Pension Cuts

House of Representatives 17/06/2021

Mr KHALIL (Wills) (10:12): I rise to speak on the Social Services Legislation Amendment (Portability Extensions) Bill 2021. I recently welcomed the temporary changes that were made to pension portability, meaning pensioners would be able to retain the full rate overseas for longer than 26 weeks. That was a commonsense measure. Let’s not forget that, a year and a half into the pandemic, the government has left 35,000 Australians who want to come home stranded overseas. We’ve heard it from previous speakers. It’s a fact. There was a promise made to bring them home, and they failed on it. They failed to keep their promise to bring them home by Christmas. Not even this government, surely, would be cruel enough to cut the retirement income of Aussies they’ve left stranded overseas?

While this bill make sensible administrative changes to pension portability, which we support, there are significant and wider problems with the pension that need to be addressed, including by making more concerted efforts to increase the number of countries we enter into bilateral agreements with. That would allow Australians to more freely travel when they can and live in other parts of the world during their retirement or part of their retirement. I know that the government, in the most recent budget, allocated a bit over $18 million to enter into social security bilateral agreements like this with the Republic of Serbia and Bosnia-Herzegovina. I think Australia should be more ambitious about what we can accomplish with that vast sum of money. But this government’s leadership and ambition are often lacking.

I note that Prime Minister Morrison, on his trip to Paris recently, met with President Macron—a very important meeting—and they talked about many important elements of the bilateral relationship. But why wasn’t a bilateral social security agreement on pensions on the agenda? I would urge the government to look into developing a bilateral social security agreement with France. I’ve been contacted by numerous expat Australians in that country who worked and paid their taxes for decades in Australia and are unable to receive their pension. This is despite such a protocol, such an agreement, existing between Australia and 31 other countries, including 21 in the European Union, but not France. France actually has more than 40 such agreements in place with other countries, but not Australia.

It’s probably true to say that many members on both sides of this House would agree with the ambition to sign more agreements with our friends and allies abroad when it comes to Australian pensioners being able to receive their pension when they are spending time overseas. What members on this side of the House do not agree with is the government’s shameful track record of cuts to the pension and attempts to cut the pension. In a speech in 2015, a freshly minted Treasurer—now the Prime Minister—stated that the age pension should not be regarded as an entitlement for all. Let that sink in. He then outlined the government’s vision for an overhaul of the country’s retirement income system through reducing expenditure on welfare payments. This Prime Minister rejects in an ideological sense what is effectively a contract between the state and the citizens. Australian citizens pay their taxes all their working lives. They contribute to this country. They work hard and make a tax contribution. They are entitled to a pension in their retirement. That is part of the social contract. It includes things like defence and security, schools and education, hospitals and health care. It’s not just a welfare payment.

Labor opposed those measures at the time because pensioners have worked hard and contributed all their lives to make this country what it is today. Older Australians deserve our respect and dignity. But this government tries to push through pension cuts at any opportunity. Many of those in the firing line of the coalition’s attempts to cut the pension are migrants to this country who are now pensioners—after 30, 40 or 50 years working hard here, paying their taxes in Australia, building a life here, raising a family here. They should be able to receive a pension that allows them to live comfortably and reconnect with family and friends overseas that they may have left behind to come and build a life in Australia. These older Australians have made a sacrifice in many ways to build a life here in Australia and to become new Australians. They left their families and cultures behind to help build Australia through their work and their contribution. Yet we’ve got a government that drags its heels on doing all it can to support these people to spend their time with elderly relatives and long-lost friends. It wants to make their income uncertain if, for example, they were to accidentally spend a bit too much time overseas.

Let’s have a look at this government’s track record and a few recent instances of where they have got their scissors out and tried to start cutting. As I mentioned, the Prime Minister, in 2015, when he was Treasurer, tried to cut the pension and increase the age of entitlement. In the 2014 budget the government tried to cut pension indexation, which would have meant pensioners would be forced to live on $80 less within 10 years. This unfair cut would have ripped $23 billion from the pockets of every pensioner in Australia. In the 2014 budget they cut $1 billion from pensioner concessions—support designed to help pensioners with the cost of living. In the same budget, the infamous 2014 budget, they axed the Commonwealth seniors health card. In the 2014 budget the Liberals tried to reset deeming rates, which would have made 200,000 part-pensioners worse off. In 2015 the government did a deal with the Greens political party to cut the pension of around 370,000 pensioners by changing the pension assets test. In the 2016 budget they tried to limit overseas travel for pensioners to six weeks. These are the people I was just talking about, who go overseas to visit family and friends after a lifetime of work here. The government also tried in that same budget to scrap the energy supplement for new pensioners. And in August last year the government was caught out by Labor on its attempts to freeze payments for 2.5 million pensioners.

