Centrelink Q&A: Why Age Pension rises fail retirees

Economist Matt Grudnoff explains why much of Norm’s Age Pension increase has disappeared.

Why Age Pension rises fail retirees

Norm says much of his recent Age Pension increase has disappeared due to subsequent rises in expenses and asks whether the pension should be linked to the CPI (Consumer Price Index). Matt Grudnoff, senior economist with The Australia Institute, explains how the system works and why it might not suit everyone.

•••

Q. Norm.
I love your eNews and find the information very useful. I was just wondering if you have investigated the effect of the recent CPI on the Age Pension increase.

I received an increase of $14 per fortnight on my Age Pension. Of this:

  • $3.50 was taken up by a CPI rent increase – I pay 25 per cent of my income
  • $2 was taken up by an increase in care package management fees, based on the CPI increase
  • the price of potatoes went up in our local supermarket by $1 and I believe that other prices were increased by a few cents per item.

My Age Pension increase has been eroded by at least $6.50, and possibly more. I would also like to know exactly what the CPI is based on, as it may be on some things that pensioners can’t afford to buy.

A. The CPI is based on a basket of goods that the ‘average’ household consumes. The Australian Bureau of Statistics (ABS) produces the numbers and they get what an ‘average’ household consumes from the Household Expenditure Survey. This survey asks a large representative sample of people to account for every cent they spend over a two-week period. They use those results to work out an ‘average’ household.

Of course, if you put your head in the freezer and your feet in the oven, your average body temperature might be fine, but you’re unlikely to be comfortable. Averages can hide results at the extremes.

The more closely your spending patterns match the ‘average’ household’s spending patterns, the more accurate the CPI increase will be for your personal inflation rate. The problem is that the ‘average’ household refers more closely to a couple paying off a mortgage and with young children than to a retired person living on the Age Pension.

The work we did with YourLifeChoices’ Retirement Affordability Index resulted in the creation of profiles that more accurately reflected the ‘average’ households for six retired tribes: Affluent, Constrained and Cash-Strapped couples and singles.

These profiles have shown that retired renting households have faced much higher inflation rates than other retired tribes who own their home.

If you have a Centrelink question, send it to newsletters@yourlifechoices.com.au and we’ll do our best to answer it, or find someone who can.

Will you be one of the 70 per cent of Australians who receive an Age Pension or will you miss out? The RetirePlanner™ tool has all the information you need.

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    COMMENTS

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    Kali-G
    26th Nov 2018
    10:35am
    our soft in the head Government worry more about giving $ 8 BILLION DOLLARS away every year instead looking after our pensioners...
    How stupid is that????????
    mogo51
    26th Nov 2018
    11:26am
    How true Kali, the money given to countries, particularly Asian countries is obscene. I have spent a good deal of time in Thailand/Philippines and they rob 50%+ of every $ that is given to them.
    The poor never see it and the parasite Government continue to line their personal pockets. Charity begins at home!
    TREBOR
    26th Nov 2018
    11:34am
    Only 50c in the dollar, mogo? I'd have epected more.. foreign aid is a cash handout to the ruling elite in those Third World countries... always has been. I suppose the assumption is that what's good for the fat class is good for the nation and 'trickledown' will ensure the peasants get a feed now and then ... sounds familiar somehow....
    Kali-G
    26th Nov 2018
    10:36am
    our soft in the head Government worry more about giving $ 8 BILLION DOLLARS in ""foreign aid"" away every year instead looking after our pensioners...
    How stupid is that????????
    TREBOR
    26th Nov 2018
    11:10am
    Silly thinking is that offering 'foreign aid' promotes trade.... and we are all swimming in those profitable to the nation imports from Sandland and other spots not on most bucket lists.... not to mention the that the current 'global economy' simply swallows the majority of earnings from trade anyway, leaving this country essentially threadbare and in the street with a beggar's bowl - hence Fat Joe/ScoMo/etc's massive increases in borrowings... that's the begging bowl.... alms for the poor business manager.. alms...

