Though the PM tried, and I must admit almost succeeded to regaining some credibility at his Press Council speech on Monday, in the end he simply couldn’t help himself by once again putting his foot right in it.
I classify it as a failed, a fail because of the answer given to the second to last question re his justification for targeting the most venerable – including aged pensions – with his austerity program; “Intergenerational theft”. That is, as he sees it, those of our elderly who didn’t save enough during their working lives so they can self-fund their own retirement, are stealing from their children, by demanding the Government fund an aged pension which is marginally above subsistence level.
So let me introduce the PM to these so called thieves.
They are the people who started work prior to the late 60’s, and are already in receipt of the pension or who will shorty qualify.
When they started work wages were low and prices were high, with wages for juniors and women doing the same work being even lower – often substantially so.
When they started work and for most of their working lives consumer prices for essentials, as a proportion of actual net income were significantly higher. That is, no cheap throw away Chinese shoes, clothing, electrical goods and the like. For instance, if you wanted a TV you either had to save for over a year to get one, or rent one, or take a chair to the local TV store and sit in front of the display window so you could watch your favourite program for free. Then of course if owned a TV or a radio you had to pay for a licence, and inspectors were employed to ensure you had one
Whereas today first home buyer expects all the bells and whistle to be in included in the initial purchase price (floor coverings, new furniture, all the electrical necessities – TV, DVD player, CD player etc. central heating and air-conditioning, the list goes on and on, and on and on), when pensioners bough their first home, it was usually little more than as shell. Old sheets for curtains, no floor coverings, basic second hand furniture usually donated by family, with the only luxuries being a fridge and washing machine, usually bought on hire purchase, which had to be paid off before you bought other luxuries like a TV, toasters and other kitchen appliances, carpets, a hot water service and the like. I can still recall heating water in an old copper so we could have a bath (no shower) with everyone using the same bath water, because it wasn’t until 10 years after my parents bought their first home that they could afford buy and install a hot water service; and that was in the 1960’s
Then of course there were home deposits and interest rates. It was a time when people were expected to save at least a 25% deposit before you could even apply for a loan, with interest rates regulated, if memory serves, at 12.5%, and before you could get the loan you actually had to have purchased the house using bridging finance at a significantly higher interest rate, because the actual home loan application approval process usually took a year or more.
Then of course there were those with children. No paid parental leave, no baby bonus, no family supplement, no subsidised childcare, no subsidised after school care. Instead women were expected to leave the workforce as soon as they fell pregnant and if they didn’t leave voluntarily they got the sack. So to make ends meet, fathers more often than not were expected to, if available, to work significant overtime, and if not, find a second part time job to compensate for the drop in family earnings. Then once the children were of school age, mum could only work part time because the expectation was mum would be home before the kids got home from school. Then of course there were school holidays.
Then let’s not forget the fact that, for most, the Super Guarantee came far too late, in that it came into existence in the last half to quarter of their working lives, with most of what they were actually able to save being decimated during the GFC - and with little, if any, residual working life left to rebuild what was lost. I lost over half overnight.
Finally and most telling, when these people asked how in his environment (high personal income tax rates, high prices for every day consumer products, little if any assistance for families forcing people work long hours or a second job just to make ends meet let alone save), were they expected to save enough to retire on, the answer from successive LNP and Labor governments was “you work so hard and pay so much, and get so little in return, so we can guarantee, let me say that again “GUARANTEE”, that when you are no longer able to work, we can afford to pay you enough, so you can get by.
Yes there is intergenerational theft going on, but who is the thief. Is it the pensioner who is now only saying, return to me what paid, and you guaranteed to return when I needed it. Or is a government who wants to reduce pensions to below a subsistence level, so that they can continue to afford to provide to others those election winning benefits which pensions did without. Things like baby bonuses, family benefits, subsidised child and after school care, paid maternity leave, historically the lowest rate of personal income tax ever and historically the lowest interest rates ever, and to help pay for it, pensioners should accept an cut to aged pension so it will ultimately it below subsistence level. But then that their fault because if they wanted better, they should have saved more.
