The 2019 Federal Budget is scheduled to be handed down on April 2 (Tuesday) barely a month before the election.
Prime Minister Scott Morrison promises to deliver a budget surplus (estimated at $1.3 billion); a move backed by economists from the National Australia Bank.
If confirmed, this will be the first budget surplus since John Howard was Prime Minister.
Australian seniors were considered the winners for the 2018 Budget as the government extended the Pensioner Work Bonus, which will take effect from July.
So what can seniors expect from the 2019 Federal Budget?
Budget Recommendations from National Seniors
In February, National Seniors published their 2019-20 Budget Submission, which revealed their proposed inclusions in the federal budget. This includes:
- Plea for the government to introduce an independent Age Pension Tribunal who would be responsible for setting ‘fair’ rates, regardless of which political party is in office
- Increasing assistance for private renters
- Expanding dental care for pensioners
- Supporting access to online services through subsidised NBN connections
- Helping pensioners with energy costs
- Exemption up to $250,0000 home sale proceeds from the means test
- Address home care shortages
- Improve the support available to people living with dementia
- Nationally consistent laws on Power of Attorney calling on all tiers of government to protect vulnerable Australians from elder abuse.
National Seniors Chief Advocate Ian Henschke said the proposed changes would help “vulnerable older people” and pensioners who are being “failed” by the government.
Voters are Calling for More Age Pension Funding
At least 59% of voters are calling for more funding for age pensions, according to a poll conducted by Essential.
The same poll reveals that 58% of voters believe that the next federal budget will benefit businesses and wealthy individuals, while only 19% said it would be good for them personally.
What are your thoughts on the budget recommendations from National Seniors? Do you have other ideas that could make a positive difference for Australian seniors?
When you don’t expect anything you are never disapointed
I applause more funding for aged pensioners, I have been living on half a pension for 11 years because the other half goes directly to the real estate for rent. I have been on public housing for Over 10 years & nothing in site. I worked 41 years in supermarkets & lost my super because I was injured at work & supermarket greedy lawyers stopped the payout.
I agree more rent assistance for seniors still renting in the private rental market. I am a widow aged 65 that has been forced into the rental market and even though I work, over more than half my income goes to rent. I worry that that as my income earning days dry up how am I ever going to manage.This forces older people to stay in the workforce longer just to make ends meet despite having to deal with health concerns that impact their daily lives.
Nobody know what life is going to throw at them and did I ever think I would be in this position at my age, NO…
I am at the stage where i can only work occasionally..sometimes have no money for food .live a very frugal lonely life .sleeping on someones couch..lost my house and super years ago .long story .almost 70 not on pension yet but will have to soon..
Budgets no matter whos government always favour big business and their wealthy
Mates ..which to a large degree amounts to pecuniary interest…
Food and rent and phone regol
etc is more than we get from the pension . We need a other $100 a week to make life bearable
Am very disappointed that after working well after pension age to increase my superannuation status, I am now penalized with a reduced pension because superannuation is now considered an asset.
I am able and happy to return to work for few days a week, but will be penalized again if I do. There is no incentive to work and save for one’s future.
whatever the and improved entitlements might be you still have to rely on Centrelink getting it right
Ask your MP why they put an asset/income test on the aged pension…they truth..because you have actually paid for your pension, it went to consilidated revenue instead of personal accounts, and they spent it…outrageously blew it!
I am about to go on the pension have no savings hardly any Super. Rent so half my pension is going to go on that.
Just had a Pacemaker put in.
More rental assistance would be fantastic and to try and get a State Housing Unit is near on impossible in my home town.
I am more concerned about the hypocrisy of the Labor party.
Past Labor Governments recognised a need for compulsory and voluntary superannuation in order to minimise an unaffordable strain on the Australian Economy.
In a recent ABC interview former Prime Minister, Paul Keating stated that
• Australian people are now living 3-5 years longer (into their late 80’s) and
• Our children will live to 100 or 105
• The current superannuation pool is not large enough to maintain the sort of standard of living we wish for them, he suggests that it will run out at about 85 maybe 90
• Ordinary people being condemned to the pension $460 per week
• Returns on superannuation are no longer high enough to support retirement standards
• Superannuation was meant to build on the anti-destitution pension
• A longevity levy should be introduced to compensate for when the superannuation money runs out
• 25 years ago, he wanted to set up a new non super system for post 85 year old’s age care
What they are now proposing is absolutely discriminatory against self-managed funds versus industry funds. Industry Funds will be able to use the credits to offset the tax liability at the fund level and stream the benefits to individual fund members. Why not a SMSF I ask and where is the fairness in this policy?
