Call to raise Work Bonus to get retirees back to work

Industry wants age pensioners to earn more before being penalised

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SKILLS SHORTAGE: Industry leaders want the Government to give age pensioners more financial incentives to return to the workforce.

SKILLS SHORTAGE: Industry leaders want the Government to give age pensioners more financial incentives to return to the workforce.

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Older workers are the answer to chronic skills shortage, say industry leaders.

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Industry leaders have called on the government to allow age pensioners to earn more before their pension is cut as Australia faces its worst skills shortage in two decades.

"There is an army of older workers, ready and willing to return to the workplace," said Australian Chamber of Commerce and Industy chief executive Andrew McKellar. "However, skilled aged pension recipients have very little incentive to re-enter the workplace."

Age pensioners can earn $480 a fortnight, which includes $300 gross Work Bonus - equivalent to about one day a week at the minimum wage, before losing 50 cents in the dollar.

Raise the threshold

"In raising the Work Bonus threshold, pensioners would be allowed the opportunity to earn more, while businesses who are struggling to find staff would have access to workers, filling thousands of job vacancies," said Mr McKellar.

Andrew McKellar

Andrew McKellar

The ACCI said raising the Work Bonus threshold was a simple step the Federal Government must take to grow the workforce, boost productivity and drive economic recovery as there was significant untapped demand for the over 65s to return to work.

ABS data shows the number of additional hours worked by people over 65 has surged in the past two years from 685,000 hours to over 978,000 hours.

In raising the Work Bonus threshold, pensioners would be allowed the opportunity to earn more, while businesses who are struggling to find staff would have access to workers, filling thousands of job vacancies. - Andrew McKellar, chief executive Australioan Chamber of Commer and Industry

Employment Minister Stuart Robert recently said age pensioners who choose to re-enter the workforce or increase their work hours will benefit from an easier return to the Age Pension if they exceed the income limit due to their employment, and will be able to keep their Pensioner Concession Card for two years.

Exemption

While welcoming the call for an increase to the Work Bonus threshold and the extension of the Pensioner Concession Card, Ian Henschke chief advocate at National Seniors Australia, doesn't believe they go far enough. He wants to see pensioners with limited savings exempted from the income test.

"A targeted exemption will encourage the thousands of retirees who have little additional income to get back into the workforce to boost the economy and their own incomes. This should be done as a two-year trial while we lack workers from overseas to test how effective it is," he said.

The organisation believes pensioners can help to meet the shortage of workers in the economy. "But only if government fixes the punitive income test that discourages them from participating in the workforce."

A targeted exemption will encourage the thousands of retirees who have little additional income to get back into the workforce to boost the economy and their own incomes. This should be done as a two-year trial while we lack workers from overseas to test how effective it is. - Ian Henschke, National Seniors Australia

It wants to see a similar situation to that in New Zealand where pensioners are not penalised for earning additional income through work.

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