Retirement Income

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Why the government is persisting on cashless debit cards for welfare recipients

<p>It would be nice if the “facts” being thrown around in the debate over the Cashless Debit Card were peer-reviewed, or even just evidence-based.</p> <p>Instead, there are <a href="https://www.anneruston.com.au/joint_media_release_expanding_the_cashless_welfare_in_hervey_bay_and_bundaberg">anecdotes</a>. And it’s these that are being used to justify the government’s decision to spend <a href="https://parlinfo.aph.gov.au/parlInfo/download/chamber/hansards/91962b64-398e-400e-ae19-98cf415623ec/toc_pdf/Senate_2019_07_31_7091_Official.pdf;fileType=application%2Fpdf">A$128.8 million</a> over four years continuing the existing trial of the cashless debit card in five sites in Western Australia, Queensland and South Australia and extending it to Cape York and all of the Northern Territory.</p> <p>The extension will lift the number of people on the card from 11,000 to 33,000. Most will be Indigenous people - its disproportionate targeting has already attracted the attention of the <a href="http://docs.wixstatic.com/ugd/b629ee_01e1002bbfc748459d2a323d278d9300.pdf">National Congress of Australia’s First Peoples and the Human Rights Commission</a>.</p> <p>The cashless card was recommended to Prime Minister Tony Abbott in a <a href="https://www.niaa.gov.au/sites/default/files/publications/Forrest-Review.pdf">report</a> from mining billionaire Andrew Forrest in 2014. He initially called it the “<a href="https://theconversation.com/healthy-welfare-card-begins-here-where-next-50756">Healthy Welfare Card</a>”.</p> <p>It wasn’t a new idea. Some A$1 billion dollars had already been spent on income management programs in the past, many of which had <a href="https://caepr.cass.anu.edu.au/highlights/evaluating-new-income-management-northern-territory-final-evaluation-report-and-summary">failed to meet their stated objectives</a>.</p> <p><strong>It’s been tried before</strong></p> <p>The biggest was the Basics Card introduced as part of the 2007 Northern Territory Emergency Response (the “<a href="https://en.wikipedia.org/wiki/Northern_Territory_National_Emergency_Response">Intervention</a>”) which was only made possible through the suspension of the Racial Discrimination Act.</p> <p>Research published by the Australian Research Council funded <a href="https://www.arc.gov.au/2020-arc-centre-excellence-children-and-families-over-life-course">Life Course</a> Centre of Excellence found its introduction was correlated with negative impacts on children, including reductions in <a href="https://www.lifecoursecentre.org.au/research/journal-articles/working-paper-series/do-welfare-restrictions-improve-child-health-estimating-the-causal-impact-of-income-management-in-the-northern-territory/">birth weight</a> and <a href="https://www.lifecoursecentre.org.au/research/journal-articles/working-paper-series/the-effect-of-quarantining-welfare-on-school-attendance-in-indigenous-communities/">school attendance</a>.</p> <p>It points to several possible explanations, including increased stress on mothers, disrupted financial arrangements within households, and confusion about how to access funds.</p> <p>The government has not addressed these serious issues. Instead, it now seeks to place those who have been left on the basics card for over ten years now, on to the cashless debit card.</p> <p><strong>What was ‘Basics’ has become ‘Indue’</strong></p> <p><img src="https://images.theconversation.com/files/167621/original/file-20170503-4096-12pb3xf.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt="" /> <span class="caption">The 2016 Indue Cashless Debit Card.</span> <span class="attribution"><span class="source">indue.com.au</span></span></p> <p>The “Indue” Cashless Debit Card trials underway since 2016 direct 80% of each payment to the card (<a href="https://www.niaa.gov.au/sites/default/files/publications/Forrest-Review.pdf">Forrest asked for 100%</a>) where it can only be spent on things such as food, clothes, health items and hygiene products. Purchases of alcohol and withdrawals of cash are not permitted.</p> <p>The trials are compulsorily for everyone living in the trial sites receiving a disability, parenting, carer, unemployment or youth allowance payment.</p> <p>My own research in the East Kimberley found it makes those people’s <a href="https://openresearch-repository.anu.edu.au/handle/1885/147866">lives harder</a>.</p> <p>Those targeted are a broad group needing support for a broad range of reasons, yet all are treated as if they have issues with alcohol or drugs or gambling.</p> <p>Most of the people on it do indeed have a common problem: that is trying to survive on meagre payments in remote environments with a chronically low supply of jobs.</p> <p>Of all the claims made for the card, the least believable is that it gets its users into jobs.</p> <p>What it does do is limit access to cash needed for day to day-to-day living. It makes it hard to buy second-hand goods, transport and (at some outlets) food, and can make living more expensive.</p> <p>For anyone actually struggling with addiction, it can’t substitute for treatment, a concern raised by medical specialists.</p> <p>While the government says the trials have been community-led, in reality consultation has been limited to a small group of people not subject to the card.</p> <p>When leaders in the East Kimberley who had agreed to the card <a href="https://www.theguardian.com/australia-news/2017/aug/23/aboriginal-leader-withdraws-support-for-cashless-welfare-card-and-says-he-feels-used">withdrew their support</a>, the government continued with the trial.</p> <p><strong>Its success has not been established</strong></p> <p>In addition to relaying on anecdotes, the government continues to cite a <a href="https://www.theguardian.com/australia-news/2017/sep/18/cashless-welfare-card-report-does-not-support-ministers-claims-researcher-says">widely condemned report</a> by <a href="https://www.dss.gov.au/about-the-department/feature/cashless-debit-card-trial-evaluation-final-evaluation-report">Orima Research</a>. Among others, the Australian National Audit Office <a href="https://www.anao.gov.au/work/performance-audit/implementation-and-performance-cashless-debit-card-trial">found this report was inadequate</a> to draw any conclusions from.</p> <p>Profiting from the Cashless Debit Card has been <a href="https://www2.indue.com.au/">Indue</a>, a private company whose <a href="https://nationals.org.au/our-team/federal-management-committee/">deputy chairman</a> up until 2013 is now the present President of the National Party, Larry Anthony.</p> <p>Indue’s involvement is helping to create a <a href="https://www.researchgate.net/publication/285590411_Is_the_Cashless_Welfare_Card_the_forerunner_to_a_Banking_Underclass">two tiered banking system</a> in which most people have a choice of financial providers, but those subject to the card are restricted to one, which provides a very different product to the others.</p> <p>Indue is also not a member of the Australian Banking Association, and so is not bound by the consumer protection provisions of its <a href="https://theconversation.com/the-new-banking-code-looks-impressive-but-what-will-it-achieve-120582">Banking Code of Practice</a>.</p> <p>The inquiry is due to report <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Community_Affairs/CashlessCardTransition">next week</a>. Given the expensive and harmful consequences of the trial, it ought to find the extension is not justified. There are better ways to spend $128.8 million that would actually help vulnerable Australians.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/123763/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Elise Klein (OAM), Senior Lecturer in Development Studies, University of Melbourne</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/theres-mounting-evidence-against-cashless-debit-cards-but-the-government-is-ploughing-on-regardless-123763" target="_blank"><em>The Conversation</em></a><em>. </em></p>

Retirement Income

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Growing numbers of renters are trapped for years in homes they can't afford

