Universal pension for all: Retirees call for tax and income reform

This is a very different proposal from Universal Basic Income.  There is no effect on job readiness because pensioners are already out of the fulltime workforce.  And if the pension is taxable any perversity in the payments would be substantially reduced

The existing system is very unfair to savers and investors as the lockdown knocks their income substantially without compensation.  A universal pension would in part compensate for that

We live in a time of great government activism and economic involvement, much of which is neither wise nor benign so it is merely balance to suggest  that governments should take responsibility for the ill results of their policies and do things to compensate for the burdens they create


Every retiree would get at least a part pension under a plan being considered by seniors' groups amid concerns the coronavirus pandemic's effect on key income streams is leaving many older Australians cash poor and increasing the number living in poverty.

Seniors organisations are pressing the Morrison government to look at a massive overhaul to the pension system that would also take into account possible changes to tax concessions, such as franking credits, as a way to pay for any reforms.

The federal government is reviewing the retirement income system although its reporting date has been pushed back to July 24 due to the pandemic's impact on agencies.

The COVID-19 crisis, and measures to stop its spread, has created havoc with equity and investment markets while also leading to a huge fall in global interest rates. Economic shutdowns have hit jobs and seen a sharp increase in the number of renters - private and commercial - unable to pay rent.

Analysis by JPMorgan suggests the huge scope of the income hit facing those dependent on interest, dividends and rents.

It estimates dividend income will drop by $68 billion in the 12 months to the end of June, property income will slump by $59 billion while interest payments will be $8 billion down.

National Seniors Australia spokesman Ian Henschke said the crisis had highlighted key shortcomings in a retirement income system he said was clumsy and complex.

He said many retirees had suffered a sharp fall in their income yet the value of their assets had barely changed. Under existing pension testing rules, it's the value of those assets that determined any pension income.

Axing the means test system and replacing it with a universal pension, paid for by an overhaul of the tax system, would improve retirement outcomes and incentives for savers, Mr Henschke said.

"It would get rid of the pension assets and income tests, doing away with the need for unfair taper rates, deeming rates and work restrictions, and end the need to engage with Centrelink," he said.

"If everyone of pension age received a pension, retirees could just add this to their other income and pay tax. Means testing is costly to administer and leads to perverse outcomes, which are more apparent in the current crisis.

"Asset taper rates unfairly penalise those who save more for their retirement. Income tests undermine ongoing workforce participation and lead to ongoing anger over deeming rates."

David Knox, actuary and senior partner with consulting firm Mercer, said the system of means testing made it difficult for many people to plan retirement.

He said there was scope to adopt a model used in Denmark where all retirees were paid a part pension that maintained some elements of means testing but also guaranteed income for all.

"The advantage is the universal part pension gives everybody a base to build on while the means-tested pension ensures that no-one lives in poverty," he said.

"Another advantage is that the means testing will cease at a lower level of assets or income than currently, as it would only apply to half the pension.

"This means that many retired Australian households would not be subject to any means testing and there would be a much clearer incentive to make some extra savings for your retirement."

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Employers to end up as JobSeekers

That $60bn miscalculation by the Australian Taxation Office is good news for long-suffering taxpayers, with JobKeeper now expected to cost us “only” $70bn rather than $130bn. The problem is that every urger is out and about suggesting ways in which the $60bn “saving” can be spent.

When confidence in government is extremely important, this enormous fiscal error carries the danger that the public’s trust in government competence is eroded. Or should that be further eroded?

The revelation of this error came in the same week as the activist judges of the Federal Court handed down a decision that ensures the Australian labour market is now close to being completely dysfunctional.

The judgment that a casual worker should be entitled both to a wage premium and payment for leave entitlements (annual, personal/carer’s, compassionate and public holiday leave) means employers will be wary of employing any worker on a casual basis apart from on a short-term and intermittent basis.

Recall that this was a case about a casual mine worker (he worked for a labour hire firm) who had been engaged on a series of contracts but with each contract involving predictable shifts agreed ahead of time.

