Age Pension - should it be a loan?

Font Size:

Watch out home owners – they’re coming to get you!

With nearly 70 percent of retirees on a full or part Age Pension, the Australian Chamber of Industry and Commerce (ACCI)’s idea to turn the pension into a loan against the family home is sure to attract attention.

In fact, as Chief Executive Kate Carnell declared on ABC Radio National yesterday, we could head into a ‘Greek-style’ debt crisis if so-called ‘runaway’ spending on the Age Pension, family tax benefits and childcare was not reined in. So the the scheme offered in the ACCI budget submission is for the Age Pension to be paid as a loan to retirees who own a home, and then the ‘debt’ would be paid back by selling the house.

“It seems irrational really for a family home not to be counted when you look at pensioners’ capacity to fund themselves,” Ms. Carnell argued.

Good grief, Ms Carnell. Just where would you start?

So we take the Age Pension – a reward for service to the country introduced in 1908 – and we decide it’s not a right any more. No it’s a loan. And it’s a loan to those who have paid off their house – no mention of those who never saved a deposit or paid back a mortgage slowly, painfully over 20, 30 or 40 years. So let’s beat up old home owners, that sounds like fun. Because the pensioners clearly have a capacity to fund themselves.

NOT.

Perhaps we should take a reality check, instead, and refresh ourselves with the numbers – one-third of Australian pensioners are living in poverty, according to Oxfam. And the money spent on the Age Pension by the Australian Government, expressed as a percentage of GDP, is the third meanest rate in all 14 OECD nations.

So rather than ‘runaway’ debt spent on the Age Pension, we have a mean, parsimonious government which knows that a third of age pensioners are living in poverty, but sees this as an inconvenient truth, best hidden by inaccurate statements and fear mongering about the increasing cost of a pension that our country can no longer afford.

Amazingly, we can afford large corporates’ tax minimisation practices, diesel fuel rebates for mining companies, generous superannuation tax concessions for the wealthy (somewhat ironically due to overtake spending on all Age Pensions), but any kind of increase in the pension to drag the bottom third up into some kind of sustainable income? No, that’s not affordable.

As always, the devil is in the detail, so we look forward to reading the full detail of the ACCI’s budget ideas. As you can, too, by visiting ACCI.asn.au  

Read more at TheAge.com.au

What do you think? Is the ACCI suggestion a reasonable response to the need to curb our national spending? Or do you take exception to the Age Pension moving from an entitlement to a loan? Should the ACCI be looking at savings within the business sector, rather than families and older Australians?

Join YourLifeChoices today
and get this free eBook!

Join
By joining YourLifeChoices you consent that you have read and agree to our Terms & Conditions and Privacy Policy

RELATED LINKS

Why do women retire in poverty?

Women retire with half as much superannuation as men. We need to close this gap.

Written by Kaye Fallick

448 Comments

Total Comments: 448
  1. 0
    0

    Chief Executive Kate Carnell likes the sound of her own voice,
    Im not a medical practitioner , could the chief be mentally retarded ?

    • 0
      0

      No. She’s the spokesperson for Big Business. Her job. Anything this woman ever says centres around tax cuts for the rich and their big business interests.

    • 0
      0

      Today I heard that Coalition politician Dantien has 8 investment properties, no doubt all negative geared, I don’t know how true this report is but maybe the Kate Carnell could start here, what do you think?.

    • 0
      0

      No kev888, not mentally retarded…just implementing a very cunning plan…my Lord!

    • 0
      0

      How on earth does a politician on his salary reckon he is losing on properties manage to negative gear.

      Probably all in his wife’s name who doesn’t work. (If he is married)

    • 0
      0

      I agree with her in that the level of welfare in this country is past ridiculous. We have become nothing but a welfare dependent society and this needs to change before we become a third world country.

      I certainly wouldn’t want to be a renter if negative gearing gets abolished and the capital gain concession gets halved.