    We are out there with that beggar's bowl every day, and like all true fasci-socialists, our 'government' chooses a social group to blame for the errors and steady declines in revenue that government has created with its short-sighted stupidity - in this case this lot have chosen the Social Security recipients, after the 'governments' (respective Mk I) stole the fund set aside for payments to those citizens and spend it at the casino.
    TREBOR
    26th Nov 2018
    11:04am
    It is inevitable that when 'pay' rises - which includes pension and other Social security, always follow cost rises and are calculated on those cost rises - the increase will always be meaningless to the recipient.

    It was always a given in pay claims that figures would be assembled to show how much wages had declined in real terms - of course with the Howard/Costello style of 'negotiation' at gunpoint, even that has declined, leading to a position where wages for the many decline at a faster rate than costs are rising.

    When pensions are calculated according to wages........... it is therefore inevitable that pensions will fall behind further and further.

    Someone else may now take on the false figures used to calculate CPI (and a few other things such as unemployment).... for the obvious reason of 'saving' the government money in pension payments... on which score we need to divest government of the idea that somehow what is in the till is 'theirs' and not held on behalf of We, The People.

    BOTR.... we're gonna need a long line of guillotines...
    Anonymous
    26th Nov 2018
    4:49pm
    Absolute nonsense
    TREBOR
    26th Nov 2018
    5:50pm
    How so? Can you argue your corner or are you content with slurs?

    **rolls eyes**
    TREBOR
    27th Nov 2018
    10:20am
    Are you arguing that wage claims, as handled in the past, were NOT on the basis of figures presented to an independent arbiter, those figures based on how much the ratio of income to cost of living had changed in the PAST twelve months?

    Never heard of the annual wage claim?

    https://www.fwc.gov.au/awards-and-agreements/minimum-wages-conditions/annual-wage-reviews#field-content-1-heading
    Cowboy Jim
    26th Nov 2018
    11:08am
    The $14 increase was to compensate for cost increases and in that way it has done exactly that. Being on a part pension I actually lost $2 because our shares were at a record high when the deeming calculations were taken and have since dropped about 20%. In effect being on a full pension you are better off then people on deeming. Might be 6 months or more before the shares lift again and I just have to cop it. So no complaints how pension increases are handled. The way insurances have risen no increase in the pension would compensate for that.
    TREBOR
    26th Nov 2018
    11:20am
    I've long advocated that an annual calculation should be mandatory for SFRs of the small kind, C Jim, and where applicable those who have fallen below pensions level should receive a top-up of their part pension, or be started on a part pension.

    Insurance is another example of the dismal 'business model' that is effectively killing this nation with its excessive costs and charges to feed overpaid executives, board menbers and shareholders. Never forget that governments respective Mk I collude in cost rises for such things, starting with selling off the publicly owned supplier who kept the market relatively honest.

    Again - the privatisation 'business model' is a costly failure, and as several times, any resumption will cost billions out of the treasury in 'Dead Man's Hand' clauses attached to 'sale' of the venture.

    Nowhere in the business world does a seller guarantee the buyer for life and cover that buyer in the event of collapse, failure, or resumption of a failed business....

    Funny thing - back in the late 1940's, those damned socialists in Cambra resumed all rural land that was not being used profitably ..... many big estates lost thousands of acres (visited one such in Tasmania), and yet governments have insulated (its mates) buyers of public utilities by signing up for Dead Man's Hand clauses of its own design, to guarantee the poor buyer never loses but gains in the event of failure.

    Never ever seen such a 'sale model'... apart from in the fevered dreams of Robber Barons Past (Mk 1), and what ever happened to 'caveat emptor'? The seller of a business sis supposed to guarantee you against any and all catastrophes in the future? Where did that come from?

