‘I feel very sorry for retirees at the moment’: former treasurer

Peter Costello says compulsory super has failed Australians and reform is needed.

‘I feel very sorry for retirees at the moment’: former treasurer

Former federal treasurer Peter Costello believes compulsory super has failed Australians, pointing out major flaws in the system and the need for reform in the sector.

Speaking at the Citi annual investment conference, Mr Costello claimed that the major mistake of compulsory super was the focus on accumulation, but when it came to decumulation “there wasn’t a lot of thought given to how it would be managed once it was in these funds and how it would come out”.

He also pointed out the shortfalls of fund structure after nearly 30 years of use.

“We realise [now] that fees were extraordinarily high, some of the products were no good, and at the end of all this, when you get your entitlement, there’s still this huge gap as to ‘what do I do now?’” he said.

“You’re at that stage of your life where you are trying to wind down and you don’t really know what to do with it, and I think this is where we’ve failed Australians.

“We haven’t had the right exit products; we haven’t had the ability to move between funds as easily as we should have, and we haven’t had fees as low as they should be.”

With low interest rates also negatively affecting many retirees, the nation’s longest-serving treasurer said it was time the Government reconsidered deeming rates, saying “he feels very sorry for retirees at the moment”.

“Everyone would say to you [that] a retiree should have most of their wealth in liquid assets – particularly in cash – and they get no return,” he said.

“I think this is where cuts in interest rates actually have a negative effect; they have a negative effect on these people.

“Borrowers save two for every one that savers lose on a rate cut, so overall a rate cut is effective for the economy.

“That’s if there’s immediate pass through and full pass through, and we’re now seeing rates are so low that you don’t get that.

“I think for those people, they’re starting to squeal.

“Deeming rates are very high and they don’t really reflect what the retirees are able to get. But, you tell me where you can get those sorts of rates any more? I think [the Government] has to have a look at that.

“It’s very hard for those people,” he concluded.

Do you agree with Mr Costello’s opinion? Are you finding it difficult to live a comfortable retirement at the moment? Should the Government revisit deeming rates?

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    COMMENTS

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    Buggsie
    22nd Oct 2019
    10:09am
    Retirement funds are like politics, neither delivers the benefits claimed for the consumer. Fund managers get wealthy on our money and politicians grow power and influence for themselves without worrying much for the future of the country or its citizens. What's changed? Nothing. What will change? nothing, again. Costello is no different from the rest of his political tribe - I wish I had one tenth of his income from the public purse.,
    VeryCaringBigBear
    22nd Oct 2019
    11:49am
    That's why I have my own SMSF. I get wealthy instead of the fund manager.
    TREBOR
    23rd Oct 2019
    2:06am
    Good for you - now - about those people tied into wage super slavery, and who, without a sudden influx of cash, will not escape that situation...

    Are you with me yet?
    VeryCaringBigBear
    24th Oct 2019
    3:49pm
    You can have your employer super put into a SMSF if you have a wage too.
    Linda
    22nd Oct 2019
    10:24am
    I think the fund managers and government and other commercial interests see the superannuation as a golden honey pot to plunder.
    VeryCaringBigBear
    22nd Oct 2019
    11:50am
    That's why now SMSFs have more money in them than industry or retail funds.
    TREBOR
    23rd Oct 2019
    2:07am
    ... and precisely why so many of them fail and are failing....

    God, you're a dreamer....
    VeryCaringBigBear
    24th Oct 2019
    3:49pm
    If my super is failing then others super must be very dismal indeed.
    johnp
    28th Oct 2019
    1:08pm
    VCB. What sort of returns and growth have you been able to generate thru your SMSF ??
    Horace Cope
    22nd Oct 2019
    10:29am
    I agree with most of what Costello has said. His points about fees, portability and products such as insurance are well made. As to the decumulation phase, I tend to disagree with his thoughts about the need to do something. The funds belong to the employee, nobody else, and the employee should have the right to do with those funds as they wish. All of us are different and there will be innumerable reasons for the way the super funds are used on retirement. Some will be debt free and want to buy an annuity, some will choose to leave the funds with their super fund and accept the minimum 5% drawdown, some will wish to repay mortgages or other debts, some will do the big circle around Australia, some will want to travel overseas and the list is endless.

    There are people who can handle money and those who can't and that ability, or inability, will also dictate how the super funds are utilised. There will be homeowners, those who rent, those who wish to self manage and those content to leave it all to their super fund. Suffice to say that all of the differences should not be rounded up and a government edict made to tell any of us what we can do with our own money. Remember, some of those super funds were placed there in lieu of a wage rise.
    KSS
    22nd Oct 2019
    1:23pm
    The whole premise of superannuation is to fund retirement whether in its entirety or in part.
    The problem is many people do not want to do that. They have other plans, such as leaving it to their offspring, upgrading homes (to hide funds and get the pension) etc.

