Sunday, February 23, 2014

Treasurer Joe Hockey warns age pension age may be raised to 70

AUSTRALIANS have been warned they will have to work longer, possibly to 70, before they have a chance of getting an age pension on retirement.

Treasurer Joe Hockey has backed moves by the British Government to hike the state pension age to 70 for those now aged under 30 and says Australia should consider doing the same.

As the Government looked for ways to rein in health and welfare costs as part of its ­Budget repair job, Mr Hockey warned the aged pension was becoming unaffordable.

He said the eligibility age of 65 for the age pension had not changed since it was introduced despite most people living much longer.

"It was set at that level in Australia in 1908 when life expectancy was 55," Mr Hockey said. "Now life expectancy is 85 and as of today, it’s still pension age 65."

Under changes introduced by the former Labor government, the pension age will increase by six months every two years from July 2017 and hit 67 in July 2023. Mr Hockey said he wanted the pension age to rise even higher.

UK Chancellor George ­Osborne recently outlined plans to lift the state pension age from 65 to 70 by the 2050s, in line with increases in life ­expectancy.

New Zealand is planning to lift its pension age to 66 in 2036 and Canada to 67 in 2023.

Increases in the pension age could have a flow-on impact on the age at which retirees can access superannuation without paying tax.

Mr Hockey did not mention super, but called for a debate about the cost of the age ­pension.

The Government currently spends about $39 billion on the age pension, and this is rising by about $3 billion a year.

The Productivity Commission last year argued that lifting the pension age to 70 would save taxpayers $150 billion from 2025-26 to 2059-60.

Seniors groups warned an increase in the pension age would hurt older people who struggled to find work, and could force more people on to the dole or disability pension.

"Without tackling mature-age unemployment first, government will be shifting people from one form of welfare to another," National Seniors chief executive Michael O’Neill said.

"Raising the pension age is a simplistic approach to a deeper problem, and it is not a solution to the national welfare bill."

Amid signs the Government is also planning to introduce means-testing or co-payments to Medicare, Prime Minister Tony Abbott vowed to find better ways to spend the health budget.

Mr Abbott said he would keep his election pledge not to cut health or education funding in total but flagged changes to the way this money was spent.

"If we find a more efficient way of spending money ... we’d be crazy not to adopt it," Mr Abbott said.

"Plainly there are efficiencies that are possible in health and in a whole host of areas."


Sexism debate rages over all-male Athenaeum Club in Tasmania

DEBATE fired up yesterday over whether gender-specific clubs should be condemned to the sexist pages of history or preserved in the interests of the perfect scone.

Food critic Matthew Evans recalled being refused membership to the Tasmanian branch of the Country Women’s Association on the grounds he is a male.

"But I make a pretty bad scone, my wife makes a better scone," he lamented.

Following an article in the Mercury revealing that high-profile Tasmanian women are trying to prise open the doors of the gentlemen-only Athenaeum Club, opinions lined up on both sides of the issue yesterday.

Comments from readers exploded on the Mercury’s website, some demanding the club be "dragged kicking and screaming into the 21st century" while others said it was no worse than female-only gyms.

The head of the Athanaeum Club issued a thundering private memo to all club members yesterday, expressing his deep concerns that a club member had leaked the issue to the media.

President Michael Dyson wrote: "We all should be gravely concerned that any member would cause this issue to be raised in the news media. The fact that it has occurred without any consultation with the committee or members of the club, and with complete disregard for the rules and conventions of the club is, in my view, disgraceful conduct that shows complete lack of regard for the club and its members".

The stoush follows club member and Denison MP Andrew Wilkie nominating Anti-Discrimination Commissioner Robin Banks and author Heather Rose for membership — to be decided at a committee meeting on Monday.

Feminists called for the club to drop its stance, while the Country Women’s Association spoke in support of clubs that wanted to preserve tradition.

CWA Tasmania state president Shirley Morrisby said the female-only rule of her association dated back to early last century, when the wives of outback Queensland farmers needed a network.

She said husbands had a place with the CWA, but in a helping capacity.

Mrs Morrisby said she believed there was still a need for women to meet without men.

"Personally, I think it is still important because there are things women talk about, which they wouldn’t talk about in front of a man," she said.

University of Tasmania Associate Professor Imelda Whelehan said male-only clubs were a throwback to our colonial past and Hobart should move with the times, as was the case in the UK.

Prof Whelehan, a feminist cultural critic, said even the London Athenaeum Club had started allowing entry to women members more than a decade ago.

"The world moves forward and these clubs are increasingly out of step," she said.

Mr Evans said he hadn’t pursued the CWA on the issue because he "has a millions other things on" and he recognised he probably didn’t have the attention span for all the good work they did.

Mr Dyson said he had taken a lot of calls of support yesterday from people who believed the club should uphold its tradition.

But he did not want to comment any further on the issue because members’ interests had to be kept private.

"We are a gentlemen's club, we don’t like to get into arguments," he said.


Business figure to help lead sweeping review of Fair Work laws

The federal government is finalising plans for a sweeping review of the nation's workplace laws, and could hand-pick an industrial relations expert from outside the Productivity Commission to help lead it.