<p>Low-income tenants in Australia are increasingly likely to be trapped in rental stress for years. <a href="https://www.pc.gov.au/research/completed/renhters/private-renters.pdf">New evidence</a> from the Productivity Commission shows almost half of such “rent-burdened” private tenants are likely to remain stuck in this situation for at least half a decade.</p> <p>Rental stress is where a low-income tenant faces housing costs that leave them without enough income for food, clothing and other essentials. The scale of the problem – <a href="https://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/1370.0%7E2010%7EChapter%7ERental%20stress%20(5.4.2.1)">commonly defined as when rent eats up more than 30% of income</a> – is usually presented as a “point in time” or snapshot statistic.</p> <p>As the Productivity Commission report reveals, the snapshot number in this situation has increased from 48% of low-income renters in 1995 to 54% in 2018. That’s around 1.5 million people pushed into poverty by high housing costs.</p> <p>For some, of course, this will be only a temporary problem. On this basis, it is sometimes argued that concerns over Australia’s high rate of rental stress are overstated.</p> <p>However, the Productivity Commission report, <a href="https://www.pc.gov.au/research/completed/renters/private-renters.pdf">Vulnerable Private Renters: Evidence and Options</a>, highlights longitudinal survey evidence showing that a low-income tenant’s experience of rental stress is increasingly likely to be long-term – not a passing problem. As the commission notes:</p> <blockquote> <p>[…] a growing number of households find themselves stuck in rental stress.</p> </blockquote> <p><strong>What is the evidence for this?</strong></p> <p>This conclusion stems from a comparison of two different tenant cohorts experiencing rental stress as revealed by survey data for 2001 and 2013. Less than a third (31%) of the 2001 cohort remained in stress five years later. But almost half (46%) of the 2013 cohort were.</p> <p><a href="https://images.theconversation.com/files/296994/original/file-20191015-98657-1evkw2.PNG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/296994/original/file-20191015-98657-1evkw2.PNG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="" /></a> <span class="caption">While many people exit rental stress quickly, the proportion of private. low-income renters in long-term rental stress has increased significantly.</span> <span class="attribution"><a href="https://www.pc.gov.au/research/completed/renters/private-renters.pdf" class="source">Vulnerable Private Renters: Evidence and Options, Productivity Commission</a>, <a href="http://creativecommons.org/licenses/by/4.0/" class="license">CC BY</a></span></p> <p>So, it’s not just that more low-income earners are paying unaffordable rents at a particular point in time. This is increasingly a situation that affected private tenants cannot escape.</p> <p>Beyond the obvious welfare impacts, <a href="https://cityfutures.be.unsw.edu.au/documents/515/Full_Report_Final_edited_logos.pdf">recent work</a> argues that excessive rent burdens may also damage human capital and, as a result, reduce economic productivity.</p> <p>The commission’s findings seem to suggest the ongoing restructuring of Australia’s labour market and housing system is eroding socioeconomic and/or housing mobility. The report notes the significant fall in the numbers who manage to move from renting to owning – from 13.6% of renters in the period 2001-04 to 10.0% from 2013-16.</p> <p>Perhaps slightly more surprising is the commission’s explanation for the rising rate of (point in time) rental stress for all low-income tenants. According to the report, this results not from increasing unaffordability for the <em>private renter</em> cohort specifically, but from the growing dominance of private rental housing as <em>the tenure in which low-income households live.</em></p> <p><a href="https://images.theconversation.com/files/296993/original/file-20191015-98661-b2ne0v.PNG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/296993/original/file-20191015-98661-b2ne0v.PNG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="" /></a> <span class="caption">The number of private renters has grown as the proportions of owner occupiers and public housing tenants have fallen.</span> <span class="attribution"><a href="https://www.pc.gov.au/research/completed/renters/private-renters.pdf" class="source">Vulnerable Private Renters: Evidence and Options, Productivity Commission</a>, <a href="http://creativecommons.org/licenses/by/4.0/" class="license">CC BY</a></span></p> <p> </p> <p>This, of course, results from the post-1990s <a href="https://theconversation.com/australia-needs-to-reboot-affordable-housing-funding-not-scrap-it-72861">failure of Australian governments</a> to expand the supply of social housing to match population growth. By 2018, well over two-thirds (71%) of low-income tenants were <a href="https://www.pc.gov.au/research/completed/renters/private-renters.pdf">renting in the (relatively expensive) private market</a> – rather than from a (rent-limiting) social landlord. Back in 1996, barely half (52%) of them were renting privately.</p> <p><strong>What does this mean for policy?</strong></p> <p>The report presents some useful discussion of possible policy directions.</p> <p>For example, while dismissing rent control as liable to advantage existing tenants at the expense of potential tenants, the report is implicitly critical of residential tenancy laws in most states and territories.</p> <p>The report advances the broad case that <a href="https://theconversation.com/an-open-letter-on-rental-housing-reform-103825">tenancy law reforms</a>, “if well designed”, can enhance tenant welfare “without substantially increasing the cost of renting”. Longer notice periods are particularly favoured because these will “provid[e] vulnerable families more time to find new accommodation and prepare for the move”.</p> <p>Slightly more controversially, the commission strongly hints at support for outlawing no grounds evictions. The landlord power to end a tenancy without any need to justify the move persists across most states and territories. Discussing this power the report states:</p> <blockquote> <p>It increases the bargaining power of landlords […] and decreases that of tenants. Landlords’ incentives to carry out obligations, such as repairs and maintenance, decrease when no grounds evictions are available, since this provides them with an avenue to terminate leases in the event of a dispute.</p> </blockquote> <p>However, having highlighted a private rental affordability problem that is both growing in scale and becoming demonstrably more entrenched, the report is timid on solutions beyond modestly improving tenancy conditions.</p> <p>It argues in general terms for an increase in <a href="https://www.dss.gov.au/housing-support/programmes-services/commonwealth-rent-assistance">Commonwealth Rent Assistance</a> but – beyond tentatively floating a 10% rise in maximum payments – advances no specific proposal.</p> <p>Expanding the social housing stock as part of the broad-ranging housing strategy Australia badly needs is scorned as “an expensive option”. This is a reference to the narrowly scoped analysis in the commission’s <a href="https://www.pc.gov.au/inquiries/completed/human-services/reforms/report/human-services-reforms.pdf">2017 Human Services report</a>. It favoured market solutions to provide low-income housing – on efficiency grounds.</p> <p>The “expensive option” assertion is out of line with the more broadly framed analysis of the Productivity Commission’s predecessor, the Industry Commission. The latter <a href="https://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id:%22publications/tabledpapers/HPP032016005137%22;src1=sm1">concluded</a>:</p> <blockquote> <p>Public housing and <a href="https://www.ahuri.edu.au/policy/ahuri-briefs/what-is-head-leasing">headleasing</a> [when social housing providers sublease private rental properties] are assessed to be more cost-effective than cash payments and housing allowances.</p> </blockquote> <p>While the Industry Commission report admittedly dates from 1993, the subsequent failure of overwhelmingly private provision for low-income renters surely presents compelling reasons to revisit the investment case for social housing.</p> <p><em>Written by <span>Hal Pawson, Associate Director - City Futures - Urban Policy and Strategy, City Futures Research Centre, Housing Policy and Practice, UNSW</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/growing-numbers-of-renters-are-trapped-for-years-in-homes-they-cant-afford-125216" target="_blank"><em>The Conversation</em></a><em>. </em></p>

Retirement Income

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Scam alert: ATO warns of text fraud

<p><span>The Australian Taxation Office has issued a warning about an SMS scam that asks people to update their personal details through a fake myGov link.</span></p> <p><span>In an example scam text that the ATO shared, the message reads: “Last warning update your details”.</span></p> <p><img style="width: 500px; height: 281.25px; display: block; margin-left: auto; margin-right: auto;" src="https://oversixtydev.blob.core.windows.net/media/7832295/tax-embed.jpg" alt="" data-udi="umb://media/f475bd5fab1a4c1eba6e8afead75ad61" /></p> <p style="text-align: center;"><em>Source: ATO</em></p> <p><span>“The website instructs users to login to what looks like their myGov account,” the ATO said on its <a href="https://www.ato.gov.au/general/online-services/identity-security/scam-alerts/#October">website</a>. “It then asks them to update their bank and credit card details. Do not click on these links and do not disclose the information requested.”</span></p> <p><span>The ATO said it will never send an email or text message asking to access online services via a link.</span></p> <p><span>Australians are urged to manage their tax affairs in ATO online services through their genuine myGov account, which is accessible at <a href="https://my.gov.au/">my.gov.au</a>. </span></p> <p><span>If you or someone you know has paid or provided sensitive personal information to a scammer, or if you are unsure whether an ATO communication is genuine, call the ATO on 1800 008 540 to report or verify.</span></p>

Retirement Income

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Thinking about downsizing? Here’s what you need to know

<p><span>After the initial relief of your children leaving the nest, you might find you’re left with a home that’s too big to make the most of. It can be hard to let go of a family home, especially if you’ve been living in the same place for many years. Plus, selling your home and finding a new one can sound like too much of a hassle.</span></p> <p><span>However, there’s definitely a range of benefits to downsizing and a number of signs that might be telling you that it’s time. Selling your home can be a long process, but by following a few steps and getting help from the right people, you’ll be ready in no time. </span></p> <p><strong>Is it time to downsize?</strong></p> <p><span>If your children have all moved out and you’re finding it hard to maintain your home or use up all the space, this is usually the biggest sign that it’s time to downsize. A smaller home will be easier to take care of. Moving might also give you the option to live closer to family and friends, or closer to certain amenities. </span></p> <p><span>Another huge reason why many people downsize is the increase in cash flow. You may be able to reduce or eliminate your mortgage entirely. For those who have already paid off property, you might still be able to make a profit, giving you more freedom to enjoy the finer things in life. </span></p> <p><span>On the flip side, downsizing might not be for everyone. If you enjoy having more space, it could be worth it for you to stay in your current home. You might also find that living in a smaller property or in your desired location, won’t actually work out cheaper for you. If you have age pension entitlements, you should also look into whether these will be affected if you move.</span></p> <p><strong>How to sell your home</strong></p> <p><span>Before selling a home, you’ll want to get to know your local market; see whether it’s currently a sellers’ market, compare similar properties to <a href="https://www.openagent.com.au/openestimates">find out how much your home is worth</a> etc. </span></p> <p><span><a href="https://www.openagent.com.au/openestimates"><em>Find out what your home is worth in today’s market.</em></a> </span></p> <p><span>When you sell your home, finding a top real estate agent should be high on the priority list. We truly believe that finding the right agent helps to reduce stress throughout the selling process <em>and</em> helps you to sell your home for more. When <a href="https://www.openagent.com.au/">finding a local agent</a>, look for someone who understands your needs, has an intimate knowledge of your area, a proven track record for selling properties like yours and the emotional intelligence to communicate and deal with potential buyers effectively.</span></p> <p><span><a href="https://www.openagent.com.au/smartsearch/"><em>Find and compare top local agents now. </em></a></span></p> <p><span>Once you’ve got an agent on board, you’ll need to prepare your property for sale and put together a marketing plan. Getting your home ready could involve decluttering, cleaning, renovating etc. Your chosen agent will be able to give you advice on what needs to be done to your home to get a bumper sales price. Your agent will also work with you to market your property whether it be with professional photography, advertising in newspapers, advertising online, or a mixture of different methods. </span></p> <p><span>Finally, your agent will need to secure a buyer, negotiate and deal with all the legalities. For instance, you’ll need a Contract of Sale and Vendor’s Statement that lay out the terms, conditions, property details etc. You’ll then need to prepare for settlement by making sure all terms and conditions are met before handing over your keys. </span></p> <p><strong>Options for downsizing</strong></p> <p><span>Whether you decide to buy first and then sell, or sell first and then buy, you’ll want to start weighing up your options early on. For your new living arrangements, you can consider:</span></p> <ul> <li><span> </span><span>Renting</span></li> <li><span> </span><span>Purchasing a smaller house</span></li> <li><span> </span><span>Apartment living</span></li> <li><span> </span><span>Villas and townhouses</span></li> <li><span> </span><span>Retirement villages or communities</span></li> <li><span> </span><span>Country living</span></li> <li><span> </span><span>Living with family</span></li> </ul> <p><span>If you’re ready for something new, downsizing could be the perfect change for you. It could lead to more convenience, more cash flow, a more exciting lifestyle and an overall better quality of life. The transition can be smooth, especially with the right people to help you along the way. </span></p> <p><strong><span>Related links:</span></strong></p> <ul> <li><span> </span><span><a href="https://www.openagent.com.au/blog/cost-selling-house">What is the cost of selling a home?</a></span></li> <li><span> </span><span><a href="https://www.openagent.com.au/findagents/31?hl=3">Get your free smart sellers guide</a></span></li> <li><span> </span><span><a href="https://www.openagent.com.au/blog/top-9-things-devalue-property">Top things that can decrease the value of your home</a></span></li> </ul> <p><strong><em><span>Guest author</span></em></strong><em><span>: Ellen Orton is the Head of Business Operations at </span></em><span><a href="https://www.openagent.com.au/"><em>OpenAgent.com.au</em></a><em>, an online agent comparison website helping Australians to sell, buy and own property.</em></span></p>

