Family home to be part of means test

Commission recommends family home as part of Age Pension means test.

Family home to be part of means test

The Age Pension has been one of the hottest topics pre-Budget 2013-4. First we had the heated debate over the most efficacious retirement age. We now believe this will be gradually moved from 67- 70 between 2023 and 2035. Next we experienced sustained argey bargey over the indexation and benchmarking of the rate of the Age Pension and a decrease in indexation is a likely announcement on budget night.

With the release of the recommendations of the Commission of Audit (COA) last Thursday, the family home finally hit the headlines. The COA has suggested the family home be included in the means test from 2027, with limits of $500,000 for singles and $750,000 for couples.

Read more
Snapshot of Commission of Audit report 
Full Commission of Audit report

Opinion: Hands off the family home, Joe

When older Australians are assessed for an Age Pension, a means test of their income and assets kicks in. Currently, the family home is exempt from the assets test. This is set to change if the Federal Government follows recommendations made by the COA, with homes valued at $500,000 (singles) or $750,000 (couples) slated to be included from 2027 onwards. While this is 13 years away, it will have a major impact on many of today’s retirees, and those aged 50 and over who will enter retirement over the next decade.

Apart from the disincentive for future generations to save for, and pay off their own home, this suggestion is problematic for a number of other reasons.

Firstly it represents an attack on an asset which has been protected from government policy to date. There is little reason to remove this protection.

Also, the valuation of $500,000 or $750,000 is too low and totally arbitrary. Currently the median house value in Sydney is $660,000, Melbourne $652,500 and Perth $535,000. So it is highly likely that the average homeowner’s prospects of receiving a full Age Pension will be significantly reduced, despite modification by expected price rises before 2027.

More importantly, the family home is not an asset which can be reduced, section by section, or disposed of quickly and easily. You cannot sell off a chunk to help out with a grandchild’s education – apart from signing up for a rather questionable reverse mortgage.

And for those who bought their homes a few decades ago, it is likely that their property is worth many hundreds of thousands of dollars, but if their superannuation savings are simply average (recent reports suggest for those aged 50-65, they will vary between $100,000-$150,000) then the homeowners are probably asset ‘rich’ but cash poor – cash strapped in fact, and unable to maintain their main asset.

Downsizing is simply not the answer many believe it should be. Many retirees have lived in the same suburb for decades. They have built up a local support network of family, friends, health professionals, and community services. Often they cannot afford to repurchase in the same suburb, even if they are seeking a smaller property. The costs of selling and repurchasing are significant, particularly when factoring in state stamp duty. So little spare change – or money to finance a retirement – remains after the transaction. Should the homeowner actually make a tidy profit, then all future Age Pension income is threatened by this cash injection.

What perhaps would have made more sense would have been a consideration of taxes such as the GST (low by global standards) or even the introduction of a death tax. As some witty soul once quipped, you can’t take it with you. So why not allow us to enjoy our (hopefully) longer lives in the houses we have worked hard to buy and improve, and if the Government MUST get its hands on every cent we have saved, let it do so when we are gone.

What do you think? Is it fair to include properties worth $500,000 and higher in the Age Pension assets test? Or should the home remain sacrosanct?





    COMMENTS

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    7th May 2014
    9:34am
    AMEN to that !

    7th May 2014
    9:39am
    Can't wait for the Budget to come out...should be happy reading.....
    fearlessfly
    7th May 2014
    10:05am
    Look, if the media stopped rabbitting on about this unworkable inane Audit Report then the sooner it will fulfill it's destiny - sinking into posterity to be lampooned as the piece of fantasising bulldust it actually is.
    islandguy
    7th May 2014
    10:05am
    Way too many people are tucking their wealth away in the family home. Multi-million dollar homes that serve no other function other than to protect the owner's wealth from the tax system. Poorer people end up paying the greater percentage tax on their wealth.
    Wstaton
    7th May 2014
    10:22am
    You are right! see comment below about it should be on the value of the house not house and land.
    retroy
    7th May 2014
    10:37am
    Rich people have paid tax at a higher rate while accumulating that wealth, than poorer paid people, for most of their life, so think about that.
    As an individual they can look forward to no government hand outs yet their contribution has been high, so where is the fairness in that ?
    You need to open both eyes to recognise fairness.
    Wstaton
    7th May 2014
    10:55am
    You seem to forget that a lot of these people have created riches on the backs of the poorer people. A lot of these riches have been gained by money out of nothing. Forex is a typical example.

    Also most of these people spend heaps to negate the amount of tax they pay a lot by scurrilous means.
    Anonymous
    7th May 2014
    11:33am
    We are not talking about multi million dollar homes here - we are talking about what is pretty much the average big city home these days. In the case of those with mansions - I assume they could rent out a wing or two.... thus they are in possession of a potential earning asset - and probably are already with it undeclared!!
    Blossom
    7th May 2014
    12:40pm
    In 1980 the house and land my parents had was worth a fraction under $40,000.00.
    In 2012 it was sold for approx $568,000.00. Early this year it was sold at auction for exactly $657,000.00 It is on a big block of land by today's standards. The house is an ex-housing trust house sold when built in 1952. Building materials were in short supply due to Armed Forces returning after WW11 and wanting a home for their families, some of whom had been living with their parents during the war. You were not allowed to build a small garage using corrugated iron so part of it is still asbestos which has been painted to seal it as much as possible. It is below street level which means if it is demolished by the new owner the soil level has to be raised and asbestos removed by prodessionals. New houses in the area has pushed the value of the older ones. If you want to own your home the onlu option for some would be to move into a home unit in a cheaper area.
    niemakawa
    7th May 2014
    4:25pm
    You should have maybe tried a little harder in life. Stop criticising those that have excelled in their chosen career and lifestyle.
    Swinging voter
    7th May 2014
    10:11am
    Death tax? And/or government commandeer what assets remain from the hardest, most thrifty workers who have paid their applicable taxes over their lifetimes, and are perhaps, thrifty in their expenditures so they have some funds they want their children to ultimately receive? If ever there was a socialist/disincentive theory, death tax and forcing people to sell their homes for government coffers, is it. Might as well apply for taxpayer funded housing in the first place, don't bother educating ourselves with the bum out of our pants for 4-5 years, adopt a do-nothing go-nowhere attitude and join the non-aspirational grouping. Whilst we are not all able to age with assets government would like to take, I suspect most of us wouldn't want our hard-earned being re-directed philosophically abhorrent causes (foreign aid, immigration, dole bludgers etc.) that are philosophically abhorrent. Superannuation is still meant to phase out the pension. Raise the super contribution and stop threatening the family home and everything it stands for.
    Wstaton
    7th May 2014
    10:50am
    Don't need a wealth tax just stop all the negative gearing super offsets subsidies to companies that are already rich, trust funds, tax havens etc and that would fix everything up.

    But no, that will affect the super rich as well to much.
    Travellersjoy
    7th May 2014
    10:13am
    An inheritance tax would ensure that keeping the home is for the benefit of the pensioner, not to rip off the taxpayer to protect the kids inheritance.
    A better solution than including it in the assets test.

    The family home can only be a tax shelter if there are no death or inheritance taxes.

    I am waiting for a party to ask me to vote for some wealth taxes instead of more and more income taxes. I doubt if any have the spine or ticker for it after what the super rich did to Prime Minister Gillard, though.
    Blossom
    7th May 2014
    12:48pm
    Are you talking about the previously cancelled Death tax.?? Previously there was 2 taxes on an estate - Death Duty and Probate Duty. We still pay Probate on assets over $26,000 (house that you live in and all other investments). That was the amount in Sept. 2009. Surely one tax is enough.
    Wstaton
    7th May 2014
    10:16am
    How grotesque, Once again the where the big end of town isn't affected. They wouldn't qualify anyway. A lot of these properties worth $1m or more have already modest houses on them. The value is in the land which the speculators would love to get their hands on, demolish the house and build a macmansion. This appears once again a way to force these pensioners and the low superanients out to feed their rich mates.

