The Association of Independent Retirees (A.I.R.) Limited provided the following policy recommendations in our Federal Pre-Budget submission.
Superannuation, Retirement Income and Tax
AIR made 10 key recommendations to the Federal Government in their submission.
Recommendation: Changes to Retirement Savings and Income Policy should be grandfathered.
Recommendation: More flexibility is required with the current aged based percentage drawdowns for account-based pensions with a broadening of the age ranges and a lowering of the minimum drawdown percentages once a retiree has reached 75 years of age.
Recommendation: The current deeming rates are too high in a low investment return environment and rates should be lower to align with actual cash rates of return.
Recommendation: That retirees who could not accumulate sufficient superannuation during their working life (with superannuation balances of less than $500,000) are able to make voluntary contributions up to age 75 without satisfying the work test.
Recommendation: That the Government retains and improves the Seniors and Pensioners Tax Offset (SAPTO) for people with income from retirement savings outside superannuation.
Recommendation: To provide a ‘spouse superannuation transfer’ facility for couples within the same superannuation fund to enable more equitable super balances for members of a couple.
Recommendation: Compulsory Super Contributions by employers should be set at a level where they provide future retirement incomes at a benchmark replacement income rate of 65-75 per cent.
Recommendation: A national program is required to improve the understanding of the Retirement Income System, so people can adequately plan for their retirement and/or make the most of their retirement savings.
Recommendation: The interest rate for the Pension Loan Scheme is too high and needs to be reduced in line with owner occupied home loans of below 4%.
Recommendation: The Gifting Rules (or Deprivation provisions) have not been adjusted since they were introduced in 2002. They should be updated immediately and then adjusted for inflation/CPI on a regular basis as occurs with the pension assets test.
Recommendation: The Association of Independent Retirees urges the Government to expedite the implementation the Royal Commission interim report findings released on 31st October 2019 and in particular the following recommendations.
Residential Aged Care
AIR made three recommendations in relation to Residential Aged Care:
Recommendation: That the Aged Care Quality and Safety Commission improves the quality and safety of residential aged care by lifting the standards of aged care and reducing abuse in residential care.
Recommendation: That the Aged Care Quality and Safety Commission comprehensively pursues complaints about aged care providers and implements a complaints mechanism similar to OPAN (which applies for non-disabled retirees) for disabled retires who are covered by the NDIS.
Recommendation: That Aged Care Providers maintain supportive and respectful relationships with residents and effective communications with family members.
AIR made three recommendations in relation to Home Care:
Recommendation: To reduce to near zero the waiting lists for home care packages at all levels so that waiting periods will be reduced substantially for aged care support at each required level.
Recommendation: To meet the growing number of elderly Australians who wish to stay longer in their home, the allocation of Home Care Packages be substantially increased particularly at Level 3 and 4.
Recommendation: With the substantial increase in home care packages, sufficient monitoring and oversight is required to prevent financial misappropriation and fraud.
Staffing and Funding
AIR made eight recommendations in relation to Staffing and Funding across the aged care workforce:
Recommendation: To provide the growing skilled aged care workforce required to meet the rapidly increasing needs of aged care providers, additional vocational training programs and places be funded and resourced.
Recommendation: That adequate funding be provided to meet the current and future demand for residential aged care and home care at the required standards including better quality food and adequate staffing levels.
Recommendation: That a remediation program be implemented as a matter of urgency to support the continued viability of at least 40% of residential aged care providers that are operating at a loss.
Recommendation: Implement an alternative to the principle of “market competition” to provide quality aged care services at acceptable costs, particularly in rural and remote areas.
Recommendation: Provide transparency of funding and provide client control over funds allocated for residential aged care and home care.
Recommendation: If an aged care provider does not publish their fees on the My Aged Care website in a timely manner, they should be removed from the website.
Recommendation: Implement aged care funding models that are fair to self-funded retirees.
Recommendation: That if there are changes to the means test on residential aged care accommodation, the family home of the surviving partner not be included and the present maximum caps on the annual and lifetime costs not be lifted.
AIR made two recommendations in relation to Health Care:
Recommendation: That the CPI indexation of Health Insurance rebates be immediately scrapped and the % rebate based on % premium increases for Australians 65 years and older be reintroduced in full.
Recommendation: The PBS Safety Net threshold for single people should be adjusted so that they are not disadvantaged in comparison with couples or families. This is particularly disadvantageous to older people.