This sort of arrangement suits many workers, in part because it is possible for them to make plans about other aspects of their lives. Not all of them want permanent work and, in any case, many employers won’t offer permanent work as an alternative because of the operational and financial requirements of the workplace.

One of the most immediate dangers of this decision is that many employers of casual workers, now and in the past, face claims for back pay based on the characteristics of the work performed. In particular, those casual workers who are given or have been given “firm advance commitments” (the legal phrase used in the judgment) in relation to their work patterns could be entitled to both the premium attached to their pay — generally set at 25 per cent — and paid leave.

There are various estimates about the cost of the back-pay bill, with some figures as high as $8bn based on estimates of 1.6 million long-term casual workers who work regular hours. There are several class actions being undertaken to secure compensation for the affected workers and the areas of employment extend far beyond labour hire firms in mining. Needless to say, these actions also will enrich the law firms handing the cases.

Many firms hit with these claims simply will go broke. They have paid the wage premium on top of the hourly wage to their casual workers but few, apart from some large firms and the public sector, will have the funds to cover the additional bill, particularly given today’s circumstances.

Mind you, many individuals may end up being paid out via the Fair Entitlements Guarantee scheme, which exists to come up with the entitlements of workers whose employer’s business has gone broke. That is, if the employer can’t pay up, the taxpayer will. This is just one of the nightmare scenarios of this fiasco.

It’s easy to see how this judgment also blows up the prospect of any bounce-back as the COVID-19 restrictions are lifted. Employers will be loath to take back previous casual workers or to employ new ones — the risks have become too great given the scope for double dipping.

But to take on permanent workers, full- or part-time, with fixed shifts will be impossible given the uncertainty of business conditions. It will be lose-lose, including for those on JobKeeper.

The government must act now. Casual employment is a very Australian invention where workers are generously rewarded for the absence of leave entitlements. It’s not as if temporary work doesn’t exist overseas but there is generally no wage premium.

The arithmetic tells us that casual workers are indeed over-rewarded for the absence of paid leave by virtue of the 25 per cent premium. But the real point is that casual work suits many workers as well as many employers given the nature of their businesses — think weekly variations in demand and seasonal factors.

Note here that the vast majority of awards (and agreements that provide for casual employment) include “casual conversion” clauses. These enable casual workers, after certain periods, to request that their employment be made permanent, a request employers cannot reasonably refuse. Tellingly, a substantial number of casual workers never makes such a request.

Whether the government can strengthen these casual conversion clauses to extract some agreement from the unions to reject double dipping for casuals is unclear. The government’s earlier attempt to solve the problem by inserting a regulation in the Fair Work Act has not worked — the judges simply brushed this aside as having no effect.

For those who think the COVID-19 crisis has led to some easing of the rigid (and oftentimes bizarre) industrial relations regulations that bedevil the workings of our labour market, think again. Apart from some early concessions, it has been a case of defiant resistance from the union movement since the JobKeeper scheme was announced, as well as inflexibility on the part of the Fair Work Commission.

While it’s clear that the government has plenty on its plate, the casual work issue must be sorted out — and quickly, if there is to be a chance of a decent recovery later in the ye

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The other diseases the coronavirus lockdown stopped in their tracks

Amid social distancing measures put in place to fight the coronavirus pandemic, case numbers have flatlined for a number of other diseases.

But experts warn with the easing of movement restrictions, people have to keep following social distancing measures to ensure they don’t come back.

Measures put in place to halt coronavirus have also taken out a range of other diseases.
Measures put in place to halt coronavirus have also taken out a range of other diseases.CREDIT:AP

Rates of influenza have been squashed flat after initially hinting at another serious year for case numbers.

The numbers went so low Queensland Chief Health Officer Dr Jeannette Young said residents of the state were more likely to get COVID-19 than a flu in 2020.

"If you have respiratory symptoms there's every chance it is more likely due to COVID-19 than it is due to anything else," she said this week.

But aside from colds and flus, the rates of a range of other viruses have also bottomed out, including a potentially serious disease called EV-D68.