    If anything if the means test should be on the value of the house not the house and land. That would also fix anyone rorting the system with a million dollar house on a $100k block.
    Oars
    7th May 2014
    2:27pm
    This article is not related to the "super rich"- who I assume are people with large incomes ( $300K plus) and mansions and holiday homes. No this article is intended to discuss the middle working group of people who pay about 25% of the total income tax collected and who have an income on average of $100K p/a. These people form the basis of policies that all Governments use to apply the various taxes and tests. To harp on about the "filthy rich" when you refer to a "medium income ($100K to $300K) is unrealistic. These people have a right to all social benefits INCLUDING a full pension without means test. They have already qualified by way of paying taxes for 40 to 50 years. The family home is another "red herring" to blame the authorities for certain wingers poor lifelong management.
    Wstaton
    7th May 2014
    3:32pm
    Don't think I mention the super rich who want to get richer by getting their hands on land in high cost areas. This was mentioning in the main where a lot of pensioners have done without to enable themselves to get their own home and did this without the help of high incomes. I am sorry they could not put anything away for their retirement.

    Then again those who did not have to scrimp and save and sort to rort the system by putting money into high cost houses so that they end up with no visible asset then get the pension is another matter.
    Travellersjoy
    7th May 2014
    10:18am
    Age pensioners should be more worried about changes to indexation than the home furphy. It seems to be going under the radar when it means real cuts to already impoverished standards of living that will get worse as time passes.
    One of Rudd's best initiatives was ensuring pensions kept up with cost of living increases.

    Why are pensioner advocates so fixed on protecting people with houses and ignoring the real and obvious threat to pension incomes via the proposed change to indexation introduced by the Rudd government after an extensive consultation?
    Allieannie
    7th May 2014
    10:42am
    Well said. Changing the pension to be coupled with CPI instead of minimum male wage is a real change in pension amounts. Better to means test those who snaffle 'their share' of the pension who really don't need it. The Aged Pension was always set up for the poorest with the least, not for those who say; "I paid my taxes so I want my share". It was never suppose to work like that. Greed is not nice including those who want more for themselves and less for others ("Swinging Voter" I am looking at you. Not my kind of person.)
    Swinging voter
    7th May 2014
    11:09am
    Dear Allieannie, the age pension was only meant to stop people from going cold and hungry. It was never meant to pay for car rego, maintenance, holidays, computers, ISP accounts etc. That is why I advocate increasing super contributions because that phases out the pension and lets people make their own disposable income choices. And do try to be nice. I don't think this is a forum where we should be telling anyone, no matter their opinion, they are not "my kind of person". None of us know the personal circumstances of anyone here. Someone wrote here that he is going cold - that's where I want my taxes to go - and what's left of my life's hard work after I have done everything as right as I can (very hard, very long hours) goes to my similarly decent living offspring. Thank you.
    PlanB
    7th May 2014
    10:19am
    No most homes are worth at least that amount maybe more , many have bought their homes and been in them for many decades and of course homes GAIN value that isn't the fault of the owner --and you can't eat bricks and mortar. When you reach older age the last thing you want it to disrupt your life and move from where you have friends and also like and know the area and the Dr etc, to buy again in the same area would cost a fortune in stamp duty too. LEAVE THE FAMILY HOME ALONE!
    Blossom
    7th May 2014
    12:50pm
    I agree with you. In some cases you would have to move to a rural area. That is not viable or wise when you need medical services.
    Paddles
    8th May 2014
    9:19pm
    Engy

    You have alluded to one of the great problems of our society. I mean of course, the apparent inability of people to even consider the pros and cons of moving to a different area for sound economic reasons.
    We see it as an inhibiting factor in juggling the unemployed versus the unfilled job vacancies. We hear of some half hearted incentive scheme to bribe people to move to an area where they can quit the dole for a meaningful job.
    Engy, I am sorry to be the one to tell you but there is a viable, nay comfortable, lifestyle to be had out of the metropolitan areas.
    I am about 120km from our capital city (Sydney) and we have everything one could wish for in our community and, if it should be lacking, then a 2 hour rail trip will take us to the "big smoke".
    I wouldn't swap this life style for all the tea in China.
    Wstaton
    8th May 2014
    9:37pm
    Same here paddles.

    7th May 2014
    10:21am
    No Government will interfere with the family home. They are not nutters. That would be the end. Look how Queensland prospered when Joe got rid of the death duties. If you have saved hard all your life and paid off the family home, why should you be subsidising others that have peed it up against the wall????? Just won't happen and neither it should. Owners of homes over a certain value should not get the pension.
    Blossom
    7th May 2014
    1:00pm
    It is not always the owner's fault that property values have risen so much. In 1952 a basic home cost about 9,000.00 Pounds. (I found the paperwork for my parents' home which they moved into in Oct 1952. Today it is worth over $650,000.00 The higher the land value in your area the higher the rates and taxes. It doesn't matter if the home isn't even liveable and still has water and other utilities connected to it or not. It the meter is still on the property you pay a supply charge. Friends of ours lived in the Adelaide Hills and relied on bore water which was tested regularly and was almost pure. When mains water was put in the area they said they didn't want any but were told they would be connected and charged whether they used it or not. Then you were charged a flat rate for a maxium of so much and excess after that. Now you pay by the quantity you use.
    Blossom
    7th May 2014
    1:02pm
    I forgot to state that I agree you should be charged by the amount you use. It discourages people from wasting water. The sewerage part of the bill is also charged on property value rather than by the number of people it is used for.
    aarceng
    7th May 2014
    10:40am
    If the family home is included in the means test then all the interest payments and other costs should be made tax deductible.
    Wstaton
    7th May 2014
    10:46am
    To true espcially as the money to pay for the interest and upkeep was with money that already been taxed.
    aarceng
    7th May 2014
    1:14pm
    Good point Wstaton

    7th May 2014
    11:31am
    The trouble - as many have pointed out - is that many people purchased their home when it was a much lower price item - I clearly recall the 1980's when you could get a house in Marrickville for $40k - try that now.

    Point is - like rates on properties - those who live in them are not responsible for the rise in prices of their homes, and while rates etc have kept pace with the times, pensions and wages have not in the real sense of covering GENUINE cost of living.

    http://simplesustainable.com/topic/2463-melbournes-median-house-prices-vs-wages-1965-2010/

    Just food for thought... I recall a lady who bought a house in Byron Bay for next to zilch who ended up having to work in retirement because her rates were more than her pension. Is it her fault that the property prices went through the roof?

    On top of that - $500,00 is unrealistic in this day and age in the big cities - and would mean that many, many people would be forced to sell their homes - which is obviously the reasoning behind this stupid idea - to get people to sell and thus sustain the current property debt cycle that is virtually all that is sustaining anything apart from mining etc that are not taxed properly for the long term, or treated as 'sovereign' property of the Australian people.

    http://www.abc.net.au/lateline/content/2013/s3736272.htm

    Just an attack on older people who've worked to own a home.
    Swinging voter
    7th May 2014
    11:54am
    I know a couple whose independently working daughter has battled with MS for 20 years. Due to her fatigue she has only managed to work 30 hours a week and therefore wasn't able to sustain the costs of purchasing and maintaining her own home, so she rents her flat. When her pensioned parents die, they want their family home to be shared between their two kids which will assure them of some security for the girl with MS, if she lives that long. The family home provides many loving things that often go way beyond its monetary value. It should always belong to the people who strived to pay for it, while they are meeting all their other financial and social commitments, and it is an earned and thoroughly taxed "belonging" that should be untouchable by government of any persuasion.
    Wstaton
    7th May 2014
    12:11pm
    Very Interesting Grappler. Not only is Norway's fund bigger it is hugely bigger $818billion.

    This a government doing the right thing not sucking up to the multinational conglomerates.

    Our Liquid Natural Gas deposits are probably greater than Norway's Our Mineral deposit's are definitely hugely greater than Norway's. They have the right idea, This is our land these are our resources and belong to every living being in Australia.

    Why are we virtually giving them away. Because we think that is a good thing as it brings some employment albeit sometimes temporary.