    • 0
      0

      So let’s change the law so that people who worked all their lives and paid taxes but never earned enough to save to be self-sufficient in retirement, and didn’t have generous superannuation schemes are denied the right to leave the home they struggled for 4 decades to pay off to their offspring. Then, logically, battlers will GIVE their home to their offspring five years before applying for a pension and then claim rent assistance. No asset for the government to claim, and the pension costs rise. STUPID! Like the idiotic change to the taper rate that screams ”don’t save for retirement unless you can retire rich. The greedy government will make you drain all your hard-won savings while others get handouts double the size of your income.”

      What we SHOULD be doing is encouraging work, saving and investing. You can’t do that by crucifying battlers who do just that, but don’t end up wealthy. We need to restore incentives and fairness, and stop over-indulging the greedy, selfish privileged whose appalling lack of social conscience is destroying this nation.

    • 0
      0

      Easier way is to set up a testimonial trust and then no one can get at the capital.

    • 0
      0

      I agree Bonny and it seems the Business and Industry and Medical fraternity are the worst leaners when it comes to bleeding the tax coffers dry.

    • 0
      0

      Carnell (she) is a failed ACT Chief Minister and responsible for some really dumb decisions. Her past is murky. But she’s just doing Turnbulks work for him. Float an idea and see who likes and who support the lies. Welfare for a start, except to big business, is not out of control. The third SMALLEST as a percentage of GDP of any OECD country. i think i’m entitled to my age pension when I’m of that age because I’ve always paid my tax willingly and accepted that as being part of a welfare state. I haven’t used negative gearing to enrich myself at the expnse of services to others, or rorted the super guarantee provisions so I didn’t gave to pay for the infrastructure everyone uses. I haven’t bitched about the $’s that go to other people’s kids despite being childless (not by choice). No doubt those who whinge about welfare are the very ones who’ve used taxation avoidance as their own personal piggy trough. Don’t like you people much. But then I don’t care what you think either.

    • 0
      0

      Yes Wstation I also heard that some may be in his wife’s name, does anyone know if this is true?, I haven’t been to town to buy a newspaper for the last 2 days this was apparently in a newspaper or business report somewhere.
      I heard it on a TV news.

    • 0
      0

      Well said Renny I agree 100%.

    • 0
      0

      Bonny, testamentary trust?

    • 0
      0

      Bonny: until it ends. Then your descendants pay up.

    • 0
      0

      Yes but we can have some fun for 99 years 🙂

    • 0
      0

      Bonny, by a third world country would you mean a country that can’t provide proper benefits to its retired citizens?
      I don’t see how property investors should be allowed to suck from the welfare teat and others are condemmed. After all negative gearing and capital gains concesions are supplemented by the tax payer. The same with trusts, someone else is subsidising a tax dodge. A bit like providing welfare to the well off don’t you think?

    • 0
      0

      So what has all this to do with me?

      Negative gearing is another word for a loss and I don’t like losses.

  2. 0
    0

    One can only assume the ACCI believes its members would make more profit under the proposed arrangement. Maybe a better solution would be for organisations such as this, and their members, to pay an additional levy to cover the cost of the age pension, so the Govt can save money. Alternatively, keep their noses out of matters that don’t directly concern them

  3. 0
    0

    I think that you have a point kev888, Kate Carnell and her ACCI is delving into the social engineering now. I guess that its far easier to do that rather than tackle the Multinational companies and their tax avoidance?

    • 0
      0

      They are Carnell’s customers….and clearly off limits. So why has this government refused to act against multinationals? Obvious dear Watson!

    • 0
      0

      I wish I knew who her clients were as I would boycott them immediately. The hide of the woman is amazing given over 30% of aged pensioners are living in poverty.

  4. 0
    0

    AND HERE WE GO …YET AGAIN………
    Pick on the RICH Pensioners….we have plenty of money and are living a life of luxury!

    We all know what to do next election beacuse this government HAS LOST THE PLOT ENTIRELY!

    • 0
      0

      Be careful what you wish for! Do you want electricity bill shorten as PM? Turnbull may not be a great choice as PM, but shorten would be so much worse!

