I speak on behalf of the Australian Democrats on this legislation, the Family and Community Services Legislation Amendment (New Zealand Citizens) Bill 2001. In summary, the Democrats' view is that we are not opposed to this bill. The growing costs of social security commitments to the Australian taxpayer for New Zealanders resident in Australia is appropriate to address. However, we do have a couple of concerns in relation to how in unintended circumstances it may impact on some people, and also in terms of some of the stereotypes that may go along with debate around these issues – and I will touch on those briefly as I speak further to the bill.

Historically, recently arrived New Zealanders were treated differently from other migrants by Australia's social welfare system. That special treatment derived in part from the ease with which New Zealand citizens can move into and out of Australia and also from the development of bilateral social security agreements between the two countries. Because of the large resulting movement of people, in recent times the cost of meeting social security commitments to New Zealanders resident in Australia has ballooned. Media attention has often focused on Kiwi dole bludgers stereotypically living the good life at Bondi. In 1986, a six-month waiting period was imposed on newly arrived New Zealanders before unemployment assistance could be paid. Last year this was extended to two years, which has essentially put New Zealanders on an equal footing with other arrivals in terms of the two-year waiting period.

Both Australia and New Zealand allow their borders to be open for free movement between the two countries and, by virtue of the bilateral agreement, signal their willingness to accept responsibility for citizens of the other country. Considerable financial inequity has arisen, however, in that movement of New Zealanders to Australia has outstripped the reverse flow. Also, the constituency of this flow of migrants, particularly those who intend to stay permanently, has had important consequences for Australia. It is worth emphasising though that this issue is not just one of cost to Australia – obviously the social security payments are a cost to the taxpayer – but also the contribution which New Zealand citizens resident in Australia make to our economy should be emphasised.

Historically, Australia has had strong ties with New Zealand. It has always been an ally, and we still share values and interests in the Asia-Pacific region. It is one of our geographically closest neighbours, probably our culturally closest neighbour, and of course there is regular trans-Tasman travel. In recent times the relationship between the two governments has deteriorated somewhat over defence and immigration issues and also now, obviously, with there being some rearrangement of matters relating to welfare. It is easy and electorally popular to mount an argument that with New Zealanders we allow backdoor entry of migrants to Australia and to talk about Kiwi dole bludgers. In relation to this bill, which deals with New Zealand citizens, there obviously are no votes to be lost, if you like, in reducing entitlements to New Zealand citizens. But I do think we have an obligation, nonetheless, not solely to look at this issue in that respect but also to look at these people, who are part of our community and who do contribute to our society and our economy, to make sure that they are fairly treated.

The Democrats certainly endorse the view that a more equitable position in terms of cost sharing of social security support is essential. However, we should not lose sight of the fact that social security income support is about individuals who frequently find themselves in circumstances not of their choice or planning, and they should not be made scapegoats for the sins and failures of past bilateral agreements or immigration policies.

This bill purports to place New Zealand residents in a similar position to migrants from other countries and, on an equal playing field, this seems fair enough. But there are specific differences in relation to New Zealanders that may have the effect of making the playing field not so equal. The trans-Tasman agreement allows – indeed, it encourages – free and unrestricted movement between our two countries. There is no migration approval necessary. The process of migration from countries other than New Zealand usually leads to a greater degree of preparation for migration on behalf of the people involved. Also, the stringency of migration procedures and the granting of approval for permanent residence prior to departure do not apply to New Zealand citizens.

The substantial change reflected in this bill before us today is to the definition of `Australian resident'. Under the social security law, the definition of `Australian resident' – and this is not a change to the immigration law, just social security law – will restrict access to the full range of social security payments to New Zealand citizens, unless they are the holders of permanent visas. The issue of permanent residence is important because this bill makes it so. But New Zealanders are not required to obtain permanent residence or even permission to remain in Australia. The 1973 trans-Tasman travel arrangement has allowed Australian and New Zealand citizens to enter each other's country to visit, live and work without the need to apply for authority to enter that country. There has been no obligation or requirement for New Zealanders to obtain permanent resident status. Historically, those New Zealanders who do choose to do so bypass permanent residence and proceed directly to citizenship.

In some circumstances, what this bill may do is place New Zealanders in a worse position than migrants from other countries. The bill will ensure that people who live, work, pay taxes and raise children in Australia will never be entitled to social security income support because they were born in New Zealand, unless they take the previously unnecessary step of obtaining permanent residence. Other than under social security law and this change we are making now, there is no need or purpose for them to do so.

Migrants from other countries arrive in Australia with permanent resident status because they are required to do so; New Zealanders do not. That is not to say that New Zealand families and individuals who arrive in Australia are temporary visitors. Many arrive to settle, work, partner and participate in Australian society on no less a basis than migrants from other countries. Migrants from other countries undertake an application process prior to arrival and then are subject to a two-year waiting period after arrival for most social security payments. New Zealanders will not even qualify after two years, unless they take that step of applying for permanent residence. This bill purports to deny them that social security support.

It is not sufficient to justify this bill on some notion that New Zealanders are Bondi Beach dole bludgers. We should acknowledge the contribution made by migrants from New Zealand to the fabric of Australian communities over the years. Data from 1996 shows that New Zealand born Australian residents have one of the highest labour force participation rates of all birthplaces. The labour force participation rate of New Zealand citizens within Australia was 78.4 per cent at June last year, compared with a rate for Australian citizens of 67.3 per cent and for all migrants from the main English speaking countries of 64.2 per cent. At June 2000, the unemployment rate of New Zealand citizens was six per cent, which was lower than that for Australian citizens. The combination of high labour force participation rates and comparable unemployment payment rates indicates that New Zealanders do not deserve the dole bludger tag that is sometimes put upon them.