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What the royals would earn if they had real-life jobs

<p><span>As members of the royal family, the Dukes and Duchesses might be <a href="https://www.oversixty.com.au/travel/international-travel/the-world-s-richest-royal-in-2019-revealed/">worth millions of dollars</a> – but how much would they earn as a commoner?</span></p> <p><span>Training and qualifications provider <a rel="noopener" href="http://www.theknowledgeacademy.com/" target="_blank">The Knowledge Academy</a> has analysed the royals’ skills and qualifications to discover the job and the salary they would have if they were part of today’s job market.</span></p> <p><span>Duchess Meghan came out as the top earner with an expected annual salary of £350,000 (around AU$655,000) thanks to her acting experience, while Prince Harry and Prince William could earn between £21,000 and £55,000 ($39,000 and $103,000) as a charity worker or a major in the army.</span></p> <p><span>Duchess Kate – the first royal bride with a university degree – could earn up to £23,000 ($43,000) in a corporate administrative or marketing role, considering her experience working for high-end retailer Jigsaw and her parents’ party supplies company Party Pieces.</span></p> <p><span>Sophie, Countess of Wessex would earn £40,000 ($74,800) with her secretarial training and PR experience. Her husband Prince Edward, who had worked in production for theatre and television, could earn up to £28,000 ($52,400) as an experienced production assistant.</span></p> <p><span>Princess Anne and Duchess Camilla, who had limited work experience, were expected to have a salary of £19,000 ($35,500) and £17,500 ($32,800) as a charity worker and a secretary respectively.</span></p>

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Why Australia paints Qantas CEO Alan Joyce as a superhero

<p>Alan Joyce is Australia’s <a href="https://www.abc.net.au/news/2019-09-17/ceo-bonuses-soar-as-qantas-boss-alan-joyce-tops-list/11518356">highest-paid chief executive</a>.</p> <p>Alan Joyce is one of the Financial Review’s <a href="https://www.afr.com/work-and-careers/leaders/australia-s-10-most-covertly-powerful-people-20190828-p52lon">ten most covertly powerful people</a>.</p> <p>Alan Joyce writes <a href="https://twitter.com/Qantas/status/1104924677175169026">heartwarming notes to children</a>.</p> <p>Alan Joyce is <a href="https://www.msn.com/en-au/news/australia/qantas-boss-alan-joyce-53-announces-hes-set-to-marry-his-partner-after-20-years-together/ar-AAIbJ0e?li=BBU4PL8">getting married</a>.</p> <p>And he is apparently some sort of <a href="https://www.news.com.au/finance/money/wealth/qantas-chief-executive-alan-joyce-deserved-to-make-24-million-in-2018/news-story/5b25597a186e24adedd01887165e398c">superhero</a>.</p> <p>Something about chief executives brings forth testimonials <a href="https://www.news.com.au/finance/money/wealth/qantas-chief-executive-alan-joyce-deserved-to-make-24-million-in-2018/news-story/5b25597a186e24adedd01887165e398c">like this</a>, published in the News Corporation tabloids last month, which followed the revelation that Joyce was Australia’s highest paid corporate chief (taking home <a href="https://www.abc.net.au/news/2019-09-17/ceo-bonuses-soar-as-qantas-boss-alan-joyce-tops-list/11518356">A$24 million</a> in 2018-19).</p> <p>Penned by Angela Mollard, a journalist specialising in celebrities, it <a href="https://www.news.com.au/finance/money/wealth/qantas-chief-executive-alan-joyce-deserved-to-make-24-million-in-2018/news-story/5b25597a186e24adedd01887165e398c">said he had</a></p> <blockquote> <p>turned around a failing company, put thousands of dollars in shareholders’ pockets, boosted the superannuation of Mr and Mrs Average and prevented thousands from losing their jobs.</p> </blockquote> <p>Joyce, and all the best chief executives, she argued, were</p> <blockquote> <p>alchemists, strategists, innovators and geniuses. They have the sort of agile brains that produce solutions to problems which seem intractable. They lead not from a textbook but from an internal well of brilliance that seems constantly replenished.</p> </blockquote> <p>Further, executives like Joyce deserved to be rewarded for</p> <blockquote> <p>the risks they take, the entrepreneurship they exhibit, the education they’ve invested in and the particular brand of brilliance that comes along all too rarely.</p> </blockquote> <p><strong>It’s been said before</strong></p> <p>I’ve been examining the language used to describe Australia’s elite executives over the past 100 years, and what’s being said about Joyce is familiar - right down to the use of the word “genius”.</p> <p>This kind of talk, repeated for more than a century now, leads us astray if we keep repeating it. It creates misunderstandings about how large companies work. Chief executives aren’t superhuman, their characteristics are not those of their companies, they don’t single-handedly determine the fate of those companies or personally employ their workers, they aren’t necessarily selfless or patriotic, and they don’t necessarily have the best interests of the nation at heart.</p> <p><a href="http://adb.anu.edu.au/biography/mackellar-sir-charles-kinnaird-7382">Sir Charles Mackellar</a>, chairman of the Mutual Life &amp; Citizens’ Assurance Company and a director of a host of other companies including the Colonial Sugar Refining Company was labelled a “<a href="https://trove.nla.gov.au/newspaper/article/15572188">genius</a>” when he died in 1914.</p> <p>FA Govett, the London-based head of Australia’s Zinc Corporation was labelled as a “<a href="https://trove.nla.gov.au/newspaper/article/45952519">man of exceptional ability</a>” in 1926.</p> <p>Often they had higher ideals.</p> <p><a href="http://adb.anu.edu.au/biography/raws-sir-william-lennon-840">Sir William Lennon Raws</a>, a director of four of Australia’s biggest companies including BHP and Elder Smith, was a “<a href="https://trove.nla.gov.au/newspaper/article/146726001">well-meaning capitalist with a dream</a>”.</p> <p>Like Joyce and his contemporaries that work their “<a href="https://www.news.com.au/finance/money/wealth/qantas-chief-executive-alan-joyce-deserved-to-make-24-million-in-2018/news-story/5b25597a186e24adedd01887165e398c">butts off to do the right thing</a>”, Raws was</p> <blockquote> <p>palpably rich and could be richer; but I doubt if the making of another million would be as much to him as the achievement of one of his cherished hopes.</p> </blockquote> <p><strong>It’s their own work</strong></p> <p>Executives have long been seen as the sole reason for their company’s success. In 2019, Joyce single-handedly “<a href="https://www.news.com.au/finance/money/wealth/qantas-chief-executive-alan-joyce-deserved-to-make-24-million-in-2018/news-story/5b25597a186e24adedd01887165e398c">took a beleaguered company and transformed it</a>”.</p> <p>Similarly, in the late 1800s, BHP director <a href="http://adb.anu.edu.au/biography/jamieson-william-6827">William Jamieson</a> was <a href="https://trove.nla.gov.au/newspaper/article/45936299">solely responsible</a> for the development of the Broken Hill region.</p> <p><a href="http://adb.anu.edu.au/biography/philp-sir-robert-8040">Robert Philp</a> of Burns Philp and Company was an Australian patriot who “<a href="https://trove.nla.gov.au/newspaper/article/120184641">controlled her destinies during a critical period</a>”.</p> <p>Industrialist and car manufacturer <a href="http://adb.anu.edu.au/biography/holden-sir-edward-wheewall-7065">Edward Holden</a> worked tirelessly to “<a href="https://trove.nla.gov.au/newspaper/article/129208064">benefit the state and the company”</a>.</p> <p>Corporate director and university chancellor <a href="https://trove.nla.gov.au/newspaper/article/61634919">Sir Normand Maclaurin</a> was “endowed with talents of a very high order […] having at heart the welfare of the nation”.</p> <p><strong>They’re exceptional</strong></p> <p>Joyce’s success might be due to his “<a href="https://www.news.com.au/finance/money/wealth/qantas-chief-executive-alan-joyce-deserved-to-make-24-million-in-2018/news-story/5b25597a186e24adedd01887165e398c">big dick energy</a>”, but he wasn’t the first. In the early 1900s, <a href="http://adb.anu.edu.au/biography/pratt-joseph-major-8098">Joseph Pratt</a> – director of the National Bank of Australasia, the Land Mortgage Bank, the Melbourne Tramway and Omnibus Company and Metropolitan Gas Company – was described in the most masculine of terms as a <a href="https://trove.nla.gov.au/newspaper/article/145710392">big man</a></p> <blockquote> <p>tall, erect, well-made and muscular. He has a pleasant, manly face, indicative of straightforwardness and goodness of disposition, and upon which grows a russet beard, containing a few grey hairs…</p> </blockquote> <p><a href="http://adb.anu.edu.au/biography/sheldon-sir-mark-8411">Sir Mark Sheldon</a> - chairman of the Waterloo Glass Bottle Works, a director of the Australian Bank of Commerce, and vice president of the Sydney Chamber of Commerce - also <a href="https://trove.nla.gov.au/newspaper/article/245762056/26911232">also big </a>,</p> <blockquote> <p>big in his outlook, his ideas, and his accomplishments. Perhaps his height (6 feet, 1.5 inches) enables him to look a bit farther ahead than the ordinary man</p> </blockquote> <p>Painting corporate chiefs like this gives corporations a human face. It helps convince customers and investors that their money is in safe hands. If Alan Joyce is a ‘good man’, then the Qantas Group is seen as a good company.</p> <p>It also makes executives untouchable. After all, if they are blessed with unique or exceptional abilities, and if their company is doing well (whatever the reason), it is hard to argue with the millions being spent on them.</p> <p>Even if it’s $24 million, even if it’s more.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/124167/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Claire Wright, Research Fellow, Centre for Workforce Futures, Macquarie University</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/painting-qantas-chief-executive-alan-joyce-as-a-superhero-is-part-of-a-long-australian-tradition-124167" target="_blank"><em>The Conversation</em></a><em>.</em></p>

