Survey of 11,000 reveals the pain of low interest rates, the sting of age discrimination and the future of GST
As far as we know Glenn Stevens, the governor of the Reserve Bank, hasn’t yet done the FiftyUp Budget survey but he’s certainly explaining, if not quite feeling, your pain. He might even like to see the results.
This week he told a conference that retirees now face tough choices because of very low interest rates meaning they need to take ‘more risk to fund their post-work years’.
Low interest rates and you
We asked you “Does the Reserve Bank need to be more mindful of retirees when cutting interest rates to record lows?”
There was a resounding “yes” with 57% saying they were suffering because of how the current low interest rate environment has reduced the returns on their savings.
Another 28% said “no”, as housing affordability was more important - and 15% “didn’t know”.
Our annual Budget survey has now attracted more than 11,000 responses. Last week we released the results around super, pensions and negative gearing. Click here to read last weeks results.
Today, in part two, we analyse what you said around older workers, age discrimination and job participation and also the GST.
Age discrimination, jobs and working longer
The Human Rights and Equal Opportunity Commission’s survey of older workers recently found 27% had been discriminated against because of their age.
When we asked if you’d felt age discrimination when applying for work, 39% said “yes” which suggests many people are conscious how their age affects their opportunities. Almost 50% said ‘no’ they hadn’t experienced it and 12% didn’t know.
Another question you may have heard debated recently is if there should be a lower income tax rate for those aged over 65 who work. A resounding 85% said “yes” and 11% “no”.
There was a mature age worker tax offset, but it was abolished in the last budget. There is also a Senior Australians tax offset, but perhaps not as generous as your answers might have hoped for.
The issue here is giving older Australians more incentive to work longer. Age discrimination commissioner Susan Ryan said last week the cost to the economy of losing older workers was $10 billion a year.
Eligibility for the age pension is gradually creeping up so eight years from now, you will have to be 67 to get the benefit.
So we asked you if you’d LIKE to work beyond 65 and you were roughly split into thirds for yes, no and “it depends on the work”.
We also asked if you’d NEED to work after 65 and 35% said “yes”, 47% “no” and 12% “don’t know”.
Should we change the GST?
Finally to another topic on which there’s no end of speculation and fear: the GST. It appeared many of you were open to change to the system.
When asked if you support change, 21% said absolutely not, 34% said some change is necessary and 45% perhaps left the door open by saying it depends on what is proposed.
The possible changes to GST concern both the rate and the range. If you were open to change, we asked you what should be our rate of GST?
About 2 in 5 opted for a 12% rate, slightly more than opted for a 15% rate. 17% didn’t know.
We then asked if you’d support an extension of GST to areas such as fresh food, private school fees and online purchases over a certain level, if compensation was paid to the less well-off.
A perhaps surprising 55% said “yes”, 36% were “no” and 9% just didn’t know.
So some interesting results this year, in which we older Australians made our feelings known on contentious issues such as retirement incomes and tax concessions.
We’ll be taking to the results to Canberra to let the pollies know where you stand and what you’d like.
We may even hand Glenn Stevens a sample of your many comments on interest rates to help with with his future deliberations.
