FAMILY AND COMMUNITY SERVICES AND VETERANS’ AFFAIRS LEGISLATION AMENDMENT (INCOME STREAMS) BILL 2004: Second Reading
3 June 2004
Mr ALBANESE (Grayndler) (11.29 a.m.) â€”I am pleased to make a contribution to the debate on the Family and Community Services and Veterans’ Affairs Legislation Amendment (Income Streams) Bill 2004. This bill is of course a response to the Treasurer’s statement, `A more flexible and adaptable retirement income system’, which was issued on 25 February 2004. Of course, out in the suburbs of Australia, that report has become known as `work till you drop’â€”the Treasurer’s philosophy on what older Australians should do, to quote the Treasurer himself.
This bill attempts to change the income stream products which come in two forms: lifetime pensions and lifetime annuities. Over the last decade we have seen a massive increase in the number of Australians who, when they retire, rely upon these income stream products. We have seen the growth of superannuation fundsâ€”thanks to the previous Labor government making superannuation universal for the first time ever in this countryâ€”to literally billions of dollars. There are a number of products aimed at ensuring that older Australians have a steady income stream. These products can be designed to meet individual needs. Moneys can be pooled in a diverse range of managed investments which are responsive to market fluctuations and trends. Savings can be made to last longer. Account balances can rise and fall and money is not necessarily locked away. Many of these products are flexible. There is a capacity to vary income received, there are tax advantages for income withdrawals if taken at a steady pace, and investment income earned is not taxable. These products are the subject of this bill, which reflects the government’s philosophy. [start page 30094]
The government’s philosophy is also reflected in its attitude towards older Australiansâ€”as has been outlined by the member for Shortland and by the shadow minister for family and community services. At the same time as the government is promoting legislation which it says is about ensuring that there is a steady income stream for older Australians, a number of measures are being introduced which in fact cause great concern and trepidation amongst these same older Australians about their future. Of course, one of those is the clawback of debts, as is occurring under the government’s debt recovery program.
The Labor Party does not have an issue with the concept that if you have a debt you have to pay it back. But this issue is far more complex. Indeed, we have seen arrangements entered into with special interest groups, such as the sugar plan, and other sections of the community who have financial hardship. But with age pensioners it is a different story. Many of these pensioners have accumulated massive debts which can run into not just tens or hundreds of dollars but indeed into thousands of dollars. And it is not because they have done anything wrong, it is not because they have lied about their income, and it is not because there is some fraud involved. These are elderly Australians who have made a contribution through the taxation system for all of their working lives; but, because of the government’s failure to undertake any basic data matching, they have been left with massive debts. The budget estimates suggest that there will be, in the coming year, some 105,000 matches conducted and that that will net $58 millionâ€”it will claw back $58 million.
In the budget estimates processes which have been going on for the past fortnight, we have found that, for just over 2,000 people who had to pay back debts, the average debt was $4,500. That is an enormous debt to be payable by an elderly Australian, when they had no expectation that that debt would be there and when it is a result not of any fault of the aged pensioner but, indeed, the result of a failure of the government system. Some of these debts, we found out in Senate estimates, have been repaid on people’s credit cards. What that means is that when the government sent in the debt collectors to visit elderly Australians, to ring them up and harangue them about this debt that they did not know was coming, four per cent of those people have actually been harangued into paying off the debts, in a block, with their credit cards. So they are not only paying the debt backâ€”the debt that they did not know they were going to haveâ€”but also paying an interest rate of 15, 16 or 17 per cent on the debt, thereby accumulating further financial difficulty as it goes on.
That should not be of any surprise to those people who have watched the government’s administration of the family and community services portfolio. Senator Patterson is just following in the fine tradition of her predecessor, `Senator Vandalstone’, who said that pensioners should sell their family home. This is what the previous minister said back in August 2003, on A Current Affair on the Nine Network. The interviewer asked the minister:
What if they don’t have the cash?
The minister said:
Well, we would look at their assets.
The interviewer asked:
So you would be prepared to sell up their family homes?
The minister replied:
Well I would be.
