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Hands off the Pension Campaign Launched by COTA

Leading seniors advocate COTA Australia today launched its Hands off the Pension campaign against proposed changes to the age pension.

COTA Australia CE Ian Yates said  Hands Off the Pension was in response to the unprecedented level of feedback COTA is receiving from older people deeply worried about how they will manage if the changes announced by Treasurer Hockey in the May Budget come into effect.

Mr Yates said that while older people will be hit by the freezing of eligibility thresholds, changes to deeming rates and increasing the qualifying age to 70, they are most worried about the proposed changes to indexation.

“Changing indexation from a percentage of average weekly earnings to CPI only will dramatically reduce the standard of living for over 2.4 millionAustralian Pensioners,” Mr Yates said.

“Pensioners already struggle to make ends meet and they simply don’t have any way to make up the difference should their pension income decline.

“Cutting indexation to CPI only will mean a big and growing cut to the pension over time and will result in many Pensioners spiraling into poverty, ill health and even homelessness.

“If only the CPI had been used since 2009 the Pension would already be $30 per week or $1,560 per year less, and that gap grows to over $80 per week / $4,160 per year in 10 years, and keeps growing.

“That’s a huge amount for Pensioners who already often have to make choices between heating, decent food, medications and a basic gift for their grandchild’s birthday.

“This measure is extremely harsh and goes beyond even that which was recommended by the Commission of Audit.

“Pensioners just don’t understand why the Abbott Government has targeted them in this way while hundreds of thousands of well off people continue to get superannuation tax concessions bigger than the value of the  pension.

“These cuts are not the result of any public inquiry or proper policy process; they have not been justified, explained or consulted  on;  and Pensioners believed Mr Abbott when he promised them in the 2013 Federal election that there would be no changes to the pension.”

Mr Yates said COTA is calling on the Government to withdraw all proposed changes to the pension while a Retirement Incomes Review is conducted. If not then COTA is urging the Senate to reject all the changes.

“At the moment there are big winners and even bigger losers when it comes to how taxation, pensions and superannuation policies interact, which many people do not understand.

“It’s time we took the lid off an unfair system and had a proper look at all the opportunities and challenges of the ageing population and how we plan for retirement incomes into the future.

“The Review needs to be a public process involving consumer representatives and all stakeholders, and include pensions, superannuation and the taxation treatment of retirement assets and income.

“Current ad-hoc approaches to retirement income policy usually impact most on those who can least afford it and must stop. The proposed changes to the pension must be taken out of the mix while this full review is undertaken.”

 

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