Changes to the pension and benefit system are always fraught because of the very mixed views in the community about who is entitled to public support. WELA would therefore support an independent body to set rates, changes and rises. An arms length process may counter political populist plays and moral panics about the potential problems of paying for the ageing population. It should also cover related expenditures and concessions such as the current allocation of resources for retirement that create the gross inequities of the Superannuation contributions taxation concessions.  Low income pensioners are being squeezed at the same time as higher income pensioners gain extra payments and major tax expenditures go to the really affluent. An independent body could oversee a total expenditure (cash and concessions) of over $50 B per annum, which is currently grossly maldistributed.

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The Henry Review of the Australian Tax and Transfer system is about to report. WEL’s recommendations to the Review were aimed at creating a total package for a fairer taxation and transfer system.

Fairness and equity

1. Integrate the taxation and transfer systems and recognise individual needs in both.

2. Ensure that the total tax take as a proportion of GDP is maintained and preferably raised to increase funding for public services in health. Maintain the dependence on the progressive income taxes.
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On 15 May 2008, the Minister for Families, Housing, Community Services and Indigenous Affairs, the Hon Jenny Macklin MP, announced that Dr Jeff Harmer, the Secretary of her department, would lead a comprehensive review of the pension system as part of the Government’s broader review of Australia’s Future Tax System.

The Pension Review will investigate measures to strengthen the financial security of seniors, carers, and people with disability by considering the:

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