    Sometimes it is best to leave something in the ground and say "if you want it, pay for it"

    I find it disgusting that i see a 17.5% increase in NSW for our gas (and their is no scarcity of it) Whilst in USA who is now virtually creating all its own Natural gas has actually lowered the cost to local consumers.

    You can equate this to the OPEC countries who supply Oil to the world. Locally they pay cents for a litre of petrol. They don't allow themselves to be screwed by these conglomerates. why should we. We are not in the business with our resources to make you super rich. We are in the business to give you a fair return.

    I think Labor were right when they tried to impose a super profits tax in the absence of the returns to us being based on the current world price of the commodity like Oil. The stuff in the ground is ours if it goes up in value then our returns to us should go up.

    7th May 2014
    11:40am
    What do I think? I think the 'commission of audit' was nothing more than a dorothy dixer by the business people to push their agenda while being paid on the public pruse at a handsome rate for doing buggar all of value, and for coming up with the predictable rubbish that ToeJoe wanted. I think the whole thing was a waste of time and money and is setting fair to launch the revolution long overdue in this courty.

    I - for one - will be launching a new party if this 'budget' is as bad as these fools are trying to make it, without reason since there are no 'black holes' and no 'budget crisis' in reality - only in their ideology.
    PlanB
    7th May 2014
    12:09pm
    I agree people work long and hard to own their homes and pay their bills AND upkeep and they should be able to pass it on to their kids when they die
    Supernan
    7th May 2014
    12:21pm
    I agree it is not a home owners fault that their homes have become valuable. When we moved to our town, it one town block. Had a milk Co-op one end, PO at the other & small shops in between. People asked why we moved to such a backwater. Our block cost $3,000, our house $20,000. Now we are surrounded by developing housing estates, 20 mins from a hospital, library, shopping centre. Yes we could sell up & move out - away from our only relatives - a son & family. Away from our Dr, Library, friends, activities, part time work, etc etc. It very unfair.
    Oldie84
    7th May 2014
    12:33pm
    I wish that people would stop this denigration of others just because they have more money. This whole argument is going far to far. there will be a change of Government long before all these mooted changes are to take place and it will all be reversed. Bill Shorten will guarantee it !!! So turn down the heat.
    Morticia
    7th May 2014
    12:58pm
    Ha ha to that. Labor will guarantee nothing. Labor and Liberal are but two branches of the one firm, that's all.
    Anonymous
    11th May 2014
    8:05am
    All Shorten will guarantee is "more borrowings". Cannot people see that?? You just cant keep borrowing. If we dont have the money coming in to pay for pensions etc it will have to come from somewhere. What happens if another GFC comes along. We dont have the $20 billion in surplus that Labor had to use as a buffer last time. Heaven help this country if that happens.
    berylpat
    7th May 2014
    12:41pm
    The rules around superannuation need to be tightened so that it is used for what it was intended, to provide an income in retirement; not for a holiday, retiring debt etc. nor for the banks to lend in anticipation of taking the funds when it becomes available.
    KSS
    7th May 2014
    1:43pm
    Agree. I think the only reason for taking a lump-sum should be to pay off the mortgage if there still is one when you retire and perhaps for medical bills. How else will you be able to pay for these? But I agree that using it to fund holidays, cars, grandchildren's education or any other reason should not be allowed. Super was for your pension and that's what it should be used for.
    Wstaton
    7th May 2014
    3:35pm
    As a thought, it would probable be better not to pay the mortgage off as and mortgage owing would be deucted from the asset value.
    Anonymous
    11th May 2014
    8:08am
    It is my belief we should be paying at least 20% into a super fund to pay for ourselves in our later years. Sweden for instance has an amount around this figure...could even be 25%.
    Should be a government owned superannuation fund that everyone pays into. Those who are unable to do this by not being in the work force (poor, destitute, disable) will go on the government pension; others will be fully funded. themselves.
    marieanne
    7th May 2014
    12:42pm
    This stinks, Take from the people who REFUSE to get a job, Take it from the baby bonus, we never had any of this and we survived. I have worked every day since I was 12 years old. I have paid big taxes too. I have worked on my days off so the dole bludgers could come and get a meal and a bed until next pension.
    Pass the Ductape
    7th May 2014
    12:50pm
    If nothing else, the concept will likely place enough worry and stress upon many an aged pensioners to drive them into an early grave! Problem solved....the Government wins no matter which way it turns out. What a clever government!
    Pass the Ductape
    7th May 2014
    12:52pm
    No sorry! I forgot....That's Centrelink's tactics!
    Morticia
    7th May 2014
    12:55pm
    We wouldn't even need to have this conversation if Rinehart, Packer, Murdoch, Google, Apple et al paid taxes. Why should I live in penury to keep fat on their evil bones?
    particolor
    7th May 2014
    5:20pm
    Yeah !! And one of them got a Black Eye !!
    Judy in the hills
    7th May 2014
    12:56pm
    I think there could be a 'ceiling value' on what a 'family home' value would be before a taxation hit on it. eg. $600,000 or slightly above. The millionaires can have unlimited cash tied up in their estates/homes/apartments/castles while we lesser souls are often required to sell up and buy something smaller/cheaper to even manage to live.
    Gee Whiz
    7th May 2014
    12:57pm
    The Commission of Audit was clearly a farce. It was a put up job by the government to create a smoke screen to take the heat of other parts of the budget. If the auditors were in anyway serious with what they proposed then they are clearly mentally deficient and should be locked away. Nobody with this debilitating mental problem should be allowed anywhere near a government committee that forecasts the financial future of this country.
    Sen.Cit.90
    7th May 2014
    1:17pm
    If this is a fact!! The treasurer should start budget savings with the pollies: Nifty Neville---Served as Premier of NSW for many years. Amassed a fortune of $40,000,000.
    Not badly paid. Nuf sed.
    particolor
    7th May 2014
    5:23pm
    Thank You.
    Nevil
    bopper
    7th May 2014
    1:21pm
    Can someone tell me if these people who decide on whats good for us pensioners and others are they also subject to the same scrutiny eg. family home,other investments, other income, these people are not about to give up what you and I are about to.
    lucky
    7th May 2014
    1:25pm
    Yes I believe the recommendations in the audit report are simply not realistic. The pollies have never lived for a time (maybe a short time) on the average Australian income, one soon looses the ability to be in the other's shoes when living on a high income. I can't believe how mismanaged the federal budget can be by all sides of politics, They just are not looking far enough ahead.

    I live on a farm with the surrounding land taken into account for the pension - the house was not included. Whilst receiving some pension the ability to have a full pension will not be possible whilst on my land. Currently doing some part time work allowable but with failing health the issue in time what will my husband & I do when unable to find funds for power, heating, rates, basic Medicare - just hospital, registering the vehicle. There will be no ability to pay these basic every day costs.

    Imagine loosing the house as suggested one cannot eat the land or the house. We have no recourse but to sell the farm that is not a working one by the way, for the future and is not a high value.

    In my workplace superannuation was not an option at my workplace for many years so have not had time to accumulate much, same for my husband.

