Australian pensioners struggling with shortfall

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Australian pensioners struggling with shortfall

12 yrs ago

The International Monetary Fund (IMF) has warned governments around the world that they will need to lift their countries' pension age due to rising longevity. The news is very concerning to me, but not for the reason you may think.

According to the ASFA Retirement Standard, to maintain a modest lifestyle, an Australian single needs at least $841 per fortnight, while an Australian couple needs $1214. Current pension rates for singles are $756 per fortnight, a shortfall of $85 while couples receive $1139 per fortnight, a $75 shortfall. What is most concerning about these figures is that they assume the ‘retiree’ owns his or her own house. For those who do not, these gaps are even greater.

After paying a lifetime of taxes, largely missing out on the implementation of superannuation funds and having played a large part in making Australia the great country it is today, the current pension rates are a slap in the face to millions of Australians struggling on a less-than-modest income.

Having gone over the figures and breakdowns by the ASFA Retirement Standard, I then decided to write down my own list of weekly expenses to see how living on a pension would feel. While I expected that certain luxuries such as buying a few beers at the football would certainly have to be cut out of the budget, I was shocked by how much I would have to give up. It is clear to me, and to most pensioners, that there needs to be a serious government review into the current pension rates.

Where do you think funding cuts should be made to increase pension rates?

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28 comments

Nautilus

12 yrs ago

Trimming ex-politicians entitlements would do little to rein in public spending.

However even if cutting politicians' retirement benefits were to help a much more significant saving would accrue from not paying PM Gillard and other politicians what can only be considered to be rates that are enormously above Award so to speak.

Because there is no way in the world PM Gillard should be getting paid more than US President Obama (US population 313,349,000 in 2012) and David Cameron, Prime Minister of the United Kingdom (population 62,262,000 in 2010).

Much higher, significant savings would come from smaller government and fewer politicians and bureaucrats as non-productive management overheads.

justme

12 yrs ago

NOVEMBER KEY FIGURES - ABS
Average Weekly Earnings

Nov 2011 Aug 2011 to Nov 2011 Nov 2010 to Nov 2011 $ % change % change

TREND ESTIMATES

Private & public sectors Full-time adult ordinary time earnings 1 333.40 1.0 4.7 Full-time adult total earnings 1 389.50 1.0 4.8 All employees total earnings 1 033.30 0.7 3.9 Private sector Full-time adult ordinary time earnings 1 307.40 1.0 4.9 Full-time adult total earnings 1 366.50 1.1 5.1 Public sector Full-time adult ordinary time earnings 1 428.10 0.9 4.1 Full-time adult total earnings 1 472.40 0.8 3.8

SEASONALLY ADJUSTED ESTIMATES

Private & public sectors Full-time adult ordinary time earnings 1 330.20 0.5 4.3 Full-time adult total earnings 1 388.10 0.8 4.7 All employees total earnings 1 032.70 0.8 3.7 Private sector Full-time adult ordinary time earnings 1 303.80 0.4 4.4 Full-time adult total earnings 1 364.50 0.8 5.0 Public sector Full-time adult ordinary time earnings 1 426.40 0.7 4.0 Full-time adult total earnings 1 471.00

0.6 3.8 StatusPension rate per fortnight - Centrelink

Single$695.30* $347.65pw

Couple$524.10* each $262.05 each

$1471.00pw/4 = $367.75pw (25% of average weekly earnings - figures from ABS and Centrelink)

I figure that's $20.10 below the 25% target, and a lot more below a reasonable liveable rate.

27.5% = $404.53 just for comparison.

Pardelope

12 yrs ago

What annoys me is the often touted "wisdom" that Seniors and Pensioners are a total drain on taxpayers and the community. Besides the fact that most have paid taxes and contributed for many years, they do not suddenly cease to be part of society. They contribute in various ways e.g. buying food, buying manufactured goods, paying for services, doing unpaid childcare or voluntary work - and (dare I say it) paying GST and other fees. The healthier or luckier ones continue to take holidays, buy cars, give gifts, pay for garden and houshold needs etc etc.

I believe that we all should contribute with taxes and contributions to super - if we have the ability to do so. Unfortunately, there will always be some people who (for various reasons - not always within their control) need help to live in a half-way reasonable manner.

I would hate to see elderly or incapacitated people living under bridges, begging outside restaurants, or relying totally on charity - as you do see in many (so called advanced) countries. A small number may choose to live in these ways, but the vast majority do hope for basic shelter, health care, and sustenance.