Retirement Income

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The financial guide to surviving widowhood

<p>That old cliché about the two certainties in life, death and taxes, becomes downright painful when they both hit you at the same time. But you can avoid this awful double whammy by making estate planning part of your financial roadmap.</p> <p>Planning for the death of your partner, and your own, is a morbid reality. After someone dies is not the ideal time to be trying to correct poor financial planning – or worse – realising there’s no plan at all. Thinking about it might be unpleasant, but the heartache of having to pick up the financial pieces after a loved one dies is much worse.</p> <p>There are a few key things you and your partner can put in place to set yourselves up properly should the worst happen.</p> <p><strong>Get intimate with your finances</strong></p> <p>Everyone’s situation is different but, in my experience, women often leave financial decisions to their husbands. Such women are unaware of their financial situation and how to move forward in the event of their husband’s death.</p> <p>I’ve worked on several cases where a client has been surprised by the financial realities following their partner’s death. It can be so overwhelming and emotional that it’s hard to make decisions, and delays can be costly.</p> <p>If you’re unsure of where you would stand financially in the event of your partner’s death, sit down as a couple and talk it through. It’s not an easy topic, but doing this will help you identify anything that needs to be addressed to protect your financial wellbeing.</p> <p><strong>Estate planning</strong></p> <p>Many people die intestate, which means without a will. And many others die with an outdated will. This can make things very tricky for the estate and any potential beneficiaries.</p> <p>The benefits of planning go way beyond convenience for the loved ones left behind. An estate can be set up in some very tax effective ways, including establishing a testamentary trust to help minimise tax paid on the total amount. I’ve had clients that have lost upwards of $40,000 to tax that could have been theirs with better estate planning.</p> <p>Speak to a good financial advisor with your estate planning lawyer and accountant to help you sort through the complexity.</p> <p><strong>Superannuation beneficiaries</strong></p> <p>Distributing superannuation after a death is not always cut and dry. A spouse is not an automatic beneficiary. Without a nominated beneficiary, the super fund can choose to distribute the funds between family members and dependents. Or if the information is out of date, the beneficiary could end up being a former spouse and you may have to make a claim to get the funds. It sounds far-fetched, but it happens more than you’d think.</p> <p>To avoid these headaches, make sure you nominate a beneficiary for your super and keep it up to date.</p> <p><strong>Paying the bills</strong></p> <p>One of the harshest realities for those impacted by a partner’s death is that the bills just keep coming in, despite the fact you're grieving. Add to that the pressure of now being on one income, or finding out some things you didn’t know about your financial situation, and things start to get really tough.</p> <p>Even if you are the sole beneficiary of your partner’s estate, you won’t have immediate access to the funds. So having an emergency fund is an absolute must. A bit of cash stowed away will give you some breathing space to sort things out.</p> <p><strong>Debt</strong></p> <p>Inheritance is usually talked about in the context of inheriting money and assets. But unfortunately, debt can also be inherited. Mortgage debt is the most common.</p> <p>If your partner dies, the money in their estate will used to pay any outstanding debts. If a debt is held in both of your names and your partner’s estate isn’t enough to cover it, you may be liable. To avoid this difficult situation, get a good understanding of the debts both you and your partner have, and what liabilities might exist if one of you dies. Once you know where you stand, you can seek advice on how to avoid any potentially disastrous consequences.</p> <p>It’s a bleak subject, but avoiding estate planning could lead to something much bleaker. Have the conversations now so you aren’t surprised later, and don’t underestimate the value of a skilled financial advisor, accountant and lawyer. If the unthinkable happens, you’ll be glad you had a plan.</p> <p><em>Helen Baker is a licenced Australian financial adviser and author of two books: </em>On Your Own Two Feet – Steady Steps to Women’s Financial Independence<em> and </em>On Your Own Two Feet Divorce – Your Survive and Thrive Financial Guide<em>. </em><em>Note this is general advice only and you should seek advice specific to your circumstances.</em></p>

Retirement Income

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Coles launches new meal kits

<p><span>Coles has expanded into the meal-kit business with its new offerings to compete with HelloFresh and Marley Spoon.</span></p> <p><span>On Wednesday, the supermarket giant launched its <em>What’s for Dinner </em>range, with 48 recipe-based bundles of ingredients that shoppers can add to their online order.</span></p> <p><span>The prices of each kit vary between $15 and $30, with each kit containing two to four serves. Also available are meat-free options, including broccoli fried rice and ricotta and spinach pasta.                                                                   </span></p> <p><span>Coles chief marketing officer Lisa Ronson said the range was developed based on one of the supermarket’s “biggest customer studies ever”.</span></p> <p><span>According to the research, 55 per cent of Australians only decide what they want to have for dinner on the day, with ingredient preparation being the biggest pain point.</span></p> <p><span>“We have created meal plans to help customers with some of the biggest challenges they face preparing dinner every night – from lack of time to cook from scratch to kids who turn their noses up at healthy options, and boredom with cooking the same handful of dishes every week because it seems too hard to try something new,” Ronson said.</span></p> <p><span>Retail analyst Neil Rechlin said he is not surprised that Coles is entering the fresh food delivery market, which has grown significantly in the past five years and shifting customers away from supermarkets.</span></p> <p><span>“Customers are buying Marley Spoon and HelloFresh, and Woolworths and Coles have been losing business to those companies,” Rechlin told <a href="https://www.9news.com.au/national/meal-kits-what-are-the-best-hello-fresh-marley-spoon-coles-woolworths/613bc7c0-df0d-4e3a-a37e-e49f0239cc48"><em>9News</em></a>.</span></p> <p><span>“This is a way to keep customers in the Coles store.”</span></p> <p><span>In June, Woolworths announced that it would <a href="https://www.woolworthsgroup.com.au/page/media/Latest_News/woolworths-group-invests-a30-million-into-strategic-partnership-with-leading-subscription-based-meal-kit-provider-marley-spoon">invest $30 million</a> into Marley Spoon over the next five years, which will lead to the supermarket owning a nine per cent stake in the meal kit company. </span></p> <p><span>Last month, Woolworths said it will add an extra $4 million into the investment, bringing the total amount to $34 million.</span></p>

Retirement Income

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Looking to rent a home? 6 things that will help or hinder you

<p><a href="http://shelter.org.au/site/wp-content/uploads/The-Australian-Rental-Market-Report-Final-Web.pdf">Two-thirds</a> of tenants in Australia rent through a real estate agent. A <a href="http://shelter.org.au/site/wp-content/uploads/fly-factsheet-australia-updated-16-September-2014.pdf">national shortage</a> of private rental housing forces these tenants to impress the real estate agent to secure a property – their application needs to stand out from other applications.</p> <p>An analysis of articles on leading online real estate sites www.realestate.com.au and www.domain.com.au identifies six aspects of interactions between the real estate agent and tenant that affect a tenant’s ability to secure a rental property. <a href="https://www.tandfonline.com/doi/abs/10.1080/02673037.2019.1621271?journalCode=chos20">My research</a> reveals the power of the agent over the tenant. Agents strongly stigmatise certain tenant characteristics during the property search.</p> <p>These real estate articles typically fail to recognise the systemic issues of housing shortages in Australia. As <a href="https://theconversation.com/affordable-housing-lessons-from-sydney-hong-kong-and-singapore-3-keys-to-getting-the-policy-mix-right-123443">owner-occupied housing becomes more unaffordable</a> and <a href="https://theconversation.com/focus-on-managing-social-housing-waiting-lists-is-failing-low-income-households-120675">public housing becomes less available</a>, a variety of household types are competing in a high-demand private rental market.</p> <p>Households have differing economic, cultural and social capital. This puts some applicants for a rental property at a disadvantage. But real estate sites present the issue of secure rental housing as an individual problem that can easily be overcome once a tenant understands how to highlight their desirable characteristics when applying for a rental property.</p> <p><strong>How do agents assess tenants?</strong></p> <p>When assessing a rental application, the two most important qualities a real estate agent looks for are a tenant’s ability to pay the rent on time and their ability and/or willingness to care for the rental property.</p> <p>In addition, a tenant’s ability to impress the real estate agent matters. My research identifies six aspects of interactions between agent and tenant that affect the ability to secure a rental property:</p> <ol> <li>responsibility – positive reference/s from previous agents and/or landlords help demonstrate this</li> <li>making an impression – dress appropriately and be on time for inspections, engage with the agent and present an easy-to-read, error-free application form</li> <li>established relationships – a previously established relationship with the agent or landlord improves the tenant’s chances</li> <li>honesty – tenants are encouraged to be honest with their agent about their lifestyle</li> <li>flexibility – be flexible about lease length and the cost of rent</li> <li>creative thinking – for example, bringing cupcakes to a rental inspection.</li> </ol> <p>Through these interactions, tenants can highlight their desirable characteristics while downplaying their undesirable characteristics.</p> <p><strong>Selection process reinforces disadvantage</strong></p> <p>The ability to make a good impression on the agent, however, is largely based on a variety of factors that place some tenants at a disadvantage.</p> <p>For example, tenants are advised that several lifestyle factors may hamper their ability to secure a property. These include pets, dependent children, age, a negative rental history and other potential housemates.</p> <p>These findings match those of an <a href="http://shelter.org.au/site/wp-content/uploads/The-Australian-Rental-Market-Report-Final-Web.pdf">Australian survey of private renters</a>, commissioned by Choice, National Shelter and the National Association of Tenant Organisations. It found 50% of renters have experienced discrimination in the private rental sector. This includes discrimination on the basis of: pets (23%), receiving government payments (17%), age (14%), having young children (10%), being a single parent (7%), race (6%), needing to use a bond loan (5%), gender (5%), disability (5%) and sexuality (2%).</p> <p>Further, when it comes to making an impression, some tenants are at a significant advantage. For example, factors such as English proficiency and the ability to “dress to impress” are often a reflection of economic and cultural capital.</p> <p>The articles assume that presenting an application form with no spelling and grammatical errors is simply a matter of taking a little extra care. However, a newly arrived migrant may find this difficult, not because of laziness but because they may not yet be proficient in English.</p> <p>The articles also highlight a tenant’s willingness to be flexible as important. Flexibility is presented in the following ways:</p> <ul> <li>where demand for properties is high, tenants are advised to offer more rent</li> <li>when a tenant has no rental history, they are advised to offer to pay rent in advance</li> <li>tenants are also advised to cater to the needs of the real estate agent and landlord by being flexible about the length of the lease.</li> </ul> <p>Tenants’ ability to be flexible in these ways varies greatly. For example, not all tenants have the means to offer more rent or pay rent in advance. The ability to be flexible about lease length also differs depending on individual circumstances.</p> <p>My research shows the process of securing a rental property could reinforce the disadvantage of some tenants. This raises an important question. When private rental housing is the only option, what happens to those tenants who fail to impress the real estate agent?</p> <p><em>Written by <span>Bronwyn Bate, PhD Candidate, Urban Research Program, Western Sydney University</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/looking-to-rent-a-home-6-things-that-will-help-or-hinder-you-123753" target="_blank"><em>The Conversation</em></a><em>. </em></p>