That is a disgraceful threat from any minister of the Commonwealth of Australia. On the one hand, we hear about the issue of the ageing of the population and the need to handle the challenge of Australia’s future: within 20 years we will have more people leaving the work force than we will have entering it. We have statements by the Treasurer, legislation and an Intergenerational Report, which is required by legislation and which was brought down for the first time in last year’s budget. We thought that the Intergenerational Report would lead to a raft of legislation, an ongoing community debate and measures and support from the government to meet the challenge of Australia’s ageing population. But, of course, we see none of that occurring. [start page 30095]
The issue of older Australians and their participation in the work force is one which must be addressed. During this term of the parliament I have held two shadow portfoliosâ€”that of ageing and seniors and that of employment services and training. Having the ageing and seniors portfolio was a great preparation for looking at the issues of employment services and training. During the period of developing relationships with organisations such as COTA and National Seniors, I was impressed by the absolute commitment that those organisations had to their constituent organisations and members. Since I changed shadow portfolio they have amalgamated into one stronger body. The government could do a lot worse than listen to what they have to say and their criticisms about the failings of the government to develop policies which are appropriate and sensitive to the needs of our older Australians.
The Job Network has as one of its major inadequacies a failure to deliver for more mature Australians. That was recognised in part by the government, which has a pilot program runningâ€”a very small pilot programâ€”that concentrates support in particular areas for mature job seekers. But it simply does not go far enough. My office receives complaints certainly every week if not every day from older job seekers who write and say that they have been out of work for two, three or four years and they simply are not even being referred to any interviews, let alone being granted those interviews or making short lists. That can be extremely disheartening.
We have a real challenge in this country for older Australians who find themselves displaced due to the changing nature of our economy. The changing nature of work in particular regions has meant that many older Australians, due to no fault of their own, find themselves unable to gain employment. This is a situation that will become more acute, not less. We live in an economic age of globalisation, where economic change is very swift and where new industries appear. Because of that, we need to develop employment policies linked in with social security policies and retirement income policies which recognise that the days of my grandparents’ generation or perhaps even my parents’ generation, where a young person got a job after they left school and stayed in a career path in the Public Service, the bank, at the local council or with a private company for 30 or 40 years and worked their way up, have long gone. That challenge means that we need to address the issue of providing retraining, reskilling on the job and recognition of prior learning. All of those issues need to be addressed, but we need to address them in the context of valuing the contribution that older Australians can make and cherishing the experience that they bring to their communities.
I can think of no more practical example and demonstration of this than that which occurred last Friday at the Worldskills competition in Brisbane. This was a truly exciting eventâ€”600 largely young Australians brought together from all over the nation competing against each other in trades as diverse as carpentry and joinery, motor mechanics, panel beating, bricklaying, cooking, hairdressing, hospitality and retail to be Australia’s best and then to compete at the Worldskills international competition to be held in Helsinki in May next year. [start page 30096]
I went to this event last Friday with David Hind, the new chair on the ANTA board, and other guestsâ€”no-one from the government bothered to go. With the assistance of Australia’s young champion bricklayer, I tried to lay a brickâ€”fairly incompetently, I must say. What struck me and hit home was the contribution that the older Worldskills volunteers were making. These people gave not only three days of their own time but also their skills and experience to younger Australians. I am told that over the three days 50,000 people went to the event. It was extremely successful. Australia can be very proud of its young Australians. They send a fantastic economic message to the international community when they go out and come back as the world’s best fridge mechanicâ€”one of the people I met.
We should value our Worldskills competitors in a similar way to the way in which we value our young sportspeople. These people carry the flag for our nationâ€”and they do it with the support of older volunteers. At the last census my electorate of Grayndler had some 14,768 people aged 65 and overâ€”a bit over 11 per cent of my electorate. These people deserve to carry out their retirement with dignity and in the knowledge that the government will provide them with support as a priority. Unless we do that, Australia as a nation suffers. I believe that the Treasurer’s statement of `work till you drop’ was entirely inappropriate but it reflects more honestly what the government’s real approach is towards older Australiansâ€”uncaring and uncompassionate, as reflected by the way it has attempted to claw back payments from our aged pensioners. (Time expired)