PENSION WITHOUT POLITICS

At Budget time every year, and at every election, Australia’s Age Pensioners take an unwarranted political and social pounding.

They are accused of being an intolerable burden on younger taxpayers who are concerned that most pensioners may be welfare cheats.

The cynical aspect of it all are that their accusers are mostly tax evaders who constantly cry out for more corporate welfare such as tax cuts, subsidies and low interest rates.

Nevertheless, the fact is that the Age Pension today amounts to a payout of 45 billion dollars a year, a figure that will double by 2030 as more Australians grow older and take a lot longer to die.

The question for us all is how we finance it without sending oldies to the gas chambers as some fascists would like to do.

We can start by taking an objective look at the current situation and work out how to turn it into a positive.

The Age Pension is indisputably inadequate, very close to the poverty line, and has been for a long time.

In September of this year, in attempting to have our nation face this issue, I was part of a team that prepared a report on THE ADEQUACY OF THE AGE PENSION. We presented our findings to the Press Club in Canberra where it went nationwide on ABC and Sky.

It was the result of a partnership of the Longevity Innovation Hub (that I chair), the Benevolent Society (Australia’s oldest charity) and Per Capita (an eminent think tank).

Part of our research involved holding focus groups across the nation where ten pensioners would meet for two hours to discuss what they actually spent daily, weekly, monthly, annually and what necessities they could not afford. It revealed a totally different result to that which is achieved by Treasury when they base their pension calculation on a number of economic indices. Older people have costs that others do not have.

Our quite definite conclusion was that the Age Pension must rise, but its size must cease to be the political decision that it has been since it was created in 1908.

The prime recommendation of our report was that legislation be passed to create an Age Pension Tribunal that would be totally independent of political pressures and whose determination of the amount of the Pension could not be challenged by Parliament (in the same manner as the Parliamentary Salaries Tribunal).

Parliament would retain the power to determine who is eligible for the Age Pension. It would also have the power to sack the Tribunal at the end of its term, while the enabling legislation can require the Tribunal to hold formal meetings with the Treasury, Reserve Bank, Treasurer and Shadow Treasurer prior to making its determination every year.

Crucially, the Tribunal would be required to carefully relate its determination on the impact that it will have on superannuation,  other savings and mature age employment and comment on this in their report. Above all, it must strive to create a situation where pensioners are not penalised for having saved diligently during their working years, as disgracefully occurs now.

All of this will mean that the Pension will cease to be a political football that demeans and humiliates Pensioners and drives a rift between the generations.

It will mean also that the Government of the day can’t be attacked by the Opposition for being mean or generous to Pensioners. The Tribunal takes the blame.

More importantly, the sum that it determines can provide a benchmark against which other pension payments and welfare transfers are calculated.

Some misinformed critics will say that the cost of the Age Pension is so great that no government could possibly agree to losing control of it. But, the fact is that the Pension has been an indispensable part of national life for a century and will be for the next thousand years. It must be accepted as an unavoidable cost just like the repayment of loans and interest. We must stop agonising about it year by year and allow the Tribunal to announce the figure six months before Budget Day.

A vital reason why the Pension must come out of politics is that there is no such thing as an average pensioner. Some are frugal, some not, while some are good money managers and others are not. Some enjoy good health, but many don’t. Far too many don’t own their own homes and many don’t live near essential services. Economic indices can’t cover any of those issues, nor will political ideologies.

The Age Pension is quite clearly long overdue for change and the challenge is not an insurmountable problem. It can be financed easily if all evaders pay their taxes and negative gearing is abolished as being ludicrous middle class welfare.

Australia is one of the most prosperous nations on earth with a hard working, intelligent work force who do not deserve to be demeaned in their twilight years. They most certainly should not have such a low pension that they have to choose between food and medicine which so many do today.

Yours at Large

Everald Compton

If you would like to buy my book ‘The Man on the Twenty Dollar Notes’, go to my website everaldcompton.com and click on the book title. Fill out the order form and I will send you a signed book and a bill before Christmas.

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16 Responses to PENSION WITHOUT POLITICS

  1. Liz Cooke says:

    The pension is inadequate for some people. Those who are struggling are people who are renting and those who have no savings. It is quite possible to live comfortably on the pension as long as people do not expect to continue with a lifestyle based on a working wage. Superannuation was expected to allow a top up of the pension to allow for lifestyle maintenance. Things have changed. It is definitely time for a dialogue about community expectations around the pension and super. There are too many ways that rules can be manipulated to both disadvantage and advantage some people.

