ASSOCIATION OF INDEPENDENT RETIREES (A.I.R.) LTD. ACN SOUTHERN CROSS DIVISION (VICTORIA)

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1 ASSOCIATION OF INDEPENDENT RETIREES (A.I.R.) LTD. ACN SOUTHERN CROSS DIVISION (VICTORIA) SUBMISSION FOR THE INQUIRY INTO THE OPPORTUNITIES FOR PARTICIPATION OF VICTORIAN SENIORS In what ways do senior Victorians contribute to society and the economy? Senior volunteers make a valuable contribution to society through community organisations. Their unpaid assistance sometimes facilitates the provision of services which might otherwise be unavailable. Mature age workers offer maturity and experience in the workplace. Some have returned to work due to financial losses during the global financial crisis. Retirees are frequently precipitated into the role of carers. Grandparents frequently occupy an important place in the family structure, offering child care and general assistance in family functioning. Hopefully, grandparents are excellent role models for their grandchildren, who benefit from the nurturing and attention which they receive from these loving people in their lives. Retirees enjoy travelling and in this way act as a stimulus to the economy. Self-funded retirees are not a drain on the public purse. What would you see as the top three concerns for senior Victorians? Affordable independence housing, healthcare and transport. Seniors want options allowing them to still live with a high quality of life, with an increasingly supportive environment as they age. This includes assistance to remain in their own independent living space where they feel safe, with access to transport and significant medical, health and wellbeing facilities. Seniors find it hard to lose their autonomy. Health issues Financial issues: Will my savings outlast me? How will investments perform? How can I cope with the rising cost of living, particularly for energy, health and other insurance? How will the carbon tax affect seniors? What do you see as the emerging issues for senior Victorians over the next 20 years? Decreasing buying power of savings, combined with increased government imposts. Concerns about aged care facilities (if required): - The availability of beds in which are convenient to family members and where the resident feels comfortable and safe. - The cost of such accommodation. - Given the growing numbers of retirees with fewer people of the younger generation to support them, it may not be possible for seniors to access beds in aged care facilities unless they pay for them. The proportionate increase in numbers of elderly people in the total population may place stress on the economy, meaning a possible lessening of funding. With fewer people of the younger generation to

2 support them, there could be difficulty in sustaining retirees on a pension, funding age care facilities and providing appropriate services. The increased use of internet information and business dealings. It is interesting to note that the internet is gradually becoming more used by senior Australians, although many initially face the situation with some anxiety. Training classes for seniors are helpful. A recent national A.I.R. survey showed that two out of every three members use and depend on the internet as a regular means of communication. For the majority of our members, it is now firmly embedded as a common element in our lifestyle. This is a dramatic change from the 1990 s. How should senior Victorians be defined? It is difficult and perhapsunwise to summarily define seniors by age. Retired seniors become eligible for the State Seniors Card at age 60 years. The Federal Government is currently working towards designating the official retirement age as 67 years. Eligibility for the Age Pension through Centrelink commences at 65 years. Many seniors are retiring later or are only partly retiring, choosing to continue in part-time work. Age is frequently irrelevant to a person s health, cognitive status, mental health and general wellbeing. A visiting U.S. gerontologist commented that our planning should embrace the idea of living to 100 years, rather than the old traditional idea of threescore years and ten (70 years). Seniors today approach the question of old age differently from their forebears. Today s retirees are generally more vibrant and more active at a comparable age. What issues are experienced by diverse groups of senior Victorians (including men, women, people of different ages and capacities, people from culturally and linguistically diverse backgrounds, people living in rural and regional areas, Indigenous people)? Seniors in rural areas are currently experiencing problems not always evident in cities:- Some of the problems for seniors in country areas are: A definite lack of necessary health facilities, which forces patients to travel long distances to secure medical attention and treatment e.g. MRI, radiation therapy. Lengthy travelling places extra strain on patients who may be unwell and anxious. Lack of proximity to aged care, which then isolates residents in facilities distant from partners, family and friends. Scarcity of public transport. Lengthy waits for aged care assessments. (Reliable sources say up to 8 months!) The Victorian Government has attempted to address the problem of expenses for country patients through the Victorian Patient Transport Assistance Scheme (VPTAS), which subsidises travel and accommodation costs incurred by rural Victorians (and if appropriate, their escorts) who have no option but to travel a long distance to receive approved medical specialist services. However, in A. I.R. s opinion, the rates of reimbursement need serious revision - 17 cents per kilometre for car travel and $35.00 maximum plus GST for overnight accommodation. Both of these figures are totally unrealistic, given current prices. We believe that country patients are being seriously disadvantaged by the unavailability of medical specialist services in their own regional centres. (e.g. Horsham residents need to travel to Ballarat).

