National Seniors CEO, Michael O’Neill, at the ‘PAC meets Parliament’ forum yesterday.
By Stephen Easton
New research reveals that older Australians feel they can scarcely afford to retire with the impact of the global financial crisis, but while many are happy to continue working, age discrimination is making that difficult.
Older Australians have kept working, cut spending, shifted to conservative investments or just battened down the hatches to ride out the storm ravaging their retirement nest eggs, according to a report launched in Canberra yesterday by the Minister for Financial Services and Superannuation, Bill Shorten.
In a relaxed, light-hearted speech peppered with jokes and personal anecdotes, Mr Shorten pointed out that figures for workforce participation among over-55s in Australia had improved to be well over the average for countries in the Organisation for Economic Cooperation and Development (OECD).
But he also noted that “people can’t afford to retire [and] people don’t want to retire”, and that there was still a lot of room for improvement, by removing the many age discrimination barriers that still stood in the way of older people contributing.
“Older people turn up to work on time, take less ‘sickies’; they are loyal, reliable and patient and to be blunt, they just know more than their younger compatriots,” Mr Shorten said.
Above: Minister for Financial Services and Superannuation, Bill Shorten, who is also the Minister for Employment and Workplace Relations.
The report, Financial Wellbeing: Concerns and choices amongst older Australians, is based around a survey of 3,500 people aged 50 and over, conducted through a collaboration between researchers from the Australian National University and the National Seniors Australia Productive Ageing Centre (PAC).
National Seniors chief executive, Michael O’Neill, said the findings were “consistent with the stories his organisation hears every day”.
“The over-50s are feeling pretty powerless at the moment. All they can really do is batten down the hatches and wait for this market volatility to pass,” he said in a statement released before the event.
“Unfortunately, they’ve been waiting since 2007, which has meant either delaying retirement, moving back into the workforce or cutting household spending. The biggest worry is that ultimately, they’re not going to have enough in retirement.
“Retirees who moved into safe investments to protect their capital, like term deposits, are now are dealing with diminished returns from falling interest rates.
“The key message to government is that we’re seeing a great deal of uncertainty and some loss of confidence in the system. Now is not the time to chop and change on retirement income or superannuation policy.”
One of the report’s authors, Dr Tim Higgins, presented some of the findings and also some of his own personal opinions, which he stressed were not those of National Seniors or his co-author, Dr Steven Roberts.
In Dr Higgins’ view, preservation of capital is paramount for those in retirement, and he suggested that the default for superannuation funds should be to focus on security rather than growth.
He also suggested that as the purpose of superannuation was to “smooth consumption over the life course”, annuities should be compulsory, removing the option for lump sum payouts.
The director of the National Seniors PAC, Dr Jeromey Temple, presented other research data on the personal and structural barriers to employment faced by older people, and levels of unemployment and under-employment in this age group.
Yesterday’s forum, called ‘PAC meets Parliament’, also featured speeches and question-and-answer sessions with the Age Discrimination Commissioner, Susan Ryan, and prominent progressive social commentator Phillip Adams, among others.
Another session featured Minister for Ageing, Mental Health and Social Inclusion, Mark Butler, and the shadow minister for seniors, Bronwyn Bishop, who confirmed she would sit in cabinet if the Coalition won the next election, and that Minister Butler’s shadow alternative, Concetta Fierravanti-Wells, would be in the junior ministry.
Some key findings from the report commissioned by National Seniors:
- 50 per cent of workers have delayed or intend to delay retirement to protect themselves
- Having a mortgage increases likelihood of delaying retirement by 20 per cent
- 75 per cent have cut back spending
- 68 per cent of workers say their greatest financial concern is that their savings won’t keep up with inflation
- 60 per cent of those who moved to cash or conservative investments listed ‘the GFC or volatile markets and the need to preserve capital’ as the reason
