Government under pressure to review Pension Loans Scheme interest rate

Seniors groups pressure government to reassess ‘unfair’ interest rate.

Government under pressure to review Pension Loans Scheme interest rate

Federal Treasurer Josh Frydenberg is under pressure to review the Pension Loans Scheme (PLS) interest rate after seniors groups accused the government of gouging pensioners accessing the reverse mortgage scheme at a time of record low interest rates.

However, the Treasurer said that the 5.25 per cent interest rate charged for the PLS was much lower than rates charged by the private sector.

“A number of private sector providers offer similar reverse mortgages,” he said. “The current interest rate of 5.25 per cent for the Pension Loans Scheme is lower than the rates charged by the private sector.

“Typical interest rates for commercial reverse mortgage products currently range from around 6.25 per cent to 6.5 per cent per annum. The Reserve Bank indicates the current average home equity loan interest rate is 6.35 per cent.

“The interest rates for reverse mortgages are above standard mortgage rates reflecting their higher risk.”

The PLS was created to give older Australians access to the equity in their home to supplement their retirement income. Those who access the PLS can boost their cash income up to one and a half times the maximum rate of the Age Pension, paid fortnightly.

Any money borrowed has to be paid back to the government at 5.25 per cent.

However, seniors groups say that rate is too high, considering the historically low cash rate, and point out the government’s hypocrisy in criticising banks for failing to pass on the Reserve Bank’s interest cuts when it was charging high rates itself.

Mr Frydenberg has responded to this allegation, saying the government continually assesses the PLS interest rate in accordance with current market conditions.

Lobbying from seniors groups has already led to the government reviewing and subsequently lowering deeming rates. It is possible that such lobbying will also lead to a lowering of the PLS interest rate.

Should the government lower the PLS interest rate? Do you think it is hypocritical for the government to condemn banks for failing to pass on the benefits of low interest rates to consumers when it is charging high interest rates itself?

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    COMMENTS

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    floss
    24th Oct 2019
    10:33am
    Pensioners have been gouged from the minute the Libs came to power and things will not change till they are booted out which will take some time so you just have to wear it.You had the chance to change things at the last election so be prepared for more pain.
    OJ21
    24th Oct 2019
    11:02am
    Spot on.
    Anonymous
    24th Oct 2019
    11:05am
    Cannot understand you floss for continually attacking the present Govt alone. Labor gave us the asset and income test as well as the extra 2 years wait for the age pension. Granted the present lot sharpened the asset and income test in 2017 which hurt a lot of us, myself included. Despite all that I am glad we got rid of Shorten's idea of socialising our society by killing all incentive to achieve something.
    Infinityoz
    24th Oct 2019
    11:09am
    Yep!
    Red 13
    24th Oct 2019
    11:13am
    Cowboy Jim, given what you wrote, u must be itching to get rid of these parasitic Liberal and useless Nationals?
    TREBOR
    24th Oct 2019
    12:28pm
    One enemy at a time, CJ.... were slowly building our strength.. let's deal with the snipers in front of us first...
    Billv
    24th Oct 2019
    12:46pm
    It's not just the Liberals it's all parties. Just think back to past Government.
    TREBOR
    24th Oct 2019
    1:17pm
    We all agree, billy - the bloody lot need a good foot where it counts.... and some major changes in their policy strategies...
    inextratime
    24th Oct 2019
    1:33pm
    If anyone believes that the attitude to pensioners is different between the Labor and Liberal Party then they best take a trip down to the bottom of the garden and take a look at the fairies. Easy to slam the current govt and rightly so, but don't make out that Mr Albanese and his union cohorts are any different, having made absolutely no mention of how they would treat OAP's except to take away their franking credits. If I'm mistaken perhaps one of our left leaning commentators can quote the Labor policy on OAP's. I've got a few years left to wait for the response.
    TREBOR
    24th Oct 2019
    2:52pm
    I won't argue with you, iet, since I perpetually slag all sides of politics...
    Hoohoo
    24th Oct 2019
    3:26pm
    While both major parties have let Australians down, the last election gave the LNP carte blanche to do as they please, no matter how unpopular or impossible as trying to milk blood from a stone (from poor people). They need to be booted out for them to get the message.

    If that means Labor gets in, then we need to boot THEM out until they too get the message.
    The message is this: if your party is privileged to represent us as the Australian government, you MUST represent all the people as best you can. STOP THE DIVISION & do the job you're paid to do - please represent the people whether they be rich or poor. A decent society provides realistic safety nets for those at the bottom. This helps everyone by lowering crime & mental health problems, providing infrastructure, health services & the education of children. Increasing WorkStart will stimulate the economy immediately, which will benefit everyone.

    It comes down to this: can a rich person bear a burden easier than a poor person? Of course they can but this doesn't mean we should disincentivise people from becoming rich, but strike a fair balance. The only reason the LNP were voted in last time is because Howard's battlers have been convinced all people on welfare are getting everything at their expense, without realising that the very rich are also getting everything at everyone's expense.
    Anonymous
    24th Oct 2019
    3:43pm
    Hoohoo - you are probably right about booting people out and getting the other mob in Problem it was time in 2007 to change teams but then Rudd put the pension age to 67 from 65. He claimed that he had a mandate to do so but no mentions were made before the election - if he even hinted at that we would have never changed the Govt then. And now down the track we have the other mob and of course they stay the course and the poor buggers have to work 2 years longer.
    I was fully convinced that Shorten was going to win with his franking credits cancellation; I promptly sold all my shares and took a long holiday in Europe with the proceeds. Had a grand time. The money is gone and so is the deeming of it - my part pension has increased. How is that going to help the Govt's bottom line?? But I am happy - feeling a bit stupid but for believing the threat.
    roy
    24th Oct 2019
    6:53pm
    Bill Shorten is filth from the top of his head to the tip of his toes,I would never believe a word that Champagne socialist says. How much is he worth, according to Google, in the region of $61 million. A real man of the people, not.
    ex PS
    27th Oct 2019
    8:23am
    Why are the Lib/Nat fans still banging on about Shorten, don't they realuze he is no longer the leader of .the Labor Party?
    I even checked the date of the comments and they are very recent, no wonder they can't make sensible political decisions, they seem to be living in the past, some of them centuries in the past.
    No wonder they can't accept the concept of things like human rights and climate change.
    Terminal Brain Freeze.
    Hoohoo
    27th Oct 2019
    3:31pm
    Raising the OAP age to 67 affects me directly, especially as it means my partner will be elligible next year while I have to wait until 2028. But I don't vote according to what's the best or worse thing for me, I vote for what I think is the best Party for all Australians.