    Only a 'government' could dream up such a cosy deal for its cronies... which should begin to give you a fair idea of how this nation works in reality.
    Greg
    26th Nov 2018
    11:47am
    Cowboy Jim - can't you update your investments with Centrelink, if you think it will be a while before the shares increase you may as well get the extra pension amount.
    Charlie
    26th Nov 2018
    11:19am
    No wonder they get it wrong when they keep calling groups of people "tribes." Is this to bridge the gap with the indigenous people.?
    TREBOR
    26th Nov 2018
    11:22am
    I'm a tribe of one....
    mogo51
    26th Nov 2018
    11:24am
    Norm is right of course, the pension increase is quickly eroded and the CPI is disfunctional.
    Why should Norm have to endure an increase in his rent, every time he gets a small rise. Is the relevant authority he pays it to going so bad, it has to rob him of a couple of dollars which I am sure he put to good use?
    This continual 'pensioner bashing' by both major parties, seems to be ingrained in their manifest.
    But we don't see them putting their hands up and saying that the people are right, our pension scheme is obscenely excessive, as is the 'perks' we continue to rip off the people of Australia!!! I am in the same boat as Norm, so are many of my friends.
    Cowboy Jim
    26th Nov 2018
    11:38am
    Norm says he pays 25% of income in rent, take that is Govt. housing so an increase of $3.50 is about right on the $14 increase. One would have to alter the public housing rules for that to change. Last week I paid my body corp costs on a small villa unit, was $2814 for the year. The council got $2100 last August for rates (with pension discount). So 25% of the full pension is quite reasonable and the few mates living like that never complain.
    thommo
    26th Nov 2018
    11:37am
    The Govt doesn't give a toss about age pensioners (or the unemployed for that matter), and their concern is reflected in the amount of the pension.
    The pension payment is totally inadequate, and the only way it will be increased substantially so as to provide a decent, fair and respectable retirement for seniors is for seniors to organise and deploy a political group to take on our politicians and force them to pay us more.
    It can be done..Aust is a rich country and seniors are ENTITLED TO A DECENT PENSION..
    We tell the polliies to fix up the system or we target their seats.. simply really...
    Cowboy Jim
    26th Nov 2018
    11:43am
    Whoever you are going to vote for is not going to change your lot, thommo. Because whoever is standing for election is not a pensioner and does not have a clue how the lower classes make the ends meet.
    You would have to start a pensioners' party but no pensioner could afford to go around giving speeches and printing flyers and so on. For that you require a lot of Moolah.
    Farside
    26th Nov 2018
    1:42pm
    if pensioners want political influence then they need to organise and vote as a bloc, something that they have historically been incapable of doing, and then reside in a marginal seats where that vote can change outcomes, which is also not an easy ask. Bottom line, don't hold your breath Thommo.

    Australia has had 27 consecutive years of economic growth so the realisation might just be that this is as good as it gets for pensioners, especially when the unemployed are for more in need of welfare support.
    Alexii
    26th Nov 2018
    5:29pm
    Join SUPA - Seniors United Party Australia. The more retired people in it the better.
    GeorgeM
    27th Nov 2018
    12:03am
    Absolutely spot-on with your comments, thommo.
    Good suggestion from Alexii as well. The key is for all retirees to unite then their voting bloc can make a real difference, and the best way this can happen is for all Retirees to see a benefit so DEMAND Universal Age Pension from their MPs, and ensure they lose their seats if they don't listen.

    While you can vote 1 for any party or Independent you prefer, the key action is to vote AGAINST the sitting MPs who are not serving you, by putting them last in preferences. The Retirees as a bloc is large enough too make a significant difference, and must use their united strength without listening to naysayers from the major parties who don't want this to happen.
    Joy Anne
    26th Nov 2018
    11:48am
    I agree with Kali-G and mogo51. Our Government only looks after itself and what they can make out of giving all the foreign aid to countries that don't give a damn for us. That money does not even reach the people who need it goes into POLITICIANS pockets. Bloody disgrace. I find it difficult to live off the pension after i pay $610 for rent per fortnight. Last rise was $8 pf. Everything goes up food and it has sky rocketed in last few weeks, rents increase, water increase which tenants pay with the EXHORBANT rents. Car rego, insurance is out of control especially for people who have never made a claim and still increases also excesses which is so unfair. Needs to be a investigation into Insurance and excesses for vehicle's. Robbery by insurance companies. We pensioners want a fair go. People who claim should pay increases and excesses not people who have never claimed.
    Joy Anne
    26th Nov 2018
    11:48am
    I agree with Kali-G and mogo51. Our Government only looks after itself and what they can make out of giving all the foreign aid to countries that don't give a damn for us. That money does not even reach the people who need it goes into POLITICIANS pockets. Bloody disgrace. I find it difficult to live off the pension after i pay $610 for rent per fortnight. Last rise was $8 pf. Everything goes up food and it has sky rocketed in last few weeks, rents increase, water increase which tenants pay with the EXHORBANT rents. Car rego, insurance is out of control especially for people who have never made a claim and still increases also excesses which is so unfair. Needs to be a investigation into Insurance and excesses for vehicle's. Robbery by insurance companies. We pensioners want a fair go. People who claim should pay increases and excesses not people who have never claimed.
    HarrysOpinion
    26th Nov 2018
    12:32pm
    If Norm got an Age Pension of $14 per fortnight for September 2018 he should count his luck because the official increase was only $8.70 pf for Singles and $6.60 for couples. Never the less, government MPs got a salary increase equivalent to $173 per fortnight, it's no wonder they are oblivious to the poverty suffered by old age pensioners.
    Vince
    26th Nov 2018
    4:25pm
    not much to worry about here-most aged pensioners who own their home have never been so well off- an aged pension with all entitlements is now worth well over a million dollars -very few self funded retirees trapped with assets -could ever afford to buy an aged pension
    Anonymous
    26th Nov 2018
    4:49pm
    Exactly right Vince
    TREBOR
    26th Nov 2018
    5:54pm
    Hmm - $22k - let's say that's a 10% return on investment.... make it easy and say $220k investments.....