    So why not make it mandatory that say 50% is transferred to an income/pension generating product, 30% left as accumulation funds and 20% which could be withdrawn as a lump sum and spent on paying out a mortgage, round the world trip, the grandkids education or anything else the account holder wishes?
    GeorgeM
    22nd Oct 2019
    2:02pm
    Good comments, Horace, agree with all, except that you haven't noticed that Costello (being a Liberal) has failed to mention the role of the nasty Assets Test changes of 2017 by his fellow Liberals as causing massive pain to people who had already retired or were close to retiring. While not acknowledged, his comment "You’re at that stage of your life where you are trying to wind down and you don’t really know what to do with it, and I think this is where we’ve failed Australians." applies very much to the people badly hit by the Asset Test changes. Libs badly failed part-pensioners with that change.

    Complete garbage from KSS, Super is earned salary - not the business of Govt to tell you what to do with it, I thought Horace had explained this fully. Any attempt to touch it will be stealing - could lead to riots! Age Pension is what the Govt controls funded by taxation of 7.5% included in everyone's individual income taxes plus other revenue.
    TREBOR
    22nd Oct 2019
    2:54pm
    What nonsense, KSS - most people, those who have a job - are tied into a compulsory superannuation system, and hardly have the wherewithal to start 'salary sacrificing', organising lump sums into super funding, and so forth - those kinds of privileges are reserved for the 'better' types in society...

    The ones who either are fat cats overpaid and work for government, or who live off their 'work' and get most of it off their taxable income....

    "I can always tell a man who works for a living - he says he on wages. If he says he's on salary - he doesn't work." Ken Bruen
    KSS
    22nd Oct 2019
    5:56pm
    Comments like those from TREBOR and GeorgeM are the very reason why super should be quarantined for retirement. Regardless of what happened in the past, the fact is the purpose of super is to support one's retirement. To that end, there needs to be some sort of restrictions in place to prevent those unable to see beyond tomorrow from withdrawing the lot and blowing it only to expect to rely on the pension.

    We now have 30 years of compulsory super. In around 15-20 years there will be people who have had compulsory super for their entire working lives. I am not one of them and have just a very few years left before becoming eligible to apply for a pension. And I still think that at least the lion's share of super must be preserved for funding retirement as it was intended. By all means have some for fun money, but not the lot.
    hyperbole
    22nd Oct 2019
    7:29pm
    No one should be able to access superanuation. It is there for one purpose. To fund retirement.
    TREBOR
    23rd Oct 2019
    2:15am
    Ah - so now you accept that superannuation should be quarantined, as I've been advocating all along over your arguments to the contrary.

    I love the way you seem to suddenly arrive on the side of the angels, but still retain your demons - the very ones who've given you your lead.

    Jeez - this reminds me of when the ex and I had the property - and our excess produce went to the poor in town... and OG/Bonnie suddenly started this thing of his/her excess produce to the poor in town - they who did not have NBN while Bonnie did.. those bloody peasants down there in the lowlands ...

    You sure you're not just a clone of OG and VCBB and Bonnie? (gotcha - deny it now forever - I used to monitor transmissions for the Guv amongst other things ... and you're so easy)....

    Personally - I'm satisfied that finally sense is coming into this issue - along the very lines I've argued for ages now.... and with which you now agree, though churlishly and still seeking to put down those who said it first.......

    By all means - insulate it from the grasping hands of politicians and their mates in 'business' .... and abolish the 'private business model' that costs to terribly much - and reserve it exclusively for retirement...

    I can now rest easy knowing that I've actually penetrated the thick hide of government and its lackeys, and taught them sense ... pure and simple sense...

    thank you for your support ....
    KSS
    23rd Oct 2019
    5:33pm
    Get over yourself TREBOR. Even a cursory glance at previous posts of mine on super, would show you that I am no convert of yours. I have always maintained that super should be used for one purpose and that is funding retirement as it was instigated to do. I do not agree with living in penury simply to leave it to the kids or grandkids. If that means quarantining the funds into an income producing product then so be it. Much like the welfare card really: keep most for what it is intended to pay for and have a little left over for ' fun'.
    GeorgeM
    24th Oct 2019
    12:09am
    I agree that Super should be mainly meant for supplementing Age Pension to have a better life in retirement, however it is NOT the job of Govt to control or tell people what to do with THEIR MONEY (in Super or elsewhere), and only an extreme right-wing nut-job would suggest to "quarantine" it and have the Govt control how people spend THEIR OWN MONEY in Super. Thankfully, such nut-jobs will never get their way in this democratic society.
    Of course, the concessional level of Super-based benefits must be far more severely capped than it is now as it is still too generous and being exploited by the rich.

