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Compulsory voting in Australia is 100 years old. We should celebrate how special it makes our democracy

<div class="theconversation-article-body"><em><a href="https://theconversation.com/profiles/paul-strangio-1232">Paul Strangio</a>, <a href="https://theconversation.com/institutions/monash-university-1065">Monash University</a></em></p> <p>For nearly 200 years, the notion of American political exceptionalism has had currency in the United States: it is an idea rooted in the nation’s status as the first modern republic. As we watch from afar, disturbed yet mesmerised by the latest chapter of violent political division in America, the country seems less a paragon than a symbol of democratic pathology.</p> <p>America’s certainty in its political uniqueness is symptomatic of a brash national chauvinism. By way of contrast, Australia is prone, if anything, to undue bashfulness about its democratic credentials. How else can we explain that this month marks the centenary of the most extraordinary feature of the country’s democratic architecture, and yet the anniversary is slipping by with neither comment nor reflection. I refer to compulsory voting, which was legislated in the federal parliament in July 1924.</p> <p>Compulsory voting is not unique to Australia. Calculating how many countries abide by the practice is notoriously difficult, since in around half the nations where compulsory voting exists in name it is not enforced. Most estimates, however, put the figure in the vicinity of 20 to 30.</p> <p>If not unique, Australia’s experience of compulsory voting is highly distinctive for a number of reasons.</p> <p>First, its emergence in the early 20th century was consistent with the nation’s larger tradition of innovation and experimentation when it came to electoral institutions and practices. This record is typically traced back to the pioneering in the 1850s of the secret ballot (sometimes called the “Australian ballot”) in a number of the Australian colonies and the embrace of other advanced democratic measures in the second half of the 19th century.</p> <p>These included manhood suffrage, payment of MPs and the extension of the franchise to women, beginning in South Australia in 1894. The innovations continued in the 20th century with such things as preferential voting and non-partisan bureaucratic electoral administration.</p> <p>Second, Australia is alone in embracing compulsory voting among the Anglophone democracies to which it typically compares itself. The electoral systems of Britain, Canada, New Zealand and the United States are all based on voluntary voting.</p> <p>Third, unlike many other compulsory voting countries, Australia does not pay lip service to its operation. Electoral authorities enforce compulsory voting, albeit leniently. It has been strongly upheld by the courts and is backed by a regime of sanctions for non-compliance.</p> <p>Fourth, compulsory voting has been consistently and unambiguously successful in achieving high voter turnout. Though there has been a slight downward trend in turnout at the past five national elections (it hit a low of 90.5% in 2022), it has not fallen below 90% since the adoption of compulsory voting a century ago.</p> <p>This is around 30% higher than the recent average turnout in countries with voluntary voting. It is also well above the recent average in countries with compulsory voting systems.</p> <p>Fifth, the public has strongly and consistently backed the practice. Evidence from more than half a century of opinion polls and election study surveys shows support hovering around the 70% mark.</p> <h2>An impregnable practice</h2> <p>Perhaps the most singular aspect of the nation’s experience of compulsory voting, however, is how seemingly impregnable is the practice if measured by its durability, the dearth of controversy over it, the consistency of its enforcement by authorities and the way citizens have dutifully complied with and supported it. Together these things make Australia an exemplar of compulsory voting internationally.</p> <p>This is not to say compulsory voting has been a sacred cow in Australia. In the final decades of the 20th century and first decade of this century, there was a concerted push to end the practice emanating principally from within the Liberal Party.</p> <p>The torchbearer of the agitation for voluntary voting was the avowed libertarian South Australian senator, Nick Minchin. <a href="https://classic.austlii.edu.au/au/journals/SGSocUphAUCon/2003/11.html">For Minchin</a>, compulsory voting was anathema:</p> <blockquote> <p>[…] in relation to the most important single manifestation of democratic will, the act of voting, I profoundly detest Australia’s denial of individual choice. It seems to me that an essential part of a liberal democracy should be the citizen’s legal right to decide whether or not to vote. The denial of that right is an affront to democracy.</p> </blockquote> <p>Minchin had a number of like-minded supporters of voluntary voting in the Liberal Party. Among them, importantly, was John Howard, whose prime ministership coincided with the mobilisation to abolish compulsory voting.