Budget: Pensions, Paid Parental Leave – 5AA
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JENNY MACKLIN: For the single pensioner whether their an aged pensioner, a veteran, a carer, or someone on the disability support pension, from the 20 September they will receive an increase of $32.49 a week if they are a single pensioner, and $10.14 a week if they’re a couple. These are major changes that of course people have been waiting for for a very long time.
LEON BYNER: What about carers?
JENNY MACKLIN: Carers will receive, if you’re on the carer payment, so the equivalent to the pension, you’ll receive those increases. If you are a carer you’ll get an additional benefit, and in fact that’s why I need to go into the Parliament in a minute, we’re paying an ongoing supplement, an annual supplement of $600 to carers, and that will go to people who are on the carer payment and people who are receiving the carer allowance, and the first $600 supplement will be paid before the end of June this year.
LEON BYNER: All right, and what about those who are disabled?
JENNY MACKLIN: Yes, the increase in the pension will find those who are on the disability support pension. We know that for many many people who are, especially those who are severely disabled, they have been finding it very hard to make ends meet, so we’re very pleased to be able to extend the increase to them.
LEON BYNER: All right, now when will this money start to come?
JENNY MACKLIN: It will start on the 20 September. As you could imagine we’ve got a lot of legislation to get through the Parliament. We hope the first legislation will go through this week for the carer supplement, but the major pension changes will start on 20 September.
LEON BYNER: So all this money will be received after that date?
JENNY MACKLIN: That’s right, and generally that will be in the fortnight following the 20 September.
LEON BYNER: Now we had a discussion a few days ago about Paid Parental Leave and there were a couple of what appeared to be anomalies. Now we have the scheme that’s going to be taxpayer funded which has been announced in the Budget.
JENNY MACKLIN: Yes
LEON BYNER: It’s going to be about $550 a week. But what happens if you have, you’re the employee of a company who has a scheme, do you get, because a lot of people were ringing about this, do you get a top-up? In other words if the scheme offers you more than that $550 that is being offered by say a BHP Billiton, do you get a top-up, do you get what you would have got, or do you get both lots? Do you get what the taxpayer is paying plus whatever your company is paying?
JENNY MACKLIN: You will get both. So if your company like BHP Billiton is paying you paid maternity leave, you will be able to get that, and on top of that you’ll receive the Government’s Paid Parental Leave. That’s one of the reasons why we’ve made the paid parental leave scheme taxable, that way it makes it fairer for those on higher incomes, and of course will pay higher taxes. This scheme that we’re introducing is really fundamentally aimed at those people working in companies where there is no paid parental leave and we want to make sure that they get a basic level of support when they have their babies.
LEON BYNER: So if a company chooses not to pay the parental leave, they still get the fallback default position of the $550, but that’s taxable of course, as all income is.
JENNY MACKLIN: Sure.
LEON BYNER: And so your answer to the criticism, well if you can advantage two schemes other than one, if you happen to be with an employer who is of a mind to give it, then your argument is it’s socially just because it is going to be taxed.
JENNY MACKLIN: That’s right, and I do expect that those employers who already have schemes in place that they’ll continue those paid parental leave schemes. The reason that employers have already introduced the method they understand how important it is to support their mums and dads if they care for their new babies, and they want to keep those employees connected with their jobs, so I certainly, and there’ve been positive messages coming from employers since we announced the scheme earlier in the week.
LEON BYNER: When does that start paying?
JENNY MACKLIN: That won’t start till 1 January 2011, largely because we’ve got a lot of work to do with employers beforehand.
LEON BYNER: In what way? That’s an interesting one because you could just pay that money earlier if you wanted to.
JENNY MACKLIN: Well of course we’ve got legislation to get through the Parliament as well, but the fundamental issue is that we intend to pay this via employers so Centrelink will make the payment to employers because and then employers will pay the paid parental leave on a fortnightly or monthly basis depending on what their regular payment arrangements are; and the reason we’re doing it this way, it was recommended by the Productivity Commission, because we really want people to remain connected with their workplaces.
LEON BYNER: All right, and again, I did ask Wayne Swan this but I’ll ask you. There are those who are single mums and unemployed. You say well there are all these benefits that you’ve already announced, I don’t have them.
JENNY MACKLIN: Well it’s important to remember two things. One is that in the budget last night we did announce an additional training supplement for people who are both on Newstart and Parenting Payments so this is an additional supplement of $41.60 a fortnight and will be available to help people upgrade their skills. This is the time to do it, to make sure that when the recovery comes you’re able to get the jobs that will be created.
The second thing is particularly for single parents. We have to remember that they also receive significant benefits through Family Tax Benefit A and B on top of their parenting payment.
LEON BYNER: Now I know you’re the Families Minister, and I’ll ask you this. The river Murray didn’t appear to get anything?
JENNY MACKLIN: You’re right I am the Families Minister and I’ve been really concentrating on the pension and family payment issues so if you don’t mind checking with Penny Wong on that issue.
LEON BYNER: Well I certainly will. So the payments are in a nutshell, the ones you’ve announced are from September of this year once you get all the legislation through, and the paid parental leave will be 2011.
JENNY MACKLIN: Yes.
LEON BYNER: And to clarify the matter, as I thought it was a top up but you’re saying no. If your employer pays you paid parental leave, you get whatever that employer is paying plus whatever the taxpayer is paying.
JENNY MACKLIN: That’s correct.
LEON BYNER: Okay. Part-time, what about part-pensioners?
JENNY MACKLIN: Yes, part-pensioners or part-time time workers for paid parental leave?
LEON BYNER: Part-pensioners.
JENNY MACKLIN: Part-pensioners. All people who are currently pensioners will continue to be looked after, so they will receive at a minimum $10.14 a week, so it depends where they are on the part-pension scale of course. So the people who’ve only got a tiny bit of private income they’ll receive not all of the $32.49 a week but a good proportion of it, so it really depends where you are on the scale.
LEON BYNER: Okay, and overseas monies that come from another pension, that’s all regarded as taxable income, so any income is regarded as taxable, is it not because Derek wanted me to clarify that point?
JENNY MACKLIN: The tax arrangements for pensioners are as they’ve always been so we haven’t made any changes to that. I can go through all of those with you separately. I have to go into the Parliament and look after this Carer Supplement, Leon…
LEON BYNER: So I understand…
JENNY MACKLIN: I can get back to you and we can go through the tax arrangements another day.
LEON BYNER: Thanks Jenny. Jenny Macklin, the Families Minister.