Nautilus

12 yrs ago

Pardelope, "What annoys me is the often touted "wisdom" that Seniors and Pensioners are a total drain on taxpayers and the community."

Good on you and I agree totally. That is one of the reasons why I refer to parliamentarians and the public agencies, mainly the federal ones because there is delivery at State and local govet levels, as mainly management overheads.

It is grossly unfair and wrong to assert that stay at home parents, carers, retired people and the like are non-productive. Those who do that know it is wrong but it suits their agendas of course. You get the same dismissive comment made of residential housing, but where would we be without shelter?

terrib

12 yrs ago

Thank you Webmaster Drew for doing the sums about living on a pension. It is not a fun time especially if you do not have good health. I have waited nearly 5 years now for a major spinal operation which has now come up again to be looked at after waiting a year once more. Last year I was told by the surgeon "that due to the osteoporosis having deteriorated so badly he did not want to do the op as he was afraid the steel rods he would have to insert into a very large proportion of the spine to try and straighten it would pop out". Thereby leaving me in a worse condition than now. It would be a year long recovery if all went well with a 30% chance of that happening. Not good odds. Now that another year has gone by I do not like my chances. My Doc has said if I don't have it done I will be a paraplegic in a few years. Damned if I do & damned if I don't.

With this glaring fact facing me my medication bill is high now, may even be higher soon. Seeing as the PBS scheme is still unfair where I as a single have to use the same amount of scripts as a couple before I can get them free, I do not see my future very bright at all.

I have just been moved ( 2 weeks prior to hospital) from a comfortable rented home that housing had subsidised me in for 5 years, into another subsidised house a quarter of the size, because they said quote "they could not afford to subsidise me any more" unquote. I have had to buy numerous items as they were not in this place. Mirrors, power points, cupboards, phone outlets etc. I can not see the sense in what they have done & never will. I will be living with boxes if I go ahead with the op for the next year or so as I will not be in a fit state of health to dress myself let alone unpack. They were being petty and stupid by doing this and most unkind. I cannot open the garage door as it is too heavy but they will not supply an opener for me. My car is 16 years old & paint is peeling off the bonnet & various places it will get worse now being as I cannot put it under cover. Why they could not leave me until I either had the op & recovered or decided not to have it I do not know. Government departments wasting money again.

There are so many areas where living on the pension is unaffordable it will take too long to list, I think all pensioners know what they are anyway. I would like to know why the government has not done a proper study on it. We have been telling them long enough now what money we should be living on. They will always lend a deaf ear to that one.

terrib

12 yrs ago

My own view is that most of these figures are academic. The ASFA says we need $841 per fortnight to sustain a livable standard for a single. What do they base this on? Most Australians live in the capital cities & the minimum rent for a 2 BR flat in an area where I would not want to live is at least $275 P/W. Electricity cost at least $25 P/W leaving $120.50 P/W to live. IMPOSSIBLE!!! We used to have a great number of grey nomads. Just look at the cost of a trip around Australia with a caraven. If you allocate a year for the trip, you will pay a minimum of $5,000 for fuel, of which the excise & tax makes up over $3,000. Add to this the caravan park rates of $35 to $40 per night, or an average of $260 P/W & you have $60 P/W left to feed you & God help you if you need a repair to the vehicle. If you take into account the actual single pension, the food has to be kept to $18 P/W. Can't be done. The cost of the evolving Nanny State is taxing the populace out of existance.

Sandi (SA)

12 yrs ago

This site explains the tax taken out of wages to pay for pensions

http://www.sosnews.org/newsfront/?p=262

Thanks for that link Sandy - I have been telling folks this for years as was told by a high up Treasury official now retired here in Tasmania that this had happened. thing is far too many just shrug and say 'oh yeah' as if it is of no consequence.

What gets me really annoyed it that all the time we are told by the left and on here I am sure at least by Fwed, that we are a wealthy country so can afford to take in all these refugees and of course the myth that arriving in a smugglers boat is legal -an oxymoron if ever I have heard one!

After all stands to reason if anyone can just rock up without a visa as these do and also having destroyed the passports they had to have to enter Indonesia or Malaysia in the first place - thre would be no need for smugglers would there.

The spin and lies that Labor and its supporters actually repeat with a straight face astound most of us who can think for ourselves.