</p> <p>Howard had been on record as an opponent of the practice since his entry to the federal parliament in 1974. The Liberal Party campaign against compulsory voting manifested in, among other things:</p> <ul> <li>the party’s federal council resolving in favour of voluntary voting</li> <li>shadow cabinet endorsing a recommendation for a change of policy to voluntary voting being placed before the joint Liberal-National party parliamentary room</li> <li>the introduction in the South Australian parliament of two bills to repeal compulsory voting by successive Liberal state governments</li> <li>Coalition members of the Joint Standing Committee on Electoral Matters repeatedly recommending the abolition of the practice.</li> </ul> <p>In the end, these agitations achieved nought. The most fundamental reason was that the opponents of compulsory voting failed to generate community resentment towards the system. Howard, while restating his preference for voluntary voting, admitted as much in 2005 when shutting down debate on the issue in his government:</p> <blockquote> <p>As I move around the country, I don’t get people stopping me in the street and saying, “You’ve got to get rid of compulsory voting.”</p> </blockquote> <p>Indeed, election survey data suggests the Liberal campaign coincided with a firming of public support for compulsory voting. In the two decades since, opposition has been dormant. For the foreseeable future, Australia’s compulsory voting regime is secure.</p> <h2>An Australian democratic exceptionalism?</h2> <p>As noted above, compulsory voting has kept voter turnout at elections above 90% for the past century. Kindred democracies marvel at, and envy, this level of participation. It affords legitimacy to election outcomes in this country. Significantly, it also produces a socially even turnout.</p> <p>Compare this to the situation in this month’s United Kingdom election. Turnout <a href="https://www.theguardian.com/politics/article/2024/jul/12/lowest-turnout-in-uk-general-election-since-universal-suffrage-report-shows">is estimated</a> to have slumped to a record low 52%. There was a clear pattern of the “haves” exercising much greater say at the ballot box than the “have nots”. Those who stayed away from the polls were predominantly less well-off, non-homeowners, the young, the lower-educated and of minority ethnic background.</p> <p>Australia cannot be complacent in this regard. Low and declining turnout in remote electorates with high Indigenous populations is the most worrying chink in the performance of compulsory voting. In 2022, turnout in the Northern Territory seat of Lingiari fell to 66.8%. Even so, the practice largely succeeds in achieving inclusive voter participation across the country.</p> <p>Crucially, compulsory voting is also recognised as one reason the political centre holds better in Australia than in many comparable nations. It exercises a moderating influence because it ensures it is not only impassioned partisans at either end of the political spectrum who participate in elections. This in turn means they are not the chief focus of governments and political parties.</p> <p>Under a compulsory voting system, middle-of-the-road citizens and their concerns and sensibilities count. This inhibits the trend towards polarisation and grievance politics evident in other parts of the globe. It helps explain why Australia has been less receptive to the aggressive conservative populism that has taken root in the United States and Europe.</p> <p>Compulsory voting also goes hand in hand with other institutional bulwarks of the nation’s democracy. While there is plenty of evidence in Australia of increasing disaffection with politics, one thing that helps bolster faith in the democratic system is the politically independent national electoral authority, the Australian Electoral Commission.</p> <p>The AEC’s trusted impartial administration of the electoral system lends integrity to the democratic process. So do the many procedures it manages to facilitate voting. To name a few: Saturday election days, assistance for the ill, aged and those from non-English-speaking backgrounds, mobile polling stations, postal, absentee and early voting, and active and regular updating of registration.</p> <p>Indeed, Australia has been described as “the most voter-friendly country in the world”. Compulsory voting encourages this accessibility: if citizens are obliged to vote, then it becomes incumbent to smooth the path to them participating. The ease of voting in Australia contrasts with what goes on elsewhere, for example, the rampant state-based voter-suppression practices in the United States.</p> <p>Dare we suggest, then, that compulsory voting is a mainstay of an Australian democratic exceptionalism? That we little note, let alone extol, the practice is perhaps not only a product of an inherent national modesty but because it is second nature after 100 years. Habituated to being compelled to participate in elections, we are inured to its specialness.</p> <p>Let’s hope this casual familiarity does not induce apathy rather than vigilance when next the system is challenged.<!-- 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;" src="https://counter.theconversation.com/content/234801/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: https://theconversation.com/republishing-guidelines --></p> <p><a href="https://theconversation.com/profiles/paul-strangio-1232"><em>Paul Strangio</em></a><em>, Emeritus Professor of Politics, <a href="https://theconversation.com/institutions/monash-university-1065">Monash University</a></em></p> <p><em>Image credits: Shutterstock </em></p> <p><em>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/compulsory-voting-in-australia-is-100-years-old-we-should-celebrate-how-special-it-makes-our-democracy-234801">original article</a>.</em></p> </div>