    Unfortunately, election campaigns in the past decade (from both major Parties) have become propaganda aimed at dividing people so they think that if someone else gets something it's because THEY are not getting it (or that it's THEIR tax paying for it). The Libs call it the politics of envy but really, it's based on simply appealing to people's greed.

    The poorer we at the low end get, the more desperate we become to hang on to whatever little we have & the easier it is to divide us & pit us against each other. That's why the Libs' Death Duties propaganda/lie by Frydenberg worked so well to frighten average wage earners NOT to vote Labor. Much like as people voted for Abbott - not because they wanted him as PM but because they were convinced that debt after the GFC would've been worse than a Recession. Turns out the Libs are hopeless economic managers when there's not a boom happening. They've been caught on the back foot by winning the May election unexpectedly, but they're still beating the same austerity drum WHICH IS CREATING NEGATIVE WAGE GROWTH & literally strangling the economy. You can't get blood out of a stone. The Libs are still expecting the bottom end to feed the top, but all that can happen is we are digging into our savings to pay for food, rent & power bills just so we don't become homeless.

    Oh yes, the politics of envy is a one-way street. Rich people don't envy poor people, do they?
    Red 13
    24th Oct 2019
    11:11am
    Next chance you get folks consign these appalling Liberals to history’s garbage bin, they deserve nothing less.
    Anonymous
    24th Oct 2019
    11:20am
    Next time, Red 13, follow the Labor dictum of "Vote early and vote often" and you might get your mob over the line. Often wondered why people here can vote without a photo ID like in the rest of the world.
    Tricky
    24th Oct 2019
    11:31am
    Cowboy Jim, please nominate the western countries that have to have photo ID to vote!
    Anonymous
    24th Oct 2019
    12:02pm
    Tricky -check
    http://www.ncsl.org/research/elections-and-campaigns/voter-id.aspx

    That is the states, you can check Canada, the EU and others. Always had to have ID in my country of Switzerland, even 50 years ago.
    If I know a person is away on holiday overseas I can vote for them down here, no questions asked. How secure is that?
    Hoohoo
    24th Oct 2019
    3:39pm
    Well I hope you get caught cheating our democracy, Cowboy Jim, & that person overseas has voted early or has organised a postal vote. There should be cameras at voting centres, in my opinion. Maybe that's already the case?

    Is there a new rule among LNP voters these days, where they think voting is like business - whatever you can get away with is not only smart, but also right & can even become the truth? No wonder people can't trust institutions any more - fake news & alternative facts rule, it seems. Think Trump, think Boris, think Morrison.
    Anonymous
    24th Oct 2019
    3:51pm
    About 40'000 people voted several times at the last election, Hoohoo. It was decided that no action was to be taken the same as the non-voter fine was quietly let go. Let us do away with compulsory voting while we are at the topic. I think we are about the only country with it apart from totalitarian states. NZ wants you to be registered as a voter but does not insist on your turning up to vote. If we do not follow up on multiple voting and non-voting what would close-circuit cameras do?
    Hoohoo
    27th Oct 2019
    3:41pm
    Who exactly decided to do away with the non-voter fine?

    Propaganda works even more easily when voting isn't compulsory. Look at Trump's Presidential campaign, where he won office even though he received 2,900,000 less votes than did Clinton. He simply targeted voters in crucial seats to carry him into office, despite the lack of democracy that using such tactics displays.
    ray from Bondi
    24th Oct 2019
    11:14am
    to take up any product similar to this is absolute stupidity, there is only one winner and that is not you.
    older&wiser
    24th Oct 2019
    2:28pm
    Exactly. Just WHEN does any govt bring in anything that will actually benefit seniors? Their absolute primary objective is to themselves, not anyone else. I gave up believing in fairies, the tooth fairy, father Xmas, the Easter Bunny....years ago.
    TREBOR
    24th Oct 2019
    2:53pm
    The way my teeth are going, I'd have made a fortune over the past few years.... but they abolished the tooth fairy ...
    Hoohoo
    24th Oct 2019
    3:45pm
    I suppose the only people who have reverse mortgages are people without descendants. In which case, who cares as long as you die before the reverse mortgage runs out? It'd be better to invest in a good not-for-profit retirement home, unless you're planning to die at home.

    But you're right, Ray, reverse mortgages are a rip-off.
    clarkey
    24th Oct 2019
    11:16am
    If any interest rate is charged it should be no greater than the deeming rate. This government (if that is what you call them) are thieves and liars only interested in feathering their own nests at the expense of all Australians except their wealthy mates.
    Tricky
    24th Oct 2019
    11:33am
    The Deeming rates need urgent review as it also excessive and a Pensioners Tax.
    Anonymous
    24th Oct 2019
    12:16pm
    The Deeming rates are hurting timid people like myself, I know, getting 1.7% on term deposits is not good but then some folks around me put their money into shares and getting 6-7% a year and most of them get their franking credits (the ones Shorten wanted to do away with). We are getting punished for being too cautious.
    Billv
    24th Oct 2019
    12:48pm
    Exactly.
    GeorgeM
    24th Oct 2019
    8:45pm
    If we had Govt FOR the people (either Liberal or Labor), they would have linked both the Deeming Rate and PLS rate to the RBA's rate and let it be updated by the independent RBA. Really simple, BUT then we don't have Govt FOR the people.
    When will the people learn that they can turf out their non-performing MPs at every election?
    ex PS
    27th Oct 2019
    8:31am
    Cowboy Jim, you seem to be fixated on Bill Shorten. Shall we bring in the special doll and you can show us where the nasty man touched you?
    But really can you explain to us exactly why Shorten is relevant to modern political discussions, he has little political power, he is not the leader of the opposition any more?
    Hoohoo
    27th Oct 2019
    3:52pm
    You're right GeorgeM, if only we had a government who was committed to serving the people & our Country, not their own careers. They are paid to work for us - they are our servants.