Pensioners in this country would not be surprised to hear that the coalition has tried to cut the pension this many times. They are obsessed with it. They have tried to do it in every single budget over the last eight years. Cutting the pension, unfortunately, is in the Liberals’ DNA. Building and supporting the pension is in Labor’s DNA. When we were last in government we actually increased the pension by $30 per week.

I would like to take a moment to show how this bill has an impact on my local electorate of Wills and the people who live there. It’s an incredibly diverse electorate. According to the Australian Bureau of Statistics, just under half of the people in Wills either were born overseas or have at least one parent who was born overseas. Many of these people migrated in the postwar period—of Italian background, or Greek, Lebanese, Turkish, Vietnamese, Indian or Pakistani, and many others. These are some of the people who helped build this country. Many of my constituents go back to their country of origin to visit, to see their family, to see friends they haven’t seen in many, many years. By the time they get there and the jet lag ends—because it’s a long trip; we’re far away in Australia—they may actually have to start thinking about coming home again, at around that six-week time frame. That is because the government hasn’t done the legwork to build a more comprehensive network of agreements, as I was talking about earlier—social security bilateral agreements—to help them claim their pension overseas if they were to stay a bit longer.

As I said, these are Australians who have worked hard. They deserve that break to visit family and spend some quality time with long-lost friends and family overseas. And just because they’re overseas it doesn’t mean that their expenses are decreasing. Pensioners tell me again and again that land tax and council rates are rising, that the cost of living for them is constantly rising. Despite this, the government’s instinct—its go-to—is to cut the pension to try to rip it away and make life harder for the nation’s elderly. It’s particularly cynical when you consider that the Treasurer has attempted to stimulate the economy by shovelling billions of dollars out the door, spending money to resolve the government’s political problems.

Wouldn’t increasing the pension help with the stimulus? Do you reckon pensioners would save this money in their sock drawer? Or would they spend it—on groceries, bills and gifts for the grandkids? Like JobSeeker recipients, pensioners aren’t saving their payments. The additional money goes almost directly into the economy, to stimulate the economy—a good use of public money. Yet this government won’t even consider it, because it runs counter to their ambitions to dismantle that social safety net that Labor spent so many years putting in place. They won’t consider it because ideologically the Prime Minister—publicly—doesn’t believe in it, because apparently it’s an entitlement. Apparently this type of welfare needs to be ripped away, and government needs to move away from providing that kind of payment to pensioners or the vulnerable. Apparently he doesn’t believe in that. And this is a deeply held belief. He doesn’t think government should be doing this.

It’s a problem, because in recent years we’ve seen stagnant wages, declining productivity, high underemployment and declining living standards—all under this coalition government. And the government has no plans to really turn the economy around. As I said, the budget that they recently passed was all about spending money on what they perceived to be their political problems—a short-term political budget, long on spin and spending on political problems but short on any real investment in the Australian economy. That’s not what a Labor government would do. We would invest in Australia’s future while looking after those who helped to build this country.

The age pension is a fundamentally important aspect of this commitment, to ensure that older Australians can actually have a life in retirement that’s one of dignity, after so many decades of working and contributing. The pension, Medicare, unemployment benefits, superannuation and the NDIS: these are all policies for the little guy, the average Australian—supporting those who have been doing it tough or who’ve worked all their life to make their contribution. These are the sorts of defining policies that Australians can trust the Labor Party to deliver if elected to government. And frankly, these are the kinds of policies that the coalition are ideologically opposed to, that they hate; they try to slash them at every opportunity. We’ve seen this government do that on so many occasions, as I’ve outlined.

We on this side will not stand silently as this government seeks to cut social services by stealth. We’ll continue to put forward the progressive policies that will make Australian lives better and create that fairer society that we should all have.