    So asset rich & cash poor. It is time the pollies look for reality in real life issues.
    Oars
    7th May 2014
    1:33pm
    Most of our "rich homes" are built with hard work and our savings when a $1.00 would buy a meal. The real estate market does not have any connection to our incomes. Real estate can be high priced due to a trend that we have no control over- we just got lucky ( maybe). The hard work part to build the home is surely a benefit to the housing market not just us. Later down the track, our wages do not escalate at the same rate as the cost of real estate, so most of us are placed in the predicament to either (i) sell to "dsownsize" ( this may not be much cheaper if in the same area) or (ii) subdivide the house to make the new "half" easier to maintain and to gain some income from the other half. If we do either, we are essentiually increasing our cash asset- so out the door goes the pension. But if we move to an outer suburb to reduce costs of relocation, then we are again faced with an increased cash asset. It seems to me that the poor savers, and lifelong renters have an advantage over the hard savers and workers. We have to foot their bill down the track although they had a great time spending up earlier. Wherte is the "fair go" in all that.?
    Oars
    7th May 2014
    1:53pm
    A good example of the hard workers is a friend of mine, whose ethnic parents REAL WORKERS- arrived here miud 50's and bought an old place in Glebe.- cost about 4,000 pounds. The old place was left to their HARD WORKING kids who lived in it for years then recently (50 years after purchase) the place was sold for $1.4 Million (after a lot of TLC). Now are these HARD WORKING parents and HARD WORKING kids deemed as the filthy rich ??? No they and many other HARD WORKING FAMILIES are the backbone of this Nation, and they are sick of hearing about this home asset being a gift. Nor should they have to subsidize certain people who bludge, wreck property, and place a social burden on society. There needs to a means test on the capacity of each person to treat gifts like pensions and welfare with respect- not a right.
    Oars
    7th May 2014
    1:53pm
    A good example of the hard workers is a friend of mine, whose ethnic parents REAL WORKERS- arrived here miud 50's and bought an old place in Glebe.- cost about 4,000 pounds. The old place was left to their HARD WORKING kids who lived in it for years then recently (50 years after purchase) the place was sold for $1.4 Million (after a lot of TLC). Now are these HARD WORKING parents and HARD WORKING kids deemed as the filthy rich ??? No they and many other HARD WORKING FAMILIES are the backbone of this Nation, and they are sick of hearing about this home asset being a gift. Nor should they have to subsidize certain people who bludge, wreck property, and place a social burden on society. There needs to a means test on the capacity of each person to treat gifts like pensions and welfare with respect- not a right.
    KSS
    7th May 2014
    1:38pm
    The family home is an asset. Why else do people want to leave it for their children to inherit? In this respect it is no different to a bank account or shares or any other investment. For the life of the mortgage it is essentially enforced savings. When you pay it off, you collect on the asset - the house/unit etc. People buy property for the very reason that it appreciates in value. Investment property is built on this fact. Do you seriously expect the 'family home' won't do the same? You can dispose of it at any time to liquidate the asset.

    The real issue here is that people do not see the home as an asset for themselves but rather one that they intend to leave for their children/grandchildren. And then there is the expectation of a very nice inheritance by the younger generation. This is quite ridiculous. Yes people work hard for their accommodation. So why not realise the asset in older age to fund retirement?

    I actually don't mind the idea of the home being part of the asset count BUT it MUST be set at an appropriate level. $500,000 would not be enough to buy something small in some places e.g. Sydney now as has been pointed out, much less by 2027! You must be able to sell, buy and still have funds left over. I would say that at $1000,000 should be the benchmark with increases in allowances at the same rate as property values go up.

    The other alternative is as others have said, death duties. Tax is paid on any inheritance. In the UK this includes all belongings of the deceased including such things as their clothes and furniture based on what you could raise as second-hand value (nothing in my family case). BUT this does not help fund retirement, only swells the Government coffers after death.
    PlanB
    7th May 2014
    1:53pm
    Even a Million these days gets bugga as all land alone is very expensive
    Oars
    7th May 2014
    2:04pm
    KSS your idea of asset increase is just a wild guess. Try asking the million of homeowners in USA how their "asset" is after the GFT mania? Recently, the public became greedier and started to purchase land & homes for capital appreciation, but 30 to 40 years ago the main reason was to have a place to live in close to your job. Movement of jobs then was not like it is now, and that becomes a huge demographic social discussion. Some people these days travel for 2 hours to their jobs- then arrive to their home late- at the expense of their health and families sometimes. Will those hard working travelers be praised for their efforts in another 40 years time when the real estate prices rise as the urban sprawl widens. ? I hope so- and I also hope they find jobs closer to their dwellings so that can reap the benefits of their venture. Here's hoping !!!
    KSS
    7th May 2014
    2:10pm
    Yes Oars, I am one of those hard working travellers taking two hours to travel home from work! I am lucky it only takes 11/4 hours in the morning because I get up at 4am and travel at 5.30am to cut the time.

    You are right that property can decline in value in the short term BUT in the long term i.e. your 40 years, property does increase in value. There would be very few people who would not realise a profit on the purchase price of their home over time but like any asset, there are no guarantees.
    Wstaton
    7th May 2014
    3:44pm
    Something missing here. One seems to forget that it is not only the value of ones home that has risen. The cost of living has also risen. How much does it now cost to buy a basket of groceries compared to 40 years ago, how much has electricity gone up in that time.
    PeterAmos
    7th May 2014
    1:50pm
    Who is going to do the valuation ?
    Is a house in Sydney/Melbourne valued at say $1 million the same as one in Hobart?
    Why should people people who have worked very hard to get their own home to be penalised compared to someone who takes an overseas holiday each year
    KSS
    7th May 2014
    2:01pm
    Just about everyone works very hard to own their own home even today. Except those that inherit it of course. Good luck to them.

    I can't afford a holiday any year whether at home or overseas. That's life. And that is what I choose to do - buy my home. They would not be penalised at all.

    As to the valuation, that would probably be the State/Territory land office as it does now for setting rates. And no today the million dollar home in Sydney/Melbourne would not be of the same ilk as one of the same value in Hobart. But so what? All that means is the Hobart residents will be able realise greater funds for their retirement. The point is you must be able to sell, buy and realise capital and at $500,000 for a single person, that is simply not realistic now, never mind in 2027+.
    Oars
    7th May 2014
    2:10pm
    Your point about valuation is very topical. If the type of valuer is anything like these recent crop of Building Accreditoirs look ou. They will have one hand on the pad and another in your hip pocket- cos' swho will take them on ?? The Authorities that licence them? Not likely. Refer to ASIC v CBA case recently under scrutiny by ICA- the BIG BANK just got a tiny fine!!!! Then you will realize what a "lucky country" we live in .
    PeterAmos
    7th May 2014
    1:51pm
    Who is going to do the valuation ?
    Is a house in Sydney/Melbourne valued at say $1 million the same as one in Hobart?
    Why should people people who have worked very hard to get their own home to be penalised compared to someone who takes an overseas holiday each year
    WayneD
    7th May 2014
    2:07pm
    Polititians are thieves!! Our homes are going to be used to reduce or disallow a pension for Australians when the Politicians get Big allowances for traveling and working in Canberra. Which is their place of work, and they also are going to force unemployed to move to get work, but they get paid to go to Canberra...........I thought the budget was going to hurt everyone, so far only pensioners and unemployed are going to bear the brunt of the pain.
    Shame on these politicians, they are over paid and under worked, and greedier than any businessman. They should hand back their last pay rise and sell off some Government owned buildings, like the Government house in Sydney, it is not needed we have a Government house in Canberra use that for when people come to Australia. It it after all the Australian Government House and we don't need two. We would get some good money for the house in Sydney, on the harbour and all.
    KSS
    7th May 2014
    2:15pm
    It is the under 30 year olds unemployed I hear they were looking at making moving to get work. I don't see anything wrong with that as a general rule. Safeguard those that genuinely can't (not those who just don't want) relocate otherwise off you go.