    On the other hand the "entitled" people such as politicians on large, undeserved, Special Defined-Benefit Pensions (such as the pre-2004 MPs) MUST have these pensions scrapped. They should only get pensions, if eligible as anyone else by the same rules. Time to fix this urgently if politicians are to have any credibility. At the same time, Costello's Future Fund needs to be rolled back into Consolidated Revenue or it should be used to fund Universal Age Pension for ALL with NO tests except Age and Residency instead.
    floss
    22nd Oct 2019
    10:56am
    Costello you and Joe Hockey caused the problem just get your party to fix it ,simple really.I very much doubt you party know the meaning of the word sorry.
    Horace Cope
    22nd Oct 2019
    11:10am
    Oh dear, what problem do you think they have caused floss? The compulsory super was designed by Keating who, the last time I checked, was in the Labor Party. Costello left politics in 2009 so how has he contributed to any legislation since then?
    TREBOR
    22nd Oct 2019
    11:14am
    You reckon this slowly developing train wreck wasn't happening up to and including 2009?

    They all bear responsibility for the failure of the 'business model' of superannuation.. and only a massive resumption and revamping will save the issue of retirement packaging for the nation as a whole...
    Horace Cope
    22nd Oct 2019
    11:22am
    Thanks TREBOR, like floss your comment is heavy on rhetoric and light on detail.
    VeryCaringBigBear
    22nd Oct 2019
    11:52am
    Why don't people just fix it themselves by having their own SMSF instead?
    Karl Marx
    22nd Oct 2019
    12:38pm
    simple answer Old Geezer (VCBB). A SMSF is a private superannuation fund, regulated by the Australian Taxation Office (ATO) that you manage yourself. SMSFs can have up to four members. All members must be trustees (or directors, if there is a corporate trustee) and are responsible for decisions made about the fund and compliance with relevant laws.
    So the first to letters say it all, Self Managed. Most people would rather have a life & do other things like travel, bowls, gardening, cooking etc than worry about Self Managing a fund which not only takes time but expertise & is also accountable to the ATO with strict rules etc & penalties if you get it wrong even unintentionally
    So OG you can now climb down from your high (rocking) horse as SMSF are only for a very small percentage of the population.
    Rosret
    22nd Oct 2019
    12:45pm
    It was Costello who recognised that retirees were going to be in big trouble. He offered very attractive incentives to invest more in Superannuation.

    Keating didn't have a crystal ball and no one really thought interest rates would grind to a rate this low.

    However we know now - so fix it before our children can't ever retire!
    GeorgeM
    22nd Oct 2019
    2:10pm
    Have to agree with Horace - Keating designed the screwed-up Super system benefitting the rich the most, plus the nasty Assets Test, as well as the disgusting Deeming Income test - a trifecta! Before Wayne Swan came along and increased the Pension Age to 67!
    Of course, with no one batting for the Retirees, along came the Libs (Abbott, Hockey, Turnbull & Morrison) who hit the part-pensioners for six with the 2017 Assets Test changes with NO grandfathering!

    Just setting the perspective right! No hope from either of these enemies of Retirees - Labor or Liberal. Retirees missed yet another opportunity to kick out all current MPs at the last election, although good that they kept the destructive Labor mob out.
    TREBOR
    22nd Oct 2019
    3:01pm
    You mean that over the years of Howard's Way, with Costello stealing the Future Fund, and then most years under the LNP - they didn't contribute to this slow moving train wreck?

    https://en.wikipedia.org/wiki/List_of_Australian_federal_elections

    Keating 1990-1996.
    Howard 1996 - 2007.
    Rudd/Gillard 2007 - 2013
    Abbott/Turnbull/Morrison 2013 - 2019

    12 years of Labor since 1990, 19 years of LNP ......

    When is the Coalition going to start to repair this 'problem' created by Keating.. a '
    problem' that, BTW, has only had half a 'lifetime' to evolve.... and which will not bear real fruit until it has 'lived for fifty years or so ... by which time everyone in a steady job now should have a heap of super....
    TREBOR
    22nd Oct 2019
    3:03pm
    Most people don't have the opportunity to start a SMSF..... sorry about that reality intruding during your Black Panther Party..