3 What are the key issues for Victorians planning for ageing well? 1. Ability to secure high-standard aged care when necessary Concern about the burden of cost of care for self-funded retirees in aged care facilities. Entry into an aged care facility comes at a cost. Bonds in the order of $5000,000 are being sought. Assessed on either assets or income, daily care fees may be in the vicinity of $45.76, making a total of $ The Government seems to be progressively shifting the cost of care on to recipients, and these charges are escalating. Concern about standards of care in aged care facilities: Seniors worry about the appropriate monitoring of standards in aged care facilities, and the extensive waiting lists at most. 2. Ability to access health care services (offering both remedial and preventative care) as needed? Seniors have many concerns in this area:- Extensive waiting lists at public hospitals with some elderly patients waiting months and years for treatment which should improve quality of life. Overcrowded hospital Emergency Departments, which makes access difficult to secure medical attention in urgent medical crises. The mounting cost of private health insurance means that some elderly people are unable to afford this, and are thrown back on to the public system with delays and uncertainty. Government delays in listing new medicines on the Pharmaceutical Benefits Scheme (PBS) Without a financial subsidy to access medicines needed to maintain quality of life, retirees either open up their wallets and pay for expensive private prescriptions or wait until the medicine is listed on the PBS. Private prescriptions do not qualify for the Pharmaceutical Safety Net. Either path may result in significant anxiety for the patient. Ageing can be accompanied by many concerning health conditions:- -Loss of vision, including age-related macular degeneration. -Deterioration in mental health: Research in this area seems to be lagging behind that with regard to physical health. -Disability - Loss of mobility - Lack of facilities offering relief to carers, such as day centres. Community health centres and municipal bodies need to offer a range of programmes which assist in preventative health care and offer opportunities for social interaction. 3. Accommodation: The ability to maintain choice in their living arrangements is important to elderly people wanting to age well. (a) Most seniors would choose to remain in their own homes for as long as practicable. The Government would be wise to encourage this opportunity, as financially this is preferable to the high cost of subsidising aged care placement. There is a need for an increased level of domiciliary services enabling people to remain in their own homes for the maximum time possible. Assistance through community care packages, home help, meals on wheels, handyman services may circumvent the need for transfer elsewhere.

4 4. Financial security: Noel Whittaker of Whittaker and McNaught, a regular writer in the Queensland Courier Mail, states that the average retiree spends more in the last 3 years of his/her life on medical/care related expenses than during all of their earlier years. Seniors need reasonable funds to finance their health and care needs in their declining years. At the same time, charges for essential services (energy and water) and food are escalating, putting considerable financial stress on seniors. Many retirees are not entitled to either the Commonwealth Seniors Health Card (CSHC) or the Age Pension (PCC), and therefore receive no concessions. Governments may feel they fall into the rich category. Parliamentarians have been known to refer to these people as silvertails. However, many of them are not wealthy by today s standards. We believe that the State Government should encourage the Federal Government to raise the threshold for CSHC, particularly for seniors over the age of 75 years. The CSHC thresholds have remained unchanged for some years. The Government continues to impose costs on business in Australia holding down share market values and earnings on which self-funded retirees depend. Cost impositions by Federal, State and Local Governments are dramatically reducing standards of living, for which retirees cannot compensate. Personal tax is a big issue for many self-funded retirees, particularly those without superannuation. As a group, retirees could be described as a disenfranchised minority within society. Seniors are facing the political philosophy of user pays. Yet there is no similar shift to apply the user pays principle to other forms of Government assistance e.g. subsidies for child care, baby bonuses, homeowner grants, educational entitlements etc. There are definite differences of opinion between self-funded retirees and the Government. Self-funded retirees perceive their efforts to hang on to their financial nest eggs as a safeguard against becoming a burden on the public purse. On the other hand, the Government seems to view those nest eggs as a resource to pay for Government and private services. A.I.R. financial experts have calculated that those over 65 are contributing some $7 billion in taxation. This alone covers more than one-third of all pensions paid in Australia. The 15% surcharge on superannuation contributions brings in a further $8 billion, covering the cost of another 30% of those who are on pensions. Self-funded retirees without superannuation or allocate pensions are major contributors to this fund. Further points for consideration regarding financial concerns for seniors: The desirability of Government consideration for 410 Retirement Visa holders, mostly originally from the UK who came to Australia mainly for reasons of family reunion. The understanding was that permanent residence would be granted after 10 years. Recently, the Western Australian Government granted the Seniors Card to all 410 Visa holders who had lived in W.A. for 5 years and who reside there for at least 6 months of the year. The question of permanent residence remains unresolved in many cases, but the granting of the Seniors Card was a small acknowledgement of their status in the community and of their ability to contribute to the economy.