    I'd like to see your figures on this.... are we talking real money or just imputed value of deadstock such as assets that return no income?
    Anonymous
    26th Nov 2018
    6:00pm
    Your ignorance never ceases to amaze

    To earn $40,000 p.a. over a 20 - 40 year horizon with ZERO risk of running out of money before death requires a principal investment of $1 M invested in stocks and bonds

    Read William Bengen or use Firecalc - why do I bother with idiots like Mr T and Mr M
    TREBOR
    26th Nov 2018
    7:40pm
    Any ignorance on my part pales into insignificance compared to your ill manners and supercilious nonsense.

    Tough titties - the Pension is paid for in advance.... invested already in the government of this nation.

    If you wish to discuss superannuation or personal savings - pray do so - but Pensions are not within the province of your investment proposal.

    You are talking about a mythical calculation - we have people here who religiously claim 18% returns etc - even 10% - my original position - would return the investor $100,000 pa.... there is no equation.... unless you wish to introduce some pie-in-the-esky figure that may represent market fluctuations, but doesn't do so in real terms in any way,...

    To earn a mere $40k p.a. your million would need to consistently return 4%.....

    Sack your investment advisor and then give yourself an uppercut...

    No wonder nobody bothers with idiots like Mr L and Mr O ... full of it, and such easy meat with their idiotic utterances based on nothing but some calculation in isolation.
    Anonymous
    26th Nov 2018
    8:44pm
    Actually, Trebor, someone with $1 million will probably have at least $60,000 (likely much more) in non-returning assets (car, furniture, etc) and will have to retain at least $50,000 in cash, at virtually no return, and then they have to pay administration fees and audit fees - very likely to amount to $5000 a year. Add to that the fact that they have to deal with risk and the stress that creates, and then the constant changes of government rules - that always seem to attack battling SFRs (not the wealthy ones). And now they face Shorten's threat of losing 30% of their income (bearing in mind many lost that much already in the assets test change!). And then bear in mind that unless they can achieve an income of well above the pension level and save a substantial amount, their income will NEVER increase except by a stroke of luck. Oh, and don't forget they miss out on thousands of dollars worth of concessions and special benefits such as free medical, transport, etc. To be as well off as a pensioner, assuming the 5% average return stated by government, one would need to have well in excess of $1 million. And yes, some claim very high returns IN SPECIFIC YEARS. But it only takes the 10% fall we've just seen in share values to reduce the average annual return to closer to the 4% you state. Go look at the figures quoted by Managed Funds. Plenty are averaging less than 4%.

    Pensioners can whinge, and I support their claims that a basic pension is not really sufficient, especially if they rent, but for once I have to agree with Lothario. Most SFRs worked their guts out to position themselves to be able to earn around about the amount pensioners are handed, and yes, pensioners paid their 7.5% - BUT SO DID THE SFRS. The difference is that SFRS DO NOT GET ANYTHING DESPITE HAVING PAID TAXES FOR A LIFETIME.