    Instead, this govt just insults us & disrespects us. I have this visual stuck in my head: at the top of the ladder is the govt, kicking me in the teeth & expecting me to kick those below me in the teeth so they can't pass me.

    It's much easier for them if they can divide us. Divide & rule.
    Curious
    24th Oct 2019
    11:21am
    I just can't bite my tongue any longer. The government should remember that voters put them there to look after their people, particularly the most vulnerable ones like OAP. To compare their PLS interest rate with those of the commercial enterprise just reveals the government has forgotten its role in governing for their people. The commercial interest rate has factored in dividends to their shareholders. What dividends are factored in by the government? If the government uses the users' pay principle, we may as well privatize the government and let OAPs have some dividends from the privatization.
    tams
    24th Oct 2019
    3:28pm
    Hi Curious, Just wondering where your complaint was in 2008 when the cash rate was 7.25% and the PLS rate was 5.25%.

    The tax payer was subsidising the loan
    tams
    24th Oct 2019
    3:28pm
    Hi Curious, Just wondering where your complaint was in 2008 when the cash rate was 7.25% and the PLS rate was 5.25%.

    The tax payer was subsidising the loan
    Hoohoo
    24th Oct 2019
    4:00pm
    Well tams, the Govt is a corporation but it shouldn't be in the business of profiteering from OAP people who are retired & who have no means to work or bargain with the banks for a better mortgage arrangement.

    Crumbs, the govt gives interest-free loans to people on welfare & farmers, so are you going to whinge about that too, tams?

    I'm so tired of people pointing fingers at those not rich enough to pay their way for everything, like "that's MY tax paying for welfare & services, but it's not MY tax paying for Franking Credit returns or leg-ups & subsidising businesses (like aluminium smelters). These people are trying to bully everyone else into thinking all consolidated revenue goes to welfare, nothing else.
    Hoohoo
    24th Oct 2019
    4:03pm
    Not to mention negative gearing & CG discounts, which are government leg ups preserved for those who can afford to take advantage of it.
    Curious
    24th Oct 2019
    4:55pm
    @tams, I don't know when PLS starts but I don't think it started back to 2008. All I know the Federal Government has an annual budget for it, in 2018 and 2019. I am not going to give anyone a lecture on government roles in our community. However, when the government compares its role in caring for the OAP and retirees with that of the commercial entreprises, it makes me sick just the caring of the elderlies in nursing homes. It is cruel and inhumane! I am sure you are not that kind of person!

    24th Oct 2019
    11:24am
    Check the Reverse Mortgage conditions and you might find that you have to keep your place well maintained (in a Body Corp I have to do that anyway). If you own a house outright you can let it go a bit older like yourself. That type of mortgage is good to stay away from. If you have children you are leaving the house to get them to tie you over from time to time.
    Lookfar
    24th Oct 2019
    11:51am
    Cowboy Jim, your interpretation of Shorten indicates to me a propagandist has been whispering in your ear, - whilst the liberal and labour parties have mostly very similiar policies, - except that labour had some ideas of reducing Global warming, that claim of taking away peoples motivation comes from nonsense in America in the McCarthiasm time, - 60 years ago? - these silly ideas are old and dead and you should not be laying them on us now, - you should be old enough to know better, imho.
    Anonymous
    24th Oct 2019
    12:10pm
    You might be right about the propagandist, Lookfar. But I do listen to both sides and Bill Shorten's ideas did not fit with me. Global warming is a nonsense for Australia alone. Have been to India and China and seen the pollution. Should these folks make a contribution to reduce Global Warming of course we should as well. But hurting our economy without making a difference is really stupid.
    Hoohoo
    24th Oct 2019
    4:10pm
    Oh Cowboy, should Australia have the same right to stuff up the world as anyone else? It's everyone's problem, including your descendants.

    The current lack of real action & countries like Australia's ignorant attitude is a huge problem for the rest of the globe.
    Tricky
    24th Oct 2019
    11:29am
    Definitely drop the rate, another example of gouging is the Deeming Rate on Cash Term Deposits!
    TREBOR
    24th Oct 2019
    12:31pm
    Just don't go near it, as several have said already... wouldn't touch one of those with a barge pole, no matter how tempting it may sound...
    casey
    24th Oct 2019
    11:37am
    It does'nt matter which party are in power, people always complain, they are never happy. We have become a society of complaining whingers.
    Tricky
    24th Oct 2019
    12:00pm
    I don't think we are society of wingers but a collaboration of people that dislike injustice.
    TREBOR
    24th Oct 2019
    12:33pm
    Complaining righteously and whinging are not even in the same universe, casey - please avoid belittling those who raise genuine issues and who are brave enough to state them.

    e.g. "Why is the United States whinging about a little old attack on Pearl Harbour? "
    Billv
    24th Oct 2019
    12:50pm
    It would appear you must be one of those rich retires
    Triss
    24th Oct 2019
    1:12pm
    No, Casey. A lot pensioners and retirees have their backs against the wall and their only option is to fight back.
    ex PS
    27th Oct 2019
    8:41am
    As a SFR I do not consider myself rich. What I am mindful of is the fact that under this governments static one shotl approach to economic management I could at some stage find myself taking a part pension entitlement.
    Time for them to participaye in some lifting and not rely on the Reserve Bank to manage the economy for them.
    A budget surplus will fix nothing in regards to our stalled economy.
    Hoohoo
    27th Oct 2019
    4:05pm
    Casey you seem to be reading straight out of the Libs' manifesto - to show nothing but heartless cruelty to the bottom end of town. You lazy wretches! Just get a better job if you aren't being paid enough!

