Concern over pension cuts

TasCOSS and a Northern self-funded retiree agree that the federal government's proposed paid parental leave scheme should be reconsidered, over cuts to the age pension.

Treasurer Joe Hockey mooted a further increase in the pension age, more welfare means-testing and co-payments for medical services, during a speech in Washington last week, ahead of the federal budget.

The pension age is 65 and is due to rise to 67 by 2023.

The federal opposition argued that the government was preparing to break its pre-election promise that there would be no cuts to the age pension.

Tasmanian Council of Social Service chief executive Tony Reidy said any potential further increase in the pension age was a concern.

He said it was already difficult for older people to retain or obtain work.

``There is already a very high level of poverty among older Australians being forced to live on the Newstart Allowance, which is currently about $35 a day,'' Mr Reidy said.

``It makes no sense when considering the national fiscal position, to be talking about reducing income support to those who most need it.

``When at the same time, we are seeing promises of increases in middle class welfare, such as the government's intent on providing maternity leave to people earning up to $150,000 a year.''

The proposed paid parental leave scheme, to begin on July 1, 2015, will cost about $5.5 billion a year.

Recipients would be paid their full wage for six months, capped at an annual salary of $150,000, or $75,000 for six months.

Northern Tasmanian branch president Graeme Barwick, of the Association of Independent Retirees, also questioned the generosity of the paid parental leave scheme.

``The North Shore lawyer who earns $150,000 a year, she should not get $75,000 from the public purse,'' he said.

``I would cut paid parental leave, that is a bit generous.''

However, Mr Barwick, 76, argued that the age pension should be seen as a supplement to savings made during one's working life.

He said the ``age of entitlement'', where people expected the government to fund almost everything from the doctor to a roof over their head, was probably over and people had to start taking some responsibility for their own retirement.

Mr Barwick suggested an increase in the GST was one way for the government to increase revenue.

Mr Reidy said that there needed to be serious national discussion on tax reform, in order to tackle the revenue problem.

Email: ctang@examiner.com.au

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