  2. I moved to the Philippines so I could afford to buy a house with my retrenchment payout as I could not afford to buy a house in Australia. I am on superannuation, but can not supplement it with any part pension because the Philippines is not one of the 22 countries that has a reciprocal arrangement with Australia to pay pensions. This seems rather inequitable. I now have a wife and a six year-old son, so want to save as much as possible to secure their future should something happen to me as in that situation they would only get two thirds of my superannuation which has a component that is not tied to the CPI and would diminish in real value over time.
    When I was working a third of my wage was going in paying rent. Rentiers tend to be parasites on Australian society, draining too much of its resources and using the tenants to pay off the rentiers mortgages. Governments should be building more public housing to create a glut on the market and drive the extortionate rents down. Another thing that has made housing unaffordable is the building labourers. They used union power to reduce their hours but get paid the same or more. Putting in less hours means less work gets done per dollar, and thus the price of housing goes up. The housing market is skewed against the ordinary person and it needs to be corrected.

    • Gabrielle Drinkwater says:

      Hello and Seasons Greetings,Colin.Yes,affordability for Housing, is indeed a problem. Recently I decided to TRY and Build Very Modest Homes with over 50’s and especially Non Superannuated’s ! Such as myself,who ARE STRUGGLING with exhorbitant Rentals…Mainly in Cities!!! My AIM is to ENCOURAGE OLDER people who are NOT employed to consider REGIONAL Living…eg..HERE in MANNUM on the beautiful MURRAY River..1hr out of ADELAIDE I hope to Build the FIRST Village in 2017. “MI mini Mansions. Australia ” By selecting your New Life, I wish you well, but .I NEED those in your position to HELP. It is said 5% of WOMEN Entrepeneurs get Financial Assistance…TRY being 76 as am I!! BUCKLEYS! BUT the NEED IS GREAT..this Concept, WILL WORK…HELP!!! .

  3. Ree says:

    New asset test …..Not fair…..pushed people to buy expensive house to lower savings?? Push up property prices, doesn’t make sense this policy !!! Do nothing good to young and old!!

    If can’t change back the policy, give me a free euthanasia pill. I don’t want to live in fear anymore.

  4. Geoff Blogg says:

    Bravo Everald! Well said as usual but can you tell me if there has been any meaningful response from any political body to the proposal? I will bet there has not. Probably the pollies are sticking their head in the sand (or up some other orifice) as usual and hoping it will all go away! Meanwhile they are all eagerly awaiting the next decision from their “independent” pay tribunal

  5. Anonymous says:

    I watched the presentation to The Press Club & wonder if the report has been delivered to the politicians & the response. It seems to me that now might be the opportunity for radical changes in light of evident voter unrest with current major political parties & I hope the matter has not fallen silent.
    I am of the view that the pension payment on it’s own will be difficult to be set at a level that equitably meets all requirements.
    I wonder if greater concession for private health fun contributions, rent assistance, transport, trades persons costs, council rates & household insurance for example in lieu of a pension increase. Usage of these & no doubt some others varies from household to household so I would expect that modelling of these should be able to be completed to determine the comparative cost to the budget,

  6. Nigel D'Souza says:

    Dear Everald,
    Thanks for your comments on the age pension. Frankly, there was no need for you and the others to conduct any detailed study of the inadequacy of the age pension. It is well known that the age pension is not adequate. You are a straight talking person, but in this case I see (in you) the same problem that I see all around Australian Society: everyone wants to talk about how much more the government should spend on a host of services ……….. hospitals, roads, schools, age pension, disability payments etc. etc. However no one wants to talk about raising taxes to pay for these services.
    I think you and your team missed an opportunity to send a message to government that our society has to pay for the benefits it wants. That’s the reality. There is no points in saying “Australia is one of the most prosperous nations on earth ……….” yes, but we are now about to lose our AAA credit rating and there is no sign of the national debt reducing even the slightest; its increasing!! And this government is considering reducing taxes in keeping with their right-wing ideology. I sympathise with the condition of some pensioners who are doing it tough indeed, but when are we as a nation going to understand that there is no such thing as “a free lunch”?
    I think your organisation together with others and the age pensioners, needs to mount a public awareness campaign to convey to our society that we cannot expect to get services from the government, until we are prepared to pay more taxes in one form or another.
    Best wishes,
    Nigel D’Souza