    I only wish the moaning & whimpering would keep them awake at night, but alas, those without hearts or souls can simply snore loudly all through the night, oblivious to the suffering of others.
    tams
    24th Oct 2019
    11:41am
    On the point of the 5.25% interest rate. It has been there since 1997, Did anyone complain when the cash rate was 7.25%. Not a word.
    It's really interesting that the Government Pension Loan Scheme has NONE of the consumer protections regulated by ASIC.
    ASIC's position is it cannot overview the Government product.
    There is no need for independent legal advice, no face-to face assessment, no discussion about long term needs such as aged care.
    I wonder how many applicants with a concerning background - drug habits, gambling addition, will apply
    If Treasury is to look at the interest rate, it should review the total product and protections
    TREBOR
    24th Oct 2019
    12:35pm
    I did - and even posted figures showing what the real interest rate, as calculated via endless interest on interest on interest and FEES monthly added, would be....

    Wouldn't touch it with a barge pole..
    tams
    24th Oct 2019
    11:41am
    On the point of the 5.25% interest rate. It has been there since 1997, Did anyone complain when the cash rate was 7.25%. Not a word.
    It's really interesting that the Government Pension Loan Scheme has NONE of the consumer protections regulated by ASIC.
    ASIC's position is it cannot overview the Government product.
    There is no need for independent legal advice, no face-to face assessment, no discussion about long term needs such as aged care.
    I wonder how many applicants with a concerning background - drug habits, gambling addition, will apply
    If Treasury is to look at the interest rate, it should review the total product and protections
    Lookfar
    24th Oct 2019
    11:42am
    Frydenburg claims reverse mortgage is high risk, - that is nonsense, the house and land is strong security, virtually no risk if set up sensibly.
    However the real killer in the scheme is the Compounding, that is what banks do to make lots of money, so their CEO's and shareholders can do bugger all but live in the lap of luxury.
    Well, we know what antisocial thieving animals lurk within the banking system, and we are finding out more as the commission continues, but why should the principles of thieves in the banking system be perpetrated on the older citizens of Australia by our representative Government? - it beggars belief that they should even think like that and be in parliament representing us, their wages paid by us, the world they live in having been created by our hard work, for which we rarely got paid adequately.
    Perhaps their attitude is that we were ripped off by the rich all our lives, so they as the representatives of the rich, are entitled to rip us off until the day we die.
    Sick, sick, sick, politicians becoming parasites, biting the hand that feeds then until the hand is dead.
    There is no justification for the members of the Government of Australia, Australia being owned by the citizens of Australia, to make money on lending money to the citizens of Australia, that has already been done by the tax system.
    Sure, members must pay back what they borrow from the Government, at the current rate of interest, so there is that money available to our fellow citizens to borrow in the future, - after all it will be paid back when we die from our estate, - but to gauge us by Compounding the interest is not just Usury, the which Morrison as a self proclaimed Christian should absolutely eschew, but jaw dropping indefensible Theft.
    Blinky
    24th Oct 2019
    11:50am
    Stop blaming the Libs. BOTH the Libs and the ALP have had plenty of chance to improve the pension system and BOTH of thrm have failed.
    The truth is pensioners live fear of "pension reforms" because all that means that they aim at taking money away from pensioners and NOT to improving the system.
    For ex. The govt and financial gurus, incl the Grattan institute and others have been forever pushing to incl the family home so as to"save money." For what? Why do they want to rob Peter i.e. pensioner, to pay Paul i.e. foreign aid, asylum seekers, foreign aid and what not?
    Pensioners who own their own homes are not in a position to stop their homes from increasing in value, those pensioners who do not own a home had plenty of time to buy one. DO NOT PUNISH HARD WORKING AUSSIE PENSIONERS for having been smart enough to buy a house.
    Mad as Hell
    24th Oct 2019
    12:16pm
    Don’t forget the 2017 changes to the Pensioner Assets Test would not have been legislated if it wasn’t for the Greens siding with LNP to steal pensioners assets.
    casey
    24th Oct 2019
    12:17pm
    Thumbs up to that Blinky. Totally agree.
    ray from Bondi
    24th Oct 2019
    11:30pm
    Mad as Hell, you are so right and this has happened many times where they say we are the force that stops excessive government then just turn turtle and let it happen, of all parties the greens are the most despicable in that they stand for nothing real (no counting the global warming problem).
    Alan
    24th Oct 2019
    11:55am
    The government needs to impose an interest rate charge that at least equates to the cost of it borrowing the money plus a small factor for the risk of not recovering the money in due course that is being on lent to those who take out such a loan. As the loan is not being repaid for some time the risk is higher than would otherwise be the case. More than this it can be rightfully accused of taking advantage of those who borrow money this way.
    Lookfar
    24th Oct 2019
    12:19pm
    Hi Alan, My understanding is that, as with the banks, such a loan would be attached to the title deeds of the pensioner, and any subsequent loans would have to wait until that loan was repaid, so I can't see where risk is involved.
    Normally interest rates vary so the borrower should pay as the rate changes, - no more nor less, and the rate should be as Bonds sold by the Oz govt.
    In fact, the Govt does not borrow money, but simply prints it, but that is a whole other discussion.
    Hoohoo
    27th Oct 2019
    4:13pm
    The main problem with reverse mortgages is the same for any retirement plan - will you outlive the income stream?