    It really is tiring to be constantly seeing pensioners who are receiving a $1 million +++ gift over their retirement years complaining, when others who probably paid far more tax AND saved to be self-funded, are struggling to be as well off - and can come nowhere near the income of the part pensioner with a few hundred grand in savings.
    Anonymous
    26th Nov 2018
    8:52pm
    A pensioner couple gets on average $40k p.a. in full OAP, concessions and discounts

    $40k over 25 years is $ 1 million in todays dollars

    At no risk whatsoever !!!!!
    Paddington
    26th Nov 2018
    9:51pm
    Why the pension envy and trying to make pensioners feel guilty?
    If the pension is so great then lose all your money and go on the pension!
    Making assumptions about who has paid most tax could be flawed. A low paid worker may have paid tax every week of his working life with no way to apply deductions,
    Your car is valued at what you can sell it for. Ours is worth $7,000. Your furniture is worth what you can get at a yard sale. Some of ours would get nothing.
    Judging others as wasters and leaners is uncharitable and unAustralian.
    It does not matter whether you are a self funded retiree or a full pensioner what counts is whether you are kind and compassionate and some of you continue to judge and knock others on here. People may be happy who have little whilst people with a lot could be lonely and miserable.
    Just stop being nasty and judgmental!
    Rae
    27th Nov 2018
    9:02am
    Nicely said Paddington. We have to remember both the LNP and the ALP have deliberately passed legislation to divide aged pensioners and SMSF pensioners and create this politics of envy.

    Hockey and Morrison deliberately created this with those budgets. Obviously not desperate for money judging by subsequent squandering but deliberately designed to divide.

    What we really need is a Leader who is kind and compassionate and believes in justice. Very few politicians fit that description unfortunately.
    HarrysOpinion
    27th Nov 2018
    9:30am
    Lothario, the future value of $40K in 25 years time is $83,751.12 at constant 3% pa However the FV of $40K in 25 years time is $1,585,872.81 if $40k was deposited regularly every year into the nest egg at same 3% rate. Is that what you mean ?
    Anonymous
    27th Nov 2018
    9:44am
    Paddington, it's not about making pensioners feel guilty. They should not. But at the same time, they SHOULD recognise FACTS and lend support to SFRs who are being unfairly treated. SFRs cop a lot of abuse and unfair attacks, claiming they are 'selfish' or 'greedy', and now they are facing a very unfair threat from the ALP.

    What's wrong with pointing out the FACTS. Pensioners DO get $1 million or more from the taxpayer purse. I am not suggesting there is anything wrong with that, and I am well aware I could restructure my affairs to get the same benefit. But facts are facts. SFRs ARE saving the government over $1 million if they remain self-funded until death, and they are being abused and threatened with unfair loss of income they need as penalty for doing that. Many SFRs ARE doing it tough. Whether they continue to struggle because of pride, desire to avoid dealing with Centrelink, or a desire to help the nation's budget is irrelevant. The fact is that it's NOT easy, and many would be far better off restructuring and claiming pensions. Many no doubt now wish they had, faced with Shorten's shockingly unfair threats.

    There's no ''pension envy'' in stating facts and asking that they be recognized. And there is certainly vile selfishness in pensioners failing to support SFR complaints about the unfairness of the ALP's proposed changes to franking credit refunds. Kindness and compassion works BOTH WAYS. And so do facts. Some pensioners ARE bludgers, leaners or spendthrifts. And some SFRS are selfish or greedy. But putting people in boxes and labelling them all the same is disrespectful and unfair.

    I will always support pensioner demands that they be afforded a comfortable lifestyle and treated with respect. But any pensioner who doesn't support demands that franking credit refunds continue for struggling SFRS is SELFISH SCUM. And I'll brand THAT pensioner a bludger and a leaner every day of the week.
    TREBOR
    27th Nov 2018
    10:05am
    Rainey - many pensioners have worked their guts out to be left with nothing for a vast variety of reasons - it isn't just SFRs who 'work their guts out'.

    That is false thinking, and is frankly elitist and divisive.

    I personally have been through periods of lost employment, loss due to company disappearing, sickness, long lasting injury, divorce, and so forth - I'm currently in the position of looking at an investment property (again after a lot of effort to get back on my feet AGAIN but now without the Jag and the Daimler in the garage) - it isn't all beer and skittles for those who are just workers on super/pension rights for retirement, and many such, particularly in the modern age go through periodic unemployment etc.