    Get out and meet some real people for a change....
    TREBOR
    22nd Oct 2019
    3:07pm
    Some facts are so self-evident they don't need a full explanation except to the unknowing and those who choose not to know... fear not - we'll bring your education along slowly... though the work is hard ...
    floss
    22nd Oct 2019
    10:59am
    In other words you and your Government are a failure Costello.
    mogo51
    22nd Oct 2019
    11:46am
    So where does that put Gillard and Rudd, Swan etc?
    fred
    22nd Oct 2019
    12:30pm
    floss and where is the last shadow treasurer and Conroy and his mate James , the shadow finace spokesman and not forgetting Shorten with their $337 BILLION tax hikes ,franking credit refunds cancelled and negative gearing closure , thank God we stopped them and their Green mates and militant unions stuffing this country
    .
    TREBOR
    22nd Oct 2019
    3:10pm
    Where are these $337 Bn tax hikes?

    Please explain? Not going over franking fraud with you again.... negative gearing needs to be properly re-done... and CGT and NG should balance one another out - not cop both.

    Many things about tax laws need to be fully re-vamped to link up with the 20th Century - then we can start on the 21st... plenty of money out there to be recouped with a proper rendering of tax liability on those who are currently skating away with the loot...
    fred
    22nd Oct 2019
    7:22pm
    TREBOR Short memory you have . Shorten and Conroy splashed their plan constantly to raise $337 Billion taxes over the last election campaign . Labor and their socialists who follwed them thought it was a great idea to tax everyone shitless . Of course they couldnt tax pensioners so they flog self employed and self funded Sounds like you are one who thought it was a great idea
    TREBOR
    22nd Oct 2019
    8:15pm
    So lay it out for us, fred...

    https://www.theguardian.com/australia-news/2019/may/13/labors-tax-policies-to-have-virtually-no-impact-on-wealth-of-bottom-50-of-households

    I take it you're one of 'the top 20%', fred?

    "“Franking credits benefit households in the top 20% of income and wealth distribution considerably more than other households,” the analysis says. “While these households often have low taxable incomes, they tend to have large wealth balances or be in households with high incomes, even when the individual affected has a low income.”

    You beginning to see the problem here, fred? Thosetest with the mostest are getting the free-est ride...

    No wonder there is a dire need for overhaul of tax laws - properly - not the Howard way...

    Let me highlight it for you, fred:-

    "While these households often have low taxable incomes, they tend to have large wealth balances or be in households with high incomes"
    TREBOR
    22nd Oct 2019
    11:12am
    Survivor guilt? Who'd 've thunk it in a politician....

    Posturing?

    Nothing that he discusses will ever affect him, and by osmosis, his descendants - he enjoys his overly fat parliamentary 'pension', plus several other lucrative strands of income.

    He should have been considering these thing when he was our paid servant ....
    Rosret
    22nd Oct 2019
    12:47pm
    No just a very clever man saying how it is. He knew it at the time which is why he offered so many incentives to invest in superannuation.
    GeorgeM
    22nd Oct 2019
    2:15pm
    Probably it is guilt when he looks at the massive amount of money in the Future Fund he is managing for fellow politicians! NAH, more likely he wants to expand it with another bucket of money for all retirees which he thinks he can manage better than the Super companies! He has his eye on the Trillions there!
    TREBOR
    22nd Oct 2019
    3:13pm
    OH? And how many of those peasants had the extra to 'invest' in superannuation, over and above what they were paying automatically?

    Yes, Geroge - they all have their eyes on that stash of cash just waiting to be 'absorbed' into consolidated revenue - would solve all their budget problems for about five minutes - before the rampant inflation and massive cost hikes kill us all and leave us with nothing again.

    Like 'privatisation' reaping billions for governments - that money vanishes with hardly a ripple of result... for one simple reason - most of it disappears into 'administrative costs' and fancy dressing for old party and 'business' mates...
    TREBOR
    23rd Oct 2019
    2:19am
    Oh and BTW - that will NOT include their own personal super fund or those 'private' funds that benefit their mates so very well...

    Only the funds of the peasants will be absorbed...