    • 0
      0

      Pablo sorry mate on this one…………… it was Mr Mike Baird who privatise the electricity…..
      ot Shorten mate……unfortunately the Liberal are the ones trying to hurt us big times ………. remember their the ones in power and coming up with the idea our homes should repay back for our pensions…cheers

    • 0
      0

      We are seeing a government working it’s pants off engaging in Class Warfare: the transfer of money from the poor to the wealthy. Pretty obvious when you examine every one of their policies. All going in the same direction from what I can see.

    • 0
      0

      And only in NSW tia-maria!

    • 0
      0

      Victoria was shafted in a same way during the Jeff Kenneth years, some 20 years ago!

    • 0
      0

      Pablo it is the LNP gradually selling off everything to the Chinese government that is the problem. Then renting and signing overpriced contracts with multinationals instead of employing Australian companies and workers.

    • 0
      0

      Vote independent.

    • 0
      0

      Pablo, at least Shorten pretends to be interested in making the big companies pay their fair share. ALP, the lesser of two weasels.

    • 0
      0

      Shorten may talk the talk but his actions tell a different story. Luckily the Greens supported LNP legislation. The ALP should be concerned about the flow of funds. Particularly where the unions are concerned.

  5. 0
    0

    Before we run off with ourselves, lets consider this. Federal and state government employees, including Members of Parliament’s pensions come from the same source as the aged pension, the taxpayer. Why are there no questions asked as to whether the pensions of these government employees is sustainable?

    Maybe some might argue that these employees have worked for it. The private sector workers rearing a family in the 1960 (and before that of course) to the 1980’s would receive a check for the birth of a child that was hardly worth cashing. Child endowment was a pittance. Medicare did not exist or it was in its infancy. There was no Community Health Centre to assist with rearing children. If a child on leaving school couldn’t get a job, there was no running off to the Government to get the dole, the parents had to keep him/her. The list is almost endless compared to the free benefits available to families today. And I don’t begrudge that.

    But what the ‘modern’ view of today fails to recognise or acknowledge, it was the ‘going without’ of yesterdays family that generated the wealth that allows today’s Government to offer current benefits.

    So why should yesterdays worker feel vilified and embarrassed about receiving a portion from the ‘pot of gold’ that most people of today happily dip into.

    • 0
      0

      Very Good Point ……………….

    • 0
      0

      Idontforget fully agree with your comment mate………….we need to be treated with more respect

    • 0
      0

      That’s hit the nail on the head. This is a game aimed squarely at average Australians who are going to be taxed so that truck loads of money flows into the bank accounts of the rich. Who voted for this lying low life government?

    • 0
      0

      mick I would never vote in Liberal

    • 0
      0

      And today on the news. A federal Politician billing the taxpayer $1,600.00 to go to Queensland and inspect the gold mine he has an interest in. Oh, I forgot. The real purpose of his trip was to inspect the home for aged cats that just happened to occur at the same place and time as his so called gold mine inspection.

      And will you hear a bleat from the opposition. No, don’t hold your breath and hope you will because the whole mob of them know that many from each side of the Parliament has been ripping the taxpayer off like this for years.

      And they have the hide to sanctimoniously stand up and put their hand on their heart and ask us to trust and respect them. Pfff

    • 0
      0

      Funny how a federal ICAC in NEVER brought in. That would rightly put those who decide to be crooks in government where they deserve to be: in jail.

    • 0
      0

      Yes, and receiving one of those parliamentary pensions would be Kate Carnel as a former Chief Minister of the ACT. In that role, the only thing she did of note, was to turn up to the opening of any/every event. Then, as now she was totally out of touch with ordinar Australians. Like all govt employees she would have contributed from her own salary, but her return which includes the govt contribution. Is much higher. No age pension for her, so her home(s) all safe.

    • 0
      0

      I’m an Ex public servant and an ex teacher. I paid for my superannuation. I was never able to claim any payments as tax deductions. Having taken 100% as a pension I can never ever convert any of my money to cash, neither can I leave any of it to my heirs and successors (other than my spouse who will get a reduced pension if I pre decease him). Which is unlikely given our age difference. It’s my asset but my access to it is xtremeky limited. Even if I don’t use all of it before death it just reverts to consolidated revenue. Your ignorance and assumptions are astounding. And I never had a choice of where to invest those funds. But don’t let facts get in the way of your irrational beliefs.

