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If you want to keep a blog that makes the arguments every day against the ravages of capitalism going and keeps alive the flame of democracy and community, make a donation to help cover my costs. And of course keep reading the blog. To donate click here. Keep socialist blog En Passant going. More... (4)

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My interview Razor Sharp 18 February
Me interviewed by Sharon Firebrace on Razor Sharp on Tuesday 18 February. http://sharonfirebrace.files.wordpress.com/2014/02/18-2-14-john-passant-aust-national-university-g20-meeting-age-of-enttilement-engineers-attack-of-austerity-hardship-on-civilians.mp3 (0)

My interview Razor Sharp 11 February 2014
Me interviewed by Sharon Firebrace on Razor Sharp this morning. The Royal Commission, car industry and age of entitlement get a lot of the coverage. http://sharonfirebrace.com/2014/02/11/john-passant-aust-national-university-canberra-2/ (0)

Razor Sharp 4 February 2014
Me on 4 February 2014 on Razor Sharp with Sharon Firebrace. http://sharonfirebrace.files.wordpress.com/2014/02/4-2-14-john-passant-aust-national-university-canberra-end-of-the-age-of-entitlement-for-the-needy-but-pandering-to-the-lusts-of-the-greedy.mp3 (0)

Time for a House Un-Australian Activities Committee?
Tony Abbott thinks the Australian Broadcasting Corporation is Un-Australian. I am looking forward to his government setting up the House Un-Australian Activities Committee. (1)

Make Gina Rinehart work for her dole
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Sick kids and paying upfront

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Save Medicare

Demonstrate in defence of Medicare at Sydney Town Hall 1 pm Saturday 4 January (0)

Me on Razor Sharp this morning
Me interviewed by Sharon Firebrace this morning for Razor Sharp. It happens every Tuesday. http://sharonfirebrace.com/2013/12/03/john-passant-australian-national-university-8/ (0)

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From the end of the age of ‘entitlement’ to the beginning of the age of resistance?

It takes a special kind of government to mobilise pensioners against them. The Abbott government is a special government.

On Wednesday in Melbourne up to 800 pensioners turned out to voice their anger with the Liberal Government’s proposed budget changes to extend the access age to 70 and decrease the indexation factor for future increases.

Australia has one of the lowest pension levels among OECD countries. Thirty five percent of Australian pensioners live in poverty. A small annual wealth tax on the top ten percent in Australia, those who own almost half the wealth in the country, could pay for an increase in the pension to a liveable amount. Getting rid of the superannuation tax concessions to the top ten percent would rake back some of their $15 billion in forgone revenue.

Labor started raising the pension access age and the Abbott government has merely adopted and extended Labor’s logic. Yet the German government is lowering the retirement age by four years for people who have worked for 45 years. If Germany, under conservative leadership, can begin cutting its retirement age for some workers, why can’t we?

Why? Because this is a government committed to continuing the bipartisan policy of shifting wealth from labour to capital and making the poor and working class pay now for a possible future economic crisis for the rich and capital in Australia.

Melbourne student demonstration against Abbott’s Budget attacks

Across Australia on Wednesday thousands of University students demonstrated against higher fees and cuts to funding. In Canberra ANU students breifly occupied an administration building and then bailed up ther Vice-Chancellor in his Office for over an hour. In Sydney and Melbourne the students marched through the town centres and some staged sit downs on the road.

Last Sunday tens of thousands marched in May against the Budget.

The Victorian Trades Hall Council had an all unions meeting on Tuesday night and the mood from the floor was anger. There were calls for strikes. The leadership are diverting this anger. They fear their membership more than they fear the bosses and their governments. It is time for members to reclaim their unions and push them into action.

The rally the VTHC has called for Thursday morning in Melbourne on 12 June gives us that opportunity. Stop work to stop the bosses’ budget. Here are facebook details of the 10.30 am ‘Bust the Budget’ rally on Tuesday 12 June at Trades Hall, 54 Victoria Street Carlton.