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Women retire with less than men: Boosting compulsory super won’t help

<p>All sorts of claims are being made following the release of the Retirement Income Review, including that it paid insufficient attention to issues of gender.</p> <p>Among other things we are being told that the gap between female and male super would narrow if compulsory contributions were lifted from 9.5% to 12%.</p> <p>It wouldn’t, not at all. As the <a href="https://treasury.gov.au/publication/p2020-100554">review</a> of which I was a member states, “maintaining the superannuation guarantee at 9.5% would avoid the increases in inequities associated with the superannuation guarantee rate rising to 12%”.</p> <p>Since men on average earn more than women, increasing the superannuation guarantee rate would widen — rather than narrow — the retirement income gap.</p> <p>By design, superannuation is a contributory scheme. That means what you get in retirement depends largely on how long you have been in the workforce and how much you have been paid.</p> <p>In that respect women are at a disadvantage, firstly due to the gender pay gap.</p> <p><strong>Women get less super because they get less pay</strong></p> <p>The review points out in November 2019 the gap in total average weekly earnings was 16.9% for women and men working full-time.</p> <p>The Bureau of Statistics reported in December 2020 that the pay gap had fallen to <a href="https://www.abs.gov.au/statistics/people/people-and-communities/gender-indicators-australia/latest-release#economic-security">13.4%</a>.</p> <p>While there is still a way to go, it’s an improvement.</p> <p>However, the second and greater disadvantage for women is that they are far more likely to take on caring roles that lead to career breaks and part-time employment.</p> <p>Some 93% of all primary carer leave is taken by women. The result is a gender pay gap of closer to <a href="https://www.abs.gov.au/statistics/labour/earnings-and-work-hours/average-weekly-earnings-australia/latest-release">30%</a> when part-time and full-time work are taken together.</p> <p><strong>Several things could help</strong></p> <p><a href="https://images.theconversation.com/files/390716/original/file-20210321-15-1jrip39.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/390716/original/file-20210321-15-1jrip39.png?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://treasury.gov.au/sites/default/files/2021-02/p2020-100554-ud03_equity.pdf" class="source">The Retirement Incomes Review modelled retirement outcomes by gender.</a></span></p> <p>To understand the contribution of career breaks to super balances and retirement incomes, the review constructed and modelled <a href="https://treasury.gov.au/sites/default/files/2021-02/p2020-100554-ud03_equity.pdf">five different scenarios</a> for female workers based on observed patterns of career breaks and part-time work.</p> <p>Not surprisingly the modelling found that when women take more time out of the workforce, the gender gap in superannuation balances increases. Breaks earlier in careers have a greater impact on balances than breaks taken later.</p> <p>In recent decades the impact of career breaks has been declining as women take less time out of the workforce. Average female working life climbed from 24 years in 1980 to around 38 years in 2019.</p> <p>There are a number of measures that could improve super outcomes for women.</p> <p>The review found one would be to require the payment of superannuation on employer paid parental leave and <a href="https://www.servicesaustralia.gov.au/individuals/services/centrelink/parental-leave-pay">government parental leave pay</a>.</p> <p><strong>The super gap isn’t as wide as the pay gap</strong></p> <p>Another would be to require employers to make superannuation contributions to workers earning less than <a href="https://www.ato.gov.au/Business/Super-for-employers/">$450 per month</a>.</p> <p>The present exemption impacts directly on those who work part-time and who work for a number of different employers, 63% of whom are women.</p> <p>Both options would improve the retirement incomes of women, but only marginally mitigate the gender gap inherent in the way superannuation is structured.</p> <p>But here’s what else we found. A number of measures already in place do quite a bit to lessen the gap.</p> <p>Among them are the <a href="https://www.ato.gov.au/Individuals/Super/In-detail/Growing-your-super/Low-income-super-tax-offset/">Low-Income Superannuation Tax Offset</a> and the <a href="https://www.ato.gov.au/Individuals/Super/In-detail/Growing-your-super/Super-co-contribution/">government superannuation co-contribution</a>.</p> <p>Because women earn less than men, both benefit women far more than men.</p> <p>Also, women benefit from the imposition of <a href="https://www.ato.gov.au/Individuals/Super/In-detail/Growing-your-super/Division-293-tax---information-for-individuals/">Division 293 tax</a> which limits concessions for higher income earners, who are more likely to be men.</p> <p><strong>Half as worse off in retirement</strong></p> <p>And women also make higher <a href="https://treasury.gov.au/sites/default/files/2021-02/p2020-100554-ud03_equity.pdf">voluntary super contributions</a> as a proportion of incomes then men. This is particularly so for women over the age of 50, suggesting some make a concerted effort to catch up.</p> <p>As a result, in 2017‑18 the median gap in superannuation balances between men and women aged 60‑64 was <a href="https://treasury.gov.au/sites/default/files/2021-02/p2020-100554-ud03_equity.pdf">22%</a>, considerably less than the <a href="https://www.abs.gov.au/statistics/labour/earnings-and-work-hours/average-weekly-earnings-australia/latest-release">30%</a> gender gap in pay.</p> <p>And the age pension means test means that once women move into retirement, they are more likely than men to get the age pension, and to get more of it.</p> <p>When the age pension and superannuation income are combined, the retirement income gap for women who have worked full time with no career break falls to <a href="https://treasury.gov.au/sites/default/files/2021-02/p2020-100554-ud03_equity.pdf">8.4%</a> For women with two career breaks and part-time work it falls to <a href="https://treasury.gov.au/sites/default/files/2021-02/p2020-100554-ud03_equity.pdf">14.5%</a>.</p> <p>We could do better, and the review spelled out steps to take. It found that boosting compulsory super contributions was not one of them.</p> <p>An increase in the proportion of income sent to super would lift the retirement incomes of high earners more than the retirement incomes of low earners.</p> <p>Until things change, increases in compulsory super will boost the retirement incomes of men more than women.<!-- 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/157412/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: https://theconversation.com/republishing-guidelines --></p> <p><span><a href="https://theconversation.com/profiles/deborah-ralston-107436">Deborah Ralston</a>, Professorial fellow, <em><a href="https://theconversation.com/institutions/monash-university-1065">Monash University</a></em></span></p> <p>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/yes-women-retire-with-less-than-men-but-boosting-compulsory-super-wont-help-157412">original article</a>.</p>