However, the Democrats do share the concern of the cost to the Australian taxpayer, and the inequity of the previous bilateral social security agreement because of the large disparity in numbers of people going to the respective countries. This bill proposes to place New Zealanders who have lived and worked in Australia for a lengthy period of time in the same context as more recent arrivals. At some point it must be assumed that, as with other migrants to Australia, New Zealanders have contributed to their home and have earned their social security entitlement. This bill proposes to place a 10-year benchmark on these cases. With migrants from other countries that figure is two years.

The Democrats are pleased to note the savings provisions of the bill which look after the interests of persons who are currently in Australia, temporarily absent or in the process of moving to Australia. As far as I am aware, there has not been any great rush of New Zealanders attempting to take advantage of this window of opportunity. However, the Democrats believe there has been insufficient notice given to people who have set in train their plans to move to Australia permanently but will be unable physically to arrive here before the 26 May deadline imposed by this legislation. Many migrants receive their information through unofficial channels, and it takes some time for the community to become fully informed about substantial changes of this nature. Moving between countries, particularly when that move is planned to be permanent, takes time to arrange. Sale of property, purchase of new accommodation, school transfers, packing and removal of households have to be arranged. The rush with which this legislation is being passed through the parliament has not facilitated the education process of citizens of both countries. For this reason the Democrats feel that the savings provision should be extended for those people who have initiated the process of moving to Australia but for whom arrival within the next couple of months is not possible. We would seek to provide a few extra months for that savings provision.

New Zealand citizens have for the most part been subject to the two-year waiting period for benefits, as with migrants from other countries. A number of times I have raised in this place the disastrous outcome which arose from the introduction of that policy initially, where skilled, educated migrants who had been invited and encouraged to come to this country were reduced to severe poverty and reliance entirely on charities for an unendurable period of up to two years if they were not able to find work in that period of time. Special benefit is the only payment that presently contains a discretion to shorten the two-year waiting period in restricted circumstances – which are whether the person has suffered a substantial change in circumstances beyond their control. Case law demonstrates that it is very difficult to establish that a person ought to be exempted under this criterion. Nevertheless, it is possible to envisage extreme circumstances where it would be inappropriate to demand that the person endure a wait until the appropriate residence determination is made, and then possibly a two-year wait on top of that, prior to their being entitled to a payment. This bill will deny even that fall back option of special benefit to migrants from New Zealand. Other migrants that come here from other countries and have a two-year waiting period, if there is a substantial change in circumstances beyond their control, do have that fall back which prevents them from being put in extreme hardship through no fault of their own. That fall back option is not present under these arrangements, and the Democrats believe that it should be.

In some cases people may live and work in Australia for quite a number of years – they may be married to an Australian; they may have children born in Australia – and may suddenly have an unexpected circumstance, perhaps domestic violence or something like that. A woman in that circumstance will not qualify for any income support. She would not receive assistance because she had never been required to obtain permanent residence and because, taking effect from next year, the new bilateral social security agreement will also exclude parenting payment. It is not enough for the government to say that simply obtaining permanent residence visas will solve the problem. The very unexpected circumstances which can befall people, which require them to seek income support, will then operate against them to make it more difficult for them to get permanent residence.

Senators may be aware of a recent Federal Court case decision of Justice Conti in October last year, in which a New Zealand citizen and former refugee aged 80 was hospitalised due to ill health. Despite their fear of returning to New Zealand, the people involved would never have qualified for the proposed new residence permit due to their age and health. The bilateral social security agreement would not assist them because they did not have sufficient residence in New Zealand, despite being New Zealand citizens. Had the provisions proposed in this bill applied – that special benefit be denied to New Zealanders – the result of that case would have left them in extreme poverty in the absence of any income support. There must be a relief valve for those special cases where it is inappropriate to refuse a payment. The practical way to achieve this is to exempt special benefit from the new residence requirement in the knowledge that only persons who have suffered a substantial change in circumstances beyond their control would qualify for the payment. We will move an amendment to this effect in the committee stage which would do no more than put New Zealanders on an equal footing with migrants from other countries, which I think should be the intent of this legislation. The Democrats welcome the opportunity to more equitably share the costs of social security income support of Australian and New Zealand citizens. However, in doing so we do not wish to create additional poverty traps for people who are part of our community or to simply move burden of support of citizens to churches and welfare organisations, which is what is at risk of happening in some circumstances with this legislation.

The Democrats are supportive of the aim of the legislation, but we are concerned that there does need to be a safety clause for people in unexpected circumstances. We do recognise the positive contribution and the high level of participation of New Zealanders in the employment market in Australia, and if we are to enable the trans-Tasman agreement to continue – and no-one is suggesting that we do not – then we do need to recognise the role that people play. If we are going to encourage or enable people to come here to contribute to our economy and to our community, we need to recognise that those people may sometimes, through no fault of their own, unexpectedly fall into difficulties, and it is in our interests as well as theirs to ensure that they do not become an underclass in our community. We will be moving a couple of amendments relating to that in the committee stage, but we are supportive of the aim and purpose of the bill.