There will also be more demonstrations. On Saturday there will be a save Medicare demo in Wollongong. The Saturday after, 31 May, there will be a save Medicare rally in Sydney. The Melbourne Save Medicare Rally is on Friday 30 May from 5.30 pm at the State Library.

On 12 June in Melbourne there will be a morning union rally against the Budget.

The recent Bentley blockade where up to ten thousand protesters shut down operations and forced the Baird government to stop tactivity pending investigation is an  example of mass people power forcing conservative parties to act.

The pressure from rank and file workers to do something is so great that even the union leadership is talking about a strike…in October. Too late. Workers want a real fight against the Budget now. They don’t want another anodyne vote Labor campaign. Two and a half years is too far away. And Labor is not the answer. They are the party with its neoliberal attacks that has laid the ground for the Liberals.

The demonstrations and meetings against the Budget over the last week are an encouraging sign. Are we witnessing the end of the age of entitlement and the beginning of the age of resistance?

We on the left need to be arguing for and helping rank and file workers and others to organise demonstrations and strikes in the fight against the bosses’ Budget.

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Comments

Pingback from From the end of the age of ‘entitlement’ to the beginning of the age of resistance? | OzHouse
Time May 21, 2014 at 10:12 pm

[…] May 21 2014 by admin […]

Comment from Kay
Time May 22, 2014 at 10:01 am

John

John

Re your comment: “Australia has one of the lowest pension levels among OECD countries.” Maybe, but you have omitted the second part of Prof Whiteford’s findings that they also have the highest median wealth relative to the rest of the population among OECD countries. The conclusion one could draw is that government pension rates should rise, but eligibility rules should be tightened up quite significantly.

Re your statement: “Yet the German government is lowering the retirement age by four years for people who have worked for 45 years.” The retirement age in Germany is scheduled to reach 67 in 2029, so this new move reduces that age to 63. You have omitted mentioning that German workers contribute to their pension scheme their entire working lives – nearly 20% of their wage, paid half by the employee and half by the employer. So really, the new retirement age of 63 is akin to preservation age. The German pension for non-public servants is similar to our old unfunded public service superannuation scheme. German public servants don’t have to make personal contributions, but they receive a lower salary to recognise this. Like the old defined benefit scheme, the pension paid is based on average salary and number of years worked. So I guess the new move means that the maximum pension payable is achieved after 45 years’ work – the old Australian PS defined benefit scheme gave 50% of final average salary after 50 years’ work.

Germans may also have access to 2 other types of pension schemes – those run by the employer itself, and private schemes. I’m not entirely sure what happens to those who don’t work, or don’t personally contribute to any other pension schemes, but I think some very minimum government payment is available. Nevertheless, Germany also has major concerns about funding the growing number of retirees into the future.

I think when you make comparisons with other countries, it is important to recognise that these other countries may have entirely different lifelong schemes – and simple comparisons are not entirely valid.

Comment from John
Time May 22, 2014 at 10:50 am

So why do 35% of Australian pensioners live in poverty then? I am in favour of universal access and higher penions. tax the rich and business during their lifetimes to pay for it.

Second, if Germany is under the same pressure as Australia, how can they even coonsider reducing their pension age? It is not the specifics of their scheme but the direction they are travelling that is important. It gives the lie to Abbott and Hockey’s claims about a Budget emergency in part from from an aging population.

Comment from Kay
Time May 22, 2014 at 11:51 am

“So why do 35% of Australian pensioners live in poverty then?” I agree that the age pension payment is lower than that required for a reasonable living standard. Hence many are living in poverty. But there are also clearly many who are asset rich – those assets could be a very valuable family home, and/or other investments. So, if some of these better-off pensioners had greater restrictions on access to the age pension, maybe the pension payments for the truly needy could be increased?

The big difference between Germany and Australia is that German workers pay 20% of their wage to the government during their entire working lives – half from their net pay, and half contributed by the employer. So effectively, German workers have already paid for their pension. So it just seems to me that Germany is effectively lowering the age of access to people’s own money – from 67 to 63 – like a preservation age. Note that this reduction to age 63 only applies to those who have worked 45 years. In Australia, the current preservation age is 60, but if you haven’t made your own superannuation savings from your wages, you have to wait until 65/67/70 to receive a fully taxpayer-funded pension.