Retirement Income

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Employees could soon be paying for their own super

<p><span style="font-weight: 400;">With compulsory superannuation contributions set to increase from 9.5 to 10 percent on July 1, 2021, most workers are expecting a big jump in their super payments.</span></p> <p><span style="font-weight: 400;">But, some employment lawyers are warning that some bosses could be looking to avoid passing on the legislated increase in super to their workers.</span></p> <p><span style="font-weight: 400;">Workers whose contracts state their super should be paid on top of their salary are safe, but those who have super included as part of their total package could be missing out.</span></p> <p><span style="font-weight: 400;">This means it could be legal for employers to take the additional super out of their employees’ base pay.</span></p> <p><span style="font-weight: 400;">“Provided the employees don’t drop below the minimum permitted wages in an award enterprise agreement, or the minimum wage, then yes, it is permitted,” said Fay Calderone, a partner at Hall &amp; Wilcox.</span></p> <p><strong>Who’s doing it?</strong></p> <p><span style="font-weight: 400;">Ms Calderone also said she has received a number of queries from employers asking whether they have to pass on the increase.</span></p> <p><span style="font-weight: 400;">She said large employers generally don’t deny workers super rises, with the four big consultancy groups - PwC, Deloitte, EY, and KPMG - proving that by publicly stating their workers will see a 0.5 percent increase to their total pay package.</span></p> <p><span style="font-weight: 400;">But other employers may not pass on the increase according to Ms Calderone, and there’s a history of it.</span></p> <p><span style="font-weight: 400;">“The businesses in the middle - where they are large enough where they’ve had their contracts prepared - they’ve had the history behind them where this has happened before,” she said.</span></p> <p><span style="font-weight: 400;">Richard Denniss, Australia Institute’s chief economist, has also heard historical reports of this kind of behaviour, but has said it could be even worse this time around.</span></p> <p><span style="font-weight: 400;">“There have been instances of this in the past, but I fear it’s becoming even more prevalent for the simple reason that more and more employees are on the kind of contracts that allow it to happen,” Mr Denniss said.</span></p> <p><span style="font-weight: 400;">“Unfortunately, I think a bunch of smaller and medium sized businesses are feeling that they’re going to get away with it. That no one’s going to notice. And even if someone notices, no-one’s really going to care,” he said.</span></p> <p><span style="font-weight: 400;">“But let’s be clear, if thousands of employers do this, that’s exactly why we don’t get wage growth in Australia.”</span></p> <p><span style="font-weight: 400;">A survey of 145 organisations conducted by the firm Mercer found that 62 percent of the organisations using a “base plus” super model said they are maintaining their employees’ take-home pay, meaning the employer is covering the cost of the increase in super contributions without cutting their employees’ pay.</span></p> <p><span style="font-weight: 400;">On the other hand, almost two thirds of organisations offering packaged super and salaries are only covering some of the cost of the super contribution increase.</span></p> <p><strong>Unions are outraged</strong></p> <p><span style="font-weight: 400;">This statistic has unions outraged, saying the 0.5 percent increase works out to cost less than $5 a week for most employers.</span></p> <p><span style="font-weight: 400;">“It’s absolutely shocking to me that employers would be trying at this point to try and avoid paying that small increase in superannuation,” said ACTU President Michele O’Neil.</span></p> <p><span style="font-weight: 400;">“This [the super rise] is something that is going to mean that for … the economy, and for our social security and pension system, we’ll be better off if people have enough money to retire on and retire without living in poverty.”</span></p> <p><strong>What this means</strong></p> <p><span style="font-weight: 400;">Wages have been stagnating for a long time already - and the pandemic making future pay rises seem unlikely - and data from the Treasury and Reserve Bank suggests a growth in wages won’t be seen anytime soon.</span></p> <p><span style="font-weight: 400;">With this in mind, unions are arguing the super rises effectively replace a wage rise. They argue that employers choosing to not pass on increases isn’t within the spirit of the law.</span></p> <p><span style="font-weight: 400;">Ms Calderone said “it’s a real conundrum at the moment” for employers deciding what to do.</span></p> <p><span style="font-weight: 400;">“Employers are struggling … but we also know that many employees are living hand to mouth,” she said.</span></p> <p><span style="font-weight: 400;">“So, employers need to balance what the financial consequences are going to be from passing on the pay reduction to employees, against the potential that those employees will go elsewhere.</span></p> <p><span style="font-weight: 400;">“And then even if they do stay - because many employees will stay in this current environment - it’s a disengagement and the impact on morale.”</span></p>

Retirement Income

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Forget more compulsory super: Here are 5 ways to actually boost retirement incomes