    You with me yet?
    floss
    22nd Oct 2019
    11:32am
    For you information HC . Labor is not in power it is for the Libs to fix,it just will not happen.The Libs only know one thing blame Labor,why can't they just govern for all Australians and not just for the big end of town.O.G YOU HAVE NO IDEA.
    Blinky
    22nd Oct 2019
    11:33am
    On the other hand, if you have a few dollars in your super, that inflates your assets an the govt, thanks to ex treasurer Hockey, pinches 3 out of 1 thousand dollars from your pension which means that you would be better off not having super and then you would be entitled to a FULL super. This is a total oxy-moron, typical of greedy treasurers, politicians and self-proclaimed financial gurus who have no idea what it means to live on a pension and to always be afraid of new and "innovative" pension reforms which aim at taking money away from pensioners instead of helping them.
    Rosie
    22nd Oct 2019
    1:07pm
    It makes you wonder what grandiose plans the government has for the poor old pensioner next. Lets hope the asset test doesn't get cut back from around the $390,000 mark for a full couple's pension or even more people will be doing it tough. It's so easy for the pollies, with their snouts in the trough, to make cut backs that really hurt the people who can't change their financial position due to old age.
    patti
    22nd Oct 2019
    11:34am
    Super never would have funded my retirement anyway, I had not been paying into it for long enough, being born post WW2. I have had to rely solely on the Age Pension after I cashed in my super of about $12,000 to pay my solicitors fees following a drawn out divorce settlement. I now rely solely on the Age Pension. It's OK if you don't have a mortgage or have to rent on the open market. But there is no discretionary money left after basic living expenses are met. Thank goodness for it though..........
    mogo51
    22nd Oct 2019
    11:44am
    Very true Patti.
    mogo51
    22nd Oct 2019
    11:43am
    Oh how we need Costello back as the Treasury, he did a great job. Deeming rates are a joke and do no tf reflect reality, giving no benefits to superannuees. The punitive nature of pension and super on those with small amounts is extreme.
    P$cript
    27th Oct 2019
    8:34pm
    Where did you get your degree in ignorance.
    A little research will reveal that Costello only survived due to the booming world economy.
    Rocky2
    22nd Oct 2019
    11:59am
    When I started work in 1966, my grandfather commented on how lucky my generation was because the federal government had a aged pension, The National Welfare fund of 1946 and by 1950 The balance in the fund was almost 100 Million Pounds and held in a trust fund with a Compulsory levy of 7.5% ,when our Politicians noted how the Aged Pension fund was accumulating Dollars all the Aged Pension fund was placed in the Consolidated Revenue Account treated as General Revenue and spent, until 1985.Noting in 1977
    Liberal Prime Minister ( Malcolm Fraser ) with Treasurer Philip Lynch ) transferred the balance in the Welfare Fund Account ( approximately $ 470.000.000 ) to Consolidated Revenue Account.
    Now Politicians point out Aged Pensioners are a drain on the government purse ,
    Actuaries have calculated the non-means tested entitlement due to each retiree, today is in excess of $ 500 per week.
    So if the greedy Politicians had left the Aged Pension fund of 1946 in place there would be no problem with Aged Pensioners drawing on the own tax paid funds.
    Anonymous
    22nd Oct 2019
    2:58pm
    Thank you Rocky2. Needs saying now and then before everyone forgets. Was here in '77 but was too young to care. Who gets old?? I regard my part pension as an entitlement not welfare. The sows at the trough get fat and everyone else is on welfare!
    older&wiser
    22nd Oct 2019
    4:18pm
    Rocky, I too am not senile, and remember clearly at my first job in 1970 at age 18, sitting in a room, remember the large white board, with the HR manager explaining the tax system. Remember how it was explained that 7.5% of my tax would go into a fund for my aged pension. Over the next years, I had some time off work having my child, then time off minding elderly parent. When super was brought in in 1992, I thought I would have something in the pot. I was then stunned to find, that I had nothing, zilch, it had been stolen, robbed from me. Had I known this at the start, perhaps I would have been putting something away for my retirement. Instead - 22 years gone, theft. To cop it off, in late 1990's, I had to take a few years off to care for ill daughter and her 2 kids, and found it very hard to get back into the workforce in my field. Only survived by taking on low paying back breaking work, so when I became ellible for Aged Pension, stopped work due to too many of my own medical issues. What little super I did have went towards my mortgage, and even now on the pension, still have a mortgage. I'm pretty frugal, always been single, but I strongly begrudge the years that were stolen from me of having something set aside for my senior years. I was lied to and robbed.
    Rocky2
    22nd Oct 2019
    11:59am
    When I started work in 1966, my grandfather commented on how lucky my generation was because the federal government had a aged pension, The National Welfare fund of 1946 and by 1950 The balance in the fund was almost 100 Million Pounds and held in a trust fund with a Compulsory levy of 7.5% ,when our Politicians noted how the Aged Pension fund was accumulating Dollars all the Aged Pension fund was placed in the Consolidated Revenue Account treated as General Revenue and spent, until 1985.Noting in 1977
    Liberal Prime Minister ( Malcolm Fraser ) with Treasurer Philip Lynch ) transferred the balance in the Welfare Fund Account ( approximately $ 470.000.000 ) to Consolidated Revenue Account.
    Now Politicians point out Aged Pensioners are a drain on the government purse ,
    Actuaries have calculated the non-means tested entitlement due to each retiree, today is in excess of $ 500 per week.
    So if the greedy Politicians had left the Aged Pension fund of 1946 in place there would be no problem with Aged Pensioners drawing on the own tax paid funds.
    Rosret
    22nd Oct 2019
    12:51pm
    My parents had a fantastic superannuation fund that guaranteed a safety net indexed at the rate of inflation for life.
    We are the first generation in modern history to go it alone so to speak. Heaven help us when the brain is not functioning so well and we aren't keeping tabs on the ups and downs of the market place.
    TREBOR
    22nd Oct 2019
    8:18pm
    You got it, Rocky - now explain it over and over to the apologists who claim it doesn't exist and never did and there is no pot of dollars accumulated - I've been doing that for years here and elsewhere.