    Isn't that what happened in the Depression? People went wherever they could to get work to support their families because there was no social welfare. Isn't that what everyone here is complaining about - they didn't get all the handouts available today?
    WayneD
    7th May 2014
    2:13pm
    If a person buys a house and lives in that house for thirty or so years and then 'gets old' their house will increase in value over the thirty years. Noe this Government is saying when you get old you must move to another house so as to get a pension, what nonsense.
    We are over governed in Australia, we could save millions if we got rid off one level of government. That would help reduce our deficit.
    wally
    7th May 2014
    2:14pm
    The Commission of Audit is an opinion which may or man not be acted upon by the government. The government may adopt some of its findings and reject others, adopt everything or reject everything. What ever the government does will have to be a balancing act of gathering in as much tax money as possible without antagonizing too many voters. Anyone living in some areas of Melbourne or Sydney may be living in inner city suburbs where the price of Victorian terrace houses has rocketed to $1 million plus, amounts unheard of in 2000. In "less desirable"suburbs some homes are lucky to be worth a quarter or a third of $1 million. I think that means testing (or should that be "mean testing"?) house values across the breadth of Australia for tax purposes would have to be judged carefully. For example, if you set a house value of $2 million as the point where means testing begins, what allowances will be made if house values in certain areas rise as they have risen since 2000? Do you raise the means testing point according to median house values/inflation rate rises? What happens when/if the housing market bubble bursts and house values fall? For those who are public housing tenants, this may not be of concern, but it is an area home owners should watch and make their views known. Or, when Grandma finally dies, the value of the home will be taken into account as a probate tax that takes a chunk out of the value of said home after it is sold so the heirs cop the burden down the track.
    Wstaton
    7th May 2014
    4:00pm
    Another problem which our amazing governments may not have thought of, If suddenly a lot of pensioners have to put their houses on the market it may cause a glut then house prices may fall. This also then feeds their rich mate who will snap them up and then rent out at exorbitant rate. Maybe this is a hidden agenda.
    Wstaton
    7th May 2014
    4:00pm
    Another problem which our amazing governments may not have thought of, If suddenly a lot of pensioners have to put their houses on the market it may cause a glut then house prices may fall. This also then feeds their rich mate who will snap them up and then rent out at exorbitant rate. Maybe this is a hidden agenda.
    Wstaton
    7th May 2014
    4:01pm
    Another problem which our amazing governments may not have thought of, If suddenly a lot of pensioners have to put their houses on the market it may cause a glut then house prices may fall. This also then feeds their rich mate who will snap them up and then rent out at exorbitant rate. Maybe this is a hidden agenda.
    Maggie
    7th May 2014
    2:19pm
    at one time not only the family home was not asset tested it was car an another holiday shack", when they really were holiday Shacks... It would depend on the worth of the home, which would pose all sorts of paper work where it is land value etc etc . No doubt there would be some wealthy people who seem to find ways of getting around this. What a nightmare!. Lets hope something more reasonable can be arranged. What about the people who have the Reverse Mortgage?? Maggie (78yrs)
    KSS
    7th May 2014
    2:23pm
    Reverse mortgage = using the asset to fund retirement with the benefit of remaining in the same home. Outcome is the same - no inheritance for the kids, asset counted in the pension mix and asset liquidated. No problem.
    Alexia_x
    7th May 2014
    2:49pm
    Lets wait and see what the new budget is all about and then react. If it is as bad as everyone is assuming lets get rid of these government and get something better (if possible in our country full of corrupt politicians) and remember the French revolution changed the face of a nation because the corruption of the government required it.
    Indy_Lopos
    7th May 2014
    3:51pm
    The assets test is currently a very UNFAIR way to stop people getting government benefits such as unemployment benefits in addition to age pensions or age concessions.
    A person who marries and lives in a property cannot get Newstart Allowance just because the spouse has a property worth more than about $279,000 - how stupid is that!
    For aged pension - it may be reduced if spouse has property more than $279,000 and cuts out altogether if it is more than about $1.1M which is highly likely if that property is in a mid-range suburb in Sydney. Also very unfair.
    And yet if this same couple own only a $3M house in one of the Sydney beachside suburbs then because they live in it, it doesn't affect the pension or the Newstart allowance, etc.

    So YES, the assets test SHOULD CHANGE because the existing system is very unfair to married couples who often consider selling their second home just so they can get the benefits they deserve.
    And - no wonder some people refrain from getting married just because they would be discriminated against for government benefits.

    A person who loses their job and lives in a $600,000 house with the spouse and the spouse has a $600,000 (which is below the average Sydney house price) should still be able to get unemployment benefits and get a full aged pension(if applicable) provided they pass the income test.
    BUT if the family home were to be included in the assets test then the total value of the properties for spouses (or partners) should NOT affect benefits UNLESS it exceeds twice the average Sydney property value, which is far higher than the proposed limits.

    Yes, there is some justification for some maximum asset value after which benefits cut out, but NOT the proposed LOW levels which are way too low if the family home is included.
    KSS
    7th May 2014
    6:09pm
    If they have a second home they do NOT need Government handouts of any sort!

    7th May 2014
    3:53pm
    TRUTH IS>>> many rich folks use the law to evade paying much tax if any at all ....SO THINK ABOUT THAT ONE
    niemakawa
    7th May 2014
    4:19pm
    Di you ever try to be rich or do you prefer everyone else to look after you. I admire rich people. It takes courage and many sacrifices to accumulate wealth. Living off the State takes nothing.
    Anonymous
    7th May 2014
    5:08pm
    Those who seek to be rich fall into the snare of the devil and many hurts..so be content with what you have....Godliness with contentment is great gain...NOT BEING RICH
    niemakawa
    7th May 2014
    5:13pm
    I think they can walk hand in hand. I am very content.
    CindyLou
    7th May 2014
    8:08pm
    Omg, PIXAPD...'snare of the devil.... ', that is so disrespectful and ungodly.
    What about the message that the lord helps those who help themselves.
    Anonymous
    8th May 2014
    9:16am
    There is NO message that the Lord helps those who help themselves....but there IS the message that 'those who would be rich fall into the snare of the devil'
    niemakawa
    7th May 2014
    4:13pm
    No the family home should not be included. Nor are death duties fair either. Most people that own their own home have made many sacrifices to buy and pay-off a mortgage. It is safe to say that interest alone over a 25 year period would be more than 3 times the amount borrowed. The increase in the value of the home would probably not cover the interest payments alone. This is apart from all the holding costs associated with owning a home. On the other hand those fortunate to have lived in Government housing most of their lives have received taxpayer funded subsidies through paying less than the market rate in rent. Generally they do have to fork out on maintenance as most of this work is paid out of State funds. No rates either. Why should these people get off "Scot" free. Maybe the subsidies over the years should and included in their assets, when claiming a pension. Why should I leave my life works assets to the State in the form of death duties? They will only fritter it away. My home and I want to leave it to family/friends and not to the Government to waste on those they have made little attempt to help themselves.
    niemakawa
    7th May 2014
    4:16pm
    No on all counts.
    unicorn
    7th May 2014
    4:17pm
    Thing is it's okay to judge house prices on Sydney prices if one lives in Sydney if not they should be judged on local prices. There is no real way they can judge a house in say Dubbo compared to a house in Sudney.
    porthboy
    7th May 2014
    4:19pm
    "swinging voter". No you're not. It's obvious from your comments you're a lieberal voter
    Swinging voter
    7th May 2014
    6:01pm
    Can't stand either party porthboy. I just don't like or trust any politicians. If you knew my circumstances, you probably wouldn't say, "No you're not". Whatever that remark was supposed to mean. It doesn't sound very nice.
    Swinging voter
    7th May 2014
    6:57pm
    Porthboy, further to the above. I seem to recall that screeching Gillard person whose longer term conduct remains under police investigation saying there would be no carbon tax. So the Liberals repeatedly called it a tax and Gillard's cronies deceitfully called it a "price". Now we have a new PM who promised there would be no new taxes, no changes to pensions, no cuts to health and education,no excuses and his cronies are already excusing a deceit tax as a "levy". Get my drift? The lying is a pox on both sides and all we have is a our vote which is gifted and what do they do in appreciation for us giving them over-paid jobs and early life-time parliamentary pensions? They lie to us.
    Wstaton
    7th May 2014
    7:00pm
    Hear hear swing

    7th May 2014
    4:35pm
    When I applied for the first home owners grant I was knocked back...why....because the price of the home was too high. It was the price everyone paid in Darwin after the cyclone...it was only $50,000 and ordinary home. Never ever did get the grant. I do not think that the family home will be included in this Budget at all; think everyone is getting all hot and bothered over something that I predict will not happen. How on earth you would police it considering what I said above...every State and Territory has different median price for a home.
    Anonymous
    7th May 2014
    4:38pm
    I might also add that I agree with some other comments that "some" people "squirrel" money away in order to get the pension. As I have said on here before in another post I know personally of a couple who did just that in order to get the pension. Live in a 2.5 million dollar home (the widow that is he died last year) and her biggest fear is losing the pension. It is not the family home they built it 5 years ago. She would love to downsize as she cannot afford the home but she is too afraid to do so.
    CindyLou
    7th May 2014
    9:37pm
    In response to the comment above that 'its not the family home they built it 5 years ago...'. Got to state that I feel it really doesn't matter if they have resided in a house for 5 years or 50 years, it's still a family home. Especially if an individual actually built the house as you generally put your heart and soul into a new home.
    CindyLou
    7th May 2014
    9:37pm
    In response to the comment above that 'its not the family home they built it 5 years ago...'. Got to state that I feel it really doesn't matter if they have resided in a house for 5 years or 50 years, it's still a family home. Especially if an individual actually built the house as you generally put your heart and soul into a new home.
    blox
    7th May 2014
    4:36pm
    i don't think multi millionaires need the pension, but including the family home at $750k is clearly crazy. Maybe something like $2.5m - $3m.
    blox.
    Nightshade
    7th May 2014
    4:41pm
    It was said - PUBLIC TOPIC - that older people could not afford heating & as a result theY huddled in one room of the house so as to keep warm :-