Retirement Income

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5 questions about superannuation the government's new inquiry will need to ask

<p>The government’s new <a href="http://ministers.treasury.gov.au/ministers/josh-frydenberg-2018/media-releases/review-retirement-income-system">retirement incomes review</a> will need to work quickly.</p> <p>On Friday Treasurer Josh Frydenberg said he expected a final report by June, just seven months after the issues paper he wants it to deliver by November.</p> <p>The deadline is tight for a reason. In recommending the inquiry in its report on the (in)effeciency of Australia’s superannuation system this year, the Productivity Commission said it should be completed “<a href="https://theconversation.com/frydenberg-should-call-a-no-holds-barred-inquiry-into-superannuation-now-because-labor-wont-114079">in advance of any increase in the superannuation guarantee rate</a>”.</p> <p>In other words, in advance of the next leglislated increase in compulsory superannuation contributions, which is on July 1, 2021.</p> <p>The next increase (actually, the next five increases) will hurt.</p> <p>The last two, on July 1 2013 and July 1 2014, took place when wage growth was stronger. In 2013 wages growth was 3% per year.</p> <p><a href="https://images.theconversation.com/files/265468/original/file-20190324-36267-olwp2z.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/265468/original/file-20190324-36267-olwp2z.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt="" /></a> <span class="caption"></span> <span class="attribution"><a href="https://www.ato.gov.au/rates/key-superannuation-rates-and-thresholds/?anchor=Superguaranteepercentage" class="source">Source: Australian Tax Office</a></span></p> <p>And they were small – an extra 0.25 per cent of salary each.</p> <p>The next five, to be imposed annually from July 1 2021, are twice the size: <a href="https://www.ato.gov.au/rates/key-superannuation-rates-and-thresholds/?anchor=Superguaranteepercentage">0.5% of salary each</a>.</p> <p>If taken out of wage growth, they’ve the potential to cut it from its present usually low 2.3% per annum to something with a “1” in front of it, pushing it below the rate of inflation, for five consecutive years.</p> <p>If we were going to do that (even if we thought the economy and wage growth could afford it) it would be a good idea to have a good reason why. After all, compulsory superannuation is the compulsory locking away of income that could otherwise be spent or used to pay down debt or saved through another vehicle, regardless of the wishes of the person whose income it is.</p> <h2>Question 1. What’s it for?</h2> <p>Fortunately, the new inquiry doesn’t need to do much work on this one.</p> <p>For most of its life compulsory super hasn’t had an agreed purpose. At times it has been justified as a means of restraining wage growth, at times as means of restraining government spending on the pension, at times as means of boosting national savings.</p> <p>In 2014, more than 20 years after compulsory super began, the Murray Financial System Review asked the government to <a href="http://fsi.gov.au/publications/final-report/executive-summary/#recommendations">set a clear objective for it</a>, and two years later the government came up with one, enshrined in a bill entitled the <a href="https://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=r5762">Superannuation (Objective) Bill 2016</a>.</p> <p>The bill lapsed, but the objective at its centre lives on as the best description we’ve come up with yet of what compulsory super is for:</p> <blockquote> <p>to provide income in retirement to substitute or supplement the age pension</p> </blockquote> <p>Which raises the question of how much we need. For compulsory super, the answer is probably none. People who want more than the pension and their other savings can save more through voluntary super. People who don’t want more (or can’t afford to save more) shouldn’t.</p> <h2>Question 2. How much do people need?</h2> <p>Assuming for the moment that how much people need in retirement is relevant for determining how much compulsory super they need, the inquiry will need to examine what people need to live on in retirement.</p> <p>The “<a href="https://www.superannuation.asn.au/resources/retirement-standard">standards</a>” prepared by the Association of Superannuation Funds of Australia are loose. The more generous of the two allows for overseas travel every two or so years, A$163 per couple per fortnight on dining out, $81 on alcohol “or equivalent spent with charity or church”.</p> <p>It isn’t a reasonable guide to how much people need to live on, and certainly isn’t a reasonable guide for how much the government should intervene to make sure they have to live on. They are standards it doesn’t intervene to support while people are working.</p> <p>And there’s something else. Super isn’t what will fund it. Most retirement living is funded outside of super, either through the age pension, private savings, or the family home (which saves on rent). Most 65 year olds have <a href="https://grattan.edu.au/wp-content/uploads/2018/11/912-Money-in-retirement-re-issue-1.pdf">more saved outside of super than in it</a>, and a lot more than that saved in the family home.</p> <p>It’s a slight of hand to say that retirees need a certain proportion of their final wage to live on and then to say that that’s how much super should provide.</p> <h2>Question 3: Does it come out of wages?</h2> <p>The best guess is that, although paid by employers in addition to wages, compulsory super comes out of what would otherwise have been their wage bill.</p> <p><a href="http://treasury.gov.au/sites/default/files/2019-09/foi_2534_document_set_for_release_re.pdf">Treasury</a> puts it this way:</p> <blockquote> <p>Though compulsory superannuation guarantee contributions are paid by employers, wage setting generally takes into account all labour costs. As such, it is widely accepted that employees bear the cost of higher superannuation guarantees in the form of lower take home pay.</p> </blockquote> <p>The inquiry will probably make its own determination. If it finds that extra contributions <a href="https://theconversation.com/productivity-commission-finds-super-a-bad-deal-and-yes-it-comes-out-of-wages-109638">do indeed come out of what would have been pay rises</a>, it will have to consider the tradeoff between lower pay rises (and they are already very low) and the compulsory provision of more superannuation in retirement.</p> <h2>Question 4: Does it boost private saving?</h2> <p>It’d be tempting to think that the compulsory nature of compulsory superannuation meant that each extra dollar funnelled into it increased retirement savings by an extra dollar. But it doesn’t, in part because wealthy Australians who are already saving a lot have the option of offsetting it by saving less in other ways.</p> <p>For them, the increase in saving isn’t compulsory.</p> <p>For financially stretched Australians unable to afford to save (or for Australians at times in times life when they can’t afford to save) the compulsion is real, and unwelcome.</p> <p>The inquiry will have to make its own assessment, updating <a href="https://www.rba.gov.au/publications/rdp/2007/pdf/rdp2007-08.pdf">Reserve Bank research</a> which found in 2007 that each extra dollar in compulsory accounts added between 70 and 90 cents to household wealth.</p> <h2>Question 5: Does it boost national saving?</h2> <p>Boosting private saving (at the expense of people who are unable to escape) is one thing. Boosting national savings (private and government) is another. The tax concessions the government hands out to support superannuation are expensive. The concession on contributions alone is set to cost $19 billion this year and $23 billion in 2022-23, notwithstanding some tightening up. It predominately benefits high earners, the kind of people who don’t need assistance to save.</p> <p>On balance it is likely that the system does little for national savings, cutting government savings by as much as it boosts private savings. But because the question hasn’t been asked, not since the Fitzgerald report on national saving in 1993 shortly after compulsory super was introduced, we don’t know.</p> <p>It’ll be up to the inquiry to bring us up to date.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/124400/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Peter Martin, Visiting Fellow, Crawford School of Public Policy, Australian National University</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/5-questions-about-superannuation-the-governments-new-inquiry-will-need-to-ask-124400" target="_blank"><em>The Conversation</em></a><em>. </em></p>

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Why shopping addiction is a real disorder