    Of course, none of the apologists need a pension....... just saying... they're all self-created, thus saving the Almighty from a dreadful burden of guilt..
    TREBOR
    22nd Oct 2019
    8:46pm
    Then they (Don Juan Huarte and Don Pedro Castella) stole $130Bn from il Tresuria Nacional and spotted it in the Caymans, a tax haven from which it pays zero tax here, and that fund is now run by Don Pedro Castella (he of this strand), to ensure the perpetual funding of THEIR retirement funding and of a few selected groups.

    Now We, The People - want it back, and we want that funding and the stolen generation of pension funding removed from the rasping hands of those bastards and their equally grasping mates, and placed in an isolated fund that they cannot touch.

    "AU$100 in 1977 is equivalent in purchasing power to about AU$554.68 in 2018, a difference of AU$454.68 over 41 years."

    http://www.in2013dollars.com/1977-AUD-in-2018

    Ergo - $470,000,000 in 1977 X 554.68/100 = $2,606,996,000 not including subsequent contributions....

    That's $2.6bn - but that figure could be safely quadrupled given that contributions between 1977 to 2018 would be much higher and of greater number due to employment rising due to population rising...

    So let's say an easy $10Bn (somehow I doubt that figure - I feel it should be much higher... but not an easy figure to approach... much more information required...

    Then if we add in the super contributions since Inception... (not the movie directed by my kid's second cousin) - the figure that should be held in an independent trust for retirement packaging is, literally in the trillions...

    Somebody correct my figures on that $10Bn - doesn't sound feasible...

    " average full time earnings in 1975 was $7,600 per year, today the annual average earnings exceed $72,000 per annum."

    In 2019 it's around $88,000 - ergo 11.59 times what it was in 1977.

    Ergo - I feel that the ABS is rather conservative and the approach to the figures is flawed... 'purchasing power' - that should give you an indication of how much harder it is to buy... given that the ABS figures show times 5.54, but the rise in AWE is times 11.57.. more than double.... over that period....

    So we multiply $470,000,000 by 11.57 and add a wedge for higher employment levels... a much healthier $5.47 Bn .... then we look at rise in employment level for a rough figure of today's true value...

    That is what $470,000,000 is worth roughly today....

    In 1977 the workforce was $6.3m - in 2019 double that ... so firstly double the figure of $5.47 bn = $10.94 Bn.

    Then how much would all those people have contributed to the fund along the way?

    Anyway - it's a huge figure today...
    TinTin
    22nd Oct 2019
    12:39pm
    Costello feels sorry, haha he doesn't feel sorry for anyone if he did he wouldn't have stolen the people's pension fund for his public servants' retirement. This mob of gangsters are guilty of treating pensioners and other welfare recipients with disdain. They are also guilty of condemning almost everything that Labor creates.
    TREBOR
    22nd Oct 2019
    8:46pm
    The Stolen $130Bn in the Future Fund to fund his and all the other parasite's retirements?
    Karl Marx
    22nd Oct 2019
    12:41pm
    his brother is a far more honest & compassionate human being, just saying
    TinTin
    22nd Oct 2019
    1:11pm
    I totally agree Mr Marx, Tim Costello puts his bad brother to shame.
    TREBOR
    23rd Oct 2019
    2:21am
    Igor, the bad, degenerate brother who lives in the cellar... just the wrong way around...
    Mad as Hell
    22nd Oct 2019
    12:54pm
    Why wasn’t my part pension grandfathered the same as Peter Costello’s parliamentary pension?
    pedro the swift
    22nd Oct 2019
    1:20pm
    A politician sorry for pensioners??? That'll be the day. More likely to treat them as use by date expired peasants who have no right to exist anymore. That's it isn't it, Pete.
    Ironman162
    22nd Oct 2019
    1:55pm
    Well said, I couldnt agree more!
    GeorgeM
    22nd Oct 2019
    2:19pm
    Now that's an idea - a National Sorry Day for Pensioners screwed up by the Govt!
    TREBOR
    23rd Oct 2019
    2:29am
    National Apology and then we could have the Stolen Generation compensation for the privatisation of power..

