As the treasurer lauds supply-side economics, a once-controversial recovery theory is gaining traction.This is the essence of modern monetary theory – that government budgeting is nothing like household or business budgeting, for the simple reason that government can create money.
Age discrimination in the workforce
Linda, a former nurse from Queensland, is angry. “It irks me greatly that if I am not a self-funded retiree I am constantly being accused of being a burden on society,” she tells me. “Politicians are blaming us instead of creating attitudinal change. Like giving the message to employers that older workers are valuable.”
While 1.5 million older Australians struggle to survive on an age pension barely above the poverty line of $426 a week, widespread age discrimination is forcing people out of the workforce. These people then face years on a Newstart allowance that has not increased in real terms since 1994.
Linda, now 71, raised her three grandchildren after being granted full custody in 2002 because of abuse at the children’s interstate home. She retired four years ago and works voluntarily on suicide prevention programs. Her 17-year-old grandson lives with her.
Linda’s pension is $877 a fortnight with some family tax benefit that will end in 2017. “I am trying to meet my basic needs on the pension and those of my grandson,” she says. “An extra $250 a fortnight would buy health and car insurance, internet, home and garden maintenance, haircuts, a dentist.”
The retired nurse wants employers to be encouraged to keep people in the workforce for longer, and suggests that workplace “quota systems” be introduced.
According to research economist Warwick Smith at Per Capita, one of the authors of the recent report The Adequacy of the Aged Pension in Australia, “over a quarter of older job seekers from the age of 50 have reported being affected by age discrimination”.
He says: “When you combine this with the push to lift the pension access age to 70, the rise of contract and casual employment, and the current and projected impact of technology on the demand for skills, the situation for many older workers looks grim.”
Australian Council of Social Service CEO Dr Cassandra Goldie says the $38.38 a day Newstart base rate was falling further behind the pension and community living standards because it is indexed to prices only, unlike pensions, which are indexed to wages.
The Adequacy of the Aged Pension in Australia, produced by The Benevolent Society, Per Capita and the Longevity Innovation Hub cites some pensioners taking drastic measures to make ends meet. They are turning off hot water in summer, blending food because they can’t afford a dentist, and choosing whether to buy food or get essential medical prescriptions filled.
Cambodian-born Keo came to Melbourne as a refugee and single parent in 1987. She suffers from diabetes and other health issues, receiving a disability support pension of $794.80 a fortnight. “If it wasn’t for my daughter helping, I would have to choose between food and medication,” she says.
With Australia’s pension spending at 3.5 per cent of gross domestic product – less than half the OECD average of 7.9 per cent –and its adequacy second worst, those paying for rental accommodation are particularly hard hit, National Seniors Australia chief executive Dagmar Parsons said. She advocates a review of the Commonwealth Rent Assistance appropriately indexed to private rental markets and a national expansion of affordable housing.
The authors of the aged pension report recommend establishing an independent age pension tribunal to determine a just base rate for the pension similar in structure to the parliamentary Remuneration Tribunal or the Fair Work Commission expert panel.
The national Fair Go for Pensioners Coalition (FGFP) has for the past three years been urging the federal government for an urgent review of the retirement income system commissioned by the minister for social services – with no response.
FGFP vice-president Lew Wheeler says the review would cover all aspects of superannuation, Newstart allowance, the national partnership agreement on pensioner concessions and barriers to mature-age workforce participation.
It makes no economic sense to not employ older workers. As a recent report by the professional services firm PwC pointed out, an older workforce could deliver gains of up to $78 billion for the Australian economy.
The Australian Human Rights Commission’s Willing to Work national inquiry in May this year made 56 recommendations to combat employment discrimination against older people. It is still with the attorney-general for consideration.
While the report awaits action, people such as Julia, 55, deal with harsh periods of homelessness and unemployment.
The South Australian lost a highly skilled technical job, and has experienced severe homelessness. Julia gained a university degree in her 40s in physics and chemistry, studying for 10 years while a single parent. Unable to find a suitable job, she works in factories, does occasional private tutoring and cleaning.
“I was on the waiting list with the dental hospital for over a year and in quite a lot of pain. I blended food, lived on soup and lost a lot of weight,” she says.
Pas Forgione of Anti-Poverty Network SA says people like Julia are not to blame for a fundamental lack of jobs.
“Ironically,” he says, “it is at these times when the economy falters that the drive to attack and punish unemployed people and label them as ‘dole bludgers’ intensifies.”
Two organisations are helping unemployed older workers. Melbourne-based Marilyn and Howard King established Willing Older Workers in 2011 when Howard was unable to find work and Marilyn was studying mature-aged unemployment in Australia. It offers practical and emotional support.
The other is olderworkers.com.au, a privately owned Australia-wide job board for over 45s. General manager Judy Higgins said many employers believed the commonly circulated myths about mature-age workers, such as that they are “too slow, [take] more sick days, no good with IT, not willing to learn”.
“None of this is true,” says Higgins, “but the age discrimination legislation is a blunt instrument that jobseekers find way too hard to use.”
Marilyn King is convinced the biggest drain on anyone relying on the pension is paying rent, even with some rental assistance.
If not for organisations such as Melbourne-based Housing for the Aged Action Group (HAAG) and its Home at Last Program, and the non-profit company Wintringham, which provides services to homeless older people in Victoria, many more people would be living on the streets.
HAAG’s latest report, At the Crossroads in Retirement – Older People at Risk of Homelessness, shows that nationally there has been a 44 per cent increase in older people in insecure private rental housing over five years. Older people are spending on average
65 per cent of their pension in rent.
HAAG co-manager Fiona York says, “There is a housing crisis but governments don’t see it. We urgently need to invest in public housing for people over 55.”
Many of the homeless are women aged 70 and above. They don’t have any superannuation, have outlived their spouses, or had a family breakdown. The loss of two incomes to make rental payments is often the catalyst for homelessness and seeking housing assistance.
The acting CEO of Wintringham, Michael Deschepper, says the more than 30,000 people registered on the Victorian Office of Housing list is evidence of the dire need not only for more supported affordable housing options but a concerted look at measures that could help prevent rent arrears and other factors contributing to homelessness that could be avoided.
With the World Health Organisation forecasting nearly two billion people worldwide aged above 60 by 2050, the United Nations has urged its member nations to fight ageism – without addressing its own ageist practices.
In 2012 I applied for a communications role with UNESCO.
I was told I was ineligible because the UN had a cutoff age for job applicants of 57 and a compulsory retirement age of 62. Employees have to work a minimum of five years to qualify for its pension. Although my case was taken up by the Human Rights Commission, it did not progress. The International Civil Service Commission has now recommended the retirement age be increased to 65 from January 1, 2017.
But the UN policy flies in the face of the human right that everyone should be able to decide when or if they want to stop working – regardless of age.
As John from New South Wales puts it: “I lost my job at 65, I am 71 now and I want to work. I am technically savvy, my ability is ageless. All the stereotyping about older people’s abilities or lack of them has no statistical foundation. But I am now locked into the system.”
This article was first published in the print edition of The Saturday Paper on Oct 22, 2016 as "Interest on maturity".
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