Age pension rates leading to 'profound level of deprivation'

Almost a third of Australians on the age pension are living in poverty, with some taking drastic steps to save money such as turning off hot water systems and mashing food to eat rather than paying for dental work, according to a new study.

The study — a joint project by Per Capita, The Benevolent Society and The Longevity Hub — found the base level of the age pension led to “profound levels of deprivation” among some of the 1.5 million Australians on the payment.

It calls for the establishment of an independent tribunal to set the age pension rate.

“The base rate of the age pension is currently around $794 per fortnight … and the rate for the poverty line, for example is around $851,” Benevolent Society CEO Jo Toohey told ABC News Breakfast.

“Our base rate of our pension is actually not even in line with what we consider as a nation to be the base rate in terms of people living in poverty or not.”

Two supplements to the pension can add a further $79 to the fortnightly payment for eligible recipients.

The new report drew on both age pension data and testimony from older Australians at forums and town hall meetings around the country.

Ms Toohey said the proposed tribunal could be run in the same way as the Fair Work Commission that sets the minimum wage.

“When you look at the reason Fair Work sets the minimum wage … they also take into consideration things like housing costs and increases in general living expenses,” she said.

“If I’m an age pensioner those increases in housing costs — particularly if I’m single, if I’m female, and I don’t own my own home — my rent over the past 10 years for example has increased considerably more than what the age pension actually has.”

The study found many older Australians had gone to great lengths to save money and live within their means.

“I haven’t had any hot water for the last four years,” one respondent said.

“I had a 20-litre bucket and I fill that up with hot water and cold water, so it’s a nice temperature and then I scoop that on me. That’s my shower.”

Another respondent added: “When the rent goes up, I can make up for it a bit on food because my daughter will bring care packages from church which give you eight or nine meals for the freezer.”

September 19,2016