Are Australian pensioners really impoverished?

By Jessica Brown

(For American readers: "Pensioners" are government-supported retired people)

The OECD this week released a report that claimed that one in four Australian pensioners live in poverty. According to the report, pensioners in Australia face the fourth highest rate of poverty in the developed world. According to the report’s author, Edward Whitehouse, ‘Public pension spending is only 3.5% of national income in Australia, compared with an average of over 7% of GDP in OECD countries.’

While these claims seem shocking, closer scrutiny shows them to be almost meaningless. The ‘poverty line’ used by the OECD is half of median income. What this tells us is that a large group of pensioners have incomes lower than the average. What it doesn’t tell us is how this actually affects their standard of living.

Another, more in-depth report called ‘Growing Unequal’ released by the OECD last year looked beyond relative income poverty. It also examined material deprivation: whether people had adequate access to necessities such as housing, food, health care, heating, etc.

It found that while the overlap between relative income poverty and material deprivation was ‘far from perfect’ for the population as a whole, this was especially so for elderly people.

Despite having relatively low incomes, many elderly people own their homes or other assets. In Australia, they have access to extensive free health care and subsidised private health insurance, transport, and utilities. The report therefore concluded that ‘income poor older people are not necessarily experiencing material hardship.’

Claims that Australia’s level of spending on pensioners is miserly also fail to stand up to scrutiny. Australia spends a relatively small amount on pensions compared to the OECD average, not because we are tight-fisted but because we have a targeted and means-tested system. In contrast, many European countries have social insurance systems that provide universal pensions often more generous to high-income earners. This means that it’s possible for a country to spend large amounts on pensions but also have a high level of material deprivation amongst pensioners.

Measuring government spending on pensions alone also doesn’t take into account the effects of private retirement savings such as superannuation.

Measuring the standard of living of elderly Australians is a worthwhile endeavour. However, meaningless statistics and invalid comparisons do little to achieve this.

Above is a press release from the Centre for Independent Studies, dated July 3rd.






"Green" investment options a flop

Real Greenies probably have no money left to invest after they have spent all their money on solar panels, water tanks and "organic" food etc.

A decade ago, a fresh wave of interest in sustainable investing broke out in Australia — and elsewhere — but things have not turned out quite as the sector's advocates expected. Howard government changes to allow a choice of super funds would let people dictate how their money was invested. This democratisation would translate into greener, more human financial markets.

Mainstream institutions such as Westpac, AMP and Perpetual launched funds into a niche market — call it ethical, socially responsible or sustainable investing — that had been held by principled specialists such as Australian Ethical Investment and Hunter Hall, who did nothing else. Real money was expected to flow into this niche, then worth about $1.4 billion. Big companies such as BHP may not have cared what a few tiny green fund managers did with their money, but failure to pass a sniff test backed by powerful financial institutions with billions to invest posed a different reputational risk.

After the Dow Jones Sustainability Index was launched in 1999, for example, everybody wanted to make the cut. But the fund managers had a dilemma: how to offer investment-grade sustainable funds that conformed with industry rules about diversification? Get too green and you limit your investment options and your chance of beating the market. No trustee or their consultant would endorse a fund likely to underperform. Not green enough and you get shot down for hypocrisy and lose your marketing edge — the offer of a true alternative — as well as any upside from green investing that might exist.

A crop of funds were launched that balanced performance against integrity to varying degrees. Slowly money trickled in, except most super fund members almost never chose the sustainability option offered by their fund. Most mandates were wholesale. By the end of last year, according to Super Ratings managing director Jeff Bresnahan, take-up of the sustainable options offered by super funds was "pitiful".

A recent Super Ratings survey, answered by 76 funds with 15 million members and $370 billion in assets, found that for 90 per cent of respondents, sustainable investments — now offered by almost two-thirds of funds — represented well under 5 per cent of net assets.

