Rising concerns about pension sufficiency and raising the retirement age have led to an increased move toward reforms in Australia. Advocates point to evidence that payments have not kept pace with the increasing cost of living. This is particularly true for blue collar workers, whose physical bodies literally break down before they hit their retirement years. Chris Grice, a prominent advocate for pension reform, has made a case for increasing JobSeeker payments, the age pension, and the disability pension to better support individuals struggling financially.
Australia’s retirement age, for instance, has recently been raised to 67. After recent reform attempts in other countries heated conversations about this topic, Denmark recently passed a law increasing its pension age from 67 to 70 by 2040. At the same time, China is mulling a phased retirement age hike to 65 for everyone. As these countries change their policies, the sustainability of Australia’s existing retirement paradigm comes under scrutiny.
Current State of Pensions in Australia
The economic situation for Australians dependent on any form of government assistance is dire. As an example, a single person on JobSeeker takes home roughly $20,300 per year. In comparison, the base rate income for an age pensioner individual is about $29,800 per year. Retirement advocates, such as Patricia Sparrow, argue that these sums are inadequate for a dignified retirement.
Sparrow stated, “The government’s own advisory committees proposed that JobSeeker should be set at 90 percent of the age pension.” She says this kind of permanent adjustment would give people the relief they need.
Chris Grice echoed similar sentiments, arguing that the financial assistance needs to be sufficient to allow individuals to have a “modest and comfortable situation in terms of their retirement.” He cited some compelling reasons why most Americans will find it difficult to work into their late sixties or seventies. Health and mobility disabilities play an undeniable role in this struggle.
The Challenges Faced by Manual Laborers
Ross, a former site builder who started at the age of 15, opened up about his own issues. For the last four years, he has not been able due to health complications and that made it impossible for him to work. Today, he just survives on Centrelink payments and his savings.
“It’s pretty tough … I own my own home. That’s the only reason I can survive,” he explained. Ross’s story brings attention to the dismal conditions that manual workers endure. These workers suffer both mental and emotional trauma, as well as severe physical toll from decades of strenuous, backbreaking work.
He added, “It’s really important because all us older guys, our bodies are worn out.” Millions of people in Ross’s situation are one unexpected expense away from financial ruin as they near the age of expected retirement. Grice noted that there are various health concerns affecting older workers: “There are other health concerns … long COVID, situations where someone has a heart attack, car accidents.”
Global Comparisons and Future Considerations
The controversial debate over raising retirement ages isn’t just an issue here in Australia. In the UK, the state or pension age is 66 and is set to rise to 67 by the end of 2028. Meanwhile, in the U.S., it can be as low as 65 and up to 67 based on your year of birth. As a point of reference, neighboring France just passed a raise in its age of retirement to 64.
These international comparisons help to underscore how different our counterparts around the world are addressing the same challenges. In the UK, proposals to increase the state pension age for people born after 1960 have caused a powerful political storm. In that change got publicly ahead of itself on the Univ.
Life expectancy is increasing, with Australia’s average life expectancy now 83.1 years. This trend casts some serious doubt on the wisdom of ever raising the retirement age. Ross reflected on his own experiences: “It’s been a real battle and you shouldn’t wish your life away, but I wish a long time ago that I was pension age.”