    • 0
      0

      Who are you having a dig at Renny?, who has irrational beliefs?, I don’t remember reading anything here about that.

    • 0
      0

      Renny I can understand why public servants who paid very large amounts of after tax income into compulsory Superannuation that are now the only workers unable to claim those non concessional amounts as savings but are told they are now classed as income again are very annoyed.

      What I don’t understand is why a class action or union court challenge hasn’t been made already.

      I just can’t see how the legislation is constitutional.

    • 0
      0

      Good point Rae. It is the strongest union in the land and if they cant mount a legal case then maybe the legal case is flawed? Thought of that? I don’t know I’m just thinking left field?

    • 0
      0

      No Frank the chief problem is the Teacher’s Union have a representative on the board of State Super getting a bit more than $200 000 a year. It is a cushy job for the boys arrangement. Also I really don’t think the union is interested in retirees as they don’t pay dues.
      It is possible that it is flawed as we know there is no fairness at all in the system.

      The best thing to do is to be self sufficient and take no money either as payments or grants from this government less it be classed as debt against any assets you might hold.

    • 0
      0

      Rae, I see. There seems to be so many Union Reps sitting on Superannuation Boards. Their pay rate must be something like $3,000 per hour?
      I agree with your assessment. The best thing to do is become self sufficient. Welfare was originally designed for the needy before it became a method of buying votes.

    • 0
      0

      You are right that welfare was originally designed for the needy, Frank. But the aged pension was NOT intended to be welfare. Governments set up a retirement funding program decades ago that imposed a levy on every taxpayer that was to be put aside to fund retirement. It’s sad that subsequent governments stole that money, while workers continue to pay into it and the government keep stealing what is contributed, and are now denying those who paid that levy the entitlement they were promised.

      If those who pay into superannuation were cheated of their super, they would scream blue murder, but the privileged seem quite content to – for their own greedy and selfish ends – demand that people who paid into a different scheme (because they weren’t as privileged) forfeit the benefit they paid for, and along with it their self-respect and any expectation of a comfortable living standard in old age.

    • 0
      0

      As an ex Public Servant I am amazed at the lack of knowledge that is prevalant in those who try to make points against the PS super schemes.
      My super is funded exactly the same way as the private sector, eg. I paid in a percentage of my wage into an investment fund and at the appropriate age I get to covert it into a pension just like everyone else.
      Yes just like most other super schemes the Employer placed a certain amount into my scheme on my behalf. This payment consisted of money ngotiated by the Union in lieu of salary increases. As far as I can remember the tax payer has not put any money into my scheme that I had not earned.
      I have a good friend who worked for a private company that had exactly the same scheme as I had.

  6. 0
    0

    Our aged pension should not be a………. LOAN……….. we worked bloody hard all our lives and paid taxes………… looks Like this Liberal Government wants to keep hurting the retired pensioners (THE BATTLERS) many own a small home and some don’t……..and to even think of repaying back what pension you have given us……….SHAME ON THE BLOODY LOT OF YOU GREEDY LAZY POLITICIANS………….You been handing out so much taxpayers hard earn money and setting up camps for Asylum seekers its about time these people paid it back………….

    • 0
      0

      Agree totally with what you say tia-maria, but I would go further and talk about the money paid to dole bludgers and disability pensioners, not the genuine ones but the ones who are ripping the taxpayers off every day.

      Stop blaming the aged pensioners who have worked hard all their lives, bought their own homes, paid taxes and built this country into what we are today. The fault lies with those who are always walking around with their hands out, wanting something for nothing. Just for once, crack down on the undeserving and leave the pensioners alone.