    If it were simple, everyone would be an SFR, but unfortunately it also includes a lot of luck and many issues over which the individual can have little to no control.

    That equally applies to SFRs, but remember that just because someone has been lucky enough in life to escape disaster, doesn't make them 'better'....
    TREBOR
    27th Nov 2018
    10:13am
    Oh - and Loathie is positing a million bucks in investment - name me anyone who over twenty or forty years will receive only $40,000 pa from a one million dollar investment portfolio?

    He's seeking to assert that 'uncertainty' somehow makes the difference.... well - you play the poker machine of the stock market etc, you take your chances as a business - pensioners are not in business, but are drawing on their retirement package... same as any failed investor who suddenly finds self down and out with nothing...

    A failed investor left with nothing can go on pension and thus loses nothing over twenty or forty years, certainly will not receive less than a pensioner.

    His entire premise, as usual, is flawed, and is posted to create a false image of reality.
    TREBOR
    27th Nov 2018
    10:24am
    Not only that, Loathie, but if you have a $1m investment portfolio, whatever you gain from it over twenty or forty years leaves that $1m untouched. You can earn up to the ceiling and retain that $1m and draw it as cash... zero comparison with any pensioner.

    Maybe we should demand that after twenty years on pension, a pensioner receive a handout of $1m pure and clean.... there's a good policy.

    Now is the time for you to whine that the $1m portfolio is all you've got... no home, no perks, no nothing else... (LMAO).

    Half-baked figures with an aim in mind, son... no value.
    Anonymous
    27th Nov 2018
    10:52am
    Trebor, if you gave up a $100 dinner in a restaurant so you could save to give your grandchildren $100, would you think it okay for others to say you should then sacrifice $100 of pension income as punishment? That's what you are saying - i.e. that having given up $1 million worth of pleasures, an SFR should then be denied a government payment of $1 million, but if they enjoyed that $1 million worth of pleasures, or put that $1 million into a better house, they should get that $1 million from the government.

    I can name people with $1 million who get less than $40,000 a year income. I won't, for privacy reasons, but I can. I know one couple who, in the past 10 years, have had an income of NEGATIVE $100,000. If Shorten gets his greedy way, hundreds of thousands will have incomes well below the aged pension level, and yes they can spend their savings. But that means all their sacrifices gained them NOTHING.

    Sure, some pensioners worked their guts out, but faced crisis. So did plenty of SFRs. I faced one crisis after another. I defy any pensioner to match the trauma and crisis I've faced. And it's precisely BECAUSE of that, that I have savings. Because I HAD to find a way through it, and I HAD to ensure I would never be poor and dependant again. Now I want my savings to benefit my disabled grandchild, but no. It's being STOLEN to benefit greedy, self-serving pensioners. And my disabled grandson will end up a poor pensioner while strangers benefit from all my savings.

    Stop ranting about pensioner superiority and superior entitlement and recognize that SFRs EARNED AND SAVED that money, and are ENTITLED to retain it for the purposes for which it was saved. It's YOUR argument that is half-baked on this occasion. Under a fair system, EVERYONE would get that $1 million - whether they already had a million or not. Nobody should be deprived because they worked harder or saved better. And frankly, I'm getting tired of this ''poor me - you don't know what I've been through'' crap. I would be willing to place bets that you had far more capacity than a lot of SFRs to have $1 million in savings IF YOU HAD MANAGED BETTER. And that goes for MOST pensioners. Certainly, I can't find a single one who had less opportunity and lower income than I did. I acknowledge that we don't know what's ahead, and I sympathize with those who lived well thinking the good fortune would last and then had the rug pulled - but the fact remains that they COULD HAVE HAD MUCH MORE THAN ME if they hadn't assumed the party would go on forever.

    Personally, I support a universal aged pension and a fair tax regime. But regardless, it's time pensioners had the RESPECT AND DECENCY to acknowledge that they ARE getting a $1 million handout, and to thank SFRs for not imposing a further burden on the government that would potentially increase pressure to reduce pensions - and SUPPORT SFRs demanding a fair deal on franking credit refunds.
    TREBOR
    27th Nov 2018
    6:34pm
    The difference, Rainey, is having $1m in investments, and having $1m in assets.. investments must deliver income or they are not worthwhile and any prudent investor would quickly see that.