Before the election, the government promised a "genuine and independent review" of the Fair Work laws by the economically dry commission, to consider their impact on productivity, the economy and jobs, with a view to raising flexibility in the workplace.

The review comes as Employment Minister Eric Abetz revealed plans to introduce new laws next week that would allow workers to trade off conditions such as penalty rates in return for more flexible hours. Fairfax Media has learnt former Australian Chamber of Commerce and Industry chief executive Peter Anderson, a critic of the Fair Work laws, was informally sounded out late last year about participating in the review.

Mr Anderson is a respected former industrial relations lawyer who has worked for both Prime Minister Tony Abbott and Howard government workplace minister Peter Reith on industrial relations policy, but he is said to have turned down the opportunity.

Sources familiar with the government's plans said at least one senior figure from the business world could be drafted in to assist the commission with the review, with the government seeking "people with industry experience, not academics" to review the laws.

The terms of reference for the review have not been signed off by cabinet but will be finalised before the government's self-imposed March deadline.

The move comes after Fairfax Media revealed the government urged SPC Ardmona to reduce workers' wages in exchange for government assistance and signalled it would give Qantas a debt guarantee while welcoming the company's tough stance on industrial relations.

Mr Abbott was heavily critical of Labor's 2012 review of the Fair Work Act, which he said was "conducted essentially by the department and, naturally, the government reviewing the government has decided that the government doesn't have a problem".

The commission has six other reviews under way and there is a view in government that it would benefit from one or more outsiders being brought in.

The commission has six full-time and six part-time commissioners, though the terms of two members - Siobhan McKenna and Wendy Craik - are due to expire in June. Industry and business figures suggested to Fairfax Media that the Australian Industry Group's Innes Willox, Australian Mines and Metals Association chief Steve Knott and former Liberal MP Sophie Mirabella could be brought in, though government sources dismissed all three.

Speaking at Melbourne University on Thursday, Senator Abetz said his new bills were likely to be brought to Parliament next week, implementing the Coalition's pre-election promises on industrial relations.

Among them would be changes to the Fair Work Act's "individual flexibility arrangements", brought in under former workplace relations minister Julia Gillard.

The laws dictate how employers and their staff negotiate conditions, and Senator Abetz said changing them would allow employees "to be able to work hours that suit them and their family-life balance".

Senator Abetz confirmed, when asked about the changes, that they would allow workers to trade off penalty rates for family time.

He stressed it would be employees who decided if this trade-off suited them, and not employers dictating that penalty rates be signed away. "If the worker is better off overall as determined by the worker, why should some collective agreement seek to deny the individual that right?"

The union movement leapt on the proposed changes, saying they were the first sign the Abbott government would restore the sort of individual contracts that were the hallmark of the Howard government's WorkChoices laws.

ACTU president Ged Kearney said the government had given employers the green light to cut wages, under the guise of greater flexibility.

"This is a blatant attempt to cut pay and conditions … despite all the pre-election promises," she said. "Minister Abetz talks about imaginary workers that want to give up penalty rates for nothing. We're yet to find a worker that thinks this is a good deal."



Childcare: a case study in regulatory capture

In recent weeks, the media has been saturated with solutions to the childcare problems Australia faces. With the Abbott government's Productivity Commission Inquiry into the sector (set up due to persistent complaints about lack of availability and prohibitive costs) planning to release a draft report in July, such 'solutions' are likely to continue.

In the meantime, childcare operators and stakeholders have come out of the woodwork to suggest magic bullets for the problems faced in the sector. Making childcare costs fully tax-deductible is a popular argument, though its advocates have not presented strong reasons why the benefits outweigh significant costs to the budget in terms of foregone revenue. Another chestnut is extending the childcare rebate (the non-means tested benefit which covers fees per child up to $7,500 per annum) to nannies and other in-home carers.

What's more interesting in this discussion, however, is what is not being said. The national conversation has been about fundamental changes to taxation law and/or a higher burden on taxpayers, instead of what's driving the problem: regulation.

Approved childcare services (that attract the childcare rebate) are regulated through a federal and state compact - the National Quality Framework (NQF). The NQF mandates minimum conditions for long day care and family day care services; conditions include 'improved educator to child ratios' and 'educators with increased skills and qualifications.' The Regulatory Impact Statement for the NQF, the Henry Tax Review and the Productivity Commission have all conceded that these conditions have a negative impact on the cost and availability of childcare.

Other regulations exist in addition to those in the NQF. Individual councils, through which family day care programs are run and educators employed, have their own, varied regulations. Local councils also arbitrate where centres can be established - and have the power to prohibit employer-provided childcare located in densely populated urban areas or industrial areas. A 2006 Inquiry into Work and Family found that fringe benefits tax legislation means there is little incentive for small- or medium-sized employers to jointly provide on- or near-site childcare for their employees.

It is important to look at how we can create a functional and accessible childcare system to free parents up to engage in work. If we take childcare seriously, we mustn't commit the grave error of thinking that writing a blank cheque constitutes a workable solution.


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