It's time for a Boomer political party. Not to look back in wistful nostalgia to days of flaired pants and campus sit-ins, but a new party that fights for intergenerational equity.
The Abbott Government has lapped up reports by the Grattan Institute and the Productivity Commission, recommending a rise in the pension eligibility age to 70. The Commission of Audit will follow suit, if it knows what's good for it. This comes on the heels of the Gillard legislation of moving the aged pension eligibility from 65 to 67 years of age.
The Grattan Institute – which has taken to humping the Abbott Government's leg - also wants to pair the superannuation draw down age to 70, while hunting down outstanding HECS fees from dead students.
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The Abbott Government is shredding the Social Contract – a tacit agreement in advanced capitalist societies, which says that the Government will look after its ageing citizens. Maybe we're more like Fiji after all.
The Abbott Government's scare campaign is a shocker. I worked (for my sins) in DEEWR in Canberra in this area. There was never, ever any figures produced to support any of the Treasurer's outrageous predictions of doom and gloom.
Treasurer Hockey has created a crisis to slash the welfare state and usher in an era of austerity in Australia. Our nation has one of the lowest government debt levels of any advanced capitalist nation in the world (see graph below).
The Abbott government plans to take $300 billion (measured in future dollars) out of Commonwealth spending over the next ten years to achieve a target surplus of 1 per cent of GDP in 2023-24. This is extraordinary and unprecedented.
Those in greatest need of the aged pension remaining at 67 such as small business owners, manual labourers and women, will be hardest hit.
The number of Australians aged 65 to 84, will double between 2010 and 2050 and outlays may rise from $64 billion in today's terms to $116 billion in 2023-24. But this will be offset by the 67.5 per cent of Boomers who have full healthcare. Treasurer Hockey didn't tell you that.
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The aged pension, disability support pension and carers' payment will add another $39 billion to annual payments by 2023-24, but this will be partly offset by those who have healthy superannuation balances ($400,000) – about 20 per cent of the post war generation.
We know, but cannot calculate exactly as yet, that many educated and skilled workers will work on past 65. Not because they have to but because they want to. That will knock down the aged pension bill considerably.
Our GDP will rise to about US $2.6 trillion at market exchange rates by 2030 and the economy will certainly slow but not because of the ageing Boomers. It's because productivity levels are heading south and the Commonwealth will have to carry two failing states: South Australia and Tasmania.
Government income is tied to the size and growth of the economy, usually expressed as gross domestic product. The Commonwealth's net debt is equal to about 10 months' revenue - most mortgage holders can only dream of such a burden. Note in the graph below that our government debt level is a little above Denmark. What is Hockey talking about?
IMF Chart showing where Australia sits in terms of general government net debt, 2012-2018
Treasurer Hockey also didn't tell you that his plan to raise pension eligibility follows Italy and Spain by linking the statutory retirement age (which doesn't exist in Australia) to life expectancy. Since when did we start following two of the largest economic basket cases in Europe – Italy and Spain – on anything? This is desperate stuff from the Liberals.
As for longevity, if you were born now as a female, you might reach 85. But for the Boomers – and especially the men – those born in the late 1940s and early 50s, probably won't see 80. We are living longer measured over a sixty-year period but those Boomers who live in to there 80s are outliers – they exist at the very end of a normal distribution curve.
While a Boomer Party must protect ageing Australians, the real fight is for a prosperous and secure future for our children and grand children. This is where political conscience and action must be focused with laser-like intensity. A Boomer party must be altruistic.
A Boomer Party would initially concentrate on getting candidates elected to the Senate and then turn its attention to Lower House urban areas in our capital cities.
Some policy ideas in no order:
- Hold a Royal Commission in to the Australian Recruitment Industry to crush age prejudice once and for all. Employment, no matter how old you are, no matter what religion or race, must be by merit.
- Leave the age pension eligibility age at 67 but use one per cent of interest from our $1.8 trillion super funds to create long-term job schemes for people under 30.
- Increase the pay by EBA for aged carers by 17 per cent and begin a recruitment drive for more carers from within Australia.
- Set aside $7 billion for the creation of new, state of the art, aged care homes in our cities and rural areas over the next 20 years.
- People over 55 would work for the dole.
- Create a 'free' mentoring service by senior Boomer executives and trades people for businesses. They will be paid a nominal weekly fee for a maximum three-year contract.
- Reintroduce ethic subjects at schools and universities. Greed has become the motivator for many business dealings rather than honesty, reciprocity and professionalism.
You may disagree with my list. You may want to add more. I have studied how the American Association of Retired Persons (AARP) works in America and have experience in mass media campaigns and demographic analysis. A Boomer Party will ensure intergenerational equity – for young and old, not just the rich.