end of town. He talked about them receiving gifts from the taxpayers when they got their franking credits. Now the new Labor leader, Mr Albanese, acknowledges that, when they were talking about them being the top end of town, they were wrong; that, actually, that was just rhetoric designed to pit one part of the community against another part—to talk about the top end of town and to talk about the other. Mr Albanese talked about the Caboolture retiree who earned $1,200 a year from franking credits. He said they felt like we weren't giving them respect—no, they weren't—and that we were classifying them as wealthy but they weren't wealthy. Doesn't that go to the heart of what we saw at this election when it came to retired Australians and when it came to older Australians? It was absolute disdain from the Labor Party, something that won't be forgotten for a long time.

Let me deal with a couple of aspects of how disdainful they were of older Australians. The shadow Treasurer at the time, Mr Bowen, effectively said to older Australians who were concerned about losing, in some cases, $1,000, $2,000, $3,000 or $5,000 a year of their limited income, 'Well, you can just go vote for someone else,' because he was so confident that they would have enough votes, completely ignoring self-funded retirees and pensioners, that they would be able to skate into office and pit one group of Australians against another.

The other part that was particularly disdainful towards older Australians was the fact that they chose not even to grandfather this policy. As bad as Labor's housing tax and negative gearing policies were, at the very least, in proposing to bring in those destructive tax changes, they acknowledged that they wouldn't hit members of the Labor Party, for instance. Many members of the shadow frontbench who own existing properties wouldn't be hit with changed tax arrangements. But when it came to the self-funded retiree in Caboolture relying on $1,200 a year in franking credits, they said: 'Bad luck. We're going to take that from you on day one. You may have structured your affairs in order to look after yourself and you may be on a modest income, but we're going to take that money away from you.' We're not going to be lectured on that by them.

It wasn't just bad policy, it wasn't just the politics of envy, it wasn't just referring to self-funded retirees as the top end of town; it was proposing to take away money that they were entitled to and that they had structured their affairs around. This is how the Labor Party treats older Australians. They sought to pit older Australians against younger Australians. They sought to pit those on middle incomes against those on somewhat higher incomes. The Australian people saw through it. Particularly, retired Australians saw through it. They took Chris Bowen's advice and did exactly what he said. They voted against the Labor Party as a result of those destructive policies. (Time expired)

Louise Pratt (WA, Australian Labor Party, Shadow Assistant Minister for Manufacturing) Share this | Link to this | Hansard source

This government is out of touch, as shown by Senator Ruston's comment on pensions. It is absolutely symptomatic of what is a poor culture in our government in terms of looking after older Australians. Now, what is the government's position on the age pension in Australia at the moment? Senator Ruston seems to think it's generous, while Mr Frydenberg, the nation's Treasurer, says he understands that pensioners have challenging times and, indeed, that pensioners do it really, really tough. Senator Ruston did a disservice to this place this afternoon when she would not say whether she had been counselled for her remarks. I can only take that to mean that she was—although, frankly, the whole country was counselling her on the inappropriateness of those remarks, as the many pensioners who called in to 3AW after she made those remarks illustrated.

The government needs to make it clear: are pensioners doing it tough or is the pension generous? Is it little wonder that we on this side of the chamber are worried, or that the nation's pensioners are worried, about what might be in the next government's budget? Will they want to remove the energy supplement? Older Australians deserve much better than this out-of-touch government.

Let's have a look at exactly what Minister Ruston said. She said:

I don’t think a debate about whether I could live on—

the pension—

or not is relevant. It is a generous amount of money that the Australian taxpayers make available to our older Australians.

It doesn't seem very ambiguous to me. She said very clearly that the pension is generous. Neil Mitchell, the interviewer, asked, 'The pension is generous?' Senator Ruston did not respond to that at the time. She was already moving on. She said, 'The other thing that we also need to realise is …' and Neil said, 'I'm sorry; did you say the pension is generous?' Here, Senator Ruston finally seemed to wise up to the political problem she had made for herself. She said:

In terms of the amount of money that taxpayers fund our social welfare system, we put a lot of money into it.

Putting a lot of money into something does not equal generosity. Even if it is one of the highest and largest amounts of expenditure on the books for our nation, that doesn't equate to generosity. There is absolutely no correlation between the size of the amount of money that's put aside in our nation's budget and the need.

As the per capita report that we asked about shows, $66 a day is not generous. This per capita report makes clear that the age pension is barely effective in keeping our most financially vulnerable and older citizens out of poverty. They say that as one of the wealthiest nations in the world we should be looking beyond simple survival for our oldest citizens. What do I take that as code for? If we're going to look beyond simple survival, then that would have some quotient of generosity in it, I would think. But this report shows that age pension dependency in Australia means a life of poverty and deprivation for thousands of our fellow Australians. They highlight that Australia can and should do better than this.

It is little wonder that pensioners around Australia reacted so angrily to this, and I think Senator Ruston should continue to be held to account.

Question agreed to.