    A reverse mortgage can crumble in on you very quickly due to compounding, as you say Lookfar, but at the very time you are looking for a stress-free end game. THAT'S the risk.
    HKW
    24th Oct 2019
    12:12pm
    Having someone of this particular background like Josh Frydenberg IN THE GOVERNMENT, which represent certain greedy tribe, one cannot expect anything good. I'm speaking from my own experience dealing with this type of people in past in another country.
    They spell disaster.
    There is nothing else but GREED!
    TREBOR
    24th Oct 2019
    1:00pm
    My great-greats on one side represented that certain greedy tribe - contrary to common misconceptions, they all worked very hard and earned their way to the top of their professions in many cases...

    Please avoid adhering to the silly ideas put about by some for some oddball reason of their own... i.e. stop listening to lunatics.
    Sceptic
    24th Oct 2019
    2:10pm
    Is that a blatant anti-Semitic post HKW?
    TREBOR
    24th Oct 2019
    2:55pm
    Doesn't mean I support our current treasurer.... we Juden and part Juden descendants etc are a catholic group in our views... the Gnesset is one of the most divisive argument houses on Earth...
    roy
    24th Oct 2019
    6:57pm
    HKW, answer the question of Sceptic please.
    Hoohoo
    27th Oct 2019
    4:19pm
    I really dislike Frydenberg, but it has nothing to do with his religion or racial group, & nor should it.
    Best to not mention any tribe, HKW, else you appear to be racist. And hello, greed is a disease that crosses all borders & faiths.
    Macheke
    24th Oct 2019
    12:16pm
    I believe there is another way that the government can allow pensioners to access equity in their home and that is to enter into an equity release where a portion of the sale of the house on death is exchanged for additional pension now. In this way the pensioner can lock in a good return (I would suggest around 4% plus the CPI pension increases) and have the pension for life.
    Anonymous
    24th Oct 2019
    12:29pm
    That would be a system I could support, thanks Macheke. Govt won't like it as you might not have much equity left when they shift you into a carehome.
    TREBOR
    24th Oct 2019
    1:01pm
    Sounds a better deal - let me work it through ....
    Lookfar
    24th Oct 2019
    1:37pm
    Yes Macheke, if you read my big rave above, i think you will find we are pretty close to agreement there, only difference is I suggest that the Interest rate should change, - but maybe I am wrong?
    Hoohoo
    27th Oct 2019
    4:26pm
    It sounds like a much better idea (only letting go of a portion of the house) but would the government agree to that? What would stop the govt from just deducting that equity income stream off your fortnightly OAP?
    TREBOR
    24th Oct 2019
    12:27pm
    Wait one - didn't someone on here, coupla days ago, challenge me over the assertion I made that government would love to see retirees burn down their accumulated assets, just as if they were unemployed, before getting any Pension rights?

    Well, I'm just a dumb country boy, but this looks a hell of a lot like it to me.... high interest rate on reverse mortgage, reduction in pension from having too much income/assets, cashback to the government when you sell off the property and going to a nursing home (The Road To Perdition For Old People) so you've got less then for that anyway so you can be 'streeted out' to live with the Chinatown Awning People in the rain or gulaged into 'public housing' out somewhere where you never dreamed you'd live in your worst nightmare (like the oldies from The Rocks issued with their 'get out now, scum, or we send in the dogs' orders) .....

    Welcome to Around the World With Trebor - the pirate radio for the thinking Australian Man and Woman... (goin' git me that fishing boat when I'm alone again, and do a Brando from outside the limit, broadcast scruffulous content to the mainland)...
    Anonymous
    24th Oct 2019
    12:31pm
    Your assumption is correct, TREBOR. Maybe that is the reason the young ones are no longer want to save like we oldies did.
    TREBOR
    24th Oct 2019
    1:09pm
    Hard to blame them CJ .. when you see what they have to contend with. Never-ending rising costs of living, endless mega-rises in cost of buying a home, shortage of real jobs, massive divisions in who can access certain jobs as a matter of national policy, failing economy, short-term management of issues such as immigration and social/national mix, inability of any government to come to grips with much more than enriching self and mates - jeez - the Pale Ass Chick in Brisbun - a Labor sheila - signed off on a deal to change a leasehold tenure on a fine piece of waterfront land where many lived in mobile homes etc and had a guarantee of thirty years, to a freehold for the benefit of the company running it - and many of the residents got their marching order with zero compensation so the 'management' (thieves) could turn their plot into medium rise for holidaymakers and not permanents - then look at ex-Labor's anna Bligh, the darling of the banking industry - don't tell me that:-

    a) women bring anything new to the table,
    b) any of them are there for anything but themselves.

    Time for that revolution, people...
    Lookfar
    24th Oct 2019
    1:56pm
    Trebor, please give up on that woman bashing shit, - we are all people, men and women, Human Beings, all gunna die, and at our ages probably most in the next 20 years, - then you won't be able to get it up, your girlriend's tits will be down the stairs and in the cellar, - why carry on this animosity? We are 50% women, 50% men, well men die younger, so? All politicians are there for themselves, we set it up wrong, - Liberty, Equality, Fraternity, Liberty includes culture, arts, education, freedom, Research, philosophy.
    Equality is human relationships, - Rights, Duties, Love, - Law is frozen feelings.
    Fraternity, working together so we all survive and the Earth we live on also, the Economy.
    - Politicians are in that equality area, they should not have access to money, war machines etc, they can only fuck it up when that is the case, we need to look at the different roles we have in life and what needs to be done.
    TREBOR
    24th Oct 2019
    2:58pm
    I bash a couple of glaring criminal Labor chicks, and you translate that into 'bashing women'? I bash politicians and feminists... I am a woman lover and supporter from way back.... but I cannot accept blatant discrimination and violence as the chosen way to gain some ideological myth of 'equality' which is nothing of the sort - nor can I condone filthy politicians who treat public service as a career move towards their mega-millionaire status and retirement.

