CEDA

CEDA pension age paper sparks national debate

The paper proposing a higher pension age has attracted praise from economic analysts and vigorous debate in radio, print and online forums.

Economic commentators have generally welcomed CEDA's Information Paper 89, with its proposal to raise the pension age from 65 to 67.

In the Sydney Morning Herald economics editor Ross Gittins argued that:

... while the proposal for a "dynamic" pension age is novel, many other countries are heading down this track. Iceland and Norway have already lifted their retirement age to 67 ... by encouraging people to work longer and contribute more to their superannuation, while spending that much less time living on their super savings, it would improve the adequacy of their retirement income.

Also in the Sydney Morning Herald, noted superannuation commentator Annette Sampson suggested that CEDA:

... didn't expect [the] proposal to be enthusiastically endorsed, especially in a pre-election climate. But by sticking its neck out it has signalled what may turn out to be the next wave of reform.

And the Australian Financial Review's economics editor, Alan Mitchell, wrote:

... Knox has a point. Attitudes to the retirement age do need to change. And a clearer signal from the government could help smooth the way ... The new economic game will be about competing for migrants, lifting labour force participation rates and rasing productivity. For the community, deferring retirement is a very cost-effective option ...

Pensioner lobby groups and superannuation groups have been split on the proposal by leading actuary Dr David Knox. InvestorDaily reported the Association of Superannuation Funds of Australia (ASFA) welcoming the measure.

And AAP reported a senior citizens' lobby group, Council Of The Ageing (COTA), agreeing the report should be debated.

COTA spokesperson Ian Yates was reported as saying the report "is certainly something that should be discussed in the community ... It is correct that the pension age has not risen for 100 years, and we certainly could have a discussion about whether it should be altered. We certainly as a country will need more people to stay in the workforce longer or we won't have a workforce."

The Investment and Financial Services Association (IFSA) and the Australian Institute of Superannuation Trustees (AIST), however, have been reported as saying blue-collar workers would be disadvantaged by the report's recommended higher pension age. And pensioners lobby groups the Combined Pensioners and Superannuants Association (CPSA) and the Australian Pensioners Superannuants League (APSL) also rejected the proposal. The APSL said an increase in pension age could only be justified by a massive increase in welfare and pension payments.

The Federal Government and the Opposition both argue that a higher pension age is not needed.

The paper was extensively covered in newspapers, on the Web and in television and radio reports upon its release, with Google News tracking more than 70 stories in the 24 hours after the paper's launch.

Online reports:

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