Imputation credits are a tax paid by companies on behalf of the shareholder or in other words the shareholder pays the tax in advance and then has to claim the monies back, no different to getting an annual tax return refund when an individual has paid more PAYG tax than they should have. How discriminatory is the ALP policy that they should not be able to get a tax refund for an overpayment of their taxes?
Is it true that taxpayers have always contributed to the aged pension via tax and, unlike the US & UK, it went into consolidated revenue?
My LNP Federal MO told me they put the assets/income test on to stop the aged rorting welfare…how can you rort what you have paid for via taxes? And yes, I have the email from him.
The $250000 exemption from assets test would be fair. We lost our pension when we downsized.
Remove pension funding out of the welfare/centrelink bucket – the pension should be funded from past taxes paid by Australian workers. Simply contributions in payments out and should not be means tested!…
Congratulations to the sitting Govt. It has taken all these years for the Libs to clean up the deficit left by ALP.
Let’s hope the average citizen put economics before voting the ALP back in coz we want to stay in surplus, not go way backwards !!!!
Oh my dear how gullible old people are. This government more than doubled the net debt with nothing to show for it.
For too long the Liberal government under Abbott/Turnbull/Morrison and co have demeanised low , middle income earners and aged people /pensioners. I well remember some of the ways they described us when they came to office. i pay $590 rent, $50 gas abd electric,$22 phone, $62 home internet,$15 mobile $15 towards rego and $105 health fund per fortnight..what little left out of my pension i have to buy food fuel doctors and medications needed. i rarely buy meat as its too expensive and out of reach. I injured my shoulder last september (previously did same in 2007 after a fall) was out if pocket just 462.00 then this time its 1890.00 out if pocket and its because the medicare rebate has veen frozen for last 10 years by labour temporary abd tgen liberaks permanently . meanwhile doctors have raised their fees and medicare and health fees we pay go up every year how is it i have to pay 2/3 rds if the operation yet i have private health. i can t afford not to have it because of my health and i can t wait long periods in public system but i think it unfair medicare has been frozen for so long. its almost criminal what they have done. Mr Morrison might gloat he alledgely will be in surplus but at what cost to us. They cut back on health education and what they have spent usnt anywhere near what they have cut back. i am not an idiot and i resent being treated like one. cone on election can t wait.
cs
I have private hospital cover which I am discarding after 30 years of good health.A friend waited 5months for a hip replacement with public health. She had a private room in a major hospital, 4 weeks in hospital, 2 weeks in rehab ward. Approximately cost $30+, I waited 4 months for the same surgeon [private] for minor knee surgery, in hospital for 7 hours and a cost of $2,000 dollars gap plus extras. Why would anyone continue with private health insurance. I am on a pension as well and my insurance is now $1,980 per annum hospital only.
I have private hospital cover which I am discarding after 30 years of good health.A friend waited 5months for a hip replacement with public health. She had a private room in a major hospital, 4 weeks in hospital, 2 weeks in rehab ward. Approximately cost $30+, I waited 4 months for the same surgeon [private] for minor knee surgery, in hospital for 7 hours and a cost of $2,000 dollars gap plus extras. Why would anyone continue with private health insurance. I am on a pension as well and my insurance is now $1,980 per annum hospital only. Why can people who where not eligible for super in past years not contribute after 75 as in the case of inheritance and get the same growth and tax benefits as others. We were self-employed and super was not available. Surely a better return on any savings they place in a super account must save the government something on pensions.
The hip replacement and hospital stay was nil cost to my friend
I understand that smsf’s do not pay tax so the franking credits will be stopped, but what about retirees that have shares and do pay tax, the franking credits should come back to them as they will be paying tax a second time on those amounts.
All the self funded retirees who had the foresight to set up thier super years ago seem to be penalised for their pro-active action.
Most are not eligible for a health care card, (eligibility threshold is too low) and have to endure paying full costs for all medical prescriptions.
These self funded retirees should be given the healthcare card as a reward for not burdening the government with additional CES pension requirements.
For Bill Shorten to propose stealing the Franking Credits is contrary to current tax laws and might bring High Court intervention if he were to try. The franking credit is merely the tax portion of the the overall dividend which is withheld by the company paying the shares dividend in the same manner in which an employer withholds and pays their employees tax. The actual payment to the shareholder that is declared as income is the Dividend Payment plus the Franking credit paid to the tax office. The combined total of which is added to any other income such as wages to determine the Total Taxable Income. The taxpayers whose taxable income falls at or below the $18,200 tax-free thresh-hold are refunded the franking credit because they have not received enough income upon which to be taxed. Currently, those whose taxable income exceeds the $18,200 tax free thresh-hold would lose either a portion or the full amount, subject to the amount by which they exceed the thresh-hold. Everybody is taxed according to the same taxation structure rules. It is obvious that Bill simply does not understand how the structure actually works. He merely thinks that someone else paid the credit at their expense and not at the expense of the actual taxpayer. The Liberals do understand how the Economy works and tend to ignore Bill’s proposals but they should explain more to the voters as to why they know it won’t work.