    Get your facts right and your sights straightened out....
    Hoohoo
    27th Oct 2019
    4:41pm
    Thanks, Lookfar - I'm tired of calling out TREBOR for his blatant sexism.

    These are YOUR words, TREBOR (I quote): "...don't tell me that:
    a) women bring anything new to the table,
    b) any of them are there for anything but themselves."

    TREBOR, why do you single out a few women who act as selfishly & boorishly as some men? It looks & smells like blatant sexism. It ruins your otherwise good argument.

    Just get over it - women can be as awful as men & it has nothing to do with gender, just being a flawed human.
    Lookfar
    27th Oct 2019
    7:49pm
    Trebor, i recall you were going to think about it a bit, I don't think you really understand compound interest at computer refresh rates of thousands per second, can you do that thinking you promised? please..
    floss
    24th Oct 2019
    12:32pm
    Cowboy Jim the Libs are in power it is up to them to fix the problem they have to stop blaming ever one else and start to govern and not let private enterprise do it.They are weak and deceitful.
    TREBOR
    24th Oct 2019
    1:10pm
    Yes - let's first clear the snipers then we can go after the rest...
    roy
    24th Oct 2019
    7:01pm
    Thank God Shifty Shorten isn't weak and deceitful flossy.
    Hoohoo
    27th Oct 2019
    4:52pm
    Roy, are you trying to change the subject? Shorten is a nobody now & he has nothing to do with our useless government who is unable to manage the economy or steer Australia successfully through hard times.

    Who cares about a Surplus when our whole economy & society is down the toilet? The Libs are waiting for the average Australian to pull them through, even while there's stagnant & negative wage growth. But they NEVER put their hands into their own pockets to help out - it's against their religion!

    Remember, their biggest tax cuts are going to the richest tax payers. Austerity is king.
    pedro the swift
    24th Oct 2019
    12:37pm
    The interest rate on gov. loans should be no more than the RBA rate. They are only loaning you money that they ripped off you in the first place. And as for "being risky" to loan to pensioners, where is the risk? They get the money from the assets of the estate if the borrower dies owing them. There is no risk. The real issue is that they don't want to upset their bank pals by giving out loans at too low a rate. Can't undercut our mates can we?
    TREBOR
    24th Oct 2019
    1:11pm
    'risky'? How is it risky to loan on an existing home?

    Is the government admitting that the value of the family home will fall - i.e. that the long-predicted Downfall of the false housing market will begin soon? And that their management style has failed, along with their economic strategy?
    Billv
    24th Oct 2019
    12:44pm
    It seems to me that it must be government policy to hit pensioners where and when ever possible. This is just another example.
    MICK
    24th Oct 2019
    12:49pm
    What can I say. More of the same from a government which has come after retirees with a passion.
    roy
    25th Oct 2019
    10:54pm
    Time to go skiing MICKOVITCH.
    TREBOR
    26th Oct 2019
    1:01am
    Come on, roy - you KNOW it isn't just the 'champagne socialists' who are profiting mightily ... it's the entire champagne mob... and you know it.

    Do you doubt that this 'government' has come after retirees with a passion?
    Fisherman
    24th Oct 2019
    12:50pm
    With help from YLC we could set up The Australian Retirees (or Pensioners) Union and sock it to the government. I know how effective the Citizens Electoral Council of Australia was in their campaign to stop the government legislation for limiting cash payments to $10,000. Now the Australian Government has deferred the legislation in the hope that opposition will die.

    There were over 4,000 written complaints sent to the Australian Treasury and more to individual politicians. The politicians don't like their email systems to be jammed and their mail boxes over flowing.

    With directions from the Bank of International Settlements in Basle, Switzerland, the IMF, the World Bank and the UN, the Australian Government seems to be trying to destroy the Middle Class here. They did it in Spain with the austerity measure introduced by the EU.

    We missed out on the worst effects of the GFC, so now we seem to be a target for the international banking cartel?
    MICK
    24th Oct 2019
    1:07pm
    Tell it to the coal lobby!
    Retirees do not (generally) have the ticker at end of life to make a difference and they will demand their right to vote for who they have always voted for, the issue being you won't get the retirement community to band together and throw out ANY government which comes after it like the current batch have done. So we get what deserve to get.
    TREBOR
    24th Oct 2019
    1:12pm
    ARPU? Simpsons fan, eh?
    TREBOR
    24th Oct 2019
    1:14pm
    No ticker? I have eight stents now, and am preparing to go to war with them if necessary... but I was always hard to control....
    roy
    25th Oct 2019
    10:31pm
    MICK, you make me puke, google QLD labor Jackie Trad and Palachook, they should be hung drawn and quartered, labor filth.
    TREBOR
    26th Oct 2019
    1:04am
    Yes, roy - I've gone after that lot, and taken endless critisism for doing so - now let's realise that we, the people , are all in the same boat - and all those political scum are in the other boat .. the one they gave the outboard to while we have oars, and only one of...

    Get with it lad, there's a war coming and I don't have all day to catch you up...

