Prepare for a retirement age of 70

[Banjo]

Prepare for a retirement age of 70: Joe Hockey

GENERATION X Australians may have to keep working until the age of 70, Joe Hockey has warned.

In another indication that a further rise in Australia’s pension age is on the cards, the Treasurer, 48, said his contemporaries may have to keep working until their eighth decade.

Labor raised the retirement age from 65 to 67 from 2023.

“It may be that my generation has to work for an extra three years (to age of 70) and we need to redesign our systems to manage that fact, “ Mr Hockey told ABC TV from Washington.

“It will affect my generation. This doesn’t happen overnight.’’

Seniors groups last week warned of a voter backlash over any rise in the retirement age, saying it was a simplistic approach to the deeper problem of funding Australia’s ageing population.

Mr Hockey also flagged a possible change to the way the aged pension is indexed. Currently it’s linked to average male weekly earnings.

“I’m not going to speculate on the budget but I will note that over here (in the USA) over the last 40 years 60 per cent of male workers in the USA have had a real cut in their incomes. In Australia we haven’t had that. Male weekly total earnings have been at a higher rate but it is not always going to be the higher rate.

“We need to have a sensible discussion about the sustainability of our entire quality of life. It’s not just pensions, it’s right across the board.”

Opposition finance spokesman Tony Burke said blue-collar workers would be hit hardest if they were forced to work for longer.

A shift in the retirement age would be a “very big deal’’ for pensioners required to do physical labour for longer while sitting on small super savings.

Mr Burke told Sky News Agenda the Abbott government faced harsh judgment if it raised the pension age, because it would be breaching a pre-election promise.

However, asked to provide the opposition’s solution to the problem, Mr Burke said it was not for Labor to provide an alternative as it awaited the government’s first budget.

Mr Hockey also said the world was making “unacceptable” progress on meeting Australia’s G20 goal of 2 per cent growth ahead of the leaders meeting in Brisbane later this year and more work needed to be done.

The Treasurer said the world needed difficult structural reform of the ilk being considered by Australia and used the tough talk to refloat the idea of tinkering with the nation’s welfare system.

”The proposal put forward by nations so far have been unacceptable and they only meet 10 per cent of our goal,” he told ABC TV. “But we pledge by the time we meet in Cairns in September and before the leaders meet later in the year in Brisbane we will have real effective plans to lift the global economy 2 per cent.”

He said with monetary and fiscal policy levers in poor condition and necessarily restrained, the only way to achieve growth targets was with structural reform which, in Australia’s case, would be informed by the findings of the Commission of Audit.

“We received a massive report to the government, we have to carefully consider the details,” he said. “We will release it in good time before the budget on May 13 and everyone will see it in its very raw form.”

Agriculture Minister Barnaby Joyce made the case on Sky News’s Australian Agenda for economic longevity on the back of trade deals but remained lukewarm about the Coalition’s trade deal with Japan, announced last week.

“I’m happy it’s come to a conclusion — I think we’ve done very well. I’ve got to call it for what it is,” he said.

“There were always going to be areas where you couldn’t tick every box. Rice, dairy, sugar. But in the end what do you do?”

But Mr Joyce said threats by the Greens to block the trade deal in the Senate were “typical”.

“The Greens will come up with a sideline distraction which will cause us immense damage in its public ventilation while they sit in manic monkey cafe of inner suburban Bananaville,” he said.

He also tempered the Prime Minister’s new-found enthusiasm for Chinese state-owned enterprises, after Mr Abbott made it clear he was willing to adjust investment rules.

“There is a natural caution and I think it will remain that SOEs are by their very nature elements of the state and it comes with a diplomatic side to it as well,” he said.

“SOEs, I acknowledge, are overwhelmingly driven by commercial principles, but sitting behind them there is a state purpose.”

Mr Joyce backed the Treasurer in the need for significant pain in the budget.

“The problems we have in this nation will change people’s lives if we don’t turn this around,” he said.

“We must turn this around. We should have turned this around back in 2009 when these other clowns were going crazy with the credit card. It needs deliberate action and it needs it now.”

www.theaustralian.com.au/national-affairs/prepare-for-a-retirement-age-of-70-joe-hockey/story-fn59niix-1226882446948

[nalang]

all blablabla...