For example Vision Super, a $4 billion fund, had just $8.5 million invested in its sustainable options. The $28 billion Australian Super had just $29 million invested in its comparable green plan — that's only 0.1 per cent. "People just aren't voting with their feet with (these) options," Bresnahan says. "A lot of funds have done the research among their members, and it comes back with a resounding 'yes', but there's very little take-up."

It's not the performance that's a turn off. In fact there's nothing in it — sometimes they're ahead, sometimes behind, depending on the time period, asset allocation, research used, and so on. Super Ratings found that sustainable super options underperformed by a measly 33-38 basis points a year over the five years to the end of May, with the median option delivering annual returns of 4.37 per cent (balanced) or 6.72 per cent (shares) after tax and fees.

Morningstar data for retail (non-super) funds shows a similar underperformance of 45 basis points a year over the five years to May. That's also after fees, which is part of the explanation — the added research required to analyse sustainable investments costs fund members 1.81 per cent, or an extra 21 basis points, a year more than mainstream funds.

More HERE





Rudd’s confusion re abuse of indigenous children

And now for some political incorrectness on a sensitive subject ...

In the wake of a damning report that Aboriginal children are 6 times more likely to suffer sexual abuse than other Australian children (the figure is likely to be much higher because many cases from remote communities are not reported), state and territory leaders of the Commonwealth (COAG) are meeting in Darwin today to discuss, in Kevin Rudd's terms, "how to overcome indigenous disadvantage". Rudd's "root cause" rolls off the tongue and is accepted as a given but it neither withstands closer scrutiny nor allows us to address this terrible problem in any meaningful way.

There are many disadvantaged groups in society who do not routinely sexually abuse their children. To give just one example close to home, a significant proportion of our own local Jewish community arrived on these shores after WWII having suffered unspeakable emotional, material and ideological loss. Yet their relative "disadvantage" did not lead to their abusing their children. This is because sexual abuse has more to do with a lack of values than it does with a lack of opportunity or advantage. Those Jewish migrants, disadvantaged as they were, nevertheless carried timeless values which enabled them to take their place in and contribute to our society.

This confusion, shared by our Supreme Leader, stems, I think, from the common misconception about what multiculturalism is supposed to be. A multicultural society is one where there is no single distinct ethnicity or religion to which everyone must adhere to and where social cohesion is promoted by permitting distinct ethnic or religious groups to celebrate and maintain their different cultural identities. It is a modern experiment which has been spectacularly successful in many liberal democracies including, for example, the USA and Australia. But it only works where all groups submit to similar values....in the USA and Australia, that means Judeo-Christian values (which are largely reflected in our statutory and conventional laws).

Unfortunately, many think that multiculturalism means that all cultures are morally equal and that none is superior to another. To think otherwise is to be labeled bigoted and chauvinistic. That is a tragedy because different cultures are not necessarily morally equal. For example, a culture which promotes female circumcision is not moral, it is primitive and barbaric. A culture which promotes sati (the age-old practice on the sub-continent of perfectly healthy widows self-immolating on their husbands’ funeral pyres) is barbaric. So too is a society which celebrates honour killings (justifying the murder of rape victims by their own fathers and brothers) and teaches children Jihad (the list of examples is endless). Because the sexual abuse of Aboriginal children is unarguably rife, our leaders should perhaps view this unhappy fact from a different perspective.

Political correctness in this context - which I would describe as the institutionalised failure to recognise that diverse cultures are not necessarily morally equal in every respect – misdirects all our attempts to cure the problem. It explains why governments wanting to do good will typically address material matters only, while ignoring the fact that the real remedy lies in teaching/educating that certain practices are simply wrong and will not be tolerated. The closest attempts we have seen were the Howard government’s belated initiative in policing remote communities and, of course, the well-intentioned efforts of missionaries in the mid 20th century (the children involved, many of whom benefited greatly, being now referred to as the stolen generations).

Unfortunately, as Rudd has set incorrect parameters for the talkfest, don’t expect any significant improvement in the plight of indigenous children.

