That Tony Abbott certainly is a curious chap. I usually have some respect for people who are generally willing to say what they think, even when I disagree with them. Yesterday, he was reported calling for the age pension age to be lifted to 70, rather than the government’s current plan to lift it just to 67 in the year 2023.
As it happens, I do agree with him on this, having suggested that myself in the past. But while he says what he thinks – and at least for once he is speaking on something in his own shadow portfolio – it does get hard to follow his logic.
Recently he was widely quoted saying he felt the Coalition should pass the government’s climate change legislation in the Senate, not because he thought it was good legislation, but because he thought it was an issue the Coalition couldn’t win. In effect, he was suggesting they would lose votes, or an entire election, if they didn’t. Whatever else you might think of that view, the rationale was pure pragmatism (if that’s not an oxymoron).
But pragmatism seems to be the last thing motivating his comments on the Age Pension. Polling done after the government’s May Budget suggested that one of the more unpopular measures was the plan to lift the Age Pension, even though it was just by 2 years and wouldn‘t be done until 2023. Now Mr Abbott is saying the measure doesn’t go far enough.
Balancing pragmatism and principle can be a tricky task in politics. Most politicians employ a mixture of both, depending on the circumstance – especially when you get higher up the front bench ranks of the major parties. But it must be very hard for Tony Abbott’s colleagues to figure out whether they are going to get pragmatic Tony or policy purist Tony from one day to the next. And the fact he swings from one to other so publicly, usually in areas outside his shadow portfolio responsibilities, wouldn’t always do wonders for their mood. But he does give the media, including bloggers, something to write about.
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Good to hear, raising it to 70 is the only way to ensure it is fiscally responsible and maintainable.
I read a good quote somewhere that voters will never elect Abbott PM because he would serve something greater than themselves.
It would be true wilderness time if the Libs were down to Tony.
The pension age rise is good. The super age should match it and super should be forced into annuities so that people don`t live off their super until it runs out and then they live on the pension. A second means test should be applied to the aged pension so that people who own their own house are encouraged to get reverse mortgages. There should be a threshold so that people have enough money to buy a nursing home bond or two if needed. This would reduce the subsidy of inheritance that is in the current system.
Some good policies there Tom.
I think there are several unresolved or unclear idea’s about “the pension”.
Firstly in the future, when most people will have been contributing to compulsory super their whole lives, the pension should be a safety net, not the default option. Most people see the aged pension as a right.
Secondly there is definitely an issue which is likely to grow in the future with the asset rich gaming the system to qualify (e.g. transferring assets to trusts or their kids to get below eligibility thresholds).
Third issue is what to do with people who can’t work til their late 60s. Amongst my parents friends (all in their 50s), every one of them has at least one, usually two, chronic and probably degenerative conditions (also several cancer, heart attacks). They all work at least 3 days a week most of them full-time, none of them can do that for another 10 years, almost all of them have desk jobs, not physically demanding ones. My point is there health issues are not at all uncommon for those in their late 50s and an awful lot of people can’t afford to retire then (even though most of my parents friends can). Do they count as unemployed and have to constantly apply for jobs they have no intention or capacity to do? Do they qualify for disability pensions?
Thanks Energy P:
I think there will always be differing views about other qualifying factors for the age pension, especially around income and assets tests.
I don’t think raising the automatic qualifying age to 70 is suggesting it is asssumed everyone is capable of working full-time (or even half-time) up until that age, any more than we currently everyone is capable of working until they are 65.
The people with the sorts of conditions you describe should already qualify for a disability pension if they reach a stage where they can’t work full-time or close to. I think its important that we don’t get too sensitive about increasing numbers of people going on to disability pensions as they get closer to aged pension age (whatever the age is).
Most people prefer to work if they can, firstly because they would usually still have a higher income, and also because most people (albeit not all) do get some sense of purpose and/or identity from working.
Will the politicians who are pushing for this increase also change the system so that they cannot access their generous publicly subsidised super/pensions until they are 70? And for a good-will gesture, how about they start it from now, demonstrating that they are happy that this apply to babyboomer politicians as well as Gen X ones.
Personally, I will be very surprised if my super is worth anything when I retire, as the bloodsucking paper shufflers of the world will have extracted as much as they can, ably assisted by the industry “regulators” and the tax department.
As for the pension, I am planning on keeping as fit as I can so I can pick fruit and perform other menial tasks until I die on my feet. We Gen Xers don’t have the voting muscle of the Boomers, and I don’t trust the younger folk not to introduce some “Logans Run” style scheme to keep their lives as comfortable as possible.
Agreed Andrew. I know quite a few people who I suspect will never retire and will keep working at least a few days/hours a week well into their 70s. I think plenty of people are quite productive until much older, but society needs to adjust its ideas about working, transitioning to retirement, etc…
There is some distinction between encouraging and forcing people to work later in their lives, I’m just not sure how that would translate into legislation. In the same way I imagine raising the Automatic qualification to age 70 could be fine, as long as the system allows for the complexity of individual circumstances and the government can explain that they aren’t forcing the non-able to work til that age.
Regardless our society does need to do something about the ratio of workers to non-workers as the population ages. Higher rates of university study and for more years is pushing back the starting date of work (also kids starting school at 5-6 rather than 4-5). A quick look at the ABS says 10.7M Australians out of about 21.7M are employed. Just under 50% of the population. With the effect of aging population can shift towards 40%. Each worker supports 2.5 people up from 2.