EV-D68 is an enterovirus that can manifest as a serious respiratory illness, especially in children and young teenagers. It's suspected of causing a polio-like condition called acute flaccid myelitis (AFM), which causes the muscles to become weak and unresponsive.

It had not been found in large numbers in Australia but UQ virologist Professor Ian Mackay said the number of cases had been steadily increasing over the last few years.

“EV-D68 is a bit funny in that it behaves more like a respiratory virus than a fecal-oral virus like a lot of the other enteroviruses,” Professor Mackay said.

“It does look like any of those viruses we call respiratory viruses - and EV-D68 falls into that -have just dropped off the radar to a large extent.”

That made sense, Professor Mackay said, because they were spread in similar ways: through droplets expelled into the air and being breathed in by others, or landing on surfaces other people later touched.

That means if social distancing measures slip in the coming months, a range of diseases, not just COVID-19, will spread.

“Most of them will tick up again [once restrictions are lifted], they’re still there in households. Whether they kick back into their patterns straight away will be interesting to watch,” he said.

The other big beneficiary of social distancing have been measles cases, which have dropped to zero in the last few months.

A serious outbreak in the Asia-Pacific region late last year, centred on Tonga, had been blamed for a rash of new cases in Australia and New Zealand.

Epidemiologist and public health expert Professor Linda Selvey said just like other diseases spread through droplets, measles was completely contained when social distancing measures were put in place.

“Measles is actually far more infectious than COVID-19," she said. "If it’s around there would be the potential to spread in public areas and we’re not seeing that. “If we didn’t have a vaccine for measles it would be far more dangerous than COVID-19.

“But we’re able to manage it with the vaccine and with post-infection [treatments].”

Children are historically more at risk from severe side-effects from EV-D68 and measles, while for influenza and COVID-19 older people are more likely to get severe cases and even die.

Professor Mackay said until there were more effective measures to control the pandemic and a vaccine to prevent it, social distancing would likely be a fact of life for some time.

“In particular we’re going to see physical distancing in place for months, probably until next year,” he said.

“Keeping virus hosts away from each other is one of the best defences we have against all sorts of viruses. It’s crude. It’s primitive, but it works.”

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Advertisements need more scutiny for false information

Misinformation, hoaxes, and fake cures have run rampant on social media platforms like Facebook and WhatsApp since the outbreak of the coronavirus. Will new measures be enough?
It is a rare moment in history when you can say with absolute certainty that tomorrow will be a great day.

But this tomorrow most certainly will be. The nation’s first and largest state – Australia’s birthplace of public education – is reopening all schools to all students.

It is a great day for society, for the economy and most importantly it is a great day for our kids. Education is the best antidote to poverty and disadvantage and the greatest gift we can give our children.

And so how did the most vital role of society – that of raising and educating its next generation – get arbitrarily shut down or suspended on the basis of no hard evidence nor top-level medical advice.

How is panic and fake information spreading so far and wide? How do we have supposedly educated people demanding the shutdown of educational institutions with no evidence to support it? And how do we have genuine concerns about the impact of such shutdowns likewise overtaken by lunatics who believe coronavirus is a myth altogether? Or caused by the 5G network? Or a conspiracy engineered by Bill Gates?

A clue to this lies in a cunning little experiment undertaken by a canny little think tank called Responsible Technology Australia (RTA), which was recently established out of concern that perhaps internet and social media giants aren’t quite as responsible and righteous as they pretend to be.

The test case was the online megalopolis Facebook, which despite its mission statement of “bringing the world closer together”, has been infamously exposed for peddling fake news stories deliberately designed to sow division.

After this came to light, a supposedly chastened Facebook claimed that it would move heaven and earth to stop the spread of false and dangerous information, just like a good global citizen should.

Only this week Facebook CEO Mark Zuckerberg told the BBC “we don't want misinformation to be the content that is going viral” and that Facebook had and would remove any content likely to result in “immediate and imminent harm” when it came to COVID-19 conspiracies.