SOURCE





Top doctor in Western Australia claims that colleagues operated 'without proper qualifications'

And another bullying Health Dept. that tries to get back at whistleblowers

A top surgeon at WA's biggest hospital claims two doctors were conducting critical surgery without proper qualifications, The Sunday Times has discovered. Cardiothoracic surgeon John Manuel Alvarez has lodged an internal complaint in which he claims last year he warned bosses at Sir Charles Gairdner Hospital that he feared two of his peers were underqualified for the major surgery they were performing. The Sunday Times understands that some of the concerns related to whether or not the two doctors had passed specialist examinations. Both doctors are no longer at the hospital. One has left WA.

Dr Alvarez himself is being investigated by the Health Department over misconduct allegations. The Health Department started investigating him in July last year after he raised doubts about the ability of the two doctors. The Sunday Times understands that Dr Alvarez believes the inquiry is a witch hunt and was not properly conducted.

Dr Alvarez filed a writ last week seeking to restrain the Health Department from continuing with an investigation and publishing or acting on its findings of misconduct against him. He also wants to stop any future investigation of him by the department. Dr Alvarez named WA Health Minister Kim Hames as the first defendant and Kenneth John Trainer as the second defendant in the action which was filed last Friday. Mr Trainer was the independent investigator hired by the Health Department. Dr Alvarez wants damages for breach of contract with the writ alleging the investigation breached his employment contract dated July 28, 2005.

A SCGH spokeswoman confirmed that Dr Alvarez had made complaints about the quality of some of his peers who were conducting critical surgery last year. She said the hospital was unable to comment specifically on the investigation into Dr Alvarez as the matter was before the courts.

SOURCE





More "stimulus" waste

Having bureaucrats spend money is a disaster. They don't give a stuff

A school with just one pupil for 2010 has been given a $140,000 government grant to build a covered playground - even though it already has a new one. Another $110,000 grant from the Rudd Government's $14.7 billion education stimulus package will be used for classroom refurbishment at tiny The Lagoon Public School, 20km from Bathurst in New South Wales central west.

But even locals say it is a shocking waste of money. The tiny rural school has one teacher and five pupils, two of whom go to high school next year. The mother of two girls there said she was considering transferring them to a larger school. That would leave just one pupil - the teacher's daughter - as the beneficiary of the federal funds.

The school is one of 1500 to receive Primary Schools for the 21st Century program funds. Government documents show it has been given $140,000 for a covered open learning area (COLA) and $110,000 for "upgraded classrooms".

But a neighbour told The Sunday Telegraph that the school had a new shaded learning area built just two years ago. "This school has been granted $250,000 for a COLA and classroom refurbishment - it already has a COLA, which was built over summer approximately two years ago," he said.

Monica Betts, whose daughters attend the school, said the funds could have been spent attracting more pupils. "It is a lot of money," she said. "They could have spent $50,000 trying to get more people here."

NSW Opposition education spokesman Adrian Piccoli said the program had been flawed. "Small schools need to be maintained, just like larger schools do, but it's the height of incompetence to spend borrowed money on unnecessary projects," he said.

The Opposition cited five new schools that received funding under the 21st Century scheme. One was John Palmer Public School, which got $546,000, despite opening only last year.

Australian Council of State School Organisations president Steve Carter said he was extremely frustrated by the scheme's inequitable allocation. "We would very much prefer a tighter, better thought out, needs-based allocation of funding, managed properly to give local school communities the resources they need," he said.

Arthur Phillip High School, in Parramatta, had sought money to repair its walls, floors, roofs and sewerage, but was rejected. Keira High School missed out on funds from the Science and Language Centres program, despite labs, built in the late 1960s, being below safety standards. Rooty Hill High also missed out, despite mould in its labs and cupboards falling off the wall.

Federal Education Minister Julie Gillard blamed the NSW Government for the funding decision and sought an urgent review of the school's eligibility. "The NSW Department of Education and Training (DET) must have assessed that it was in need of new or refurbished facilities," a spokesman said. "The Deputy Prime Minister has requested her department to hold immediate discussions with the NSW DET to investigate claims that this school may be non-viable in 2010".

SOURCE