House of Representatives

Veterans' Affairs Legislation Amendment (Budget Measures) Bill 2009

Second Reading Speech

Mr Griffin (Minister for Veterans' Affairs)

I move:

That this bill be now read a second time.

I am pleased to present legislation that further improves the operation of Australia's repatriation system. This is in line with the government's election commitment, demonstrated in successive budgets, to deliver better services and benefits to the ex-service community in Australia.

The bill will introduce two budget measures that will assist veterans, members and their dependants and improve the effectiveness of the repatriation pension system. A third measure will assist members of the veteran and defence communities.

The first budget measure will provide more convenient payment arrangements for Australian veterans, members and dependants who live permanently overseas.

Currently Veterans' Affairs beneficiaries who live permanently overseas must have their Veterans' Affairs payments paid into an Australian bank account, often incurring relatively high bank fees when transferring money internationally. In comparison, most other Commonwealth beneficiaries who live in overseas countries with reliable banking systems can receive their pension directly into an overseas bank account. In 2008 the Prime Minister made a commitment to review this inequity for members of the Australian veteran community living overseas. This budget measure will deliver on that commitment.

The second budget measure will extend eligibility for the Defence Service Homes Insurance Scheme to persons eligible under the Defence Home Ownership Assistance Scheme Act 2008. The Defence Service Homes Insurance Scheme currently provides home insurance to eligible Australian veterans and members, peacekeepers and widows and widowers. This measure will extend eligibility for Defence Service Homes insurance to those serving and former members and reservists eligible under the Defence Home Ownership Assistance Scheme, introduced in 2008. This extension will provide eligible persons with access to cost-effective insurance designed specifically for the service and ex-service community.

The final budget measure will cease payment of an outdated dependant pension and will pay existing pension recipients a lump-sum payment equivalent to three years of pension.

Under previous repatriation legislation, certain dependants of veterans or members on disability pensions were eligible for a dependants pension at a rate which reflected the rate of disability pension paid to the veteran or member. The maximum fortnightly payments are $8.42 for partners and widows and $2.86 for children. The minimum payments are 84c and 29c respectively. This small pension has been virtually frozen for many decades and new grants of the pension ceased in 1985.

The purpose of the payment when it was introduced was to provide financial support to the dependants of veterans. Other government programs, such as the partner service pension and social security payments, now provide this support more effectively.

The government will pay a one-off payment equivalent to three years of payments to current recipients. Entitlement to the dependant pension will cease on 22 September 2009. We anticipate the lump-sum payment will be made on 24 September 2009. The lump sum payment will be exempt from income tax. It should be noted that dependant pensions that were granted on the basis that the person was without adequate means of support are not part of this measure. I also want to make it quite clear that existing war widow and widower and orphan pensions are not affected by this measure.

With a pension of such a relatively low amount, the value of which will continue to erode over time, a three-year, lump-sum payment will be of greater use to many current recipients.

The government is committed to maintaining and enhancing services and support to Australia's ex-service community. This legislation continues the progression we have made since coming to government to ensure that the support available through the Veterans' Affairs portfolio is effective and equitable.

Debate (on motion by Mr Billson ) adjourned.