<p>This morning the Grattan Institute releases its <a href="https://grattan.edu.au/">submission</a> to the government’s <a href="https://treasury.gov.au/review/retirement-income-review">retirement incomes review</a>, a review called in anticipation of five annual increases in compulsory superannuation contributions, scheduled to begin in July 2021.</p> <p>Our research shows the super increases aren’t necessary. For most Australians, retirement incomes are <a href="https://theconversation.com/why-we-should-worry-less-about-retirement-and-leave-super-at-9-5-106237">already adequate</a>. Since higher super contributions will come <a href="https://theconversation.com/think-superannuation-comes-from-employers-pockets-it-comes-from-yours-130797">at the expense of wages</a>, the scheduled increases should be abandoned.</p> <p>But there are big problems the review will need to confront.</p> <p>Here are <a href="https://grattan.edu.au/">five changes</a> that would tackle them.</p> <h2>1. Boost rent assistance</h2> <p><img src="https://images.theconversation.com/files/317733/original/file-20200228-24685-y74ele.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt="" /> <span class="caption"></span></p> <p>While most Australians are comfortable in retirement, the system is failing too many poorer Australians, especially low-income women and retirees who rent.</p> <p>Senior Australians who rent privately are more likely to suffer financial stress than homeowners or renters in public housing. And it will get worse because young Australians on lower incomes are <a href="https://theconversation.com/three-charts-on-poorer-australians-bearing-the-brunt-of-rising-housing-costs-87003">less likely</a> to own homes than in the past.</p> <p>The government’s priority should be boosting <a href="https://www.servicesaustralia.gov.au/individuals/services/centrelink/rent-assistance/how-much-you-can-get">rent assistance</a>, which has not kept pace with rent increases. Raising rent assistance by 40%, or roughly A$1,400 a year for singles, would cost just $300 million a year if it applied to pensioners, and another $1 billion a year if extended to other renters.</p> <p>A common concern is that boosting rent assistance would lead to higher rents. But that’s unlikely: households would not be required to spend any of the extra income on rent, and <a href="https://theconversation.com/rudds-rental-affordability-scheme-was-a-1-billion-gift-to-developers-abbott-was-right-to-axe-it-122854">most would not</a>.</p> <h2>2. Ease the age pension asset test</h2> <p><img src="https://images.theconversation.com/files/317738/original/file-20200228-24664-1yln6g.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt="" /> <span class="caption"></span></p> <p>While retirement incomes are adequate for most retirees, the age pension <a href="https://www.servicesaustralia.gov.au/individuals/services/centrelink/age-pension/how-much-you-can-get">assets test</a> excessively penalises people who save more for their retirement.</p> <p>Before January 1, 2017 retirees with assets above the threshold lost $1.50 of pension per fortnight for every $1,000 of assets above the threshold. In 2017 the Coalition lifted the threshold but also lifted the withdrawal rate to $3 of pension per fortnight for each $1,000 of assets.</p> <p>The changes resulted in very high effective marginal tax rates on retirement savings, so much so that a typical worker who saves an extra $1000 at age 40 increases their retirement income by only $25 each year, or $658 over 26 years of retirement, which is a <a href="https://grattan.edu.au/report/money-in-retirement/">negative return</a> on money saved for decades.</p> <p>The age pension withdrawal rate should be cut to $2.25 per fortnight for each $1,000 of assets above the threshold. This would cost the budget about $750 million a year.</p> <p>For middle and high-income workers, this change would have a bigger impact on retirement incomes per government dollar expended than boosting compulsory super.</p> <h2>3. Boost Newstart</h2> <p><img src="https://images.theconversation.com/files/317734/original/file-20200228-24685-1m16m5p.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt="" /> <span class="caption"></span></p> <p><a href="https://www.servicesaustralia.gov.au/individuals/services/centrelink/newstart-allowance">Newstart</a>, together with the disability support pension, provides an important safety net for Australians who are unable to work right through to retirement age.</p> <p>Yet while the <a href="https://www.servicesaustralia.gov.au/individuals/services/centrelink/age-pension">age pension</a> and <a href="https://www.servicesaustralia.gov.au/individuals/services/centrelink/disability-support-pension">disability support pension</a> are indexed to wages, Newstart is not. It only climbs in line with inflation. It should be increased by $75 a week and then indexed to wages going forward.