Tony Zappia (Makin, Australian Labor Party, Shadow Parliamentary Secretary for Manufacturing) Share this | Hansard source

The opposition supports this legislation, and so do I. Before I get to my remarks about the legislation, I want to say that I listened to the contribution of the member for Eden-Monaro earlier in this debate. It is my view that the comments that the member for Eden-Monaro made about his predecessor—Dr Mike Kelly, the former member for Eden-Monaro, a man who served in the defence forces, and served this place very well—were in very poor taste. In fact, I thought they were very ungracious and derogatory. It is my view that they reflect adversely and poorly on the current member for Eden-Monaro.

I support this legislation and I have always supported fair indexation for our defence veterans. This legislation effectively does three things. It retains the current indexation methodology for pensions paid for persons under 55 years of age. It uses the triple indexation system of either the consumer price index, the pensioner and beneficiary living cost index, and the male total average weekly earnings in determining the amount by which DFRDB and DFRB pensions are increased. It also ensures that DFRDB and DFRB members with significant past service are not required to pay division 293 tax on the value of past service as a result of this legislation.

The legislation, as other members have quite rightly pointed out, is the result of a very long campaign by Australian defence veterans who have pursued this matter relentlessly. Their fighting spirit and their never say 'die' attitude, I believe, are testament to their military training. I know of no community group who have campaigned harder and longer over a single issue—certainly not in my time in this place. They have been one group that have been truly relentless and have persevered with the campaign that they embarked on. They have done so across all electorates—I have heard other members speak about that—but certainly in my own electorate of Makin. I have spoken with defence veterans to discuss this very issue at different functions. I have at all times supported them, by taking up their cause in writing to the relevant ministers of the day with arguments supporting their case. I am quite comfortable in saying that I have made representations on their behalf from the day that I was elected to this place. I did so because I saw merit in their arguments.

This is a complex matter. When reading the bills digest for this bill, I find that there are still matters in there that are not very clear. It is not as simple as it is sometimes portrayed by people who have spoken in respect of this legislation. Not surprisingly, the former Howard government—I make no criticism of them about this—did not accept the arguments being put to them at the time. Senator Nick Minchin, whom I know as a fellow South Australian, even after having left this place—from memory—still maintained that the position that his government took in respect to this matter was the correct position to take. I think that simply highlights that this was not a case of one side versus the other in this House, but rather that this is truly a complicated matter and that neither side was absolutely convinced that the change needed to be made. The current government have decided that they will bring in the legislation, and I support it, because I am of the view that the change did need to be made.

The Rudd government, on being elected in 2007, ordered a review of the current arrangements. The review was carried out by Trevor Matthews. There were four recommendations in that review and I am familiar with all four. The government chose not to make any changes as a result of that review. As the shadow minister quite rightly said in his comments on this matter today, the DFRB and DFRDB schemes ended in 1972 and 1991 respectively and so the consequential arrangements made with respect to this legislation relate to a very limited number of veterans.

Why have I supported the veterans in their campaign? I have done so because I have been persuaded by one very simple argument. It is my view, and always has been, that the sole purpose for indexing pensions—it does not matter what pensions we are talking about—is to ensure the purchasing value of those pensions is not eroded by inflation. That was reaffirmed by recommendation 1 of the Matthews review. Originally, the index used for pensions was the consumer price index. It was the index of the day and it was the index of the time. I assume that it served the scheme well for many years. As time passed, it became clear that the consumer price index no longer provided a fair representation of the actual living cost increases being incurred by the people on the various pensions. The Labor government acknowledged that point when it brought in a Pensioner and Beneficiary Living Cost Index. That index better reflected the cost increases affecting veterans and other pensioners or retired people, because where they spent their money was not necessarily the same as where the broader community expenditure occurred and, therefore, the CPI did not always accurately reflect the cost of living increases incurred by pensioners and retired people. The former Labor government also factored in the male total average weekly earnings as a third measure to help work out a fair income for people living on retirement incomes. Again, I believe it was the right move. This legislation takes in all three of those measures and as a result I support the legislation. The legislation takes into account a formula based on the best ingredients that we have available to us today to ensure that the increase in the pension granted reflects real purchasing value, taking into account the prices of today.

I represent an electorate that has a lot of veterans living within it and I have a very good relationship with all of the veterans groups in my electorate. I have the utmost respect for them. Over the years, I have been able to spend time with them, listen to their stories and look at the way they live their lives and integrate into the community, and I have come to truly respect what they have done for this country through their service. In this case, my support for them does not stem from my respect for them. Rather, it stems from my belief that the system we are currently using is not right. We have shown that is not right through the way we now treat other pensioners and, therefore, we accordingly need to change it for them as well.

I have been approached by Commonwealth superannuants and Commonwealth pensioners who argue the very same case. They argue that their pension, resulting from their service, should be treated in the same way as another person's pension. That is, if one indexing arrangement is fair for one group then it should be fair for others. I have taken up this cause for them because again I am persuaded by their argument, based on maintaining the purchasing value of the pension. This is a matter that the government needs to consider, as we, in opposition, will need to consider it. I accept the argument of these superannuants and pensioners and so I have taken up their case by making representations on their behalf, and I will continue to do so.

I want to finish on the matter that other Labor members have raised in recent days. We have been painted as a party that does not care for and has very little interest in the defence community of this country. Nothing is further from the truth. No-one in this House has greater support for the veterans of this country than we do. It is fair to say that everyone in this House genuinely supports our defence personnel, both serving and retired. But the decision by the Abbott government to take away the $215 payment to some 1,200 defence families was a low point in the decision making of this government. The amount of money is insignificant in the scheme of the total federal budget but for the families the money taken away is not insignificant. I have no doubt that, to them, $200 is worth $200. If the argument is that it will make so little difference to those families, then why take away the money in the first place. That argument works both ways. If it is such a minimal amount, why not leave it there? This is a decision that the government should reconsider, because I believe it was the wrong decision to make. The government will be judged on this decision harshly by the community at large and it will be judged harshly, as it has been, by the defence people of this country. I would certainly urge the government to reconsider that decision.

I conclude where I began. This legislation comes before us after a very long campaign. I am aware of the private members' bills that were bought into this place when Labor was government and I am aware that they were rejected. I am also aware that the legislation probably was prompted by nothing more than the government thinking it was good political campaigning on their part. I do not criticise them for that; that is what good political campaigning is. But it took an election for this commitment to be made. Yes, our side of politics came back with an alternative which was somewhat different; nevertheless, we have finally got there with legislation that I believe satisfies most of the veterans' representations to me and other members of this parliament for years and years.

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