ACCI plan: turn Age Pension into loan, recoup from sale of home

This year, $44 billion will be spent on the Age Pension. The chamber wants the government to consider converting pension payments to elderly homeowners into a loan that is repaid when the property is sold.
‘Don’t wait until the system breaks’: ACCI chief executive Kate Carnell
The nation’s peak business chamber has urged the government to use the May budget to curb spending to avoid a “crippled” economy relegating Australia’s next generation to the painful adjustments needed in Spain and Greece.
As Malcolm Turnbull and Scott Morrison shun radical tax reform, The Australian can reveal new calls for the government to find extra spending cuts, including by tightening the means tests on several social-welfare programs that cost billions of dollars a year.
The Australian Chamber of Commerce and Industry’s pre-budget submission, to be released today, says unless public spending “is brought under control, the Australian economy will gradually be crippled by increasing taxes and growing public debt, both of which are unsustainable”.
“If Australia waits until the system­ breaks, we will consign the next generation to painful re­adjustments similar to those taking place in southern Europe,” the submission says.
The chamber’s focus on spending comes as business faces waiting years for a significant cut in the company tax rate, with the Treas­urer having revealed that phased cuts to the 30c-in-the-dollar rate were an option.
The government has repeatedly indicated it wants to offer income tax cuts at the next election to boost economic growth, after warning of the hit to workers from “bracket creep”, as inflation pushes them into higher tax brackets.
The submission is the first of this year’s pre-budget submissions from a major business group. While ACCI still wants tax reform, including an increased reliance on consumption taxes, the emphasis on spending restraint shows a shift in the business community’s focus following the government’s re­trea­t on lifting the GST.
The Business Council of Australia, which has vowed to push for “transformational tax reform”, is yet to release its pre-budget submission.
ACCI’s chief executive, Kate Carnell, said budget repair had to be accompanied by broad economic reforms, including changes to workplace relations, infrastructure,trade and education. On savings, she pointed to welfare and social security, which account for a big share of government spending.
Changes to the Age Pension could encourage “innovative financ­ing solutions that guarantee that pensioners can remain in their homes and still save billions of dollars from spending”, she said.
The chamber also says abolishing Family Tax Benefit Part B could save $13.9bn across four years, while means-testing the Child Care Rebate could save $250 million a year.
Cuts to social-security payments would almost certainly face a backlash from Labor and welfare groups, with Labor last year rejecting changes to family tax benefits to fund a new childcare system.
The Weekend Australian revealed the government is trying to cut waste in the tax and transfer system, targeting the 3.6 million working households who get more in benefits than they pay in tax.
The government is also considering scaling back negative gearing, workplace tax deductions and superannuation tax breaks.
Ms Carnell said that “doing nothing is not an option”.

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8 Comments Add yours

  1. Leon Collinson says:

    When will the business council who represent large businesses who are making great profits for wealthy shareholders want to cut penalties, wages to gain greater profits yet minimalize their tax bill now want to deprive the greatest tax paying generation the entitlement to a pension. If you don’t own a home or have a mortgage your are going to get nothing? They are trying to deprive our children of any inheritance to help them get their own homes. I bet not one of these business leaders have had to justify to a bank or the government there incomes would have good accountants advising them to minimalize their tax bill as well. Any Government who accepts this as an alternative will feel the wrath at the ballot box if not before everyone should tell their politicians who by the way WORK for us not big business to think again.

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  2. Rosie says:

    Oh yes, same old garbage tbat doesn’t , work is cruel and unnecessary being trotted out by the monsters. Tax reform and the end of corporate welfare, the end of subsidising private schools, eliminating middle class welfare will give the country the money it needs. Taxing the churches would be a help, too. And let’s not forget the politicians’ perks- politicians past and present.

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  3. sand49 says:

    Reblogged this on sand49.

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  4. Tony Brown says:

    The ACCI has to be peopled by deluded fools.

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  5. Jean harrison says:

    My God
    No way. We paid in for this in all the years we have worked hard for it…
    And we worked very hard to pay off our homes ….. we went without so much …
    I wanted to be a nurse but couldnt cause I had to work to pay for the home.
    I couldn’t afford to do the course so I never became a nurse but spent 35 in nursing homes working my butter off
    I’m all for helping others BUT hey.
    We come 1st every time. We get or got anything for nothing like these people ..
    So sod off government NO WAY !!!!

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  6. Rharr says:

    The family home is already being sold to fund Aged Care facilities.

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  7. julanne says:

    Do you have a link to the ACCI report about the Age Pension? This issue is such a worry, I want all their details but I can’t find them.

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  8. tamartiger says:

    Please leave our family home alone, we have worked hard for over 50 years to put a roof over our heads without relying on housing trust support, we have paid taxes all our lives, so our pension should not even be categorised as welfare, welfare dependency means supporting those that are unable to work through disability or other illnesses, and if the pension age is raised to 70 years of age, it would suit the government down to the the ground, because the average life span of a Caucasian male is 79 years, and female 84 years, so an average hardworking individual would be extremely lucky if he/she even survived those 9 years on a pension.

    Liked by 1 person

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