35. Age Pensions

Hi. I am Greg and I want to grumble about proposals to raise the pension age.

I am not necessarily against changing the pension age, or tightening some of the restrictions so that we are not subsidising relatively wealthy people, but it is such a mono-dimensional debate.

“Be prepared to work until your 70” the headline says – but what does it mean for people who aren’t working? We already have a real problem of mature age unemployment – people who may have worked for 30 or 40 years, but who find themselves out of work and facing age discrimination in the employment market.

Sure, if you are a CEO, an academic or a highly paid consultant there might be jobs for 60 year olds which value that lifetime of experience, but for many people, if you are made redundant or out of work in your 60s it might be near impossible to get another job.

For those people, raising the pension age is not about the inconvenience of staying in work longer, but living for longer on the much lower unemployment income support rather than getting the higher benefits of the age pension. The difference is about $120 a week in the base rate, so raising the pension age may sentence older unemployed workers to another 1, 2 or 5 years of living below the poverty line.

If we are going to have a conversation about raising the pension age, can we have a real discussion which includes:

• how we are going to change workplace cultures to provide job possibilities for older employees;
• whether we can create a part-time job pathways for older workers to ease into retirement, or to just share work more fairly; and 
• how we can index pensions so that pensioners do not begin to slip backwards relative to the rest of the population – in the same way that those on CPI-indexed benefits like Newstart and Austudy have been left behind.

And finally, if we keep people in work longer, who is going to do the vast amount of volunteer caring and community work that younger retirees do – because there is no doubt that retirees care for grandchildren, aging parents and siblings, and are the backbone of many community organisations?

These are genuinely hard issues. Much easier to just cut benefits to vulnerable people in order to fill a revenue hole at the same time as we cut mining and pollution taxes.

I am Greg and I am grumbling.


This Grumble can be heard online or by podcast.
First Broadcast: 15 April 2014

15. Climate Changes and Taxes

Hi. I am Greg and I want to grumble about climate change and taxes. Ok, this is a recurring grumble, but it is particularly topical this week as Tony Abbott’s legislation to scrap the carbon tax is introduced in the Federal Parliament. This was a flagship policy of the election campaign and we were promised that it would reduce electricity prices and ease cost of living pressures – his Bill to reduce our bills.

Except that now key business leaders are saying that we won’t see any big price reductions. Where were these voices during the election campaign I wonder? And where was the reporting of the current wave of economists who think that putting a pricing carbon is more effective and efficient than the proposed direct action approach to reducing carbon pollution. And that is without even questioning the manifestly inadequate pollution reduction targets of both schemes.

But the hip pocket question remains: will our power bills come down if we are without a carbon strategy – sorry, I mean a carbon tax? I don’t know, but I do know that carbon prices were always only a small proportion of the massive recent hikes in energy prices. Adelaide’s electricity prices went up 18.2% in the quarter immediately following the introduction of the carbon price, but only about a quarter of this increase was down to the carbon tax and the general inflation rate increased by only 1.5%. For most households, and particularly for the poorest households, this increase was more than covered for by the government’s compensation package.

The good news is that even if the carbon tax is scrapped, we will keep the compensation package. It is currently worth about $7 a week for pensioners, less for some other income support recipients. It’s not much, but it seems only reasonable to keep it after last week’s announcement that the Federal government would give the richest households a huge bonus by dropping the proposed tax on superannuation earnings over $100,000 a year (ie. for those whose super-pot is a couple of million dollars). And they announced that at the same time as announcing the dumping of the rebate support for low income earners’ contribution to super.

Who knows, after that bit of robbing from the poor to give to the rich, maybe the government figured it owed the poor one.

Shame about the planet though!

I am Greg, I am grumbling.

This Grumble can be heard online or by podcast at https://radio.adelaide.edu.au/gregs-grumbles-15/

First Broadcast: 12 November 2013