New legislation is being introduced into parliament today to increase the number of hours age pensioners can work before their payment is cut.
The private member’s bill is being put forward by independent MP Rebekha Sharkie and is intended to address worker shortages in multiple industries, The Australian reports.
Older Australians could be the big winners. Under current rules, a single person on an Age Pension can earn up to $180 per fortnight, plus a further $300 under the Work Bonus scheme, for a total of $480.
Any money earned after that reduces their pension payments by 50 cents in the dollar. Ms Sharkie’s proposal seeks to increase this income test threshold.
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As well as a being a boon to many Australians’ retirement savings, it’s hoped the change would help to fill the more than 480,000 vacancies across the country.
With skilled migration collapsing in the wake of the pandemic, Ms Sharkie says businesses are ‘crying out’ for more workers.
“In our seniors, we have an experienced workforce that, like many Australians, is facing cost-of-living pressures and wants the opportunity to earn a wage without being unfairly penalised,” she says.
“This is a single solution to two major issues that just makes sense.”
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The proposal has the backing of major business groups, including the National Farmers Federation, Council of Small Business Organisations Australia, National Seniors Australia and mining magnate Gina Rinehart.
“In addition to income tax, their pension income is also taxable,” Ms Rinehart said in a statement.
“It means thousands of vulnerable working pensioners who have limited savings are being penalised at a tax rate that is higher than the wealthiest Australians in the top income tax bracket.”
Ian Henschke, chief advocate at National Seniors Australia, is also lobbying the federal government to have employment income exempted from the pension income test entirely, as occurs in New Zealand.
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“At the moment, it’s a giant disincentive not to work and it just doesn’t make economic sense … if you work more than one day a week and you lose 50 cents in the dollar,” he told Channel Nine.
He also said the fact that Australia punishes its senior citizens for working makes us wildly out of step with the rest of the developed world.
“We could look at the pensioners as a being a standing grey army ready to jump into action and fill those jobs,” he said.
“We’ve got American presidents in their 70s, we’ve got people like Sir David Attenborough in his 90s – still working.
“The Queen is still working and yet in Australia we say once you reach 66 and a half, we’re going to punish you if you decide to work more than one day a week.”
Are you pleased with the private members bill? Do you believe it will make a difference? If you’re an age pensioner, would you like to work more with penalty? Why not share your thoughts in the comments section below?
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