<p>UK-based healthcare group the Priory is well-known for treating gambling, sex, drug, alcohol and computing addictions – especially of the <a href="https://www.thesun.co.uk/fabulous/7327125/the-priory-celebrity-guests-katie-price-rehab-centre-cost/">rich and famous</a>. Now it has added a new condition to its list: shopping addiction.</p> <p>Research suggests that as many as <a href="https://onlinelibrary.wiley.com/doi/full/10.1111/add.13223">one in 20 people</a> in developed countries may suffer from shopping addiction (or compulsive buying disorder, as it’s more formally known), yet it is often not taken seriously. People don’t see the harm in indulging in a bit of “retail therapy” to cheer themselves up when they have had a bad day.</p> <p>Indulging in the occasional bit of frivolous spending is not a bad thing, if it is done in moderation and the person can afford it. But for some people compulsive shopping is a real problem. It takes over their lives and leads to genuine misery. Their urges to shop become uncontrollable and are often impulsive. They end up spending money they don’t have on things they don’t need.</p> <p>The worst part is that compulsive buyers continue to shop regardless of the negative impact it has on them. Their <a href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMc1805733/">mental health gets worse</a>, they get into serious debt, their social network shrinks, and they may even contemplate suicide – but shopping still provides the brief dopamine rush they crave.</p> <p>There is no doubt that people who engage in this behaviour suffer, and often badly. But it is debatable whether compulsive buying disorder is a condition in its own right or a symptom of another condition. Often it is difficult to diagnose because people with compulsive buying disorder have symptoms of other disorders, such as <a href="https://psycnet.apa.org/record/1994-29953-001">eating disorders and substance abuse</a>.</p> <p><strong>Formal criteria needed</strong></p> <p>The most commonly used manuals for diagnosing mental disorders are the <a href="https://www.psychiatry.org/psychiatrists/practice/dsm">DSM</a> and <a href="https://icd.who.int/en">ICD</a>, and neither include diagnostic criteria for compulsive buying disorder. One reason may be that there are many theories about what kind of illness the disorder is. It has been likened to <a href="https://psycnet.apa.org/record/1995-01870-001">impulse control disorder</a>, mood disorders, <a href="https://onlinelibrary.wiley.com/doi/abs/10.1111/j.1360-0443.1987.tb00424.x">addiction</a> and <a href="https://www.sciencedirect.com/science/article/pii/S0005789402800259">obsessive-compulsive disorder</a>. How the disorder ought to be classified is an ongoing debate.</p> <p>What is also an <a href="https://www.macmillanihe.com/page/detail/Consumption-Matters/?K=9780230201170">ongoing debate</a> is what the disorder should be called. To the general public, it’s known as “shopping addiction”, but experts variously call it compulsive buying disorder, oniomania, acquisitive desire and impulse buying.</p> <p>Researchers also struggle to agree on a definition. Perhaps the lack of a clear definition stems from the fact that research shows that no single factor is sufficiently powerful to explain the causes of this compulsive behaviour.</p> <p>What most experts seem to agree on is that people with this condition find it difficult to stop and that it results in harm, showing that it is an involuntary and destructive kind of behaviour. People with the condition often try to hide it from friends and partners as they feel shame, thereby alienating themselves from the people who are best placed to support them.</p> <p>Although the disorder has not yet been clearly defined by name, symptoms or even category of mental health problem, most researchers agree on one thing: it is a real condition that people truly suffer from.</p> <p>The fact that the Priory, a well-established healthcare group, is treating people with compulsive buying disorder, may help to raise awareness of the condition. Hopefully, this will result in more research being conducted to help define diagnostic criteria. Without the criteria, it will be difficult for healthcare professionals to diagnose the illness and treat it. This is a condition that is crying out to be properly recognised and should not be trivialised.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/123813/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Cathrine Jansson-Boyd, Reader in Consumer Psychology, Anglia Ruskin University</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/shopping-addiction-is-a-real-disorder-123813" target="_blank"><em>The Conversation</em></a><em>.</em></p>

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Australia's top 10 favourite brands revealed

<p>Australia’s top brands for customer experience have been revealed, with an international company grabbing the number one spot.</p> <p>KPMG’s 2019 <span><a href="https://assets.kpmg/content/dam/kpmg/au/pdf/2019/customer-experience-excellence-report-2019-au-summary.pdf"><em>Customer Experience Excellence</em></a></span> report surveyed more than 2,500 Australians on their experiences with 114 Australian and foreign brands.</p> <p>Singapore Airlines came out as the highest-rated brand, followed by RACQ Insurance, Bendigo Bank, PayPal and Afterpay.</p> <p>Financial services dominated the top 10 list and rose as the second best-performing sector after grocery retail. Dan Murphy’s dominated the retail sector, with the report noting its wide product range and optimised store experience. Following Dan Murphy’s were ALDI at number 18, First Choice Liquor at 19, and BWS at 21. Woolworths, Coles and IGA came up with a wide gap at number 46, 47 and 48 respectively.</p> <p>The report said the findings indicated that customers prefer brands that are community-led and values-driven.</p> <p>“Brands that are community-led, abiding by collective values and playing an active role in the community are likely to engage customers over brands that are focused solely on building their customer base,” KPMG Australia customer, brand and marketing advisory partner Sudeep Gohil.</p> <p>“It’s evident amongst customer experience leaders across industry that holding an altruistic stance has become common practice and therefore organisations that choose not to be community focused risk falling behind in years to come.”</p> <p>The overall customer experience has stagnated at 7.14 out of 10 in the 12 months since the previous report, reflecting “good but not great delivery”.</p> <p><strong>Top 10 customer experience brands in Australia</strong></p> <ol> <li>Singapore Airlines</li> <li>RACQ Insurance</li> <li>Bendigo Bank</li> <li>PayPal</li> <li>Afterpay</li> <li>ING</li> <li>NRMA Insurance</li> <li>Dan Murphy’s</li> <li>RACV Insurance</li> <li>Subway</li> </ol>

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Why rising inequality in Australia isn't about incomes

<p>Compared to the rest of the world, income inequality is not particularly high in Australia, nor is it getting much worse.</p> <p>The real problem is housing inequality.</p> <p>Rising house prices have increased <a href="https://theconversation.com/what-the-bureau-of-statistics-didnt-highlight-our-continuing-upward-redistribution-of-wealth-121731">wealth inequality</a>. Rising housing costs have dramatically widened the gap between high and low disposable incomes.</p> <p>The gap between low-income and high-income households in Australia is <a href="https://grattan.edu.au/wp-content/uploads/2019/04/916-Commonwealth-Orange-Book-2019.pdf">close to the OECD average</a>. Income inequality – measured by the gini coefficient – <a href="https://www.abs.gov.au/AUSSTATS/abs@.nsf/Lookup/6523.0Main+Features12017-18?OpenDocument">has fallen</a> slightly over the past decade.</p> <p>The <a href="https://www.pc.gov.au/research/completed/rising-inequality/rising-inequality.pdf">Productivity Commission</a> says inequality has increased only slightly in the past three decades. Economists at the <a href="https://www.rba.gov.au/publications/rdp/2015/pdf/rdp2015-15.pdf">Reserve Bank</a> have come to similar conclusions.</p> <p>But inequality is growing once housing costs are factored in, with the poor being hurt the most.</p> <p>Incomes for the lowest 20% of households <a href="https://grattan.edu.au/wp-content/uploads/2018/03/901-Housing-affordability.pdf">increased</a> by about 27% between 2003-04 and 2015-16. But their incomes after housing costs increased by only about 16%. Low-income Australians are spending <a href="https://grattan.edu.au/wp-content/uploads/2018/03/901-Housing-affordability.pdf">much more</a> than they used to keep a roof over their heads.</p> <p>In contrast, incomes for the highest 20% of households increased by 36%, and their after-housing incomes by 33%.</p> <p><strong>Leaving the young and poor behind</strong></p> <p>Home ownership is increasingly benefiting the already well-off. Since 2003-04, increasing property values have contributed to the wealth of high-income households increasing by more than 50%. Wealth for low-income households has grown by less than 10%</p> <hr /> <p><a href="https://images.theconversation.com/files/289162/original/file-20190823-170922-dg3w9b.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/289162/original/file-20190823-170922-dg3w9b.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="" /></a> <span class="caption"></span></p> <hr /> <p>As we’ve <a href="https://theconversation.com/retiree-home-ownership-is-about-to-plummet-soon-little-more-than-half-will-own-where-they-live-115255">noted previously</a> rising housing costs have widened the gap between renters and home owners. As property prices have escalated, the higher deposit hurdle has seen rates of home ownership falling fast among the young and the poor.</p> <p>In 1981 more than 60% of those aged 25-34 had a mortgage; by 2016 it was 45%. The trends are similar among older groups. In the same period, home ownership among the poorest 20% of households has fallen from 63% to 23%.</p> <p>The big winners of the property boom have typically been older typically Australians <a href="https://theconversation.com/for-the-first-time-in-a-long-time-were-setting-up-a-generation-to-be-worse-off-than-the-one-before-it-121983">lucky enough</a> to buy a house before prices took off. Housing has thus compounded <a href="https://theconversation.com/three-charts-on-the-great-australian-wealth-gap-84515">inequality between the young and old</a>.</p> <hr /> <p><iframe id="OX09s" class="tc-infographic-datawrapper" src="https://datawrapper.dwcdn.net/OX09s/6/" height="400px" width="100%" style="border: none;" frameborder="0"></iframe></p> <hr /> <p>This could lead to higher inequality in the future, because the children with wealthier parents can rely on the “bank of mum and dad” to break into the housing market, and then inherit their parents’ home as an investment property.</p> <p>Many low-income Australians <a href="https://theconversation.com/rethink-inheritances-these-days-they-no-longer-help-the-young-they-go-to-the-already-middle-aged-122029">won’t be so lucky</a>, which is why the share of Australians who own their homes is expected to <a href="https://theconversation.com/retiree-home-ownership-is-about-to-plummet-soon-little-more-than-half-will-own-where-they-live-115255">fall sharply</a> in the decades ahead.</p> <hr /> <p><a href="https://images.theconversation.com/files/268787/original/file-20190411-44785-55hftp.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/268787/original/file-20190411-44785-55hftp.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="" /></a> <span class="caption"></span></p> <hr /> <p><strong>A clearer policy agenda</strong></p> <p>Despite the clear evidence housing is key to inequality in Australia, housing policy is thin on the ground.</p> <p>In the dying days of the federal election campaign, the Coalition announced a <a href="https://theconversation.com/the-brutal-truth-on-housing-someone-has-to-lose-in-order-for-first-homebuyers-to-win-117010">plan</a> to help those struggling to save the 20% deposit normally required to buy a home.</p> <p>The federal government has also made it easier for people to access their <a href="https://www.ato.gov.au/individuals/super/withdrawing-and-using-your-super/first-home-super-saver-scheme/">super</a> to pay the deposit.</p> <p>These policies might be popular but do little to improve housing affordability for low-income earners; they might even <a href="https://insidestory.org.au/another-lost-opportunity-for-housing-affordability/">do more harm than good</a>.</p> <p>Labor, meanwhile, ran with a <a href="https://theconversation.com/shortens-subsidy-plan-to-boost-affordable-housing-108881">proposal</a> during the last election campaign to build 250,000 new affordable housing dwellings, using a mechanism similar to the earlier National Rental Affordability Scheme (NRAS). On our <a href="https://blog.grattan.edu.au/2019/09/learning-from-past-mistakes-lessons-from-the-national-rental-affordability-scheme/">analysis</a>, though, the original NRAS was poor value for money, and did not target those most in need.</p> <p>Addressing inequality requires a clearer view on what to do about rising housing costs.</p> <p>The priority should be to <a href="https://grattan.edu.au/report/commonwealth-orange-book-2019/">boost Rent Assistance</a> by 40% – an extra A$1,410 a year for singles and A$1,330 for couples – and benchmark it to rents paid by low-income renters.</p> <p>The federal government should also give <a href="https://grattan.edu.au/report/commonwealth-orange-book-2019/">more funding</a> to the states for social housing carefully targeted to people at serious risk of homelessness.</p> <p>Emulating the Rudd-era <a href="http://www.nwhn.net.au/admin/file/content101/c6/social_housing_initiative_review.pdf">Social Housing Initiative</a>, which resulted in 20,000 new social housing units being built and thousands more refurbished at a cost of A$5.6 billion, would provide a much-needed boost to housing construction when the pipeline is <a href="https://www.rba.gov.au/publications/smp/2019/may/pdf/statement-on-monetary-policy-2019-05.pdf">drying up</a>.</p> <p><strong>Supply-side economics</strong></p> <p>But redistribution alone won’t be enough. Housing is a A$6.6 trillion market. Subsidies can only paper over market failures arising from overly strict zoning rules that <a href="https://grattan.edu.au/report/housing-affordability-re-imagining-the-australian-dream/">prevent greater density</a> in our major cities.</p> <p>Housing inequality will really only fall if housing costs fall. That requires building more houses. We <a href="https://grattan.edu.au/report/housing-affordability-re-imagining-the-australian-dream/">estimate</a> building an extra 50,000 homes a year for the next decade would make house prices and rents 10% to 20% lower than they would be otherwise.</p> <p>This is primarily a challenge for state governments. They govern the local councils that set most planning rules and assess most development applications. But the federal government can and should <a href="https://grattan.edu.au/wp-content/uploads/2019/04/916-Commonwealth-Orange-Book-2019.pdf">encourage</a> the states to boost housing supply by reforming land-use planning and zoning laws.</p> <p>If Scott Morrison really believes in “<a href="https://www.theaustralian.com.au/nation/politics/scott-morrison-pays-tribute-to-grandmother-in-mardigras-ritual/news-story/5af22d241145aae979e8d694d2f7dbe7">a fair go for Australians</a>”, he needs to tackle the housing crisis.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/119872/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Brendan Coates, Program Director, Household Finances, Grattan Institute and Carmela Chivers, Associate, Grattan Institute</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/rising-inequality-in-australia-isnt-about-incomes-its-almost-all-about-housing-119872" target="_blank"><em>The Conversation</em></a><em>. </em></p>

