Hanson urges end to NDIS ‘rorts’

Pauline Hanson says she holds ‘grave concerns’ about the government’s 2.5 per cent Medicare levy.

One Nation senator Pauline Hanson.

One Nation leader Pauline Hanson has called for an “investi­gation” into the National Disability Insurance Scheme and warned the government she has “grave concerns” about its plan to fully fund the project.

Scott Morrison introduced legislation into the House of Representatives yesterday that, if implemented, would increase the Medicare levy to 2.5 per cent from July 1, 2019, to help pay for the NDIS.

Under the proposal, Australians earning $80,000 would pay $400 a year extra in tax while those on low incomes would fork out “less than a dollar a day”.

Senator Hanson said Australians were already struggling with the rising cost of electricity and her party had not given the government any indication it would support the measure, which is expected to raise $8.2 billion in revenue over four years. She is demanding inquiries into the NDIS and the disability pension.

“We are not going to put the public under more stress with taxes if the government doesn’t rein in and stop those who are rorting the system,” Senator Hanson told The Australian.

“I believe (the NDIS) needs a full investigation into it. (The government) has to do an investi­gation and everybody on a disability pension has to reapply and ensure they truly require ­assistance on the disability pension. People have been on it for chronic fatigue for years.”

Without the support of Labor, the government will need to sec­ure 10 extra votes from the Senate crossbench to legislate the 0.5-­percentage-point increase to the Medicare levy.

The Greens, One Nation, the Nick Xenophon Team and Jacqui Lambie are opposed to the bill in its current form but are open to discussing changes to make it “fairer”.

Liberal Democrat senator David Leyonhjelm and Australian Conservatives senator Cory Bernardi oppose the bill, while Derryn Hinch has said he will support it.

People with taxable incomes of less than $21,655, or $34,244 for seniors and pensioners entitled to the pensioners’ tax offset, will be exempt from the levy. Families earning up to $36,541 — plus $3356 for each dependent child or student — will also be excluded. Labor wants the tax increase to apply only to those earning more than $87,000 but the Treasurer said that would create a “ginormous effective marginal tax rate”.

“You earn a dollar more and now you are paying an extra half a per cent on all $87,000. Now, that is a tax cliff. It’s bad design. It’s not good policy. But worse than that, (Bill Shorten) is just raising it because it is about his politics of envy,” Mr Morrison told Sky News.

Labor slammed the legislation, saying it would result in a tax hike on over seven million Australian workers earning less than $87,000.

“Labor’s plan raises more than $4bn more than the government’s proposed tax rise over ten years by increasing the Medicare levy for individuals earning more than $87,000 a year and keeping the deficit levy on those income earners earning more than $180,000,” opposition treasury spokesman Chris Bowen and opposition social services spokeswoman Jenny Macklin said.