07 December 2015
by John Passant
Pensioners in poverty – Australia is the second worst in the OECD for paying its pensioners
More than one third of Australian pensioners live in relative poverty. The OECD average is 12 percent of pensioners. Of OECD countries only South Korea is worse. Let that sink in. Slovakia, Greece, Poland, Estonia, Slovenia and Turkey, for example, all treat their pensioners much better than the Australian government does. Instead of Australian Productivity Commission suggestions that pensioners reverse mortgage their homes or downsize, maybe we should tax the rich and abolish their superannuation and other tax concessions to pay for an increase in pensions in Australia to take all pensioners out of poverty. To read the whole OECD report click here. Pensions at a glance 2015.
Note: These are relative figure based on the level of the pension compared to average wages. Imagine if Australian pensioners were paid a pension or were receiving superannuation payments the same as their counterparts in other countries. If retirement incomes were for example the OECD average that would be 87% of the average wage, i.e. around $70,000. The pension in Australia for a single person is $788.40 per fortnight, plus a maximum supplement depending on circumstances of $64.50 per fortnight and energy payment of $14.10 per fortnight and rental assistance if the circumstances are appropriate. $788.40 per fortnight is almost $20,500 a year. The average wage in Australia is a bit over $77000 before overtime is thrown in, which takes it to just over $80,000.
The poverty line in Australia is the internationally accepted 50% of median income. According to ACOSS for the year 2012 ‘for a single adult was $400 per week. For a couple with 2 children it was $841 per week.’ They say 15% of pensioners (around 300,000 pensioners) are below the poverty line.