No matter what spin is put on it; the Abbott Government is cutting pensions. It may not happen overnight, but over time, the value of the age pension will decline dramatically.
At present, pensions rise in line with Average Weekly Earnings (AWE). However, the Government wants to link pension increases to the Consumer Price Index (CPI). Wages rise on average about 1 per cent higher than the CPI.
This means that pensions will be cut on average by at least 1 per cent a year.
Over a year, it may not sound like a lot, but cumulatively it will amount to a dramatic cut in the purchasing power of the pension. This is what has happened to unemployment benefits, which increase in line with the CPI. Over time, they have fallen far behind general living standards.
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READ NOWThe Abbott Government claims there is a so-called budget emergency because of the previous Labor Government’s spending. But if that is the case, then why not simply cut back on Labor’s programs that are causing the problem.
That cannot be universal health care, pensions or unemployment benefits as they were all in existence before the Labor Government came to power.
The Abbott Government has fabricated the so-called budget emergency in order to reshape Australian society along American lines and in the process is driving more people into poverty.