    Oh - wait a minute - just yesterday some here were saying that pensioners should not be compensated for the Stolen Generation if they go for a holiday Offshore and still have bills to pay back home (unlike fat cat sheilas on $150k who can cop PPL and also childcare subsidies - apparently the bills of pensioners stop when they are not at home or 'on the job' of being pensioners after a lifetime of toil, but the bills of fat cat sheilas do not stop - yardle, yardle)....

    ...must be that costs didn't treble under 'privatisation' in which government retains a huge share... taxing the peasants by another means....

    Then there is the National Apology to Men..... for the war against men that many women now oppose ...

    (I posted on a Veteran site that the government needs to stop the war on men - and countless Veteran women and Veteran's wives supported that stance - they now know, first hand, what it costs to be a man today)....
    Ironman162
    22nd Oct 2019
    1:52pm
    For all his sweet talk, Castello was nowhere to be found when the GFC hit Australia. In fact the worlds 'best' treasurer declined office.
    So thanks mr Costello but you could have done something to remedy the situation instead you retired on a pension to die for, well done on taxpayers money!
    Typical politician, kissing babies and patting dogs when they want your vote and then you dont see them for the dust when you need them!
    Chuck
    22nd Oct 2019
    1:55pm
    I'm much the same as you Rocky2. I started work at age 16 in 1964. Retired in 2010. Paid taxes all my working life. So like you, I also would like to know where my pension money has disappeared to.
    Red 13
    22nd Oct 2019
    2:46pm
    Wow, look at the Liberal apologists go.
    Liberal good, Labor bad, they repeat that mantra over and over again, self brainwashing themselves.
    The Coalition are the ones flogging this country to it’s death, they are the ones in power.
    But forget that fact, hold The Opposition to account instead.
    Morons the lot of them
    Rosret
    23rd Oct 2019
    6:48am
    Why would LNP voters have to apologise for a Labor initiative?
    cupoftea
    22nd Oct 2019
    3:21pm
    The only people Costello feel sorry for is him self I would like to say more but I would get done fore slander
    TREBOR
    22nd Oct 2019
    8:48pm
    I call them spades spades - they can sue me.... it'll cost them a hell of a lot for nothing in return.... except my everlasting enmity...
    Tricky
    22nd Oct 2019
    3:49pm
    Totally agree with Mr Costello's remarks concerning the Deeming Rate and the urgent need for review and correcting this imbalance!
    TREBOR
    23rd Oct 2019
    2:31am
    A broken clock strikes right twice in 24 hours...
    Old grey
    22nd Oct 2019
    4:35pm
    But Mr Costello still draws his parliamentary pension, which those on an old age pension (or part pension) can only dream of. Wonder if he's prepared to give some of it to those who are so badly off???
    TREBOR
    22nd Oct 2019
    8:49pm
    He also has several other lucrative income strands.... and pays no tax...

    If he does, I'd like to be enlightened...
    Old grey
    22nd Oct 2019
    4:35pm
    But Mr Costello still draws his parliamentary pension, which those on an old age pension (or part pension) can only dream of. Wonder if he's prepared to give some of it to those who are so badly off???
    danielboonjp
    22nd Oct 2019
    6:24pm
    Peter Costello is arguably the worst, most incompetent and dishonest LNP politician ever.
    Cheezil61
    22nd Oct 2019
    7:21pm
    No shit Sherlock! No point telling us what is bleedin' obvious unless you put your money where your mouth is..not interested d-head!
    Baby Huey
    22nd Oct 2019
    8:44pm
    My wife set up a SMSF when we were in business in the early 2000s and it was reasonably straight forward and viable. Between the GFC and corrupt NAB bank we were lucky to retain enough super to live on for a period which is fast coming to an end at which time we will be on the part pension. Now in our early 70s we tried to find an adviser who understands how to advise and guide us into investments which balance both decumulation and accumulation providing an adaquate income stream without the majority of the income stream being drawn from invested capital. Not one "independent" adviser could provide advice which was independent and in our interests. All four advisers wanted take our money put us into accumulation platforms which do not mature for 20 years when with good luck we will double our money. The advisers were most upset when they were told how are we going to spend the money if we live that long. All said that we could leave to our children. The advisers are cognitive defective rip off mercants and so are the politicians and governments that support them.
    VeryCaringBigBear
    24th Oct 2019
    3:52pm
    Less than 5% of advisors are independent so good luck with finding one.
    MICK
    22nd Oct 2019
    9:43pm
    I had to smile when I read that Costello was sorry.
    The facts are that HIS SIDE OF POLITICS have stopped the growth of super deductions. They were supposed to be 15% by now but the business directed government we have to have has held this back to under 10%. Its no wonder ordinary Australians cannot live on the pitiful amounts they have and its no surprise that the well to do have done quite nicely as they salary sacrifice and avoid the 48% tax rate as well.
    WORK IT OUT.
    TREBOR
    23rd Oct 2019
    2:35am
    Question on Hot Seat Millionaire yesterday (now day before) was what level was the super portion supposed to be by 2025.