    THE PUBLIC RETORT ON AUSTRALIAN TELEVISION BUY FAT CAT CELEBRITY TV PERSONALITIES & THE LIKE WENT LIKE THIS -

    "GREEDY OLD PEOPLE WHO ARE LIVING/HOGGING 2-3-4 BEDROOM HOUSES - THAT SHOULD BE LIVING IN SMALLER UNITES ":-

    THIS RETORT WAS DELIVERED WITH THE AMBIANCE OF DISGUST FOR THE GREED OLD PEOPLE LIVING IN A HOUSE TOO BIG FOR THEM.
    ALL THE WHILE THESE SUPER TV PERSONALITY BEINGS GUZZLE CHAMPAGNE AT THE CASINO
    PAID FOR BUY THE TAX PAYER.
    SELL THE ABC
    SELL THE SBS
    GET RID OF THE PARASITES THAT PLAGUE OUT NATION ONCE & FOR ALL
    Nightshade
    7th May 2014
    4:43pm
    I heard it !
    Nightshade
    7th May 2014
    5:05pm
    "cause the night has a thousand eyes & a thousand eyes can't help but see"
    & the hospitality staff see & talk = waiting staff - security - room service - housekeeping - bar tenders - etc..............................
    "& a thousand eyes can't help but see"
    Bobby Vee
    Wstaton
    7th May 2014
    5:41pm
    Isn't it amazing. Does this mean that all these rich guys with Mcmansions where only a couple of people live should not be greedy and downsize. I know a guy very well off middle aged lives in a 40square house all by himself. How greedy can you get. He can afford to live in s smaller house and save all the resources (planetwise as well) he is using.
    KSS
    7th May 2014
    6:17pm
    Nightshade the news report you talk about was about those in Government housing not just any one living in a large house. Government housing is meant for those in need. I don't thing a single older person living in a 3-4 bedroom house is in need of that much space. I think it is quite reasonable for them to be moved to smaller property and release the bigger home for a family who may need it.
    It should be a hand up when you need it not a handout for life. THAT is the selfish bit where a safety net becomes a perceived entitlement.
    MICK
    8th May 2014
    10:33am
    Have you noticed that the Liberal Party do not go after the rich. No attacks on all the tax lurks and tax deductions and subsidies, no attacks on the woefully low tax scale (which used to be around 65 cents in the dollar top marginal rate) and no attacks on the superannuation deals which only work for those who have enough money to all but avoid the taxation system by money into super for concessional rates of tax. But then the the new deficit tax will hit the rich in a small way but it is high time and it will not be on their gross income but only their much depreciated net income. Don't think that the scam is over or that ALL AUSTRALIANS will bear the same pain. They won't.
    Nightshade
    8th May 2014
    2:49pm
    KSS -
    NO IT WAS NOT THE ONE I SAW - SORRY
    Dotty
    7th May 2014
    5:44pm
    Not owning any Property I wont ever have that problem !
    But I feel for all those people that will get to pension age by the years in question and will then be penalised for working and owning a property that they live in and have maintained and paid taxes and rates etc for the upkeep ! Just for the Federal Government to get their grotty hands on and drain them dry !
    As is said they may be asset rich !But will certainly be cashed strapped for the rest of their retirement!<
    So where do they go from there ?
    And not those sitting on there backsides in the senate making all these decisions about who should pay what and how much !
    As these same people will be sitting pretty after they retire and I can garrentee that there will be some clause in this that will protect them from their assest,s and there pension so that they dont have to downsize or make their assets available for any pension they are getting when they retire !! Dotty
    Nightshade
    8th May 2014
    3:29pm
    It is about getting those of us who own houses to sell up & move into their retirement villages so they can maker - A KILLING
    The retirement villages escapade has been a massive loss in real $$$$ terms for all of them including the religious institutions who partook of the investment expecting big returns = $$$$$$$$$$

    * AUSTRALIA LIKE EVERY OTHER NATION ON THIS PLANET DOES NOT HAVE AN AGING POPULATION
    * THERE ARE NO BABY BOOMERS - IT IS & ALWAYS HAS BEEN A SCAM
    * WE THE PEOPLE OF THIS PLANET ARE NOT BREEDING LIKE RATS
    * WE THE PEOPLE OF THIS PLANET NEVER DID BREED LIKE RATS
    * THEY TOOK CONTRACEPTION AWAY FROM US/OR TRIED TOO
    * THEREFORE THERE IS NOT AN EVER INCREASING POPULATION ON THIS PLANET
    Yet business is still geared to make a killing .../?
    N/a
    7th May 2014
    6:52pm
    And don't forget the Ex Pats U.K.
    We are still paying tax from our u.k. Pensions and we don't
    Even get a full Australian pension after working over 40 years and paying tax.
    We all can't be Millionaires however, in my opinion they won't be happy until they have ruined this Beautiful, Wonderful Country.
    Then nobody mentions the people who worked hard. Payed their taxes and never lived to collect their age pension where did their money go,something for everyone to think about.
    JJ
    7th May 2014
    6:58pm
    Maybe there could be a system which includes a proportion of the family home as an asset IF it is valued above a certain level. This could perhaps discourage people from making expensive improvements to their home in a bid to conceal assets. I really believe that the assets allowed at present are pretty generous - and that comes from someone who is excluded from the pension due to assets, which are only just above the cut-off line.
    Anonymous
    11th May 2014
    8:12am
    I have the same view on this JJ. If, say a home is valued over $500,000 there is an adjustment to the amount they receive in pension.
    grandma
    7th May 2014
    7:23pm
    We bought a 3.04 hectare property in a rural residential area because it was cheaper than a city or suburban property. However when we applied for our pension part of the land was assessed as assets because it is over one acre in size. The land itself is just grazing land so although it is assessed as an asset it is totally useless to do anything with. So we are already penalised just for having a bigger than normal block which is nowhere near the value of the properties they are trying to bring under the assets test. Where does this all end?
    The Black Fox
    7th May 2014
    8:05pm
    As far as Centrelink benefit goes, the value of the family home is not taken into account when determining the rate of payment. The man who calls his tent his home receives the same pension as the cash poor man who owns a posh sea or riverside home. It would be far fairer if all assets were added together, home included, and a limit imposed on the total value of these, say one million dollars all up before tapering started.
    MICK
    8th May 2014
    10:37am
    Yeah, let the pensioners who do not have a razoo but lives in a nice home starve. That'll make those who live in government subsidised homes feel good.
    Crazy Horse
    7th May 2014
    8:08pm
    History is that conservative governments do not look after pensioners and this is the most extreme conservative government Australia has ever had. They have manufactured an artifical crisis for purely political purposes, a crisis that is denied by every credible economic commentator. In fact only today the OECD has issued a warning against savage budget cuts, stating that such a path could cause serious damage to the Australian economy.
    Abbott and co are in the process if implementing ideologically driven changes that have nothing to do with efficiency.
    My advice to anyone who will listen is to finalise anything involving government benefits or taxes before next Tuesday. For example, if you have any prescriptions that need filling do it now.
    MICK
    8th May 2014
    10:41am
    I could not believe that people were so stupid in the 2 years leading up to the last federal election that they could not recognise a propaganda campaign run by the media, presumably for its big business owners who wanted their own party back in charge. And now this lying, deceitful party which has attempted to break every promise it made is turning on those who bought the deceit hook line and sinker. You get what you deserve and I can only hope that in two and a half years voters find themselves a good local Independent and do not vote for either of the (toxic) major parties, which includes the Greens. Only that way can we rid ourselves of the money wasting deceit which has become the norm in our political system.
    MICK
    7th May 2014
    10:02pm
    Increase the "GST (low by global standards) or even the introduction of a death tax".

