Age Pension poverty prompts call for urgent review

21 Jul 2020

Posted March 27, 2018

Federal Member for Mayo Rebekha Sharkie wants a better deal for people receiving the Age Pension to stop vulnerable elderly Australians from slipping into poverty.

Yesterday the NXT MP backed the Benevolent Society’s Fix Pension Poverty Campaign and spoke in Parliament about the need to increase rent assistance for the growing number of older Australians who do not own their home.

Rebekha also called on the Government to establish an independent tribunal to assess the base rate of the Age Pension in order to determine the best mechanism for annual review.

“Unfortunately there are big changes underway in the Australian economy and this is eroding our ability to keep our elderly residents out of poverty,” Rebekha said.

“I’m particularly concerned about this issue because I have the oldest electorate in South Australia and the eighth oldest electorate in the country.

“The Government should be taking steps now. The number of people on the Age Pension is growing disproportionally larger than the number of people working.

“But what is even more worrying is the rapidly declining rate of homeownership in Australia.

“What we are seeing is more and more people moving onto the pension who no longer have the family home, or any home, and have been renting for much of their lives. Many of these are women without superannuation or other savings.

“Not owning your own home has a profound impact on an older person’s ability to survive on the Age Pension.

“In 2015 the difference in expenditure on housing between homeowners and renters of over 65 years of age was dramatic.

“The average fortnightly expenditure on housing for renters was over $300, whereas homeowners spent less than $40 on repairs and their remaining mortgage payments.”

The maximum basic Age Pension is $794.80 per fortnight for a single and $599.10 for per person in a couple.

These payments are supplemented by Commonwealth Rent Assistance (CRA) for elderly residents renting privately.

The maximum rate of CRA is $130.40 per fortnight for singles and $122.80 per fortnight per person a couple.

Rebekha also called on the Government to establish a roundtable to review services to people on the Age Pension.

“Almost a third of the 1.5 million older Australians on the Age Pension are living in poverty, going without food, turning off the heating and skipping medications to make ends meet,” she said.

“The Age Pension is not welfare.

“I would argue that it should be managed separately to Centrelink, as it is a payment for older Australians who have worked and contributed to our community.

“It is also quite different to working-age payments such as Newstart which is a temporary payment where future employment is the goal.

“People receiving the Age Pension have little future opportunity to earn more money.”

The Benevolent Society’s Executive Director Strategic Engagement, Research and Advocacy Dr Kirsty Nowlan this week thanked Rebekha for highlighting the inadequacy of the Age Pension in the Parliament.

“It’s heartening to see our friends in Parliament support the campaign to address the poverty experienced by too many people living solely on the Age Pension,” Dr Nowlan said.

“Our 2016 research showed that older Australians are being forced to choose between mashing food or finding money to see the dentist because they are struggling for funds.

“We heard from others who are turning the hot water off because they can’t afford their energy bills. This is an embarrassment in a rich country like Australia.

“The Benevolent Society thanks Rebekha Sharkie and commends her for bringing these issues to Parliament, supporting our initiatives and advocating for changes that would make a real difference to the lives of many older Australians.

The Benevolent Society released The Adequacy of the Age Pension in Australia report in September 2016.

About the Age Pension in Australia

  • The Age Pension is a universal means-tested payment. It is universal in that eligibility does not depend upon prior contributions.
  • As of September 2017 (latest available data) there were 1,552,340 full rate Age Pension recipients and 931,669 part Age Pension recipients.
  • More than 10% of the older Australian population receives the Age Pension.
  • It is the primary source of income for over 6% of the population.
  • The qualifying age is going up from 65 to 67 over the next seven years. The Liberal Party policy is to increase the qualifying age further to age 70, but this has not been passed by the Parliament.

Statistics for South Australia and the electorate of Mayo

  • South Australia had 306,587 people aged 65 years or over in 2016 representing 18.3% of the population.
  • The median age of people in South Australia was 40 years. Children aged 0 - 14 years made up 17.5% of the population.
  • The South Australian areas with the highest proportions of their populations aged 65 years or over were all located on the South Australian coast at Goolwa-Port Elliot (57.6 median age) Victor Harbor (57.2), Yorke Peninsula – South (55.5), Yorke Peninsula North (54.4) and Moonta (54.3).
  • In the 10 years to 2016, Goolwa-Port Elliott had the second-largest increase in median age, up 7.3 years. Quorn-Lake Gilles had the largest increase, up 7.3 years.
  • Mayo is the oldest electorate in South Australia and the eighth oldest electorate in the country.
  • The top three oldest electorates are Lyne and Gilmore in NSW and Hinkler in Queensland.
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