National pension crisis accelerating in regions
In a preview of what is coming for the nation, Australia’s oldest regions are experiencing a growing pension crisis with some regions already having 20 per cent of the population reliant on the age pension.
Lower growth, lower incomes and a higher welfare and services bill are the results for these regions. This is the finding of new Regional Australia Institute research on ageing and the workforce in regional Australia released today.
To counter the problem, the report recommends that government engage in more comprehensive regional trials of incentives and other support for older workers in worst affected regions.
“High migration is temporarily keeping the cities young, but this won’t last.” CEO of the Regional Australia Institute Mr Jack Archer said.
“We don’t yet know how to deal with the impacts of a really aged workforce. We say let’s test the options in the places already experiencing the issues, help them to make progress, and prepare
Australia properly for the wider crisis that is coming nationally.”
Age Discrimination Commissioner, The Hon Dr Kay Patterson AO in supporting the proposals said “There are many older Australians who are willing and able to work, but are often overlooked as candidates. It is important that society push back against discrimination, and allow older people a place in the national workforce so they too can enjoy the dignity, purpose and independence that work brings.”
The good news is that the Regional Australia Institute’s work shows if we can engage a higher proportion of older people in work, a significant lift to local incomes, economic growth and a lower pension bill for the government should follow.
- The 2016 Census shows that ageing is accelerating in many regions but stable in the cities. Since 2011, the median age for both Sydney and Melbourne didn’t budge from 36 while rising in NSW and Victoria from 41 to 43.
- The Aged Pension is already the largest expenditure item in the Federal Budget at $45 billion annually, and if nothing changes, it is forecast to blow out to an unsustainable $51 billion by 2020.
- Victor Harbor, Port-Macquarie-Hastings, and East Gippsland already have 20 per cent or more of the population reliant on the age pension.
- If we can lift older employment across regions like the Central Coast and Hume, this will increase spending in their local economies by $30 million each.
Further information can be found in the report Ageing and work in regional Australia: Pathways for accelerating economic growth and Data Tool.