I think Tony Abbott has jsut decided that under no circumstances should Turnbull ever become PM. Whilst fiscally a retirement age of 70 might make good sense, I think it would be electoral suicide to actually advocate such a thing.
I’m interested to know where all these so-called jobs for 70 year-olds are going to come from. Even in the ‘good-times’, I don’t think there was a week go by where there wasn’t a news report about people in their 50s being actively discriminated against by their prospective employers.
Andrew, you said…
“Most people prefer to work if they can, firstly because they would usually still have a higher income, and also because most people (albeit not all) do get some sense of purpose and/or identity from working.”
Govt reasons for raising the pension age has nothing to do with this – it’s about saving money.
Your statement looks like a smelly “we’re doing this for your own good”
And why stop at 70?
Tony Abbott must pine for the good old days of the 19th century when economic liberalism was at its height. It was this cruel unfettered, no safety net, exploit them from cradle to grave Liberalism that of course spawned Marxism and led to Capitalism being thrashed to within an inch of its life. Oh for the days when people of Tony’s ilk could visit the Tsar of Russia at his summer palace at St. Petersburg.
The aged pension is a right and given the rights these overpaid, undertalented and sociopathic politicians like Abbott have in relation to their entitlements and their access to these entitlements, it is a bit rich of Abbott to be telling workers who are already underpaid and overworked to the point of exhaustion in this dog eat dog world that they have to work even longer.It all sounds rather Dickensian and I think Abbott is in danger of giving the game away, which is the view that the Liberal Party acts in the interests of all Australians. They don’t – they are and will always be the party of greedy big business and bloated corporations who want to wring out the last drop of blood sweat and tears that they can from as many workers as they can.
People like Abbott think that working people do not have the right to a meaningful existence and a meaningful retirement where they can enjoy life after contributing their lifeblood, sweat & tears to the economy. The share of tax paid by corporations and the rich has been shrinking and perhaps instead tax rates for the rich revertng back to the nineteenth century levels ie zero, the higher cost of the aged pension due to increased lifespans should be paid for by taxing the top end of town who are the ones who have benefitted the most from the contriobution of working people.
Perhaps Tony Abbott’s view of the role of working people in society can be summed up by the Title of a song by the rock band Painters and Dockers called Eat, Shit & Die.
Just a point on the baby bonus. Instead of giving a cash amount of $6,0000 to the parents. Wouldn’t this money be best spent by the federal government instead opening a superannuation account for the child and depositing whatever the baby bonus amount is into this account. In this way this bonus amount will have over 50 years to compound and by the time the child retires their super will be enhanced.
While we are at it, instead of having all these private superannuation company bloodsuckers taking out their fees and so on, wouldn’t a better idea be the establishment of a nationalised Superannuation scheme run by the Federal Government that invests the super funds of workers into government infrastructure projects that will provide benefits to future Australians. Such an idea has two benefits. The Australian government will not have to borrow as much on money markets and the superannuants investment will be more safe and less at risk from the boom and bust cycle of stock market speculation. At least under a scheme like this workers super will actually be used to create infrastructure which will make a contribution to the community.
spidermonkey:
Your criticism of my comment suggests you believe people should be forced out of the work force at retirement age (whatever the age level might be). Many people already work past the age of 65 for precisely the reasons I outlined, and many more would if there wasn’t a bias in the employment market against older workers.
Of course people shouldn’t be forced to work if they are not healthy enough to do so. The same applies now and it always must. But even with further rises, the pension (whether it be Aged or Disability) is still hard to live on. Encouraging and supporting people to be able to earn more for themselves is surely a better thing.
You can ask “why stop at 70″, I can ask “why not lower than 65″? As has been widely noted, the age level of 65 was set over 100 years ago when life expectancy was far lower than it is now. Raising it to 70 slowly over the course of the next decade or two would still leave it clearly lower as a proportion of remaining life expectancy.
Yes, raising the qualifying to 70 would save money – I’m not sure why that’s a bad thing. It is clear that over the next few decades there will be a smaller proportion of the population in the paid workforce, which will mean a smaller pool of people (proportionally) from which to draw income tax to pay for things like pensions. Enabling people to stay in the workforce longer if they are willing and able is one way of expaning the paid workforce. It is not the only way, but there’s nothing magical about the number 65 which makes it fair, while 67 (where it is heading to anyway) or 70 is unfair – particularly if there is still similar assistance available for those unable to work who are younger than the qualifying age
I agree, who will provide these jobs? Nobody will employ anyone 50 or over, they are too much of a risk in the minds of employers. I have been knocked back for jobs that I am more than qualified for & I’m only 38 years old. One guy told me, “You are over qualified”, we have a system here & don’t want anyone with previous experience or ideas of their own”. “We only want young, unskilled people that we can mould”.
In that industry I had been a manager, I was willing to go back in at the bottom but they wouldn’t have a bar of it, they viewed experience as a deficit. If the Tony Abbots of the world had their way we would be reduced to surfedom, they would be more than happy for us all to work until we die. In the eyes of these ultra right wing conservatives, only those who live in the top end of town have the right to peaceful enjoyment of life. And don’t ever forget, he believes he has God on his side.
I see many 50 to 70 year lolds wandering about town, bored shitless, eating fatty foods and slowly fattening but at the same time crumbling away towards death.
Better to have them leading meaningful lives, using their life experience in work than in collecting these handouts which are really bribes from successive governments.
Jack Hackett
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