In early 2012 I wrote a submission to the Australian Government Inquiry into the Asian century called ‘Parity for Pensioner Pariahs’. In that submission I addressed the topic of ‘portability’ of welfare benefits, and considered its impact on the ability of Australian citizens to access affordable care facilities overseas.

Fast forward to May 2014 and I’m fuming about changes to the rights of Australian welfare recipients to travel and live overseas announced in last night’s Federal Budget.

Under current regulations the Disability Support Pension (DSP) can be paid for absences from Australia for up to six weeks, on multiple occasions in any one year. In addition, a small number of exemptions are granted depending on assessment on a case-by-case basis.

It is now proposed that DSP recipients who leave Australia on or after 1 January 2015 will only receive DSP for a maximum of four weeks in a 12-month period. The Government claims that this move will result in savings of $12.3 million over five years.  

Another change that was announced was that of limiting the six week portability period for student payments from 1 October 2014
to generally align the portability period for student payment recipients (Youth Allowance, Austudy and ABSTUDY) with the rules for job seekers. Recipients of student payments will no longer be eligible for payment while overseas on holiday.

In addition, the relevant Minister has indicated that he would like to see a uniform approach taken to all welfare recipients. Thus it is highly likely that further restrictions will eventually be imposed in relation to, for example, recipients of the aged pension.

This tightening-up of regulations was foreshadowed by the media, for example in an article in the Courier Mail entitled ‘Travel bans to ground disability pensioners’. Extracts from that article, together with my response, are provided below.

“Disability support pensioners will be banned from travelling overseas for more than four weeks at a time as part of Budget crackdown on welfare cheats.”

Oh, ok, let’s label pensioners who travel/live overseas as “welfare cheats”, despite them presumably meeting all existing eligibility requirements.

 “The Government will tighten “portability” rules for the Disability Support Pension to crack down on recipients taking holidays at taxpayer expense or living in places like Bali while claiming they are in Australia.”

Loaded statement. They are a taxpayer expense where-ever they are located – unless they can be coerced into relinquishing the right to welfare support accorded to other Australian citizens.

“Taxpayers spend about $100 million a year on payments to 7,313 disability support pensioners who live overseas.”

Irrelevant point – would this amount be any less if they stayed in Australia the whole time?

“The Government has already cut trip times for these pensioners from 13 weeks to six weeks to reduce the risk of them basing themselves in cheap destinations like Bali and flying in and out of Australia to meet residency requirements.”

Hmm, sounds serious. But in what way does their choice to base themselves there constitute a “risk”?

“Mr Andrews said he eventually wanted a consistent approach to travel rules for all who received welfare payments.”

Aha, then I guess we can assume that the four week absence rule will soon apply to old age pensioners too, right? They already can’t afford to live in the mainstream Australian community, so perhaps the Government might need to create cost-effective special settlements for them – perhaps somewhere in the outback?

“The question here is what’s fair from the community point of view given that people are in receipt of benefits and that’s the balance we’ve got to try and achieve”.

No Minister, the question is whether economic logic tempered with some compassion should drive government policy, or whether pandering to ill-informed bias and media-inspired stereotypes should dictate how our government treats its citizens.

Yes, you bet I’m angry about this progressive winding back of peoples’ right to be absent for extended periods or to relocate to their country of choice. I’m angry not only because it is unfair, but also because it doesn’t even make economic sense.

The Government decides who qualifies for citizenship, and who is therefore potentially eligible for welfare payments. The Government determines the eligibility criteria for particular forms of welfare (other than residence), and how much people are paid. I’m not buying into those broad issues, other than to say that if there is a problem with those determinations then fix that problem and don’t try to balance the books by pushing people overboard on the basis of a bogus “crack-down” on “welfare cheats”.

Minister Andrews, is it not a fact that if everyone receiving benefits abroad  simply returned to and/or remained in Australia, then these tightened residence restrictions would have had the effect of actually costing tax-payers substantially more money? [see footnote] Has this not been established in research undertaken by the Government? Research that seems to have been quietly shelved … perhaps because it went against what the radio shock-jocks were telling us, and what the man-in-the-street preferred to believe?