</p> <p>This would <a href="https://www.theguardian.com/australia-news/2018/sep/17/push-to-raise-newstart-allowance-by-75-a-week">cost a lot</a> but it would help the <a href="https://theconversation.com/5-charts-on-what-a-newstart-recipient-really-looks-like-125937">growing legions</a> of older Australians, many of them women, who find themselves among the long-term unemployed in the years leading up to retirement, or are forced to retire early. And it would lift many more younger Australians out of poverty.</p> <h2>4. Include the home in the pension assets test</h2> <p><img src="https://images.theconversation.com/files/317739/original/file-20200228-24701-1urtm3l.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt="" /> <span class="caption"></span></p> <p><a href="https://www.smh.com.au/national/soaring-cost-of-housing-for-poorest-australians-is-driving-inequality-grattan-institute-20190906-p52ot2.html">Falling rates of home ownership</a> mean we are at risk of creating an underclass of retirees who rent.</p> <p>And our retirement incomes system makes this worse by favouring homeowners over renters. Once a person is retired, their home is <a href="https://www.servicesaustralia.gov.au/individuals/services/centrelink/age-pension/how-much-you-can-get/assets-test/assets#assetstestlimits">treated differently</a> to their other assets. Which is why <a href="https://www.theaustralian.com.au/nation/politics/elderly-in-1mplus-homes-raking-in-63bn-in-pensions/news-story/30cbe2423577d46f5489ec39b673f8f4">$6 billion</a> in pension payments go to people with homes worth more than $1 million.</p> <p>It’s time for more of the value of the family home to be included in the pension assets test. Counting more of the home above some threshold (such as $500,000) would be fairer and would save the budget up to $2 billion a year.</p> <p>No pensioner would be forced to leave their home. Pensioners with valuable homes could continue to stay at home and receive the pension under the Government’s <a href="https://www.servicesaustralia.gov.au/individuals/services/centrelink/pension-loans-scheme">pension loans scheme</a>, which recovers debts only when homes are eventually sold.</p> <h2>5. Fix super tax breaks</h2> <p><img src="https://images.theconversation.com/files/317743/original/file-20200228-24676-1whwfak.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt="" /> <span class="caption"></span></p> <p>Superannuation tax breaks <a href="https://treasury.gov.au/sites/default/files/2020-01/complete_tbvs_web.pdf">cost a lot</a> – tens of billions each year in foregone revenue, with half the benefits flowing to the top one fifth of income earners, who already have enough resources to fund their retirements.</p> <p>And the costs are set to climb further as super balances climb. The cost of the earnings concessions alone is set to climb from $17.4 billion to $20.8 billion over the next four years.</p> <p>Three reforms would keep them in check.</p> <ul> <li> <p>Voluntary contributions from pretax income should be limited to $11,000 a year. This would save the budget about $1.7 billion a year.</p> </li> <li> <p>Contributions from post-tax income should be limited to $250,000 over a lifetime, or to $50,000 a year. It won’t save the budget much in the short term, but in the longer term it will plug a large hole in the tax system.</p> </li> <li> <p>Earnings in retirement – currently untaxed for people with <a href="https://www.ato.gov.au/Individuals/Super/Withdrawing-and-using-your-super/Transfer-balance-cap/">superannuation balances less than $1.6 million</a> – should be taxed at 15%, the same as super earnings before retirement. Doing so would save the budget about $2 billion per year at first, and much more in future.</p> </li> </ul> <p>These changes to super taxes free up money to help Australians who need help without hurting the retirement prospects of middle Australians.</p> <p>Australia’s retirement incomes system works well, but there are things that need fixing.</p> <p>The reforms we propose would make retirement fairer, save taxpayers’ money, and ensure that all Australians can enjoy a comfortable retirement free from poverty.</p> <p><span><a href="https://theconversation.com/profiles/brendan-coates-154644">Brendan Coates</a>, Program Director, Household Finances, <em><a href="https://theconversation.com/institutions/grattan-institute-1168">Grattan Institute</a></em> and <a href="https://theconversation.com/profiles/jonathan-nolan-575166">Jonathan Nolan</a>, Associate, <em><a href="https://theconversation.com/institutions/grattan-institute-1168">Grattan Institute</a></em></span></p> <p>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/forget-more-compulsory-super-here-are-5-ways-to-actually-boost-retirement-incomes-132655">original article</a>.</p>

