Regional pension crisis looms amid calls to end age discrimination
As seen in The Border Mail, 17 October 2017
Age discrimination in the workforce needs to end to combat a growing aged pension crisis in the country’s oldest regions, according to the Regional Australia Institute.
A RAI report has found there is lower growth, lower incomes and a higher welfare services bill in aging regions which are increasingly reliant in the pension.
The report said some regions already had more than 20 per cent of their populations reliant on the age pension.
The 2016 census showed while aging was stable in metropolitan cities, it is accelerating in many regions, particularly rural areas and coastal communities.
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 $51 billion by 2020.
The report said raising workplace engagement among older workers was an effective way to offset negative economic impacts of an ageing population. RAI chief executive Jack Archer said attitudes towards older workers needed to change or regions risked stagnating, with older workers often facing discrimination. .
“Frankly (regions will) struggle to grow and they will be increasingly reliant on government benefits for local incomes,” Mr Archer said.
“They risk losing their independence if too much of the population relies on the pension.
“I think the starting point at the moment is that you’re better off having younger workers … it’s all part of a broader, costly attitude in society about what older Australians can bring to society.
“Maybe that’s an overhang from when jobs were more likely to be highly physical.”
The report said if older employment increased across regions like Hume, spending in those local economies could be boosted by $30 million each. Age Discrimination Commissioner Kay Patterson said many older Australians who were willing to work were 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,” she said.
Mr Archer called on governments to engage in more comprehensive regional trials of incentives, tailored to specific regions, which would better engage people in the 55-64 year old age group.
He said employment services could prioritise older workers and schemes such as pensions work bonus should be considered, as well as testing rules around superannuation.
“I think if we can identify a group of older people in the community who would like to work and see how we can connect them to local opportunities,” Mr Archer said.
“There’s an incredible amount of experience in the 55- 64 age bracket … we need to know how to tap into that experience and maybe pair them up with younger workers.
“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.”
Experience brings benefits
The Murray region has ranked as one of the highest employers of mature-aged workers, however new information suggests national action needs to be taken to prevent Australia’s pension crisis from worsening in regional areas.
One of the concerns raised in the Ageing and work in regional Australia: Pathways for accelerating economic growth conducted by The Regional Australia Institute is the mindset of “unemployability” some employers have about mature aged workers.
Proprietor for Griffith City Hire Gary Rennie has been a strong proponent of hiring mature-aged workers, and speaks about the benefits working seniors bring.
“There was a time where we tended not to consider older guys, for the reason that this can be quite a physically demanding job,” Mr Rennie said.
“(But) mature-aged workers have the skills base, their knowledge is unbeatable, and the know-how they can pass on is highly regarded.”
The report details suggest enabling greater workforce participation among older Australians will take a mix of policies aiming to empower older workers to stay in their jobs for longer.
The report also outlines programs and incentives to help make it “easier for those out of work to take advantage of new opportunities.”
While the report outlines benefits to regional economies, it also details the current disincentives seniors face for working certain hours in regards to superannuation and lack of access to income protection insurance beyond the age of 65.
Despite these disincentives, many mature age workers cannot afford to stop working even after the legal retirement age.
Sixty-four-year-old Charlie Miller, who has been working for Mr Rennie for a year and a half, says he absolutely loves working, but even if he could retire he wouldn’t be able to afford it.
“I’m a long way off retiring, we still have a mortgage to pay off,” he said.