    • Gabrielle Drinkwater says:

      Hello Nigel, I don’t know Your Circumstances, nor want to. It seems to me that No Decent Aussie really wants a Free Lunch BUT lately I as a pensioner see just How Hard, those like me that are Non Superannuated after decent hard working lives, are finding Life. Acouple 77/78 rang me in desperation when being charged $748 a fortnight for decent Rental on fringe of a Town 20 mins out of Adelaide! That was a specially built house under the scheme meabt to offer 20% less in rent. I am myself facing extreme difficulty now from A Bank, sfter Mr Abbott removed Sola Rebate and our Y.P Wind Farm was not built. Trying to get ahead , honestly, is a Joke now. Spare a thought..it IS tough out here. Perhaps,as in the inconceivable result in USA, WE need TOP Businessmen/Women to Organise the Shemozzle Trying to RUN this Country..THEY NEED HELP! To ALL lets hope All Children in Allepo are given HOPE and Man’s Inhumanity to ALL on this Small Beautiful Blue BALL, is Curtailed at last…Blessings.

      • Nigel D'Souza says:

        Thanks for your comment Gabrielle. The point about the “free lunch” is that our society wants and needs more expenditure on services, but it seems no one wants to raise the issue of increasing government revenues (taxes). “Growing the economy” will not pay the additional revenues that we need. This has been proven time and time again. Yet the silence from Everald and other prominent Australians on the matter of increasing taxes, is disappointing. I can mention that the highly respected CEDA (Committee for the Economic Development of Australia) has come out strongly and clearly in favour of increasing taxes and/or reducing the various tax rorts such as negative gearing. We need more of such calls; only then will we be able to pay our pensioners a decent pension.
        Nigel D

      • Gabrielle Drinkwater says:

        Hi Nigel, I Do get your point, Perhaps when we see ALL Multi Nationals and Big Businesses PAYING TAXES and Dues to This Country the attitudes of the masses will be lessened. I see/hear of corrupt practices so often that to be “honest” seems to be considered a MUGS GAME by many. I so wish we had some REAL Strength AND LEADERSHIP in Australia’s Parliament. Did you see where the Family Party’s BOB DAY is having his LEGAL BILL Paid by Govt.? WHY?????? It is a Grubby world…Unless you are a threat in some way…? Good to share views, however disparit.!

  7. The Dells says:

    Thanks for going in to bat for those who have reached that stage in life where the plans that they put in place back some 20 years ago are turned on there heads when it is to late to do anything about it. A Merry Christmas to you and yours Cheers Charlie

    _____

  8. Michelle Rafter says:

    Very insightful as usual. My problem with this issue is that previous governments failed to heed warnings as far back as the 1960s of a looming ageing boom. Unlike prior generations which raised large families, without any reliance on government financial aid, the boomers had access to birth control, modern medicines & higher educational opportunities than their parents before them. It could therefore be argued that, not only governments, but also society failed to factor into budgets the future costs of caring for the aged. A ratio of 1 tax payer per 5 over 65s is unsustainable in the long term. The mandatory voluntary super contributions was a step in the right direction & an indication that, at the very least, the Keating government were proactive as opposed to successive government’s reactive positions. The media too are a driving force in portraying aged pensioners, or indeed, any welfare recipient as a drain on the economy. Nowhere is there any mention of politicians reigning in their own excessive entitlements. This, despite the former treasurer claiming ‘the age of entitlement is over’. Before any course of action is taken to provide for our ageing population, surely our leaders must set the benchmark regarding equitable & responsible incomes?

  9. Gabrielle Drinkwater says:

    Seasons Greetings Everald…Of course you are correct, but will ANYTHING Positive in THAT area happen, without events such as ALL Volunteers STOPPING for a period? The Huge Savings to Govt .by Volunteers Australia wide Must be fully acknowledged for a start. Muster the Courage our beloved Malcolm cannot muster, despite the disgusting group of Hidden Disgruntled OLD, past their time so called Men, who only care for Revenge, NOT this COUNTRIES, well being. BUGGER OFF you behind the scene Puppeteers,please for Australias sake…NOW. I call for your mass SACKING.!

  10. Heather says:

    Hi Everald, How do I send this page to a new group I have joined. Its called GreyPower Australia ? For the over 55’s. Oh oh I see the facebook logo under here. Do I have your permission to post it to GreyPower ?

  11. Brian Peat says:

    Well done sir you are right onto it again. It is a shame that Govt does not often listen

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