[boku]

Today I read in the herald sun (or herald scum as some say) that the PM says he won't touch the age pension for another 3 years

[Banjo]

Row over pension age heats up

THE federal opposition has accused the Abbott government of breaking an election promise to pensioners amid reports it will push ahead with plans to lift the retirement age to 70.

In the lead-up to May's budget there has been ongoing speculation the eligibility age for the pension will be increased from 67.

The new retirement age could come into effect from 2029, and the federal government is also considering changes to pension indexation rates, The Australian reported on Saturday.

The changed pension age would affect every worker born since 1959, the paper said.

Labor families spokeswoman Jenny Macklin said pensioners had a right to be furious.

"No amount of weasel words can change the fact that the prime minister is planning to break the solemn promise he made to Australian pensioners on the eve of the election," she said in a statement.

Parliamentary secretary Simon Birmingham said it was reasonable for the government to look at the long term structure of the budget and ballooning costs, but he declined to confirm the report.

Any changes would be over the long term, he said.

"You can't just, if you're being sensible about it, say we're going to up pension age ... in the next couple of years and disrupt everybody's retirement plans," he told Sky News.

"You have to make decisions today that are about 20 or 30 years hence."

Labor MP Matt Thistlethwaite said it was unfair for blue collar workers.

"The brickie's labourer, the plumber, the carpenter, how are they going to physically be able to work until 70 years of age?" he told Sky News.

www.theaustralian.com.au/news/latest-news/row-over-pension-age-heats-up/story-fn3dxiwe-1226889807145

[Banjo]

Politicians thinking about cutting the aged pension need to walk in the shoes of Australian pensioners

THE Abbott Government is considering cuts to the aged pension? Well, Tony and Joe, do either of you understand living within moderate means, dependent on a modest nest egg, carefully garnered from a lifetime’s work, and the old age pension?

And what about the expensive, federally legislated minefield of residential aged care? It seems doubtful you know anything about either of those things. If you did you’d likely appreciate that for many, many elderly people there is no fat to trim and if you rob Pensioner Paul, you’ll just have find a way to pay Pensioner Peter.

Allow me to elaborate.

My 90-year-old mum held out in her own home for as long as she could but she entered residential care last year. She was placed on a wait list at the facility we favoured after we were told it could be many months before a room became available.

We were taken by surprise when one came up almost immediately. We were given 24 hours to make a decision. We were told it could be many more months before another spot became free so, flustered, we took the room at which point we were required to provide mum’s asset and income status to the facility for them to determine an accommodation bond, the payment of which became due and owing immediately, with penalty interest accruing at a whopping 6.95 per cent.

The bond was set at a six-digit figure that would leave mum with $46,000, or just 16 per cent of the total estimated value of her home and cash, a residual actually more “generous” than the $43,000 minimum required under federal legislation.

We put mum’s home on the market immediately for the mean of the four estimates we got but, after realising the market was dead, handed over half her cash in part payment of the bond in an effort to reduce the penalty interest rapidly accruing.

After five months, we pretty much fire-sold her place, dropping the price by more than $20,000 on the basis mum would be handing over something approximating that in penalty interest by the end of the year if we didn’t do something drastic.

In the end, mum handed over $8260 in penalty interest and, with a readjusted accommodation bond, she has been left in control of 14.6 per cent of her assets.

So who pays for mum’s accommodation and care? She does.

Firstly, the facility collects the interest from investing mum’s bond — as at three years ago providers were holding well over $10 billion of older Australians’ money, the latest figure I could find from the 2011 Productivity Commission “Caring for Older Australians” report — plus she pays a monthly “retention” amount of $323, which the facility is allowed to charge for five years.

Then, from her old age/superannuation pension, supplemented by a tiny UK pension, she pays her daily “care” fees and a government “income-tested fee”.

Out of her pension income, she’s left with about $140 a week. This must pay for her private health insurance (which eats up $35 a week), her medications, any medical costs, phone bills and any other costs like podiatry, occasional hairdressing etc.

It’s just as well mum isn’t very mobile because she isn’t able to afford much in the way of outings or treats, without dipping into the relatively small reservoir of cash she has left at her disposal — which we’re trying to keep intact in case of something medically dire.