After all Howard and his government had stopped the boats and it was Rudd and Gillard who turned the boats back on and why - merely to win more votes as these people coming today always vote to the left until such time as they can form their own parties and of course fulfill the intention which is to overwhelm our welfare buget and services and having achieved sufficient numbers turn the place into an Islamic Republic, so is the third invasion by Islam, first two having failed.

Now Labor is borrowing 100 million a day simply because they are spending beyond their means - our money collectively earned by all the people here today - and pensioners who have spent their working lives paying taxes only to be vilified in their golden years and paid peanuts but monkeys overpaid themselves.

Again another lie by Gillard saying about pensioners 'they dont vote Labor' when far too many do, thinking that labor is still the party of the working man when it ceased to be that in the 1980's, after accepting donations from big business in order to increase their profits by holding back wages, slashing the number of workers and making those left work harder. Calling this productivity increases and the whole plan was called The Accord.

So we are not a wealthy country after allwith some say 250 billion of debt already racked up and more being added daily and having to pay interest on these borrowings as well so any deficit is a joke because should be used to pay down debt and cut borrowings and then sut spending to income.

One way stop the boats and cut immigration until we have caught up with the mess labor has managed to land us in. They are not to blame for shortage of housing directly but indirectly can sheet it home to them too because of their making going to Uni a done deal and neglected TAFE making that hard for parents on normal incomes to fund so short of trades which is why we have had to bring in skilled workers and why we are short of homes and have been - in 2007 Rudd said 55,000 short and today - who knows - more than that most likely. Catch 22 bring in skilled workers and they need a house to live in too. 4 years and labor closed down the Technical Colleges which produce tradesmen overseas and the one built here in Tassie was to close too but the Catholic Church took over the funding. Again labor is not for the working man these days another proof of that right there.

All of you with a printer should print off what Sandy has given us and show it or copy it for local Old Age Pensioners Club Boards and friends as we need to be more active not just lie down and let them walk all over us - Liberals and Nationals too. Not alone in the con at all yet all agree on having their own wages rise to higher than any other country for PM we know of and maybe for back benchers too?

I for one am fed up to the back teeth with being told it is the fault of the looming age of the baby boomers, plus age pensioners who should have saved up their own retirement fund, that we are short of money so if I go on about the boat people, no wonder, as they are costing the country 1 billion a year they say, and that is in processing them in on Christmas Island. Not for ongoing costs once they hit the mainland.

OOps not edit on reply

should read "paying peanuts by monkeys" - using the description used by those who think the politicians are underpaid and getting monkeys etc.

also 'cut' spending not sut.

Sorry typing too fast with cold fingers as trying to save on power, and no spellcheck.

justme

12 yrs ago

I don't usually read long posts; but I read yours BV.

You all knew that the pension was going to very hard to live on but what did you do about it....NOTHING. You should have got off your backsides when you were young and invested for your twilight years.

Easy to say when many of us had a partner whose savings in a company Pension Fund which went walk about prior to Howard being in government. Bit like the Pension Fund all who work paid into.

And then the latest GFC meant many lost so much they are now on the full pension over 90,000 and more part pensions and they had also no control over their investments.

Please dont encourgage the left wing accusers of all on the age pension by saying must have pissed it all away when the average wage of most on the age pension simply would not even pay the mobile accounts of the average teenager. And one income as she stayed home with the kids with no handouts no FHO grants or TAX benefit A & B and no child care if they did work so part time to help pay the bills.

Pardelope

12 yrs ago

Dear Davey - not everyone had the option of contributing to superannuation - or earning sufficient to put money aside for their old age.

Many were the victims of disability, illness, accidents, crime, having to support a spouse or family alone, bad luck, poor timing, crippling divorces, unequal pay, being forced by law to cease work when they married, or being "ripped off" by persons known or unknown.

Life is unpredictable - and doesn't always go they way we plan. I hope you never suffer any of these negative events in your life, and in the meantime I hope you gain some understanding and empathy toward others.

I worked three jobs at times.

Pardelope

12 yrs ago

Good on you Davey for working so hard. You were fortunate to be able to work three jobs.

particolor

12 yrs ago

Big Val One eyed Liberal Twit!!!! Howard was the Meanest B****** we ever saw!!!

Davey ..Get a Wooly Bull Up Ya !!!

Pay More Peanuts and get BIGGER Monkeys!!!

Nobody believed me when I said that no Government would be game to reduce the aged pension benefits. I would be the only thing that would be capable of polarising the seniors. Big scary budget that just didn't happen.

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Australian pensioners struggling with shortfall

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