Bill should also look back in history to when Paul Keating perfected the structure of Negative Gearing. It is designed to give a temporary tax relief to the investor, whilst they maintain ownership and keep the rent levels affordable. When the property is sold, the Government wants it all back by way of Capitals Gains Tax. Any deductible item claimed by an investor during ownership for an investor in say the $0.37 cents in the $1 tax bracket, has still outlaid 63% of the cost of any expenses throughout their ownership years. Because the overall item was claimed previously, their 63% out-of-pocket expense must be ignored and eliminated from the Capital Gain equation. This shows a more elevated Gain to what the true profit figure actually was. To worsen the mix, the ATO requires that every dollar claimed in depreciation for the property and capital items purchased must now be added back to the Gain figure. The ATO refers to this as ‘Cost Base Adjustment’.
It is because of these ATO requirements that a higher than accurate Gain figure results and it is upon this figure that investors were taxed. As investors recognised these disadvantages and terminated their investments a slump in the property investment market was occurring. According to accountants, the previous governments introduced Capital Gain Discounting to offset these losses to encourage the Market to strengthen by enticing Investors back. The discounts would apply to private investors who were not registered companies and who kept their property longer than 12 months.
Bill should further study his history, because he has to learn from history. He should learn the lesson that the State Labor Government had to learn under Bob Carr in 2004 when Bob Carr decided to introduce ‘Vendor Duty’ on all property investors, where he would charge a 2.25% tax on the Sale Price of the property, in addition to the stamp duty that they had already paid when first they purchased the property. When introducing this policy on radio with Alan Jones, Bob Carr declared that it would be a 2.25% tax on the Capital Gain, he then added, “So it’s a tax on the profit.” Wrong Bob, Capital Gain figures exceeds the true profit figure. At the time I thought it odd that this 2.25% tax would apply, because in some cases there may be a Capital Loss. Does this therefore mean that the resulting negative figure would generate a 2.25% credit to the investor? I checked it with the then Treasurer, Michael Egan, who replied in writing to confirm it to be a 2.25% tax on the full selling price. I called Alan Jones and I forwarded him a copy of the Treasurer’s letter. In short, Alan realised that Bob Carr had lied to him and all his listeners. The introduction of this tax brought with it a massive slowdown of the investors entering the market as well as an exodus of of investors from the market, due to the uncertainties of the ever moving goalpost. The State Government lost millions in lost revenue from Purchase Stamp duties declining. With the demise of Bob Carr and at that time when he was replaced by Morris Iemma, the Media questioned Morris Iemma about the ‘Vendor Duty’ policy and the great losses it generated. Morris responded, “It’s abolished as of right now.” Morris added, “It was a mistake.” Mistake yes, but there was no refunding of all the Vendor Duties stolen.
In Summary…….
The Confiscation of Franking Credits would lead to:-
1) A shortfall in retirees income and the need to increase the demands on the age pension, adding pressure to the government to increase taxes.
2) A drastic decline in the Stock Market or even the potential of a Stock Market Crash, affecting a multitude of investments, including Superannuation Funds, even further pressuring the age pension scheme.
The abolition of Negative Gearing and/or reducing Capital Gains Tax discounting would lead to:-
1) A mass exodus of investors from the Property Market, reducing the supply of Rental Properties.
2) Remaining investors, whose property gearing is Negative, rectifying their gearing to run Positive by simply increasing Rents.
3) Inability of investors who left the market being able to self-fund in retirement and simply forced to retire on the Age Pension, placing undue pressure on and forcing up taxation.
4) Renters being forced to pay higher rents and a greater demand from renters now seeking Public Housing.
5) The government becoming so overwhelmed with the demand to produce more public housing and could only financially do so by increasing Rents for Public Housing and Taxes throughout the Nation.
6) Rent Assistance needs would rise, pushing taxes up even further.
SINCE BILL SHORTEN ISN’T THINKING ABOUT THE MESS HE’S GOING TO CREATE, THEN ALL THE VOTERS NEED TO BE THINKING ABOUT IT AND KEEP HIM OUT OF THE DRIVER’S SEAT.
SCOTT MORRISON HAS STATED THAT UNDER LABOR THERE IS THE THREAT OF A RECESSION AND THAT LABOR WILL PUT TAXES UP AND HE’S RIGHT.
Regards and Good Luck to All
Steve G