5 The desirability of review of legislation concerning retirement villages. There appear to be difficulties between the Retirement Villages Residents Association (residents) and the Retirement Villages Association (corporate owners). Conditions vary between villages, but some residents in retirement villages feel trapped. Contracts are often complicated and residents sometimes move in without fully appreciating the implications for example, the extra charges payable and difficulty in securing a return of their finances if/when a transfer to a high level care facility is required. The desirability of further State concessions for holders of the CSHC. A.I.R. was involved in advocacy prior to and following the last State elections. We were delighted that the new Baillieu Government granted concessions in the 2011/12 Budget. The stamp duty costs and thresholds were revised, and these concessions were extended to holders of the CSHC. This was notable for being the first Victorian state concessions granted to holders of the CSHC. However, Victoria lags behind other states in this regard, notably Western Australia and Queensland. The desirability of revision of the Fire Services Levy: This is a subject on which A.I.R. has campaigned for some years. The current system is inequitable. Owners who take out property insurance are hit with stamp duty and GST on top of their premiums, adding an extra 22%. The current system encourages owners to under-insure their properties, while those who do not take out insurance at all still receive the services of the MFB and the CFA (which is inequitable). We understand that the Baillieu Government has a group currently investigating the alternative of a property tax, payable by all owners. A.I.R. would strongly encourage this Inquiry. 5 Demographics: The growing numbers of retirees mean there will be increasing numbers of older people requiring support, while the Government may be progressively unable to provide this. A further compounding factor is that many more people in our society are remaining single, which could mean they are less affluent. The younger generations will need to be encouraged moreproactively to put money aside for their retirement, and particularly for their later years. Middle generations with limited resources will need to be better educated about what will be required to maintain their retirement and not rely on a pension. It will become increasingly difficult to manage on a pension alone. Many retirees will need to work into their older age. Governments need to consider how to aid those who are compelled to continue working. A whole new paradigm is required. We need to face economic realities and the changing demographics. There should an expectation among seniors that they have the right to continue living, working and being educated. They are not a group of people who want just to wait to die. They expect to age well. The age of 60 years is seen by many as the new 50. They want to participate fully in life. In what ways do Federal, State and Local Government service provision and responsibility for seniors intersect? There is no cohesive, overarching plan. Different levels of Government tend to blame each other for lack of funding. In what way could collaboration be improved? More input from the people working closely with seniors at the coal face.

6 A one-stop-shop approach to information on all matters concerning planning for ageing i.e. not spread across a multitude of Government departments. Government-funded financial and legal planning workshops on ageing matters. The provision, wherever possible, of appropriate services at the Local Government level to facilitate communication. In what ways could pathways for participation and access to service for Victorian seniors be improved? More certain and more speedy access to necessary health services. Voluntary organisations need to be better resourced to help the community. Increased priority needs to be given in Government funding for services to seniors. How can approaches to ageing be most effectively integrated in Victoria? In Warrnambool, there is a City Council Active Ageing Committee. Attached to that committee is the WHO Age-Friendly Cities Sub-Committee. In 2010, Warrnambool was granted registration as part of the WHO global network of Age-Friendly Cities. The committees have been working diligently over the last 3 years to achieve some inroads into making change In Warrnambool towards achieving some of the benchmarks set by the WHO checklist for Age-Friendly Cities. What does participation mean for senior Victorians and in what ways are opportunities for participation enabled? Social participation Economic participation Community participation 1. The opportunity to engage in community activities at a local level. 2. The provision of information on what activities are available in a format easily accessible to the aged. 3. The financial capacity to allow participation. 4. Safe, reliable and accessible public transport. What are some examples of effective whole of government and community responses to the needs of senior Victorians? It is noted that the Assistant Federal Treasurer, Bill Shorten, in a recent address to the Association of Financial Advisers in Sydney, summarized the Government s policy responses to Australia s ageing population as follows: Inevitably, the changing demographics will have consequences for economic growth and government finances. We can expect an increased demand for age-related payments and higher quality health care services. At present we spend about 9 precent of GDP on health, the United States spends upwards of 16 precent so we're not doing too badly. But increased health demands spike as you go past 80 years of age so health costs are a big part of an Australian population growing older. Successive Labor Governments have long recognised that the current Superannuation Guarantee rate of nine per cent is inadequate. In fact, gaining support for the increase in the Super Guarantee to 12 per cent has been a personal crusade. The increase will gradually come into effect from1 July 2013 to 1 July This increase, together with the increases in the age pension which we introduced in 2009, will allow many Australians to enjoy a significantly higher standard of living in retirement.

