Change is forever with us, a clinging certainty from which we cannot hide.
So, the time has come for Australians to accept that, after 106 years of enjoying a Retirement Age of 65, we must face the inevitability of it rising to 70.
Having said this with a strong conviction that it is a right and good thing to do, I totally disagree with the negative manner in which the Australian Government has presented it to us in the 2014 Budget by declaring that there will be economic doom unless we make the change by 2035.
Fear is the weakest form of motivation available to humanity, yet this year’s Budget was riddled with it.
All the medical evidence that is currently available indicates that, for most people, the longer one works, the longer one lives. An additional five years of work should result in a further five years of life. Right now, most Australians can look forward to a life expectancy of 85. An active working life beyond 65 could raise this to 90, with females doing better than males. The long-held fantasy that continuing at work will shorten your life is simply not proven, unless you are in poor health to begin with.
There is some validity in the argument that a person doing heavy physical work could have difficulty in continuing to do that for an extra five years, in comparison to those in mentally-intensive work, but the latter should realistically be able to work an extra 10 years, ie, to age 75.
We must remind ourselves of the fact that, when Andrew Fisher and Alfred Deakin brought in the age pension in 1908, declaring that it would be available at age 65, most workers did not live to that age. Most died between 55 and 65. So, we had a society at that time which accepted the inevitability that you worked until you died. Now, we have a totally different situation. The equivalent medical age to that of 65 in 1908 is 85 in 2014. And, in the area of physical work, there is now lifting equipment and other technology to assist workers that were unheard of a century ago.
Looking at it from a financial perspective, most Australians now retire with insufficient superannuation to give them a better lifestyle than is provided by the age pension. In addition, it can be expected to run out before many reach 85. An extra five years of receiving the superannuation guarantee would significantly improve this situation.
Indeed, an enlightened government would allow all workers aged between 65 and 70 to add increased personal contributions to their superannuation over and above the guarantee and receive the benefit of a tax deduction for doing so. This incentive would save the nation a lot of pension payments that will be inevitable when the capital in individual Super Funds run out.
It will also help significantly if the Access Age for both Pension and Superannuation are the same, ie, 70. There should be an additional law that forbids people from taking their Super in a lump sum, making it mandatory to receive it in monthly payments until 85. It is grossly unfair to others that some people take their Super as a lump sum and use it to repay the mortgage on their home so they can then qualify for the Pension.
A key issue in raising the pension age to 70 will be the availability of work. If a 65-year-old does not have a job, they will collect the dole instead of the pension — so the nation gains nothing. The greatest job creation program in our history must go hand-in-hand with the five-year work increase. Added to this, employers, including the Public Service, must stop their rabid discrimination against older workers in the jobs market. It is an unjustifiable disgrace for which huge penalties must apply.
Let me give a personal testimony about ageing. I am 82 and I started work at 16 as a bank clerk. I have never stopped working, and I can’t remember even noticing my 65th birthday. I currently enjoy my active life as a director of four companies and Chairman of a Panel on Ageing and a Charitable Trust as well as being a writer, broadcaster and volunteer charity worker. I find the thought of retirement to be absolutely repulsive and, although I suffer significantly from arthritis and a few other medical conditions, I reckon that I would now be dead if I had retired at the traditional age.
Fortunately, because I have been an avid saver all my life, my superannuation and other investments are large enough to keep me off the pension and provide enough to enable me to spend a month every year travelling around the world to visit my family in Europe and America. In addition, I spend lots of time with friends at dinner and the theatre, as well as being heavily involved in my local church.
The key issue is that I enjoy working and find it both stimulating and relaxing. Sadly, the fact is that anyone who dislikes work will be very unhappy with working to 70 and beyond, but there is nothing that any government can do to save them from this.
Now for a comment that may cause some angst: We can’t wait until 2035 to raise the Pension and Superannuation age to 70. It should happen by 2025 if we want the rapidly-increasing number of older Australians to have a good and healthy life and want to avoid having our grandchildren pay sharply higher taxes in order to fund our pensions. Let’s agree to retire at 70 or later in order to reduce their tax burden. We are not doing it to help the government.
While we are at it, let us do all we can the turn ageing into a national asset, not a burden. There are many ways we can do this in addition to working longer, such as studying for a mature age university degree and paying the fees. This will help reduce fees for young students.
We can also use the internet to work online from home to improve our personal finances. There are, in fact, many business opportunities that await us all in the Ageing market.
Here’s to a great life as we get a bit greyer.
Indeed, Australia is the greatest place in the world for us to live out our mature years, while seeking to achieve the oldest possible age without ever going into a nursing home.