    NONE of us real people actually, in our hearts and wallets, support ANY of these political scum... now get on the boat... and stop trying to kick your fellow survivors under the water.. t'falc is wrong with you, man?
    Karl Marx
    24th Oct 2019
    12:59pm
    The government has forgotten that they should never be a "For Profit" institution so to compare themselves to private enterprise like the banks is disgusting.
    Why can't they offer zero interest or the going RBA rate of 0.75% or even the same rate as the outrageous deeming rate. So what if they undercut the banks for OAP, the banks will either need to offer a similar rate for OAP or just get out of that sector of the market.
    At the current rate it's a "For Profit" offer, wouldn't touch it with a 10' barge pole
    TREBOR
    24th Oct 2019
    1:15pm
    Aye - government is not a business and cannot be run on business lines - time for that nonsense to be sent back to the toilet where it came from and flushed away.
    Lookfar
    24th Oct 2019
    2:49pm
    Absolutely, Karl, economics has been twisted by the Super Rich, 50/60 years now, the Neo-Liberal, pet "Theory," is that because the rich are rich they must be clever, - because they are rich, so anybody not rich is stupid, "sheep", whilst they are 'wolves'.
    They, by owning the media and most govts, are able to advertise their sick ideas and can stop differing opinions, so in their attempt to make everything based on richness, the poorer must lose their money as they can't justify having it because they aren't rich.
    Round and round we go, as long as they are given power by us, them getting richer, Govts helping them extract the last cent, - bit by bit within the "parameters of acceptance' they have decided for every country and community, until 'they' have it all, - then starts the higher taking from the lower even in that place of ultra rich, where does it all end?
    In the Roman times, the super rich got control of Govt and the money and decided they did not need to pay the Army, - they preferred to party, so the Army eventually gave up and went home to their various villages and the Goths, etc. just walked into Rome and killed them all.
    The Rich are incredibly Stupid, and they still are, - we still have the greedy becoming rich same as then, - it is actually a sickness, Psychopaths, eg Trump, fixated on wealth and Power, ignoring human rights, - perhaps not even understanding that concept, and now owning all the fossil fuel industries, and despite that pollution destroying our planet, wanting to keep on doing it until all is gone - different time, same stupidity, - can not learn because they choose not to, they believe they are all powerful.
    Well, now time has proven them wrong, eg all over the world Coal fired Power stations etc are closing/closed already, Renewables, with the promise of Abundance from the Sun, - a delivered abundance, have destroyed the coal fired in America, and will shortly in Australia, - and just as well, becuase fossil fuels wil destroy our children and Grand children, and any loving grand parent would not do that.
    roy
    24th Oct 2019
    7:04pm
    I have to agree with Trebor Skid, the Gov't is not a business and your commie ideas make me want to puke.
    TREBOR
    25th Oct 2019
    1:06pm
    Hmm - let me get a grasp on this issue - 'communists' and 'socialists' still want to run government as a business - but along their lines...

    There is really the difference of a cigarette paper between 'left' and 'right' when it comes to impact on ordinary people.

    Perhaps I can best runthis by examples:-

    Hitler was a 'national socialist' - meaning that his intent was to have the best for all Germans first - the rest second to last... but Nazi Germany was still run as a business in conjunction with business.. just by its own peculiar rules of who controlled what happened.

    Stalin was an 'international socialist' who claimed to pursue the idea that the entire human population would be best served by the tenets of communism/ultra-socialism - in reality his government was a continuation of the old very corrupt and inefficient Tsarist feudal approach, in other words, it was a business based on outdated principles, and all 'businessers' were controlled by the state, the difference from Nazi Germany being that that control was more centralised.

    The aim of BOTH those 'business government' - the two theoretically polar opposites - was the enrichment of those 'at the top'..... you see the extreme of that in 'communist' China nowadays... which is simultaneously a communist state (for the peasants), a super-capitalist state (for the 'best classes), and a fascist state in the way it approaches issues of civil rights and laws etc. A perfect example of what is wrong with any over-controlled and over-centralised government.

    Just saying..... (welcome to Around The World With Trebor)...

    One day - that fishing boat moored outside the limit and spraying radio to the Continent of Australia under the jackboot...

    ..... doing a Brando ... "they send young men out in fighter planes to bomb and burn villages, women and children and babies without a thought... but they won't let them paint 'fork' on their airplanes..."
    roy
    25th Oct 2019
    7:36pm
    Fantastic post Trebor, I hope Comrade MICK and Skid Marks have read and understood it.
    Anonymous
    25th Oct 2019
    9:38pm
    Comrade/Kamerad/Towaritch TREBOR - you have certainly nailed it to the mast. Can see you know your history and wish more Aussies to study it. Thanks!
    roy
    25th Oct 2019
    10:24pm
    Cowboy Jim. Hear hear.
    TREBOR
    26th Oct 2019
    1:11am
    Thanks, men... now - I support all the views that currently refuse to our government of two parties any solid ground. Mick is one such... and if you sit back and think for a while, he is on the same side as you. We all need to ally ourselves together and stop carping about our minor difference, and often differences in how we present the same case (jeez - is that a 'government of national reconciliation'?)

    Oh, and sergeant? I'm not a Quaker.... I'm just a loyal servant..... and duty comes first...
    Hoohoo
    27th Oct 2019
    5:07pm
    Thank everyone TREBOR & I agree with everything else.

    Many free democracies (USA, UK & Australia) are becoming more & more totalitarian by restricting information & punishing whistle-blowers who are only trying to warn us that the elite are doing us all over.

    We really need to put aside our petty differences & Party politics if we are to have any chance of salvaging real democracy for the people. Multinational corporations have been allowed to become the enemy of democracy & freedom. Who has the power to stop them?
    Tricky
    24th Oct 2019
    2:39pm
    Thoughts and Prayers and may the almighty speedily condemn these thieves!
    TREBOR
    26th Oct 2019
    1:12am
    Aye - but the guillotine works faster...
    TREBOR
    24th Oct 2019
    2:51pm
    Why not just offer an interest loan at the going bank rate for a savings account?

    How is the Guv to lose? Colonel C'Link is already in place to handle such things... plus the money wasted out outside consultants to do the same work...

    (word for today:-

    "outstide" - (n) - the rushing tide to place everything outside (of an already in place structure)... as in "the government outstided as much public service work as possible..."
    TREBOR
    26th Oct 2019
    1:21am
    I'm talking about an ordinary mortgage - there is zero 'need' for a reverse mortgage, which generates profit from capital appreciation anyway, to have such a punitive interest rate...

    How much does a 'government' really lose by, say, offering a pensioner with a home worth ~ $600,000 - an amount of $100,000 up front on an 'interest repayment' basis, with a requirement that the loan be repaid at closure (like that word) of the capital (#100,000) plus accumulated interest at the going rate for a lowest cost mortgage, like any 'interest only' loan?