    I said (wrongly) that since it was supposed to be 15% already, and this government was holding it back - by 2025 the target would be 14% - wrong - that target is 12% by 2025..

    This 'government' is not remotely interested in anyone's retirement but their own and that of their mates.... the rest of us can hang ourselves to evade starvation.......

    Time for a massive change of government, methinks... and not to the feminist party ... or the ratbags on the periphery... maybe one or two Independents can stay...
    Rosret
    23rd Oct 2019
    6:54am
    Mick - so they should. I tried to pay catch up by throwing more than the 9% in super only to have it wiped out by the GFC.
    If I had diversified and not put all that money into super then I would be much better off now. Also that money was coming from my salary. The 15% would have had to be above the individuals salary. That money comes straight out of companies and businesses. It would have been a crippling burden on the economy and there would never be any future wage growth.
    BillF2
    23rd Oct 2019
    10:16am
    The problem with the superannuation system in Australia is that it is the wrong way around. Everyone has been brainwashed by greedy and manipulative federal governments into believing they have to provide for their own retirement, regardless of income, capability, physical and mental condition, and life circumstances. Basically it is a 'sink or swim' system with a miserable and onerous state pension as a so-called safety net.
    If Peter Costello and other overly compensated politicians like him were really concerned for retirees, they would devise a government pension system which would provide a comfortable liveable income for all retired citizens, regardless of ability and circumstance. Then those with additional after tax funds can invest in their own private superannuation schemes, to their own benefit or detriment. At least, this way, everyone will be treated equitably, and those with extra cash will not be prevented from trying to improve their situation. There will then be no need for 'robo-debt' or 'cash back' schemes by and for the government. But can you expect sense, justice and equity from our federal government? Don't hold your breath!
    Captain
    23rd Oct 2019
    4:33pm
    BillF2, there is a different way. I have spoken to both Labor and Liberal candidates about everyone at age 65 receiving an aged pension. It requires a revision of our tax structure.

    A reduction in tax for all to somewhere around 0.15c in the dollar - with no deductions (currently companies paying tax average 0.17c in the dollar).

    For those at 65 and over they would also pay 0.15c in the dollar on all income above the pension rate.

    These are figures that need to be reviewed in depth and we need to make sure that no politicans are involved in the review. The tax from all companies that currently pay no tax amounts to somewhere in the vicinity of $60b. It is feasible however as every political has said to me "it is too difficult". My response is "what do you think we pay you for?".
    Hairy
    23rd Oct 2019
    12:22pm
    Mr Costello and all his his theiving self serving rorting creed are the biggest part of the whole problem,still on the bandwagon spewing shit , too little to late,none do anything but argue like children in parliament while the poor pensioners die in the streets from all the stress.Prince John beating and collecting taxes from the serfs is still alive and well . We need a Robin Hood for the people.
    Hairy
    23rd Oct 2019
    12:36pm
    Yes I agree George media is quiet on that information .And why are so many retirees not informed of this information .it was blatant robbery of the people’s pension and it’s been subdued.This country is being run by a pack of thieves and liars .nothing they say or do will change my mind on that.
    Hairy
    23rd Oct 2019
    12:55pm
    Right on the button Rocky 2. Blatant Goverment Robbery from the people’s pension fund.they all should be doing time in prison for theft.
    Hairy
    23rd Oct 2019
    1:13pm
    Yes older and wiser blatant robbery from the people . And they have the gall to ask us to believe a word they say they should be hung for the thieves and traitors they are.
    Hawkeye
    27th Oct 2019
    1:25pm
    I wouldn't give Peter Costello the time of day.

    By retiring from politics when he did,
    HE ROBBED AUSTRALIA OF THE OPPORTUNITY TO BE RUN BY ABBOTT & COSTELLO.

    All future Australians would have had the ultimate excuse for anything that went wrong.
    We could've just said "Yeah, but we were once run by Abbott and Costello"
    Just like future yanks can say "Yeah, but we were once run by Donald Trump"
    Alexia
    27th Oct 2019
    6:05pm
    Don't feel sorry! Do something about it!
    Fair Dinkum
    30th Oct 2019
    12:20pm
    We should put our money with the government and they should be forced to pay us the deeming rate they are charging us.


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