David Feeney (Batman, Australian Labor Party, Shadow Minister for Justice) Share this | Hansard source

I am pleased to speak to the Defence Force Retirement Benefits Legislation Amendment (Fair Indexation) Bill 2014. This is a bill which has caused some political debate and angst, not only in recent times but indeed over a much longer time frame. So, I think it is useful to contextualise this bill, because this bill—for all of its virtues and indeed some of its challenges, and I will come to those—has been deployed by the coalition as a weapon against the Labor Party for the purposes of undermining the ALP's record in government, and indeed more generally, in terms of its support for veterans and veterans affairs. That political task is one that I think has brought the coalition little joy and little credit, because of course when it comes to defending veterans and their entitlements and indeed their place in our society it remains the Labor Party's view that that is an important and fundamental task. That is why, as recently as today's question time, you have seen the Labor Party speak so earnestly against the coalition government's resolve to cut benefits to orphans and children of veterans. Some facts will form a useful backdrop to the Defence Force Retirement Benefits Legislation Amendment (Fair Indexation) Bill 2014.

Let us first of all remember that, during the 11 long years of the Howard government, the coalition absolutely refused to countenance the measure that is being brought into this House today. Those 11 long years of the Howard government were a time of fiscal plenty, a time when surpluses were able to be organised by even the simplest of Treasury officials, so healthy were government receipts at the time. Even during this time of plenty, a boom was something that those opposite struggled to successfully manage, but they did. Even during this time of plenty, the coalition refused to countenance this measure.

Let me quote a letter, sent by Mr John Hevey, of a group called the Aussie Digger Forum, to the then Minister for Veterans' Affairs, Mr Bruce Billson MP, just before the 2007 election:

Bruce, it is long past the pale … that the Coalition Government refuse to acknowledge the injustices that have been perpetrated by the Coalition on the issue of Military Superannuation over the past eleven years, it is long past the pale that the Veteran Community and in particular Military Superannuates have been flagging with the Coalition this very issue for the past eleven years, and now on the eve of a federal election you tell us through a “spokesperson” that the report into this matter will not now be forthcoming until 2008 - the same report that has been in your possession since July.

So, this is not a field of endeavour in which the coalition has a track record to be proud of.

In fact, we can recall some of the champions of the Howard government who worked so vociferously against this measure becoming coalition policy. The most outstanding of those—and I might say my personal favourite—is former Senator Minchin, then finance minister, who of course made very plain the fact that he regarded this measure as fiscally irresponsible and refused to accede to the demands of the veterans community. Whether Mr Billson was right or wrong, it is plain that Senator Minchin had very strong views about the issue. In fact, so strong were his views that, when Senator Ronaldson in another place brought a private member's bill to tackle this issue, in a stunt of a couple of years ago, Senator Minchin was motivated to launch himself out of retirement, make some comments and write a letter to the editor—all of which, you will be delighted to learn, I have kept. Senator Minchin said:

This claim (to change indexation) was properly rejected by the Howard Government, of which I was a member.

There is no inherent logic to the proposition that a public sector employment-related superannuation payment should be indexed in exactly the same fashion as a means-tested welfare benefit in this case, the age pension.

Senator Minchin was making the public policy case—in fact, he has never ceased to do so, notwithstanding the ebb and flow of policy amongst those opposite—that this measure was fiscally irresponsible and was not sound public policy. So, when the government seeks to cloak itself as being absolutely committed to the welfare of veterans, let us all remember that this was a measure long opposed by those opposite. This cloak does not change the fact that this road to Damascus conversion that you have had was purely an electoral device rather than a matter of longstanding coalition principle.

It is also true to say that the former Labor government had a plan to improve the DFRB and the DFRDB schemes. Indeed, that plan is only one part of a much longer and more expansive list of Labor accomplishments in veterans affairs—a list of accomplishments spanning the last six years, which has done extraordinary good in terms of improving the lot of our veterans, their families and dependants.

Let me talk very briefly about the plan Labor took to the last election with respect to the DFRB and DFRD It was on 30 July 2013 that the then Minister for Defence, Science and Personnel, Warren Snowdon, and the then Minister for Defence Materiel, Mike Kelly, announced changes in the way in which military superannuation retirement pay will be indexed for the Defence Force Retirement Benefits Scheme and the Defence Force Retirement and Death Benefits Scheme. It is worth also remembering that both of those schemes were closed respectively in 1972 and 1991—a point that those opposite often forget. These are changes to a scheme that has not admitted a new member since at least 1991 and so any soldier, sailor, airman or woman who has joined the ADF since 1992 is not someone who is a part of these schemes and whose lot is not being improved by this legislation today. That is an important point of detail those opposite like to constantly ignore and/or blur.

As at 30 June 2013, there were 3,349 DFRB superannuants, of which 92 per cent were aged 65 or over, and there were 53,242 DFRDB superannuants, of which 45 per cent were aged 65 or over. Then there were 2,968 DFRDB contributors and 314 DFRDB non-contributors—that is, recipients who returned to service for less than 12 months but who continued to receive payment. Those are the numbers of people we are talking about. Labor's plan was that from 1 July 2014, payments to military superannuants aged 65 and over within those two schemes—the DFRB and the DFRDB schemes—would be indexed to the higher of the Consumer Price Index or the Pensioner and Beneficiary Living Cost Index—the PBLCI. The Labor government at the time estimated that that measure would cost the Treasury some $34 million.

The PBLCI was developed to measure the changes in the prices of goods and services purchased by older retirees. It was first used as an indexation factor for the aged pension in September of 2009, and the then Labor government decided to include it in the indexation of military superannuation and retirement pay for the two schemes—a very practical measure deploying a new public policy tool to a task for which it was perfectly suited.

Since coming to government in 2007, Labor had embarked on—as I said earlier—a comprehensive program of support and recognition for our veteran community. This is a very important set of points, because we see those opposite work assiduously to denigrate the Labor Party's commitment to veterans and the Labor Party's accomplishment in this very important space. Let the record be set very squarely here, because this is a record that Labor can be very proud of and we will enjoy watching those opposite flummox about as they struggle to match what is indeed a—

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