    Anyone can have $1m in assets - but in most cases they produce no income - hence my opposition to including the family home in the assets test (cues OG to rant about all the people he knows who put millions into their home so they could draw pension).

    If a person has $1m in income generating assets, they are a pretty poor manager if they can't make more than 4% on them per annum.
    Anonymous
    28th Nov 2018
    7:14am
    And when pensions increase to $50,000 a year, that million is supposed to generate 5%, and when they rise to $60,000 a year, it has to generate 6%, etc. - or else it has to generate a lot more than 4% NET in order to increase the $1 million each year to keep pace.

    4% is NOT easy to achieve given the costs of advice and administration. So you would have poor managers punished for saving but not being investment experts? And you continue to deny that pensioners get a $1 million handout? Sorry, Trebor, but you are wrong on this score. I don't begrudge pensioners their sustenance, but SFRs are being abused and bullied and it's disgraceful. Yes, they may well generate more than $40K a year in some cases, and they may well still have their $1 million at the end of their life - AND SO THEY SHOULD. They go without a great deal to accumulate savings that enable them to save the taxpayer over $1 million. Why should they not enjoy a good retirement AND have that $1 million they saved to gift to their offspring? Why should they give up the $1 million pension and be left with nothing for their hard work?

    This BS that savers should have to live on their savings while non-savers get handouts is selfishness in the extreme.

    Stop being so selfish and show some appreciation for the handout you enjoy. You are driving antagonism that will cost you the support of SFRs who support demands for pension increases.
    Anonymous
    28th Nov 2018
    7:47am
    And OG is right that the family home SHOULD be included in the means test if there is one - over a generous threshold. Personally, I think the assets test should be abolished completely. It's patently UNFAIR and WRONG and BAD FOR THE ECONOMY. But as long as we have one, it is absolutely WRONG in every way to reward people who over-invest in the family home and punish those who accept more modest accommodation and invest responsibly to try to avoid being an imposition on the taxpayer in retirement.

    26th Nov 2018
    4:48pm
    Wages increase has outpaced inflation since the end of WW2

    Aussies have more discretionery income now than in any time in history

    It follows then that pensioners are also increasingly better off now than they ever were, be it full or part OAPs
    TREBOR
    26th Nov 2018
    5:51pm
    Absolute nonsense.
    Anonymous
    26th Nov 2018
    5:55pm
    Didnt expect you to understand Trebor

    Most things are way above your intelligence . Never mind old boy. Perhaps in your next life , god will be kinder
    TREBOR
    27th Nov 2018
    10:09am
    Ooooh.. nasty.. nasty. Son - nothing is above my intelligence.... you are simply incapable of engaging your intellect with your intelligence and coming up with anything but party-orientated drivel.

    I warend you when you 'first' arrived to avoid the personality stuff.. but obviously you are a slow learner and need your ass handed to you daily to get the message.

    https://www.rba.gov.au/speeches/2003/sp-dg-100403.html

    This has some interesting reading.....
    Maxyboy
    27th Nov 2018
    8:12am
    I am an average pensioner but can't believe the number of whiners on this site. They seldom mention all the lurks they get from council rate relief, rent assistance, reduced or nil rego and licence renewal, transport, bulk billing, discounts for club meals, and the list goes on. Time for everyone to get more positive in life. I'm happier being positive than all of those who live a life of complaining.
    TREBOR
    27th Nov 2018
    10:16am
    I'm a non-average pensioner, and cannot believe the number of whiners on this site, either.... though I think my focus is on a different group...

    As an individual, I've long advocated that all retirees on a specified amount or less should automatically receive all those perks. In fact, thatis the case with part pensioners, so I don;t see any real issue of 'division' between those who receive 'lurks' and those who do not. If you do not receive 'lurks', you are not on pension... meaning you are already in receipt of enough and more.

    No argument at all...