    I think you have a few issues if you think that one or both of these are a good idea. They are not.

    Firstly, GST is levied ON TOP OF the income tax system. If you look at the US (which is what our CEOs do to justify their overly high salaries) we are taxed at a very high rate already.

    Secondly, you can't be serious about reintroducing death duties. If this happens then your families lose most of what people have worked for for a life time. The result is that people will rent a home not buy one and make other investments, perhaps offshore, so that the government cannot steal what they have worked for all their lives. IT IS A DUMB SUGGESTION and lets hope that the greedy unaccountable politicians of both persuasion get it out of their idiotic heads sooner rather than later.

    A better suggestion (including governments not wasting public money and/or permitting fraud) is to do away with the parental leave scheme and look at much rorted social benefits which permit people to 'choose' a life style (ie. never work). This was little more than a vote buying exercise which will come back to haunt gen Y when they retire....and if this is not to come into for 35 years then gen Y will get their just deserts if they plug away for the sort of policies we are currently seeing.
    MICK
    7th May 2014
    10:03pm
    Increase the "GST (low by global standards) or even the introduction of a death tax".

    I think you have a few issues if you think that one or both of these are a good idea. They are not.

    Firstly, GST is levied ON TOP OF the income tax system. If you look at the US (which is what our CEOs do to justify their overly high salaries) we are taxed at a very high rate already.

    Secondly, you can't be serious about reintroducing death duties. If this happens then your families lose most of what people have worked for for a life time. The result is that people will rent a home not buy one and make other investments, perhaps offshore, so that the government cannot steal what they have worked for all their lives. IT IS A DUMB SUGGESTION and lets hope that the greedy unaccountable politicians of both persuasion get it out of their idiotic heads sooner rather than later.

    A better suggestion (including governments not wasting public money and/or permitting fraud) is to do away with the parental leave scheme and look at much rorted social benefits which permit people to 'choose' a life style (ie. never work). This was little more than a vote buying exercise which will come back to haunt gen Y when they retire....and if this is not to come into for 35 years then gen Y will get their just deserts if they plug away for the sort of policies we are currently seeing.
    MICK
    7th May 2014
    10:03pm
    Increase the "GST (low by global standards) or even the introduction of a death tax".

    I think you have a few issues if you think that one or both of these are a good idea. They are not.

    Firstly, GST is levied ON TOP OF the income tax system. If you look at the US (which is what our CEOs do to justify their overly high salaries) we are taxed at a very high rate already.

    Secondly, you can't be serious about reintroducing death duties. If this happens then your families lose most of what people have worked for for a life time. The result is that people will rent a home not buy one and make other investments, perhaps offshore, so that the government cannot steal what they have worked for all their lives. IT IS A DUMB SUGGESTION and lets hope that the greedy unaccountable politicians of both persuasion get it out of their idiotic heads sooner rather than later.

    A better suggestion (including governments not wasting public money and/or permitting fraud) is to do away with the parental leave scheme and look at much rorted social benefits which permit people to 'choose' a life style (ie. never work). This was little more than a vote buying exercise which will come back to haunt gen Y when they retire....and if this is not to come into for 35 years then gen Y will get their just deserts if they plug away for the sort of policies we are currently seeing.

    8th May 2014
    9:17am
    There is NO message that the Lord helps those who help themselves....but there IS the message that 'those who would be rich fall into the snare of the devil'
    MICK
    8th May 2014
    10:45am
    I also recall that "it will be harder for a rich man to see heaven than for a camel to go through the eye of a needle". As I get older I am seeing that often people become hard uncaring unfeeling people prepared to do anything for a dollar and justifying their behaviour as 'business'. The problem is not the wealth, the problem is what people become as they struggle to make more and more money.
    Anonymous
    8th May 2014
    12:13pm
    Correct....money is not the root of all evil.........BUT the LOVE of money is..and what folks do to get more and more of it.
    MICK
    8th May 2014
    12:49pm
    No arguments there. And it is so easy to "lose" one's own soul in the pursuit. A bit like a lobster being put in cold water and slowly cooked without realising what is happening.
    WTF
    8th May 2014
    9:46am
    My wife and I both work full-time. We still owe $300K on our modest home in Newcastle. We pay income tax & medicare. We pay for private health insurance, GST on goods/services we need & want, We send 3 kids to public schools and pay the 'voluntary contributions' that the schools seek, we use petrol in our 2 cars and we drink a little alcohol.....(good thing we don't smoke). We pay through rates etc for the utilities (Elct. Gas & Water) to be maintained. We pay our local council rates for LGA facilities maintenance and services.

    I think that we contribute our fair share to the Gov coffers (all levels) via direct and indirect means..... so can the focus move to reigning in the wasteful spending and get the spending priorities right rather than squeezing more from the taxpayer to keep funding the bullshit? The Audit (by the term) report I thought should have looked at how money was / is spent rather than how to keep funding bullshit. I'm now 48 and I'm trying my best to be able to to retire at age 60 - 62 therefore aiming to enjoy good health & mobility in the early stages of retirement. (60-62 probably a dream as the goal posts continue to be shifted) and I'm taking the advice of financial planners in planning for my retirement, factoring in at best a part pension (even at this early stage) as a fallback element of the retirement plan. My wife & I are doing this on collectively... $130K a year.... We are hardly super rich but must be reasonably disciplined. Can the various levels of Government just put a cap on the wasteful spending.....and get the priorities in order?
    Anonymous
    8th May 2014
    11:35am
    I agree with everything you say WTF...except that the audit report for the first time looked at govt role in spending..
    It suggested that govt spending should only go to those in need . And that all welfare should be means tested .
    Wether we like it or not we now have an interest bill of 12 billin a year just at federal givt level . So spending must be cut . The loudest shouts will be from those who loose services they should be paying for...
    For instance it is ridiculouse that we give the minimum wage to those on PPL on top of their company scheme that gives them full wage ....Including the public service and ABC ...
    MICK
    8th May 2014
    12:02pm
    Means testing is good. But do you include the home you live in rather than 'other' assets and income? This is the devil in the detail as there are plenty of retirees who live in a nice house (some inherited) who do not have 2 razoos to rub together. The trouble with this most deceitful of all governments is that they are going after average Australians whilst the rich pay token gestures and are left alone with all their outs. Is it any wonder that the divide between rich and poor is growing so fast.
    Anonymous
    8th May 2014
    2:07pm
    I agree means testing the home to receive the state pension is very touchy .,,I don't have the answer but I think there should be a limit to how much exemption from assets is given..,
    MICK
    8th May 2014
    2:12pm
    There is a very clear difference between the family home (where a person lives) and 'assets' (those things which generally derive income). This is where the current scumbag government does not care and is happy to plunder so that it and subsequent governments do not have to live within their means like those on old age pensions are supposed, with both hands tied behind their backs I dare say.