7 In addition, it was pleasing to note that the Commonwealth Department of Health and Ageing recently unveiled a new policy for aged care with the release of 700 Consumer Directed Care Packages for aged care recipients across Australia. The Minister for Mental Health and Ageing, Mark Butler, announced that more than $15 million had been allocated for support services for 700 older Australians to remain independent in their own homes. Mark Butler commented, Consumer Directed Care is a new and innovative model of care which provides older Australians and their carers with a greater say in the types of care services they access and the delivery of those services, including who will deliver the services. The expansion of this program means that an extra 700 older Australians can access a range of services to assist with day to day living including low care services such as domestic assistance and meal preparation or high care services such as personal care, nursing, and in-home respite. It was advised that each care package would be personally tailored and flexible, designed by the care recipient or their carers to meet their specific needs. The 700 packages included 500 low care, high care and dementia packages and 200 consumer-directed respite care packages. The packages would be delivered via local aged care providers and Commonwealth Respite and Carelink Centres. The new allocations would be New South Wales (189), Queensland (119), Western Australia (94), South Australia (99), Victoria (109), Tasmania (39), Northern Territory (36) and the Australian Capital Territory (15). A further $40 million would be provided to over 140 Day Therapy Centres in delivering assistance to more than 127,000 clients across Australia. The Day Therapy Centre Program provides a wide range of therapy services such as physiotherapy, occupational therapy, speech therapy and podiatry to frail older people living in the community and to residents of aged care homes, to assist them to regain or maintain physical and cognitive abilities. How can communities be best empowered to promote participation of senior Victorians? 1. The provision of more programmes facilitating preparation and transition into retirement are required. Many mature aged people have vested a lot in their working roles. Many have not thought ahead to retirement, and may be lost when that transition occurs. 2. The provision of more health promotion programmes 3. Adequate funding for municipal councils to cater more adequately for the needs of seniors in their community. What forms of community and social participation are senior Victorians inclined to be engaged in? - Voluntary involvement in organisations assisting other members of the community e.g. delivering meals on wheels, acting as advocates for people in residential care, working in opportunity shops, involvement with agencies offering community service for disadvantaged citizens, - Clubs and societies e.g. Probus, A.I.R., Senior Citizens, U3A - Social groups e.g. cards, Men s Sheds - Sporting associations e.g. golf, tennis, bowls. - Exercise groups e.g. Tai Chi, yoga, gymnasium, - Singing groups, coffee groups etc. - Attendance at day centres - Occasional part-time work such as census collectors, election officers etc. What can be done to help senior Victorians who wish to continue to build up income for when they retire? - The promotion of ability to continue contributing to superannuation without undue restriction.

8 - Financial incentives of some sort, which are reasonable given that these workers are contributing to the economy and not causing any drain on the public purse - Government encouragement of employers willing to employ mature aged workers. What avenues are effective in assisting senior Victorians to combine work with other activities, such as community and social participation? - The possibility of part-time employment and flexible conditions, most likely in areas of work in which seniors have previously-developed skills. - Much more consideration needs to be put into planning for the retraining of seniors, in terms of re-training where earlier skills are no longer appropriate. This is important, not just from an economic perspective, but for seniors wellbeing and the maintenance of self-esteem, providing a sense of meaning and purpose. What are the barriers to community, social and workforce participation by senior Victorians? - Negative attitudes among some younger members of the population. - Concerns about safety of public transport. - Lack of public transport in some areas. - Poor access to public buildings - Dangerous condition of footpaths and gutters. - Volunteering necessarily incurs some expense. What are some examples of effective inter-generational social inclusion? - Grandparents volunteering in schools class reading, music activities, tuck shops etc. - Adopt a grandparent schemes for children lacking such a family member. How does discrimination manifest in the lives of senior Victorians, and how does it impact their ability to participate in Victorian community, society and economy? - Discrimination by employers, some of whom prefer to employ attractive, younger people. - Negative attitudes among some younger people, including the assumption that an older person is deaf, demented and incompetent! Even TV reporters seem to frequently describe an elderly person as a pensioner which seems to be derogatory. An unemployed younger person would not be described as a welfare recipient. Is it possible that such negative attitudes cover a concern among some about their own approach to mature age? Patsy Haywood Immediate Past President. Presented on behalf of the Southern Cross Division, Association of Independent Retirees (A.I.R.) Limited.

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