    • 0
      0

      Pablo yes fully agree………PM Turnbull all he wants to do is attack the retired pensioners……………cut out the dole……cut our PPL……cut of giving so muck to refugees……and stop our Politicians ripping taxpayers off all together……….with high pensions and Perks ………….

      and leave the Battlers and retired pensioners alone and show respect that we deserve

    • 0
      0

      Strange concept to even come up with I think.
      Would like to comment though tia-maria . . . . you said “we worked bloody hard all our lives and paid taxes”. Agree! I’m sure you did as I have as well. Unfortunately there are some though who have not – some people live on welfare almost all their lives & it appears that this portion of Australians is growing. This means that they will have no home to sell to repay the “loan” so again the rest of us workers support them . . . . 🙁

    • 0
      0

      Fliss…………In our days we never had to the dole……..We had the Big depression back in the 40s and a job was job what ever you could get to survive……….Todays society The Dole is good money ……and many in my opinion are dole bludgers who don’t want to work…….Our government should bring back in National Service make them earn dole ……the ones living on welfare these days have been on it since leaving school………(BUT we have some great young adults who been brought up great and love to earn their way in life…

      Now stop making us the retired Pensioners feel guilty we done our hard days and paying taxes that we are entitle to an pension……..Our Politicians should stop their big pensions and perks after politic………as they earned enough………
      and stop ripping you the taxpayers off.

    • 0
      0

      Speaking of politicians big pensions, superannuation & other lurks and perks. Will they be required to sell their homes to pay for all this? Not bloody likely. It wouldn’t effect Turnbull in the slightest anyway as he currently has 7 houses & I bet they are not 3 bed, 1 bathroom, built on a small block!

    • 0
      0

      cyclonesally you hit the nail on the head………we should all start bonding together and put a stop to our greedy politicians ripping off the taxpayers of our country.

    • 0
      0

      Agree totally Tia-maria what are we all going to do an election is happening later this year so we need some tactics as to who do we vote for??????

    • 0
      0

      There are over 2 million people on 457 visas in Australia employed by Carnells people to provide cheap labour. The dole has not increased for six years. There are not enough jobs because of 457 visas. I think i’m giving up on this site. The ignorance is gobsmacking. Vote for Malcolm – it will serve you right.

    • 0
      0

      Vote independent.

  7. 0
    0

    It’s happening more and more AND WE SENIORS HAVE TO BAND TOGETHER TO STOP IT before they go too far. I make no apology for strong words. What will it take to get you all to take action?

    Hands off our homes. Stop big corporations running the country and avoiding paying tax. Stop making the poor and elderly foot the bill after a lifetime of hard work. It’s going from bad to worse for the older age group. Nothing will improve until we combine our efforts to vote the bastards out. Well?

    • 0
      0

      Perhaps we need a petition to government to tell them just how we feel before it is too late?

    • 0
      0

      I suggest this is the thin edge of the wedge. Carnell is probably just feeling out the electorate on behalf of her colleagues in government.
      Surely the direction of this deceitful government must be clear by now. If not then if/when the pension is gone it will be……

    • 0
      0

      Who we going to put in mick shorten is the only alternative and he has no idea and voting for an idependent don”t work.

    • 0
      0

      We need an independant soley for representing the senior citizens and the elderly. Someone needs to keep the bastards honest.

    • 0
      0

      robbo you rusted on government troll. Who mentioned Shorten other than you. I’d put in anybody in preference to the lying big business controlled government we currently have. I was not aware big business were allowed to elect our governments!

    • 0
      0

      Yes Bletch lets all send a petition to Malcolm and let him know just how we all feel before the budget is done, does anyone know how to organize one on line?, maybe Change would do it.

    • 0
      0

      We have to stop allowing asylum seekers and others into Australia if they cannot pay their own way, I have been told they go onto welfare from day one and will continue to do so as they cannot get jobs. We cannot possibly solve the problems of other countries and their homeless we will end up the same as their war torn lands. There are billions of peoples around the world needing help but we cannot do the helping. Countries around the world have to band together and make the corrupt governments look after their own people not leave it up to other countries to solve. If the government wants to use our family home to pay back as a pension we might as well sell now and go into public housing and help our children buy their own homes and we spend up big and enjoy life.

    • 0
      0

      Brien, we need someone to stand up for us and stop these fascist mongrels, they get in and think they can be all empowering — well they have to have a wake up call.

    • 0
      0

      The ballot box designed for just that. Now talk to family and friends and get this ball rolling. Do nothing and we deserve what we get.