The existing pension is quite expensive already. For a single retiree to buy an annuity that paid $842 a fortnight indexed to real wages until death, he would need $444K, and she would need $500K – or $799K for a couple receiving $1246 a fortnight. That’s a lot of money, and even most self-funded retirees would not have that level of super funds. I favour a move more towards the German model where both the employer and the employee contribute towards the employee’s future pension – effectively paying for your pension ahead of your actually receiving it.

Of course, this would require a lengthy phase-in period. I would see it as augmenting the current SG provisions. The contributions could continue to go into low-fee superannuation funds to produce a fully-funded pension.

I believe the government should only be responsible for paying a pension to those in the community who, for various legitimate reasons, have been unable to fund their own retirement.

Pingback from En Passant » Who do you believe – Christopher ‘the Grub’ Pyne or Socialist Alternative?
Time May 22, 2014 at 2:43 pm

[…] as my article yesterdayon the beginning of the age of entitlement shows, students and others are fighting back. It is this return to rowdy but peaceful resistance […]

Comment from Chris Warren
Time May 22, 2014 at 10:16 pm

I am getting fed up with Kay’s crazy stuff. It is clearly not the case that:

the old Australian PS defined benefit scheme gave 50% of final average salary after 50 years’ work.

Judging from the scheme benefit tables, it appears you could get 50% after 20 years service if you entered the scheme before July 1976 and reached 65.

You could get 50% after 30 years service if you entered from July 1976 and reached 65.

This is calculated on final salary at last birthday, not final average salary.

There were older schemes, and State governments and authorities had other arrangements.

When capitalism needed to attack working conditions generally, after Whitlam, the earlier super schemes were closed over time while each new replacement scheme gave workers less and less, while demanding more and more in contributions.

Scheme details are here:

http://www.css.gov.au/publication/resource/?id=288

$444K cannot provide $842 a fortnight – indexed to real wages. It only provides $842 dollars for life if interest rates are 5% and there is no inflation. So in 20 years you still only get $842 even though real wages would have gone up and inflation would pushed the value of $842 down.

To get any fixed dollar amount “indexed to real wages” you need to increase fund earning rate by both inflation and real wage increases. Most funds only index to CPI.

Any annuity that does this would probably be a term annuity – often for 30 years.

A socialist superannuation scheme would collect resources from those based on ability to pay, and provide pensions based on need.

Under these conditions all those who worked from 20 to 60, can easily receive a living pension for life.

Comment from Kay
Time May 23, 2014 at 7:46 am

Chris

So I made a typo – big deal – yes, the 1976 Act gave 50% after 20 years, not 50. Later entrants had to wait 30 years. Details. But the thrust of my argument remains. I was a member of the 1976 scheme, jumped to the accumulation scheme because I would be much better off, transferred to a Qld PS defined benefit scheme, then jumped to its accumulation scheme – and have never regretted it! The accumulation schemes gave employees what they had always demanded – flexibility – and better benefits for those on lower salaries, with options to increase your fund amount by various means. And they were actually funded! Terrific!

Re the annuity figures – forgive me – I was quoting a figures from an annuity calculation site that actually gave those dollar amounts – based on expected longevity after retirement. If they underestimated the amount needed, it just makes the government age pension even more valuable. Of course, all projected figures are based on assumptions that can be challenged.

I definitely favour accumulation schemes – the returns vary with economic circumstances (eg GFC) but over time, the performance is excellent. For example, even taking into account the GFC, most industry-based balanced investment options have returned around 10% over 5 years, 7% over 10 years, with the pension fund being around 1% higher because of tax considerations.

As for your so-called “socialist superannuation scheme” – only a fond wish – it has never ever been tested. And, like socialism/communism generally, I expect that whilst the concept might sound great, the execution would be an unmitigated disaster. Australia has many self-funded retirees living quite comfortably, thanks to our current plethora of superannuation schemes. With the SG in place, that number should increase, but only if it is modified to provide for real retirement incomes – like the German system. Both employers and employees should contribute during their working lives.