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How Aussies are overspending on food

<p><span>Most Aussies agree that take-outs and barista-made coffee are an unnecessary expense – yet we still spend nearly $1,700 every year on these treats, a new report has revealed.</span></p> <p><span>Suncorp’s <a href="https://www.suncorpgroup.com.au/news/features/food-for-thought-australians-spend-272-billion-on-food-annually"><em>Cost of Food</em></a> report found that a staggering 60 per cent of Australians blow over their allocated food budget, with the average person spending close to $300 a week on food and drinks.</span></p> <p><span>One in four Australians do not stick to their food budget, while a third do not budget for food at all. </span></p> <p><span>The bank’s behavioural economist Phil Slade said the findings showed that Aussies are ruled by “instinct” when it comes to purchasing food. </span></p> <p><span>He noted that an average person spends $140 each month – or $1,680 each year – on take-away food and café beverages despite recognising them as an “unreasonable expense”.</span></p> <p><span>“We all have good intentions when it comes to our finances, but for many of us our brains go into auto-pilot when it comes to food,” Slade said.</span></p> <p><span>“As we get busier, we tend to ‘throw money’ at painful problems or situations as an easy solve – hunger or boredom are examples of painful problems we tend to solve by spending on food.</span></p> <p><span>“This is why we shouldn’t go shopping when we’re hungry, as our brains are more focused on addressing the hunger than thinking about our finances.”</span></p> <p><span>Slade said the rise of food delivery services could also lead Aussies to break their budget. </span></p> <p><span>“While the rise of food delivery services are perceived as making life simpler, they’re also giving us another outlet to spend money in moments when we’re experiencing pain [hunger], which in most cases hasn’t been budgeted for,” he said.</span></p> <p><span>The report, which polled more than 1,500 Australians across the country, discovered that the average shopper spend $135 on groceries, $52 on dining out, $31 on alcohol, $22 on takeaways, $13 on coffees and teas, $12 on food delivery services, $12 on supplements and $11 on health foods, totalling to $288 every month.</span></p> <p><span>Slade said meal planning would help people keep their expenses in check. “A good trick is only planning meals a couple of days in advance, so you only buy what you need. This also allows you to buy what’s on special, and avoid food getting lost in the freezer.”</span></p>

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How robo-debt class action could deliver justice for tens of thousands of Australians

<p>The announcement by Gordon Legal of a <a href="https://www.abc.net.au/news/2019-09-17/robodebt-centrelink-class-action-lawsuit-announced/11520338">class action</a> to compensate victims of the government’s so-called robo-debt scheme is welcome, perhaps even groundbreaking.</p> <p>Standing alongside class action litigator Peter Gordon at a press conference in parliament house on Tuesday, former opposition leader and shadow government services minister Bill Shorten said the <a href="https://gordonlegal.com.au/about/">legal veteran</a> was the man who “took on big tobacco in America, took on asbestos cases, took on thalidomide compensation”.</p> <p>Gordon said he only began looking at robo-debt when Shorten took over the portfolio in May and invited him to examine the government’s curious behaviour of wiping the debts at the centre of legal challenges rather than pursuing them and establishing its right to the money in court.</p> <p><strong>What is robo-debt?</strong></p> <p>Robo-debt is a part-automated process in which recipients of government benefits are sent letters asserting that they owe the government money because they have been overpaid. Many of the debts are <a href="https://www.notmydebt.com.au/the-issue">false or highly inflated</a> because they are calculated using an inaccurate formula that averages employment earnings over a series of fortnights rather than identifying what actually earned in the relevant fortnight.</p> <p>Robo-debts have been routinely overturned as lacking a legal foundation when appealed to the first level of the Administrative Appeals Tribunal. Although the rulings have always been accepted by Centrelink in the individual cases taken before the Tribunal, Centrelink has not applied them to cases not taken to the tribunal.</p> <p>Nor has Centrelink <a href="http://www.unswlawjournal.unsw.edu.au/wp-content/uploads/2018/03/006-Carney.pdf">ever challenged</a> those individual rulings at the second level of the tribunal, where the hearing and the reasons for decision are made public.</p> <p>A Federal Court challenge by two Australians who are arguing the illegality of robo-debts remains underway, but Centrelink <a href="https://www.theguardian.com/australia-news/2019/sep/06/centrelink-wipes-robodebt-in-second-case-set-to-challenge-legality-of-scheme">wiped both debts</a> after the case was launched. Argument remains about whether this means there is still a live legal issue to be heard. The case is not expected to return to court until December.</p> <p><strong>What is “unjust enrichment”?</strong></p> <p>What is incontrovertible is that very large sums of money are being raised by a scheme that verges on extortion. “<a href="https://gordonlegal.com.au/news/gordon-legal-to-fight-illegal-robodebt-clawback/">Unjust enrichment</a>” is the term Gordon Legal plans to use in the action, a term that applies when one entity is enriched at the expense of another in circumstances the law sees as unjust.</p> <p>It is also investigating whether the so-called collection fees levied by Centrelink should be refunded and whether those who have wrongly paid all or part of the amounts claimed should be paid interest on the amounts collected and whether they are entitled to compensation.</p> <p>Between July 2016 and March 2019 the government issued <a href="https://www.theguardian.com/australia-news/2019/feb/06/robodebt-faces-landmark-legal-challenge-over-crude-income-calculations">500,281</a> robo-debt notices, asserting debts of A$1.25 billion, with the average being $2,184, but not uncommonly as much as $10,000.</p> <p>Much less has as yet been collected, but tax return garnishees, debt collection agencies and staff “quotas” are <a href="https://www.theguardian.com/australia-news/2019/may/29/centrelink-still-issuing-incorrect-robodebts-to-meet-targets-staff-claim">driving it up</a>.</p> <p><strong>What’s different about the class action?</strong></p> <p>The class action differs from Administrative Appeals Tribunal reviews or Federal court actions by seeking remedies for a whole class of people, not only those with the knowledge or personal stamina to lodge an appeal.</p> <p>It is form of legal process that cannot be stopped or slowed by wiping the debts of a few individuals. Being a judicial process, it is aired in public (first-tier tribunal decisions remain private).</p> <p><strong>What’s being claimed?</strong></p> <p>The simple argument that will be put is that the government has obtained monies to which it was not lawfully entitled. Not having a lawful basis for the collections (their being, in a sense, an unwarranted “tax” on the supposed debtors), it will be argued that it should return (“restitute”) the monies and pay damages as compensation for unjust enrichment.</p> <p>There are a number of <a href="http://www.austlii.edu.au/au/journals/UWSLRev/2001/2.html">special features and technical requirements</a> to be satisfied before a class action can successfully be lodged for consideration, including obtaining a sufficient number of plaintiffs.</p> <p><strong>Where to now?</strong></p> <p>It is still very early days. There are many procedural and legal hurdles yet to be crossed.</p> <p>However, unlike the paths trodden to date, the class action holds the potential of being able to deliver justice to the many rather than to the few who win private victories without ever testing the government’s powers in open court.</p> <p><em>Written by <span>Terry Carney, Emeritus Professor of Law, University of Sydney</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/robo-debt-class-action-could-deliver-justice-for-tens-of-thousands-of-australians-instead-of-mere-hundreds-123691" target="_blank"><em>The Conversation</em></a><em>. </em></p>