    • 0
      0

      Jannie, I agree that half the world cannot continue to absorb all-comers from the other half. The ‘World’ must begin looking for real solutions to the problems that put an end to the tribal warmongering from which the refugee situation arises. That will of course take the citizens from those countries putting their personal/familial differences aside and working together. The ‘World’ cannot do it for them. Continuing to ‘accept’ millions of displaced people cannot continue in perpetuity.

    • 0
      0

      It’s always been a choice between to evils, but it doesn’t have to be if you have the courage. Problem is, most of us don’t have the ticker to make the right decisions. YOU DO NOT HAVE TO VOTE FOR EITHER OF THE MAJOR PARTIES. THINK ABOUT IT!

    • 0
      0

      Paulodapotter you surely don’t consider the inept Greens a worthwhile alternative do you? It’s all about numbers and none of the lesser parties have the numbers to form government in their own right so what are we left with? The best we can do is elect enough independents to ensure whichever party does come to power HAS to listen to the independents to remain in power.

    • 0
      0

      Paulodapotter you surely don’t consider the inept Greens a worthwhile alternative do you? It’s all about numbers and none of the lesser parties have the numbers to form government in their own right so what are we left with? The best we can do is elect enough independents to ensure whichever party does come to power HAS to listen to the independents to remain in power.

    • 0
      0

      Vote independent.

    • 0
      0

      I will only join the merry band if we adopt Jannie’s immigration policy. And don’t vote for a Labor/Unions/Greens/Independent government. I think their Minister for Immigration Chris Bowen must have been missing in action, to have the massive blowout in numbers.

    • 0
      0

      No need for a petition that they will not take any notice of, show your displeasure of the so called major partys by backing an Independant in the next election. That will get their attention.

    • 0
      0

      Brian P, Bletch, Misty, re your comments from 16/2/16…….You are so very right. We need this Petition to Malcolm Turnbull to be started, organised and submitted. Has a Petition been started as yet? I am anxious to sign and distribute to all my contacts.

  8. 0
    0

    I’d never thought of Kate Carnell as evil. Clearly I was mistaken.

    Governments have been pushing to force people into tinier and tinier accommodation for years now. It’s time we pushed the bullies into a pit and buried them.

    • 0
      0

      When has this piece of work ever talked about anything other than tax cuts for business and the rich? She is what she is.

    • 0
      0

      She would be better served finding out why failing business people who only declare incomes of $18400 are driving around in porches and live in mansions on the harbour with a yacht out the front.

      Perhaps their homes could be taken to pay their proper tax bills.

  9. 0
    0

    I’d never thought of Kate Carnell as evil. Clearly I was mistaken.

    Governments have been pushing to force people into tinier and tinier accommodation for years now. It’s time we pushed the bullies into a pit and buried them.

  10. 0
    0

    Darn yourlifechoices delay tricked me again.

Load More Comments

FACEBOOK COMMENTS



SPONSORED LINKS

continue reading

Health news

Australians want to die at home - but do we achieve that goal?

How do you want to die? More than 70 per cent of Australians want the end to come at home,...

Retirement

Rise in 'grey divorces' sparks warning from legal experts

More Australians are divorcing later in life, leading to "unique, confusing and overwhelming" challenges for couples aged over 50. The...

Entertainment

Friday Funnies: Short jokes for the shortest month

February flies by too fast, just like these short but sharp jokes. What is the recipe for Honeymoon Salad?Lettuce alone...

Health

The four types of hearing loss explained

Research indicates that one in six Australians has some form of hearing loss.  Hearing loss refers to reduced hearing, which...

Dinner

Fabulous Fish Pie

It should go without saying that a fish pie needs to have lots of big chunks of fish in it,...

Food

Succulent Spice-Roasted Salmon

These little salmon bites are something I've made time and time again over the years and this method of roasting...

Photos

How to take great pictures of gardens

If you've never been too good at taking pictures of your beautiful blooms, now's the time to brush up on...

Aged Care

Paid on par with cleaners: the broader issue affecting aged care

Paid on par with cleaners: the broader issue affecting the quality of aged care Ben Farr-Wharton, Edith Cowan University; Matthew...

LOADING MORE ARTICLE...