    8th May 2014
    3:52pm
    Have NOTHING and you get everything..that's my strategy......
    jangary
    8th May 2014
    4:06pm
    Why on earth can't we bring in the system they have in the UK. Workers pay what used to be called a stamp which was taken from your wages each week. The amount you contribute throughout your working life determins how much pension you recieve. Blind Freddy can see it has got to be better than being forced to line the pockets of financial institutions ( SUPER FUNDS) with our hard earned dollars who rip us off with high fees and play tiddly winks on the stockmarket with our money. Anyone can then choose if they so wish and want to take a Gamble on topping up with a Private Super. Which is what happens in UK. Its a WIN WIN The goverment gets its money to pay for pensions Wholla !! Or does that sound too easy Mr RIP UZOFF Hockey !!!!!!!
    MICK
    8th May 2014
    4:50pm
    So trust government to invest your money and not steal some or all of it? Hmmm. You are a trusting soul.
    jangary
    8th May 2014
    5:32pm
    At least we would be guarranteed a pension at the end of our working life and there would be plenty to go around for the less fortunate. You would still have the company contribution to your Super Fund. We would never be threatened with dismanling the retirement pension. If the goverment chooses to invest the money all well and good but once legislation to this effect is passed there would be no arguement. Consider the welfare state in the UK and the system has worked well beyond its means for decades. We are being brainwashed by
    the BULLSHIT Coservative pollies, this country is doing just fine.
    alfie
    8th May 2014
    5:43pm
    Leave the house alone. It has been worked for and paid for over and over. It is mine to own and not the governments. Increase GST to get more money as users pays and its fairer than all the other taxes. LEAVE THE HOUSES ALONE....
    Paddles
    8th May 2014
    9:36pm
    Reading most of the posts here confirms my opinion that the concept of "the age of entitlement" is more than just a slogan.
    I freely admit to having been born and reared in the prior age when people made do with what they could provide for themselves and their families and, you know what, I am still here and, by and large, haven't done too badly.
    Almost all my working life was in the area of dealing with financial matters so it was no surprise to me that we finally elected a leader who said "Whoa, we can't afford to go on in the way we have allowed to develop".
    I can understand, and even sympathise to a degree with, the Hanrahans of today who have only ever known the nanny state where nourishment was always available from the Govt teat but I am also here to tell them that it is not the end of the world.
    The pendulum had to swing back some time and I believe that it has still a fair way to swing back before we see a movement in the other direction.
    But take heart, you will survive.
    Anonymous
    11th May 2014
    8:10am
    spot on Paddles!!
    Dollars over Respect?
    9th May 2014
    11:13am
    Forcing the elderly and vulnerable to sell their home or reverse mortgage it (after working hard all their lives and contributing to build our Australian society, which traditionally respected the older generations but now no longer seems to) is nothing short of disgusting. This is the position most aged pensioners would be forced into, to be able to continue to receive what is really a paultry reimbursement towards today's living expenses in our cities - where elderly need to continue to live as they get less mobile. What sort of society do we want - greed and rampant profit-making over caring and the provision of moderate comfort for the less fortunate or cashed up? This current Govt represents the wealthy and cashed up investors (many living overseas), not the average Australian. Sadly, the true Aussie spirit is fast disappearing. Since compulsory super has been introduced, it is possible for working Australians to provide a better future for themselves. The parental home must remain sacrosanct until enough time has passed for compulsory saving to kick in. Younger generations (and their Govt reps) feel they have a right to complain about the cost of the pensions (openly disrespectful). Pensioners' income is not hoarded, it is all spent in our community on services and in retail stores. Ultimately, generally, younger generations benefit from their shared inheritance from the sale of the family home - at a point in their life when this benefit can clear their own mortgages. Thus, traditionally, the average Aussie family benefits, not cashed up (overseas) investors. Is the Hockey investment family one of the multitude that has created their wealth from opportunistic real estate investments? This is the type of investor our society cannot afford. Australia's wealth needs to stay here - for our future Aussie generations.
    Wstaton
    9th May 2014
    11:25am
    Thisis true when you consider thes cashed up investors are now causing the first home owners out of the possibility of getting their first home, cuased by the dramatic increase in prices. Most sales today are from investors.

    Now this government wants to add to the pool for these investors by virtually forcing pensioners to sell thier homes.
    Wstaton
    9th May 2014
    11:45am
    As for the average Australian what should be remembered and so should the government, is that the average Australian is in the majority. The way the government is going the average Australian numbers are going to increase as the rich get richer and the average Australian gets poorer. But! unfortunately for this government they seem to forget that you have a vote and your vote in an election is exactly the same as each of these rich people no matter how rich they are. You should use this.

    Except for the fact that we should be looking after our older people and the disadvantaged we seem to forget (or the rich people do) that these rich people got rich on the backs of these people, Working, creating things that were sold on to make them rich.

    Now don't get me wrong, I am not against anyone being rich, I would like to be rich myself. I am again how they got rich and in a lot of cases on the backs of the average Australians, sucking out of government, subsidies, tax reduction, grants etc.

    All governments are complicit in this e.g. it is said that the top 10% of earners, super participants get %53 of the subsidies. Trusts (which most of us don't have or even qualify) get tax reduction. Why the heck is this. These do nothing to help the average Australian our even the country.

    If there is now no "Age of Entitlement" then that should apply to everyone.
    Paddles
    9th May 2014
    2:35pm
    Today's press reveals that a recent, in-depth study shows that 48% of taxpayers receive more in social security benefits than they pay in income tax.
    They, and those like them, have been living in a fool's paradise for years and now they are squealing like cut cats at the prospect of change.
    No rational argument but plenty of spleen venting about politicians salaries and benefits and the purchase of the next two generation's air protection capabilities.
    Well may we be known as the "lucky country" because we sure as hell aren't the smart country.

    10th May 2014
    12:38pm
    Tuesday evening.... potato chips, pepsi, some cashews, licorice twists..as I watch the budget..... Wednesday will be pension day...YEAH !
    Gee Whiz
    10th May 2014
    6:02pm
    You are indeed a weird person Pixapad.
    Anonymous
    11th May 2014
    7:42am
    To try and get out of paying 12 billion a year in interest something has to give
    Why don't we means test all govt payments .
    For instance under Gillards nutty PPL everyone gets the minimumum wage even if you are already receiving full pay .
    Child care not means tested .
    The wealthy can access bulk billing.
    Family tax. Recites b not means tested ..etc etc

    11th May 2014
    8:14am
    The title to this post is misleading.
    Where does this information come from anyway. The Budget has not yet been delivered...just scaremongering in my view.
    Ritza
    13th May 2014
    8:17am
    I am so very angry about this. I am a single woman who has worked all her life to have this home. I have paid super. I am not a drain on the government.
    ALL governments have not allowed me ONE SINGLE advantage aside from free insulation
    no first buyers grant, no income splitting etc.

    Tony Abbott you did not help me pay for it ....you DON'T get to abuse it
    lindy
    28th May 2014
    4:04pm
    Rita you are spot on!!
    Not Senile Yet!
    20th May 2014
    2:08pm
    Yeah..Yeah ..Yeah..
    Anyone that taxes the family home or wants it included in an asset Test is dead!
    Doesn't matter what the Value of the home.....it is Called the FAMILY home for a reason......Want to know the Names of those faceless people who had the gall to recommend it.....no no! who got paid probably...to recommend it!
    But listen to this.....
    We the people keep voting for the Parties when we the people know that they have sold your vote to the Party BEFORE they have even been elected!!!!!!!!
    We the people....are the idiots and the Party Politicians know this.....that's why they sit back with their cigars and laugh at us!
    We keep doing the same thing......play by their rules......meaning the Party Rules.
    The joke is on us alright!
    We need to stop Voting These Parties into Power!
    If just 1/3 of the Population Voted for their Local Independent......none of these suckers would control Parliament enough to get these stupid budget ideas would get the Senate approval....ie thrown out!
    Vote them out by NOT VOTING for any of them...Labor, Liberal, CNP,NP..all of them......have SOLD your vote to a Party Machine BEFORE you even gave it to them.
    That is the ultimate Corrupt Act!
    Stop encouraging THEM....Stop giving them your Vote!
    lindy
    28th May 2014
    3:59pm
    Seems to me we did not vote for the committee of audit; a committee of members whose average wealth is in the top 5 per cent; any persons with any experience of poverty; hardship; just the usual liberal heartless job.
    Gee Whiz
    28th May 2014
    5:37pm
    Its a forgone conclusion that the baboons from the LNP, and the ALP running government, will include the family home asset test. Its simply a matter of when?

    If after the next election, the LNP again win government you can expect it to be included in their very first budget.

    And here are some other predictions. The GST will be increased in the next twelve months, and death duties are a certainty to be included in the next budget. Either LNP or ALP.

    As long as people keep voting for either these treacherous political parties we will continue to suffer more and more tax pain, while they enrich themselves with taxpayer money.