    Would you prefer that all receive full pension benefits on retirement and pay tax on all income and imputed income over and above?
    Anonymous
    27th Nov 2018
    12:17pm
    Yes, I would prefer that all receive full pension benefits in retirement and pay tax on all income and imputed income over above. That would be much fairer, socially beneficial, and economically better for the nation.
    Anonymous
    27th Nov 2018
    1:06pm
    It would be a smart move for the nation and for all retirees if we were to form a lobby group to demand this outcome. Surely all retirees SHOULD support it, and if all retirees joined forces, we would make a powerful force.
    TREBOR
    27th Nov 2018
    6:27pm
    I'm sure that nobody would miss out, Rainey - except the very fat.... the lower income SFRs would gain a bit and the top dogs would pay tax they don't now pay.... which is why politicians will not come at it - 'top dogs' includes them with all their freebies and salary and deals on the side.

    $2.5m p.a. to run a politician - you don't expect them to pay for their trips and feeds, do you?
    GrayComputing
    27th Nov 2018
    10:33am
    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

    NO ASSET TEST FOR A PENSION EVER AGAIN!
    A pension is not welfare.

    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 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.

    Does your MP really like being part of the system that allows this indirect abuse of the elderly?

    This abuse is actually sponsored by our government and forced down to Centrelink and borders on a criminal act.

    Why do MPs normally compassionate persons let this Centrelink abuse happen at taxpayers’ expense?

    Some opposition and independent MPs stand to lose their chance at being part of the needed government changes


    DEMAND: NO ASSET TEST FOR A PENSION EVER AGAIN!

    Please help yourself and others today and every day, pass this demand on to all government, opposition and independent MPs and senators who could help us to get a fair deal on pensions

    27th Nov 2018
    1:12pm
    Poor pensioners. At least they got an increase. SFRs mostly suffered a fall in income AND in the value of their assets - but they still face the same price rises, and if Shorten has his way they will lose up to 30% of their income in unfair tax. How many pensioners are protesting that unfairness?
    HarrysOpinion
    27th Nov 2018
    2:59pm
    OGR- how on earth would you expect old age pensioners protest against the unfairness aimed at SFRs when SFRs have more wealth than old age pensioners who live in poverty?
    It should be the other way around where SFRs ought to be protesting against the poverty old age pensions paid by the current government just in case SFRs fall to the same level of poverty as old age pensioners and have to jump on the old age pension just to survive!!!!
    Anonymous
    28th Nov 2018
    7:04am
    HS. A lot of SFRs DO lobby for pension increases. And pensioners certainly SHOULD lobby for fairness for SFRs, because if more SFRs are forced onto pensions and the general living standard of retirees falls, it's far more likely pensions will be CUT rather than increased.

    Furthermore, not many pensioners are living in poverty. The vast majority are living very well indeed. A very large number are better off than their SFR counterparts, but I'm constantly seeing greedy, self-serving pensioners ranting that SFRs should live off their savings while pensioners continue to get $1 million +++++ in handouts. Unbelievable greed and selfishness!
    Old Geezer
    2nd Dec 2018
    4:34pm
    What a lot of whingers! You get welfare old age pension because you have no other means of support to cover the basics of life. If you wanted more then you should of saved for it. If it is not enough for the basics of life then you are living beyond your means. Stop the luxuries.
    Paddington
    2nd Dec 2018
    5:32pm
    OG, I may not have your wealth but I am educated and know that ‘of’ is a preposition and not a verb. I am one of these grammar freaks who cannot stand people using ‘of’ instead of ‘have.’ Also, stop insulting pensioners, they have every right to put their case and everyone has individual issues that affect their lives. You are not always consistent in what you say either as far as your situation is concerned.
    Not everything is about money. Some people have class who are very poor.
    Vince
    19th Dec 2018
    8:39am
    Australia does NOT look after its old people period I should have emigrated to the USA
    Vince
    19th Dec 2018
    8:48am
    I made major contributions to Australia https://www.sciencedirect.com/science/article/abs/pii/0020751988900409 It has given absolutely nothing. I would NEVER recvommend a young person to emigrate there. My while family lives ther tey cannot evenpay me half the old aged pension 8000k/annumm what a disgusting country that claims to be first world its fourth world
    Vince
    19th Dec 2018
    8:51am
    Paid 32 years taxes and I am an Australian citizen (1982) they will not pay me aged pension this is not an advanced country sorry


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