Retirement Income

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COVID-19 vaccination to become compulsory for international travel

<p>The CEO of Qantas, Alan Joyce, has warned international travellers that compulsory vaccinations will be required in the future.</p> <p>Mr Joyce noted that as soon as a vaccine becomes available, while domestic travel may be exempt, the terms and conditions will change for international journeys.</p> <p>"For international travellers that we will ask people to have a vaccination before they get on the aircraft."</p> <p>"Certainly, for international visitors coming out and people leaving the country we think that's a necessity."</p> <p>The Qantas CEO told A Current Affair that this will be something required all around the world.</p> <p>"I think that's going to be a common thing talking to my colleagues in other airlines around the globe."</p> <p>Alan Joyce also mentioned that by Christmas, 60 percent of the flights from Sydney to Melbourne should be running. </p> <p>"Aussies love to travel, the two cities are unbelievably well connected, and we went from 45 flights a day before COVID, to one flight a day," Mr Joyce said.</p> <p>The route has just re-opened again.</p> <p>"Today we're back to 70 flights on the first day of opening up."</p> <p>And post-Christmas he hopes they'll be able re-activate 1000 jobs for the people who were stood down in the height of the pandemic in March. </p> <p>"If we can get Melbourne and Sydney back to where it was pre-COVID that will be 3000 people that didn't have a role, were stood down, were working at Woolworths, somewhere else that are working for the airline again."</p> <p>The CEO said domestic flights between Sydney and Melbourne have already proven popular, with 25,000 seats sold within 48 hours</p> <p><a href="https://9now.nine.com.au/a-current-affair/coronavirus-exclusive-the-compulsory-conditions-for-australians-to-travel-internationally-as-lockdowns-ease/e4bf2f6c-faab-46dd-8528-b7f8120ede2f">Check out the full story here.</a></p>

