The Meeting Place

Push to compensate carers with super credits

There is a push to compensate carers with credits for superannuation.

On average, women retire with 42 per cent less super than men.

People who care for disabled children, or members of the sandwich generation who care for ageing parents miss out on super contributions because their caring is essentially a full-time job.

So, the Human Rights Commission has recommended that the Productivity Commission investigate possible financial models for carer credits.

Around 70 per cent of primary carers are women who miss out on the opportunity to grow their careers and pay packets.

Should the government compensate carers for this time out of the workforce with carer credits to their superannuation, these women – or men, if that is the case – would have much better options in retirement, and the initial outlay would come at a lower cost to the taxpayer.

"It actually encourages people to spend more time looking after their dependent-aged parents or disabled family member at home and that actually does save the taxpayer a considerable amount of money," said economist Stephen Koukoulis.

"If those people are placed in some sort of government-sponsored institution the cost to the taxpayer is quite phenomenal. We know that from NDIS and aged care."

Australia is lagging behind other countries such as the United Kingdom, Germany, Canada, Japan, Denmark and Sweden, which already pay carer credits in various forms.

"In fact, most of the countries that have had carer credits for decades have actually spent the last few decades trying to strengthen their schemes," said Dr Myra Hamilton from the University of New South Wales Social Policy Research Centre.

Labor has committed $400 million to pay superannuation to parents while they take parental leave, and the Coalition has extended the spouse tax offset for those who contributed to the superannuation of a low-income-earning partner, as well as allowing people with low super balances to carry forward their concessional cap for five years, which effectively allowed those with interrupted work patterns to catch up.

But these are just small steps towards solving a bigger problem, says Dr Hamilton. 

Carers NSW believes that carer credits might be another step towards a fairer system for carers.

"Carers NSW believes the introduction of 'caring credits' would contribute to a more financially fit future for many of the 2.7 million unpaid carers across Australia," said Carers NSW chief Elena Katrakis.

Read more at www.abc.net.au

Do you think carer credits are a good idea?

11 comments

 

Yes..I think it's an excellent idea. It certainly has my support. It must be one of the hardest jobs in the world having to look after a person with a disability.

Carers should also be provided with more respite for themselves and young people should not have to bear the burden of caring for sick parents at the detriment of their own wellbeing and education. 

u want a real burden on tax payers?? pay those who care for aged/disabled family ( i cared for 4 at the same time ) more than the 3.50 an hour the government currently pays.  if we got what those who care for strangers got you would be working just to pay tax.  and we dont work 40 hours a week we are there 24/7 

Yes, tisme,   you are so darn right -- when I was caring for my Husband I got $20 a week!  and I was at his side 24 - 7  for almost 2 years b4 he died

 

 

"People who care for disabled children, or members of the sandwich generation who care for ageing parents miss out on super contributions because their caring is essentially a full-time job."

Anyone who has experienced the mental exhaustion associated with this responsibility, definitely deserves all the help they can get.

The simple fact is, if you don't look after the home carers eventually they will give up and put their loved ones into institutional care, not neccessarilly by choice but probably out of need.  If you think the proposal put forward is expensive, just think what it will cost for the increase in instutional care.

Forget trying to politicise this problem, it is one that will touch all of us at some time.  To try and politicise it is just trying to trivialize it.  Anyway social engineering is not a one party trick, they all do it.

As Margaret Thatcher said: “The problem with socialism is that you eventually run out of other people's money.”  Who is going to pay for all of these schemes? It's not a government, it's the taxpayers and when a government promises to spend money, they have to find the money to pay out. If the budget isn't running a surplus then to balance the books more money has to be raised. Will politicians take a pay cut or will they raise taxes? I know you know the answer.

If the useless Lieberal government made big business and the rich pay their fair share of taxation, this would not be a problem.

Good one Knows-a-lot, just the usual mantra from Labor, no specifics just a simple generalisation. Any business in Australia which doesn't pay their taxes as legislated are prosecuted. I presume you have a list of those big businesses and the rich who are evading their tax responsibilities? No, I didn't think so.

"On average, women retire with 42 per cent less super than men."

And rightly so! Women on average do not work as many years as men do, and work shorter hours.

Knowsy, you think it is rightly so? And you dont find that a little discriminatory? A recent report revealed that women do a lot of work behind the scenes. They do a lot of ironing apparently but I wouldnt be talking about that.

Knowsy, you think it is rightly so? And you dont find that a little discriminatory? A recent report revealed that women do a lot of work behind the scenes. They do a lot of ironing apparently but I wouldnt be talking about that.

As a carer for 2 family members, I am saving the government plenty as the rate for a paid service is SO much more. And YES, a little top-up to super would be nice. Unpaid carers have been treaded like scum, try enjoying life when your whole life is taken up by caring for your loved ones. Even the bonus each year is not enough to say thanks too as it's not that much more than a fortnights payment for working 24/7 365 days a year. BUT, if you have a reply please make sure you are a carer otherwise you don't understand or don't want to understand what it's like.

So why was my comment removed?

What did you say?

The current pension system actually punishes carers, and Labor's FC proposal will make it worse for many. 

Consider a real world example (one I witnessed first hand, but names are changed of course)

A couple of years ago, Jack and Molly and Jim and Sarah both had an aging parent in of care. Both couples were planning retirement in the next year or two.  Both couples had around $900K in super and savings.

Jack and Molly elected to put their aging parent into institutional care and take their long-yearned-fo European holiday. They spent about $100,000 on a year of travel and came back to claim a part pension.

Jim and Sarah postponed their holiday until after their needy parent's death, which hasn't happened yet. Thus, they do NOT qualify for a pension. 

Guess who now has a far higher income,  all the nice pension concessions, AND ISN'T THREATENED WITH LOSS OF FRANKING CREDITS on their dividend income?

Jim and Sarah might eventually get their holiday, and a part pension, but if Shorten has his way they've lost their franking credits for life, and regardless they have forfeited several years of part pension income and concessions. 

How can anyone justify penalising carers for sacrificing this way? Our system is ridiculously flawed and politicians must be brain dead to continue devising policies that encourage and reward dumping those needing care on the taxpayer and punish people who make personal sacrifices to do what is best for both their loved ones and the nation.

Of course, both couples are far better off than vast numbers of carers who would never need to choose between caring for a loved one and holidaying abroad - and would never risk their pension no matter what choices they made, and for those folk, yes, superannuation credits would be an appropriate reward for their efforts. They certainly deserve reward!

Old Man, I agree with Thatcher's caution - but the simple fact is that our current system costs MORE because it is so mean and unfair. It would cost far less to give carers a little more and rationalize our pension system so it doesn't reward people for being irresponsible or selfish. The savings are there to be made, by sensible, logical reconstruction of a system that is so ridiculously flawed and inefficient that one wonders how anyone in power could ignore the urgent need for overhaul. 

Old Man, I agree with Thatcher's caution - but the simple fact is that our current system costs MORE because it is so mean and unfair. It would cost far less to give carers a little more and rationalize our pension system so it doesn't reward people for being irresponsible or selfish. The savings are there to be made, by sensible, logical reconstruction of a system that is so ridiculously flawed and inefficient that one wonders how anyone in power could ignore the urgent need for overhaul. 

11 comments