And that’s great to hear. The only problem is it hasn’t and it didn’t.

To prove this, the people at Responsible Technology Australia set up a Facebook page called “Ozzie News Network” and then set about posting the most dangerous misinformation they could think of.

These included:

*  COVID-19 pandemic “advice” ads urging users to turn off their 5G, drink more water and get 30 minutes of daily sunshine

*  Saying the Australia-Indonesia free trade agreement was just a front to allow mass migration from Jakarta

*  Telling 18-year-olds not to bother to enrol to vote

*  Saying that the new 5G network will allow the Australian police to spy on you through your phone

*  Telling people the AEC has assessed they live in a safe electorate and therefore shouldn’t bother voting

These posts perpetuated obvious lies and misinformation posing as official advice. At worst they encouraged people to risk their lives and break the law. And the kicker is that they were posted as ads that Facebook both reviewed and approved.

There is absolutely no way on earth they would ever have been allowed to run in a responsible mainstream media outlet. Not News Corp, not Nine; nor Ten nor Seven nor anywhere with a pair of human eyes.

But still, a global giant like Facebook with billions of users could hardly be expected to notice everything that was posted on its millions of pages. Surely once it was brought to their attention the ads would be removed, right?

Wrong. Even after the group reported their own ads to Facebook for fake and dangerous misinformation they were still not taken down.

“No traditional publisher or broadcaster would ever run ads like this,” RTA’s executive director Chris Cooper told news.com.au.

“But not only did Facebook review and approve them, even when we repeatedly reported them as misinformation they were never taken down.”

Yes, even after RTA did Facebook’s job for it and flagged the fake ads, still no action was taken – even though anyone following their advice could be putting themselves at risk. So much so that the group deliberately targeted the ads to an audience which had already been informed they were fake and consented to receiving them to ensure they did not inadvertently spread dangerous information themselves.

“Our fake ads deliberately play on people's fears in ways we know are typical,” Cooper says.

“This experiment proves just how easy it is to spread fake news on Facebook, and it would be easier still for an experienced malicious foreign actor.”

The posts were finally removed only after news.com.au approached Facebook for comment. The company confirmed they violated its policy.

“We’re aggressively going after misinformation about COVID-19 and have teams across the company dedicated to this effort,” a spokesperson said.

“We’ve applied warning labels to millions of pieces of misinformation and remove content that could lead to imminent harm.”

But the fact they were able to be posted in the first place, were spread for so long and were not removed even after being reported should send a chill down the spine of anyone who still believes in facts or whatever the world has left of reality.

We have social media giants policing opinions while publishing obviously false information for the sake of a few bucks. And all the while using the journalism of real news organisations to cannibalise the advertising revenue that allows real journalism to survive.

This is the perfect petri dish for fake news. An Essential poll this week found one in eight Australians believed Bill Gates was somehow responsible for the coronavirus and it was being spread by the 5G network.

The corona crisis has already shown that even argument among politicians and experts can produce catastrophic results for both lives and livelihoods. Adding endless idiotic opinions to the mix makes things far worse, yet for anyone who believes in free speech it is a necessary evil.

But peddling false facts for cash is another level of devilry altogether, especially when you are pretending to be on the side of the angels.

Facebook and other social media titans have already helped forge a wild new world where facts are determined by sentiment instead of science and reality is a matter of opinion. The result has been a decade riven by extremes: Crazed conspiracy theories, right-wing populism and left-wing socialist fantasies.

The chaos they have fuelled on global issues ranging from coronavirus to climate change is often quite literally a matter of life and death. Surely they have profited from it enough without pocketing every last cent from dangerous and dodgy propaganda – not to mention the pontification they serve up for free.

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 Posted by John J. Ray (M.A.; Ph.D.).    For a daily critique of Leftist activities,  see DISSECTING LEFTISM.  To keep up with attacks on free speech see Tongue Tied. Also, don't forget your daily roundup  of pro-environment but anti-Greenie  news and commentary at GREENIE WATCH .  Email me  here