    I mean - seriously, people - what 'costs' are involved in having a simple arrangement like that? So no need for ongoing costs....

    I'd think that most pensioners with a home could afford to repay the interest only.. leaving only the capital to be recouped... and they would have a little with which to see the world before Eternity Day...

    Who loses? Not qui bono.... the worst thing that ever happened was that some WOP came along and said that government in Australia should be a business.. it is not, and can never be.

    It is a service to the people, and the scumbag who came up with that idea should have his pensions taken from him and should be arraigned for stealing public roads... then after a fair trial we'll give him a fair hanging..... the old way....
    TREBOR
    26th Oct 2019
    1:31am
    Little bit confused there.. I meant to say "Interest Only loan' - meaning that if the Guv gave a pensioner $100,000, the pensioner would repay the interest component only - at a real rate. there are NO costs....... since costs are already covered by the rate of interest (that they are not is a lie perpetrated by self-interested vultures in 'banking', 'superannuation' and 'government').

    There is also zero need, given the actual equity of a home, for any extra interest rate over and above the normal mortgage rate...

    i.e. the capital 'investment' to the pensioner is guaranteed ..... the interest rate covers any inflation (etc) .... there are non 'ongoing management fees', since there is no ongoing management ... the ONLY additional cost, levied on the the estate, is the costs of verifying that the pensioner(s) have ceased to exist.... and that verification is a paltry fee... and if made automatic, would not exist at all...

    So - is there a reason NOT to offer to home owner pensioners a reasonable sum,that will not impoverish their beneficiaries,along these lines, and which sum will give to those pensioners a reasonable opportunity to enjoy their last remaining years??

    Now all we need to resolve is stopping Colonel C'Link from reducing their pension while they are repaying interest - so that they obtain real benefit from such a move...

    Easy as pie..... the Zen Of Pie....
    TREBOR
    26th Oct 2019
    1:40am
    Where is the 'risk' ...... unless government itself, meaning the elected nodding clowns and their agencies various, are admitting that their policy of housing, housing, housing at all and any costs, and building, building building as a result.... is teetering on the edge and is about to collapse in upon itself like a super-nova (Keating's 'over-heated economy'? ha, ha ha - not quite - his 'over-heated economy meant the peasants were getting too much while he swanned in the warm sun of politician cash for life all day...)
    VICMT
    24th Oct 2019
    4:26pm
    Hypocrisy.
    Compare this to deeming rates.
    Deeming rates that were conveniently reduced just prior to further reductions by RBA, which government would certainly have been expecting.
    When will they not only reduce rates on the reverse mortgages, but also on the deeming rates.
    They are gouging elderly retirees, who have made this nation what it is today.
    They taking it from us in all directions.
    Doubt if the others would be any better.
    GrayComputing
    24th Oct 2019
    5:23pm
    NO ASSET TEST FOR A PENSION EVER AGAIN!
    A pension is not welfare.

    Now is the season for discontent, so do something about it!
    It is time to kill off this insane hugely expensive pensioner whacking bureaucracy.

    It is time for all of us (yes that means you) to rant at our MPs and Senators daily to take action for human decency and a huge stress reduction for pensioners

    Most economist say we will save taxpayers money by dropping asset testing because of the massive overheads cost in running Centrelink and the 10,000 conflicting rules.

    Hiring more Centrelink staff will only increase taxpayer’s costs for processing the creeping insane red tape monster system politicians and well paid bureaucrats have created.

    Help scrap it now. Become a hero.

    Even the UK and poorer New Zealand has a NO ASSET pension so it is cheaper and user friendly.

    Why worry that few million$ earners get it too. That is peanuts to them, not enough for a good vintage champagne.

    Do retired and retiring people really look forward and want 100++ visits to/from Centrelink and be part of 3 million waiting queues and lost calls?

    We all (that means you) need to tell our MP and senators every day that these criminal asset tests for a pension must be dropped now.
    roy
    25th Oct 2019
    10:52pm
    Hear hear.
    TREBOR
    26th Oct 2019
    1:33am
    Spot on, GC!!
    Chooky
    24th Oct 2019
    6:50pm
    What did you expect? What? Did you say you thought LNP government would support pensioners better? Aren’t you are fool? LNP don’t like pensioners at all. When are you going to grasp that? And you were suckered in and voted for them in May. Well let’s hope your memory holds out until 2022. Will you allow yourself to be fooled again?
    Libby
    25th Oct 2019
    12:04am
    In brief, there is no way of managing your funds without Centrelink being involved unless you cease claiming the pension – obviously, this does not make any sense from a financial perspective. I wish they would keep their pig noses out of the trough! Labor or Liberal, I won't vote for either in next election!
    TREBOR
    26th Oct 2019
    1:34am
    ... or we abolish centrelink.......
    Libby
    25th Oct 2019
    12:04am
    In brief, there is no way of managing your funds without Centrelink being involved unless you cease claiming the pension – obviously, this does not make any sense from a financial perspective. I wish they would keep their pig noses out of the trough! Labor or Liberal, I won't vote for either in next election!
    BillF2
    25th Oct 2019
    1:18am
    'Sfunny, but you never hear of politicians having reverse mortgages. Wonder why? Could it be that they award themselves infinitely higher pensions than they are prepared to give the average Australian sucker?
    roy
    25th Oct 2019
    10:52pm
    Shifty Shorten is worth $61 million, a good champagne socialist, shakes head.
    TREBOR
    26th Oct 2019
    12:55am
    What are the rest worth, roy?
    Lookfar
    27th Oct 2019
    8:47pm
    Compounded reverse mortgages is what the rich 'give' to the poor, - it is a version of 'kicking us in the face,' - and they laugh..
    ex PS
    28th Oct 2019
    7:51am
    $61 million? Just goes to show, socialism does work. But I can"t understand why Bill is getting so much attention, was he made opposition leader whist I slept.


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