I don’t believe for one moment that savings of anything like the forecast figure of $12.3 million will be achieved. In fact the only way the tightened residence restrictions can result in any savings is if welfare recipients stay overseas and conveniently drop out of the welfare system. I believe that this is most likely the real objective of the Government’s announcement.

Just for the sake of argument though, let’s say half of those affected obliged the Government by dropping out of the welfare system (saving taxpayer$). Let’s say the other half returned to and/or stayed in Australia (costing more taxpayer$). Even if that meant tighter controls on travel became a zero-sum game in a monetary sense, the government could care less given that it still gains some advantage just by being seen to be strong on welfare rorting.

Thus these further restrictions are not about stopping welfare rorts, they are about getting otherwise eligible Australian citizens off welfare. This will be achieved by forcing people to choose between living in penury in the suburbs watching TV 24/7, or living in somewhat great comfort in warmer and more exotic locales.

I’m angry because these changes really does seem to be all about pandering to a media-created perception that if people can afford to travel overseas then they don’t need and/or deserve welfare payments.

It really is very sad that Australian Government policy formulation has descended to this low level of rigour and vision, and that it has reflects poorly on the potential of the country we are creating for the next generation.

It was extremely disappointing to note that all of the major newspapers were content to unquestioningly parrot the same line. So much for the benefits of a free and independent press! In reviewing the readers’ comments appended to the article at http://www.heraldsun.com.au/news/youre-paying-100m-for-pensioners-to-live-overseas/story-fni0fiyv-1226901383832, it was however gratifying to note the number of people who saw through the charade and expressed opposition to the further tightening of residence restrictions.

Interestingly, a similar biased pattern of behaviour towards expat pensioners is being demonstrated by the British Government, see:

http://www.survivefrance.com/profiles/blogs/british-expat-pensioners-to-be-given-badge-of-shame-by-british-go

http://www.telegraph.co.uk/finance/personalfinance/pensions/10665839/Frozen-pensions-force-expats-to-come-home.html

Footnote: For those of you who are asking how welfare recipients who stay away from Australia could possibly be SAVING the taxpayer big bucks …

Most welfare payments and Government services are already denied to citizens outside Australia. That means that when (in this case) disability pensioners return to Australia they become eligible for (for example) rental assistance payments, subsidised medicine, and access to public hospitals/Medicare. Then factor in government subsidies on aged care home placements for some. Really, the list just goes on from there. And don’t forget to include the pensioner’s spouse and perhaps children, and the support (e.g. family assistance payments) and services that they receive/use.

OK so those are immediate costs arising from forcing pensioners to spend at least 48 weeks of the year in Australia. But what about the additional (taxpayer-funded) costs incurred should pensioners’ physical and/or mental health deteriorate as a result of poorer diet, colder weather, and the onset of depression and anxiety related to their reduced circumstances in a country with much higher costs, higher stress, and lesser amenity?

Now some might say, “well why don’t we make sure that no-one receives any government benefits if/when outside Australia“. To that I’d say why? On what basis? The constitution doesn’t include provision for two classes of citizenship, e.g. citizen and citizen lite. Why – especially in this much-touted age of globalisation – should expats only deserve a portion of the rights and benefits of citizenship accorded to those back home in Oz?

Postscript: In July 2014 I prepared a submission to another federal government inquiry into proposed changes to the welfare system – you can read it at http://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Community_Affairs/Social_Services_2014_Budget_Measures/Submissions (refer submission #28)

Postscript 25 February 2015: The report of the Inquiry mentioned above has now been released and can be accessed at https://www.dss.gov.au/our-responsibilities/review-of-australias-welfare-system. There was virtually no discussion of the issue of portability of benefits. This summary of proposed changes indicates an intention to “limit the period for which Disability Support Pension (DSP) recipients can travel overseas and remain eligible to 28 days in a 12 month period (with some exceptions for special circumstances)“.

Postscript 25 January 2016: I noticed this article in The Age today, it’s entitled ‘Moves to limit overseas travel for pensioners ‘discriminatory’ say migrant, refugee groups‘

Postscript 15 July 2024: More evidence of consumer unhappiness with available aged care options in Australia … ‘Lifestyle Communities promise retirees affordable, resort-style living. But some say they’re a ‘financial prison’