People often make the mistake of lumping two seperate issues into one, Ageing. 1. The baby boomers now 5.2 million, was followed by below replacement fertility and this bulge, or pig in the snake, will eventually pass out of the snake. The fiscal challenges that relate to the boomers do not really apply to those that follow who have been paying into comp Super all their working lives, rather than half their working life like the boomers. This bulge is temporary. 2. Increased lonjevity is here to stay.
While there is a need to address the issue of the ageing population, and the increasing cost of the age pension it needs to be done in both a sustainable and equitable manner.
…the government’s response to the growing outlays of the age pension was to hurt everyone receiving a pension rather than attempt to make it more targeted and equal…
Reducing the indexation below the cost of living of pensioners to the CPI will only exacerbate this gap between what the pension provides and what is classed as a “modest retirement lifestyle”…
[A report by Per Capita] suggests that the pension needs to be better means tested. Currently the family home is excluded from the assets test… [But] instead it recommends continuing to exclude the family home, but reducing the asset-free amount – the amount of assets you can have before it affects your pension – for homeowners from $202,000 for singles and $286,500 for couples to $100,000 and $150,000 respectively.
It also recommends that the government provide loans at the 10 year bond rate to those who were excluded from receiving the pension under the new means test up to the value of the pension they would have received. The loan would be repaid out of money from the sale of their estate.
But as many critics of the budget have noted, retirement policy is not just about the pension, but also superannuation.
…it massively favours those on higher incomes. It notes that “over 50% of superannuation tax concessions are paid to Australia’s top 20% of income earners.” The report also says “the public cost of superannuation concessions will be $42.4bn in 2015-2016, by which stage these concessions will cost the government more than the age pension”…
Rather than a flat 15% tax for everyone, the Per Capita report recommends taxing superannuation contributions for those earning $80,0001-$180,000 at the marginal tax rate less 5% (32%), and for those earning over $180,000 at the full marginal tax rate (45%).
Such a move would certainly make the system more equitable, and less costly to government.
We elect people mainly based on the fact they are wealthy and have either had connections through family and high society to get then there or they've had the funds and influence to get themselves there.
Then we are all stunned mullets when they make decisions in favour if one class or demographic, their own, and ignore the rest of society.
We elect these people through sheer ignorance, we let Murdock and others like Rheinhart who own or have control over our largest media outlets force feed us our election preferences. We get what we deserve!!
Chris Is is politically next to impossible to do anything that will adversely effect the 5.2 million boomers. It is just too big a voting bloc.
It is paramount that we treat the boomer bulge quite differently to increased lonjevity. IMO it would be possible to borrow our way throught the last stage of the pig in the snake as after that, population may peak and then decline and it will be possible to repay the debt. Quite simply, the fiscal challenge facing the budget is temporary only.
I've had discussions with my father about super and he says there used to be a Reasonable Benefits Limit on super.
Maybe this needs to be introduced again. An RBL of say 20 times avarge wage (indexing of course) receives all the current benefits and then a progressive tax applied to amounts over that on a sliding scale
There are some people who seem angry and continuously look for conflict. Walk away, the battle they are fighting isn't with you, it's with themselves.
The first lesson of economics is scarcity: There is not enough of anything to satisfy all who want it. The first lesson of politics is to disregard the first lesson of economics. ~ Thomas Sowell.
Who was the fool, who the wise man, who the beggar or the Emperor? Whether rich or poor, all are equal in death.
Chris Is is politically next to impossible to do anything that will adversely effect the 5.2 million boomers. It is just too big a voting bloc.
Not if your party is performing so badly that they are going to be voted out anyway...
There are some people who seem angry and continuously look for conflict. Walk away, the battle they are fighting isn't with you, it's with themselves.
The first lesson of economics is scarcity: There is not enough of anything to satisfy all who want it. The first lesson of politics is to disregard the first lesson of economics. ~ Thomas Sowell.
Who was the fool, who the wise man, who the beggar or the Emperor? Whether rich or poor, all are equal in death.
I'd be quite happy to reduce concessions on super, provided people had the choice of not contributing once concessions were lost.
In other words, allow the benefit to a certain level (e.g. RBL), but after that allow people to choose between contributing or taking the money as cash, paying tax appropriately.
I think it's unreasonable to force people to contribute past the point where benefits or concessions end.
I'd be quite happy to reduce concessions on super, provided people had the choice of not contributing once concessions were lost.
In other words, allow the benefit to a certain level (e.g. RBL), but after that allow people to choose between contributing or taking the money as cash, paying tax appropriately.
I think it's unreasonable to force people to contribute past the point where benefits or concessions end.
I agree....
There are some people who seem angry and continuously look for conflict. Walk away, the battle they are fighting isn't with you, it's with themselves.
The first lesson of economics is scarcity: There is not enough of anything to satisfy all who want it. The first lesson of politics is to disregard the first lesson of economics. ~ Thomas Sowell.
Who was the fool, who the wise man, who the beggar or the Emperor? Whether rich or poor, all are equal in death.
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