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Frequently Asked Questions

Commission research

Some misreporting in the press has led to many queries directed to the Commission in response to our An Ageing Australia: Preparing for the Future report. The following frequently asked questions have been developed to help answer your questions. Also, many of your questions are likely to be answered in the report itself, so if you have time, look at the full report to see some of the details.

If you still have questions or would like to provide some general feedback on the report, please use the comment form below.

Frequently Asked Questions

Did the Commission recommend that people could only retire when they were 70 years old?

The report makes no recommendations to government. It is a paper designed to spark a debate, not to end one. Much of the report is about Australia's likely future – the numbers of the old and those in work, the costs of health and aged care services, productivity and living standards. One part of the report examines some policy options that deserve debate — of which the design of the system that provides benefits for people when they have retired is just one of the many options that could be considered.

The Commission did not suggest that people could only retire when they reached 70 years. They could choose when to retire as they do now. The issue raised, but not resolved, was when taxpayer funds would be used to provide retirement income. (See the next question)

Did the Commission recommend that the Age Pension eligibility age be increased to 70 years?

The Commission suggested that there were grounds for linking the Age Pension eligibility age and life expectancy after the already legislated shift to 67 years in the eligibility age has been completed in 2023. The Commission gave an example of the possible effects on employment and on budgetary savings if this were to occur and the eligibility age was shifted to 70 years by 2035. Under this scenario, people unable to work would still be able to access the Disability Support Pension. They could access other savings if they wished to retire early, and would be given a long lead time to think about how they would finance any earlier retirement.

The Commission ignored the fact that older workers often face difficulties in finding employment

The Commission raised this as a serious issue in any debate about raising the Age Pension eligibility age or in any changes in how Australians access their superannuation. Attitudes would need to change. Full details can be found in chapter 6 of the report.

Did the Commission recommend older Australians sell their house and pay 50% to the government?

The Commission raised the possibility of people making use of the equity in their own home to help cover the costs of some of the services they use, and as a means to avoid governments cutting back on such services in the future. Such schemes are already in place across the country to help people pay their rates without them being forced to sell up and move elsewhere.

The Commission did not specify a given approach to using equity, but described several approaches that could work.

The 50% figure was an example only, and did not relate to the entire equity in the house, but to its change over a given year. In the example, if a house valued at $400,000 was to increase in by 2% (after taking into account inflation), or $8000, the homeowner could use $4000 to contribute to a government-funded service they use, and yet would still have a house worth $404,000 at the end of the year.

Full details about how equity schemes already work, and how they might be used is discussed in Chapter 7 of the report.

Why did the Commission write this report?

The central goal of the report is to inform people of Australia's likely future and start a discussion of possible options — and especially, new ideas that would avoid big cuts in services or new taxes — before a crisis hits.

This report was written to highlight the implications for governments and society of demographic change. It highlights that Australians and governments must take action as our population grows and ages.

Without a debate and some action to follow, ongoing budget deficits will happen year after year and the share of the population who are working will fall substantially.

The Commission was not directed by the government (previous or current) to write this report.

I have some ideas as to what could be done instead, who do I contact?

If after having read the report you have views of your own which you would like to contribute to the debate then the report is doing its job. We suggest you share your views with your local Member of Parliament and/or lobby group or lodge submissions to relevant inquiries when they arise.

If you still have questions or would like to provide some general feedback on the report to the Productivity Commission, please use the comment form below.

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