The Beagle Editor, Your readers might find the following letter, posted today of interest.
The Hon. Josh Frydenberg MP,
Treasurer
Parliament House
Canberra ACT 2600
Dear Treasurer,
Re Deeming
I know you are a politician so it could be expected that you would hope to get away with saying just about anything but how can the grasp of basic maths be so wacky as in revelations of the Government’s decision to marginally reduce deeming rates?
In the last couple of days, we have heard how the proposed reduced deeming rates will "cost" $600 million over four years - that sounds better than saying an average of $150 per annum, eh, Mr Treasurer?
The published spiel goes on that the number of people who will benefit is between 650,000 and 1,000,000 and they each will benefit up to $1,000 each per year. Working on averages, the 650,000 recipients would get $230 each or the 1,000,000 would get $150 each per annum. If some will be receiving up to the higher $1,000 amount, the average benefits for the bottom end punters will be minimal, eh?
When explaining the government's decision in an ABC interview, you pointed out the different average returns a pensioner could expect from investments in cash, super and shares but when asked about applying the simple solution of setting and using deeming rates for each of these investment types, the response was that the government is happy with the present system!
You might be happy Mr Treasurer but, while appreciating at last that there has been some acknowledgment of the unfairness of the last few year's deeming rates, many recipients are not happy, indeed they are even more adamant that justice in this area is long overdue and will continue to advocate for fair and sensible reform.
It is galling too for these recipients to hear their benefits being referred to as "costs", when in reality, they would be better described as a returns on their past investments in government.
Most of these retirement recipients are the ones who have worked to make this country what it is today, rearing their families - now many of whom are in your generation, Mr Treasurer! - paying their taxes, working for all or much of their lives without any benefit of compulsory superannuation, and rightly expecting that when they reached retirement, they would be fairly treated by the government who knew all too well that the baby boomers, as one particular group, were getting to the stage when they would retire and some would need support in the form of some return on their investment.
If the economy on your government’s watch is so weak that it's not possible to be fair to these pension recipients, then please say so, and may I suggest, take the lead by perhaps reducing your pension entitlements but please, don't waffle on with your dubious maths!
Please reconsider the deeming rates so that a fairer system or rates will be put in place.
Yours faithfully
Jeff de Jager
Self Funded Retiree
Further reading: “How can you go to an election accusing Labor of having a retirees tax, when you’ve been running your own pensioner tax?” National Seniors Australia advocate Ian Henschke told The New Daily.