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"An insult": Why welfare recipients condemn cashless card

<p>“This is a bit controversial, we know that,” deputy prime minister Michael McCormick told the <a href="https://www.michaelmccormack.com.au/media-releases/2019/9/16/address-to-the-nationals-federal-council-canberra-14-september-2019">National Party’s federal council</a>, which on the weekend voted for a national roll-out of cashless debit cards for anyone younger than 35 on the dole or receiving parenting payments.</p> <p>The Nationals have joined the chorus within the federal government proclaiming the cards a huge success.</p> <p>The Minister for Families and Social Services, Anne Ruston, has even gone so far as to claim welfare recipients are “<a href="https://www.canberratimes.com.au/story/6355110/welfare-card-users-full-of-praise-govt/">singing its praises</a>”.</p> <p>Really?</p> <p>Both McCormick and Ruston have proclaimed success based on the most recent trial of cashless welfare in Queensland. This trial began barely six months ago, and the independent evaluation by the <a href="https://www.adelaide.edu.au/future-employment-skills/research#review-of-cashless-debit-card-cdc-trial-in-the-goldfields-region-of-wa">Future of Employment and Skills Research Centre</a> at the University of Adelaide is ongoing.</p> <p>A more complex story emerges out of my research into lived experiences of the first cashless debit card trial, which began in Ceduna, South Australia, <a href="https://www.dss.gov.au/families-and-children-programs-services-welfare-quarantining-cashless-debit-card/cashless-debit-card-ceduna-region">in March 2016</a></p> <p>I spent about three months in the town of Ceduna between mid 2017 and the end of 2018 talking to people <a href="https://insidestory.org.au/weve-lost-our-vision-a-card-cannot-give-vision-to-the-community">about life on the card</a>.</p> <p>All communities are diverse and people’s experiences diverge. Some liked the card, or had come to accept it, others were caught up dealing with far more significant problems.</p> <p>But I talked to people who found the card “an insult”. They told me it made them feel “targeted” and “punished”. They talked of degradation and defiance. They also told me the card didn’t work.</p> <p>As for the the claim by both Ruston (and her ministerial predecessor <a href="https://www.paulfletcher.com.au/portfolio-speeches/speech-to-sydney-institute-welfare-personal-responsibility-and-the-cashless">Paul Fletcher</a>) that the card empowers people to “demonstrate responsibility”, the opposite was true. In the words of June*, an Indigenous grandmother, foster carer and talented artist: “It has taken responsibility away from me. It’s treating me like a little kid again.”</p> <p><strong>Indigenous testing grounds</strong></p> <p>Ceduna, in the far west of South Australia, was the first of four sites chosen to trial cashless debit cards. The second was in the East Kimberley</p> <p>The location of these two trial sites meant early trial participants have been predominately Indigenous. I am of the view that Indigenous communities are being used as testing grounds for new technologies and controversial measures.</p> <p>In the first two trial sites, income support recipients younger than 65 have just 20 per cent of their payment deposited into their bank account. The remaining 80% goes on to their debit card, which cannot be used at any alcohol or gambling outlet across the nation. Nor can they be used to withdraw cash.</p> <p>The lead-grey cashless debit card is similar but different to the lime-green BasicsCard, introduced as part of the 2007 Northern Territory National Emergency Response (the “Intervention”). The use of the BasicsCard as an “income management” tool was extended to non-Indigenous people in the Northern Territory in 2010, and to other states in 2012.</p> <p>The BasicsCard generally quarantines 50% of a social security recipient’s income so that it cannot be spent on alcohol, gambling, tobacco or pornography. BasicsCard holders need to shop at approved stores. In contrast, the cashless debit card, administered by financial services company <a href="https://www2.indue.com.au/">Indue</a>, can theoretically be used wherever there are Eftpos facilities.</p> <p><strong>Shame and humiliation</strong></p> <p>My research wasn’t based on collecting statistics but “hanging out” and getting to know people. I came to see the stigma associated with the “grey card” sometimes resonated with past experiences.</p> <p>Robert*, for example, told me about growing up on a mission and then suddenly finding himself as “one little blackfella” in a large high school. He was acutely sensitive to the “smirks” and judgements of others whenever he used the grey card to pay for things.</p> <p>Pete* left high school after a couple of weeks to join an itinerant rural workforce that has since vanished. After decades of manual work, finding himself unemployed due to ill health was devastating enough. Being issued the grey card compounded his humiliation.</p> <p>Others voiced their belief the grey card was designed to induce shame. But they refused that shame, expressing instead a defiant belief in the legitimacy of their need for support.</p> <p>The welfare system often defines people by the one thing they are not currently doing – waged employment. But many people I spent time with in fact laboured constantly: it just wasn’t recognised as work. People like June*, for example, looked after sick kin, the elderly and children. Yet the grey card treated <em>them</em> as dependents.</p> <p>I heard about ways of getting around the card’s restrictions. As one acquaintance put it: “Drunks gonna drink!” One strategy involved exchanging temporary use of the card for cash. With terms that nearly always disadvantage the card holder, it has the potential to make life tougher for people living in hardship.</p> <p>These observations concur with the sober assessments of experts such as the <a href="https://www.smh.com.au/politics/federal/cashless-welfare-card-trial-not-working-drug-and-alcohol-centre-says-20190910-p52pv5.html">South Australian Aboriginal Drug and Alcohol Council</a>.</p> <p>The evaluation of the Ceduna trial for <a href="https://www.dss.gov.au/sites/default/files/documents/10_2018/cashless-debit-card-trial-final-evaluation-report_2.pdf">the Department of Social Services</a> was more positive, noting that alcohol drinkers and gamblers reported doing so less frequently. But it also noted no reduction in crime statistics related to alcohol consumption, illegal drug use or gambling. And the Australian National Audit office was so critical of the government’s evaluation it <a href="https://www.anao.gov.au/work/performance-audit/implementation-and-performance-cashless-debit-card-trial">concluded</a> that it was difficult to ascertain “whether there had been a reduction in social harm” as a result of the card’s introduction.</p> <p>Which makes simplistic claims about the card’s success look a bit rich.</p> <p>*<em>Pseudonyms are used throughout</em>.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/123352/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Eve Vincent, Senior Lecturer, Macquarie University</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/an-insult-politicians-sing-the-praises-of-the-cashless-welfare-card-but-those-forced-to-use-it-disagree-123352" target="_blank"><em>The Conversation</em></a><em>.</em></p>

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Cancer Council calls for tobacco licence for businesses

<p><span>Around 10,000 businesses would be required to purchase a licence to continue selling tobacco products under a new proposal to reduce smoking-related cancer deaths.</span></p> <p><span>Cancer Council has called on the New South Wales government to introduce a ‘tobacco licence’ to reduce the number of stores selling the controversial item in the state.</span></p> <p><span>According to a study that the non-profit organisation conducted with the University of Sydney and Western Sydney University, an annual licencing fee would help discourage stores from selling cigarettes and other tobacco products. </span></p> <p><span>In Western Australia, the only state in the study that has licencing fees, around one in eight former tobacco retailers said the licence was the reason they stopped selling the product.</span></p> <p><span>The research surveyed more than 4,500 businesses in NSW, Victoria and Western Australia, with about 1,830 of these selling or having previously sold tobacco.</span></p> <p><span>“Tobacco is among the most widely available consumer goods in Australia, and this wide distribution increases consumption, maintains smoking and undermines smokers’ quit attempts,” said Christina Watts, Cancer Council NSW’s tobacco control senior project officer and lead author of the research.</span></p> <p><span>“This research shows that a fee-based tobacco licence can contribute to a reduction in the availability of tobacco.” </span></p> <p><span>Currently, retailers in Western Australia, Tasmania, Northern Territory, South Australia and the Australian Capital Territory have to pay between $242 and $297 to sell tobacco products. NSW, Victoria and Queensland do not require businesses to pay any annual fee for tobacco sales.</span></p> <p><span>“Licensing can be used to restrict the number of retailers within areas, limit the types of outlets that can sell tobacco and/or deter retailers from selling or continuing to sell,” said Watts.</span></p> <p><span>The survey found up to 45 per cent of NSW tobacco retailers to be in support of an annual fee if the money was put towards greater enforcement and education of laws.</span></p> <p><span>“Smoking still places a huge burden on the community and on people’s lives,” Watts said.</span></p> <p><span>“If the NSW Government are to achieve the goal of restricting the availability and supply of tobacco, as outlined in their tobacco strategy, the introduction of an annual licence fee for retailers is a common-sense next step,” she concluded.</span></p>

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