My mother and my father worked their entire lives until retirement, paying tax in Australia since the early 1950s.

Mum, a nurse, then became a carer for dad whose health deteriorated severely in the 10 to 15 years before his death, aged 81, in 1997.

Her steadfast care of him meant he was able to stay at home until close to the end so he did not become a “burden” on taxpayers.

My parents worked and raised three children without the benefit of all the common wealth-squandering, vote-buying “entitlements” splashed about in recent years by Liberal and Labor governments like the baby bonus, first home buyers’ schemes, rebatable child care, family tax benefits, maternity leave, education supplements and on and on and on. And, as quite modest wage earners, they never got to sample the delights of tax minimisation schemes of one form or another that the more wealthy enjoy.

My mother, like most of her generation, has jolly well earned her pension albeit that the bulk of it is now being used to pay for her aged care — on top of her accommodation bond which, if I’ve read the Productivity Commission’s report correctly, also means she’s cross-subsidising the care costs of others.

To my mind the aged care sector is already an inequitable mess. But if the Government raids old age pensions, then it will have to pull a smoke and mirrors job to compensate for the reduced capacity of those in aged care — and there’s a lot of them — to pay for themselves and others. And all this, of course, doesn’t begin to touch on the many other pensioners struggling to remain living independently, as mum did until last year.

And let’s not forget this threat to aged pensions comes as the Government is proposing a bloated maternity leave scheme for high-income earners? What a disgusting slap in the face for my mother’s generation.

[e-mail]

www.couriermail.com.au/news/opinion/politicians-thinking-about-cutting-the-aged-pension-need-to-walk-in-the-shoes-of-australian-pensioners/story-fnihsr9v-1226897259987

[Banjo]

Poll Shows Opposition to Raising Pension Age

More than 70 per cent of Australians are against raising the pension age to 70, results from a new poll have revealed.

The Essential Research Poll showed that 71 per cent of respondents disapprove of raising the pension age to 70 and 72 per cent believe that Australians should receive the age pension at 65 or younger with only 10 per cent happy to wait to 70.

It also showed that 82 per cent of those aged 55 to 64 disapprove of including the value of the family home in the assets test for eligibility for the age pension.

Ian Yates, Chief Executive of seniors advocate COTA Australia, called on the Federal Government to acknowledge its clear pre-election promise to make no changes to the age pension and listen to the overwhelming opinions of the electorate.

“Mr Hockey continues to point first off to pensions and aged care needing to be cut because the budget is in crisis and they are going to make it worse,” Yates said.

“Yet the figures the Treasurer has released simply don't support this.

“According to tables the Treasurer released [last week] from the Commission of Audit, GDP is rising at a rate of 5.1 per cent and government outlays only at the slightly higher 5.3 per cent - pointing to the need for tightening but not for major cuts to seniors living standards.

“Similarly, pensions are projected to rise at a rate of 6.2 per cent - a modest and sustainable figure given the sizeable rise in the numbers of older Australians in future years, about which we have known for a long time - indeed the 2009 Pension Review, which had bi-partisan support, confirmed the age pension is sustainable over coming decades.

"The Treasurer's speech focused on expenditure but not on government revenue and we need to discuss how government pays for the things taxpayers expect it to provide.

“Critically, the figures the Treasurer released leave out the generous tax concessions paid on compulsory superannuation - which benefit the top income earners and are not paid to low income earners at all.

“An Australian Institute analysis released this week shows that superannuation concessions are higher than the costs of the pension, so the question must be asked - why is the Treasurer intent on targeting those who can least afford it, Australia’s pensioners?

“Australians see the age pension and provision of health and aged care as core business of government and took the Government at its word at the last election.

“It’s time for a comprehensive and holistic look at retirement needs and the ageing population, not this piecemeal approach which targets some people and not others.”

- See more at: www.probonoaustralia.com.au/news/2014/04/poll-shows-opposition-raising-pension-age#sthash.CJFLkfwa.dpuf

[scallywag]

www.abc.net.au/news/2014-04-28/abbott-budget-deficit-age-pension-reform-unavoidable/5416470