8degreesoflatitude

Tuesday, Feb. 22, 2022

My latest scribble from The Desk of the Retired Fulminator

It will soon be budget time again, that annual festival featuring temporary triumph of hope over experience (again), inventive mathematics, and wall to wall politics. The Venice Carnival it isn’t, granted; but as an inescapable bet on a regular fiscal trifecta, at least, and we’re channelling Gilbert & Sullivan here, it’s the very dilemma of a modern major democracy. It’s probably best just to grin and bear it as an impractical exercise, unless you’re a glutton for punishment or you really want to get on the bus, in which case, good luck.

In the lead-up to the budget, flagged for Mar. 29 in the Morrison government’s skeletal parliamentary sitting days diary for the first half of 2022, there will be the usual flurry of budget submissions from lobby groups. That’s all part of the theatre too. It adds to the sound and light show that enlivens politics, if you let it, and sometimes it gets results.

Among the many proposals coming forward in submissions this year is one that should particularly interest every age pensioner. National Seniors, a leading lobbyist in the field, will again be calling for an age pension tribunal to set the age pension rate free from direct political input. Its budget submission is due for release today (Feb. 22). 

Among other benefits from this would be that cost-of-living pressures on age pensioners would be addressed by an actuarial tribunal, not a political cabinet committee.

Age pensioners’ costs differ in detail from those in other community sectors. The latest ABS Living Cost Index (LCI) data, out this month, show they faced Australia’s highest annual living cost increases in 2021, fuelled in large part by steep rises in petrol prices, up 32 per cent over 12 months and now at a 31-year high. Most of Australia’s fuel supply is sourced via Singapore at Singapore prices. There, like here, higher global oil prices, limited supply, and – lately – high economic costs from the otherwise welcome recovery from the depths of the pandemic recession are a triple-whammy.

The age pension is usually adjusted for CPI rises twice a year, in March and September. It went up in September 2021 in line with the CPI and is likely to be raised again next month.

Age pensioners are doubly disadvantaged by the ways in which rising prices affect different classifications of households. The new ABS data shows rising food costs were the highest proportion of overall spending for age pensioner households when compared to other groups.

There’s food for thought in that last point, at least, for politicians of any stripe.

This commentary was written for the website startsat60.com, where it appears today (Feb. 22).