Scrapping energy subsidy a shock tactic

Abolishing the energy supplement would be akin to human rights abuse, the Australian Council of Social Service (ACOSS) said yesterday.

Under legislation being considered by the Senate, removing the payment would cost pensioners up to $14 a fortnight.

Speaking at a Senate hearing into abolishing the supplement, which since 2009 was meant to offset expected higher power costs linked to the carbon tax, ACOSS chief executive Dr Cassandra Goldie said the measure must “be firmly rejected”.

“If this Bill goes through, 1.7 million people on the lowest incomes will be worse off, including those paying for accommodation, food, travel costs and day-to-day bills while living on just $38 a day,” Dr Goldie said in the ACOSS submission.

“Expecting people in Australia to survive on so little is a human rights issue.

“We cannot fathom why the Government persists in trying to cut the incomes of people who have the least.”

The Federal Government has proposed axing the supplement for anyone who began receiving income support from 20 September 2016. 

The hearing held in Melbourne yesterday into the Social Services Legislation Amendment (Ending Carbon Tax Compensation) Bill 2017 received submissions from eight organisations. Each group objected to the supplement’s abolition.

The committee behind the hearing is due to report on 9 August. If the Bill is passed, the supplement will no longer be paid from 20 September, saving the Government more than $930 million between now and 2020.

Opinion: Government’s power play pickpockets pensioners

The Federal Government’s attempt to rob our poorest of the energy supplement is unconscionable and overtly discriminatory.

Pensioners on income support before 20 September last year are safe for now. But anyone who has fallen on hard times since will be wondering if they are living in a parallel universe, because the Government has arbitrarily decided they won’t be entitled to help paying killer power bills.

Welfare groups have justifiably rounded on the senators taking submissions before the measure is presented to parliament.

The Australian Council of Social Service (ACOSS) rightfully described removal of the assistance as bordering on human rights abuse.

It told the hearing yesterday that nearly 3 million Australians are living below the poverty line and the Government’s job should be about helping increasing these people’s incomes, not slashing them.

Yet, in its submission to the hearing, the Department of Social Services borrowed from Trump team’s alternative facts manual. It laughably claimed that the “repeal of the carbon tax … put downward pressure on electricity prices”.

Bollocks. As several groups pointed out to the senators, wholesale and retail electricity prices are significantly higher now than they were in 2013 under carbon pricing.

Analysis by Melbourne University’s Australian-German Climate and Energy College identified the average electricity price across Australia was $134 a megawatt hour last summer, compared with an average of $66 during the two summers that the carbon tax was in place. That is a doubling of the rate.

Further research from the Australian National University found that between 2006 and 2016, the average electricity bill soared 65 per cent.

The department went on to claim “the actions the Government is taking” is also helping to ease the pain of expensive energy bills.

I’m sorry? Which actions? The ones involving giving energy transmitters and distributors permission to jack up wholesale prices because of their gold-plating of infrastructure?

Before a power company can increase its prices, it needs to convince the Government’s energy regulator that a hike is warranted. Thus the blame for higher power prices lies fairly and squarely at the feet of a Government that has allowed runaway network cost blowouts to be passed to the consumer via electricity retailers.

Plus this year, electricity retailers have added even more pain by announcing steep tariff increases.

And if the measures referred to are the one-off energy assistance payment of $75 for single pensioners or $125 for couples, someone hasn’t done the maths. Axing the supplement will cost some pensioners as much as $366 a year – a one-off $75 bonus will go nowhere near covering the shortfall.

A Salvation Army survey this year found that socially disadvantaged households spent $73 a week on utility bills. The Government really is delusional if it thinks its one-off bonuses are going to be much help.

The Australian Competition and Consumer Commission (ACCC) is now probing electricity retailers’ pricing methods. Preliminary findings will be presented to the Treasurer by 27 September 2017 and a final report by 30 June 2018.

At the very least, the senate review should await the consumer watchdog’s independent verdict before tampering with the energy supplement.

What do you think? Where else could the Government find the savings it will make by scrapping the energy supplement? Will losing this supplement mean you won’t be able to pay your power bill?

Related articles:
Why has my energy supplement stopped
Energy bill increases

Written by YourLifeChoices Writers

YourLifeChoices' team of writers specialise in content that helps Australian over-50s make better decisions about wealth, health, travel and life. It's all in the name. For 22 years, we've been helping older Australians live their best lives.

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