International Travel

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2.3 million cars hit with compulsory recall in Australia

<p>The federal government is expected to issue a compulsory recall of 2.3 million cars in an effort to protect Aussie drivers from faulty airbags.</p> <p>According to the <a href="http://www.heraldsun.com.au/news/australias-first-compulsory-car-recall-order-to-hit-millions-of-vehicles-today/news-story/cfbb964926b7e4ba099e64eed90655e7" target="_blank"><strong><em><span style="text-decoration: underline;">Herald Sun</span></em></strong></a>, the Turnbull government will announce the forced replacement today after 23 deaths (including one Sydney man last year) and more than 200 injuries worldwide due to defective Takata airbags, which have been found to explode unexpectedly and launch shards of metal upon deployment.</p> <p>The recall proposal was first put forth in September <a href="http://www.oversixty.com.au/finance/insurance/2017/08/australians-could-have-deadly-airbags-in-their-cars/" target="_blank"><span style="text-decoration: underline;"><strong>following an investigation</strong></span></a> by the Australian Competition and Consumer Commission, and today, Assistant Minister to the Treasurer Michael Sukkar is expected to finally make the recall announcement.</p> <p>Ford, Holden and Volkswagen are among the affected manufacturers who will be forced to replace the airbags for free and as soon as possible – they will need to be replaced within two years of the recall. More than 100 million cars around the world are believed to be affected by the faulty airbags.</p> <p>“This is a deadline problem that needs to be solved,” Ben Turner, a spokesman for the Royal Automobile Club of Queensland, <a href="https://www.9news.com.au/national/2018/02/28/06/27/millions-of-australian-cars-hit-with-compulsory-takata-airbag-recall" target="_blank"><strong><span style="text-decoration: underline;">told the <em>Today </em>show</span></strong></a>.</p> <p>“It has been scandalous, and it has been an issue that has been going on for more than a decade across the automated industry.</p> <p>“We’ve seen some manufacturers respond well and do the job and voluntarily call the motorists in to replace these airbags. But that’s why the ACCC and the government has had to step in because it has been inconsistent and other manufacturers have essentially hoped the problem would go away.”</p> <p>Turner urges drivers who have already received recall notices to have their airbags replaced as soon as possible, and for those unsure whether or not they’ve been affected, you can <a href="https://www.productsafety.gov.au/" target="_blank"><strong><span style="text-decoration: underline;">visit the ACCC website here</span></strong></a> to see a list of recalled makes and models.</p>

Insurance

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Compulsory desexing of pets to be considered by South Australia

<p>Mandatory desexing of pet dogs and cats is being considered by South Australia, with a citizens’ jury of 35 randomly chosen members of the public guiding the changes.</p> <p>The Dog and Cat Management Board believe compulsory desexing will help reduce the number of unwanted animals. It’s estimated that more than 10,000 dogs and cats are put down in South Australia each year. However, the board note that any change needs a common sense approach.</p> <p>"We don't want to make this something where we have no pets for people," board chair Felicity-Ann Lewis told ABC.</p> <p>Other changes to the animal management act may also see a trebling of fines for animal-related offences to $315.</p> <p>It’s a move that RSPCA chief executive Tim Vasudeva disagrees with.</p> <p>"We'd be concerned as to whether that might have the effect that people can't afford to reclaim their dogs or are going to take longer to reclaim them because they need to get the money together," he said.</p> <p>However, Environment Minister Ian Hunter pointed out that while pet owners might dislike the higher fines, the general public considered safety the priority.</p> <p>“If you're a pedestrian or out in the street or have got a young toddler with you and you're attacked by a dog, you might think $315 is way too low,” he said.</p> <p><strong>Related links:</strong></p> <p><span style="text-decoration: underline;"><em><strong><a href="/news/news/2015/06/awlq-social-media/">This Australian animal welfare organisation embraced social media to do amazing work</a></strong></em></span></p> <p><span style="text-decoration: underline;"><em><strong><a href="/news/news/2015/06/dachshunds-racing-miniature-horses/">Watch this group of miniature Dachshunds racing a horse</a></strong></em></span></p> <p><span style="text-decoration: underline;"><em><strong><a href="/news/news/2015/06/four-seniors-at-bonnaroo/">What happens when a group of 70-somethings go to their first ever music festival?</a></strong></em></span></p>

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