August 7, 2011

AUSTRALIA: Evergreen controversy stirred by report on the aged

SYDNEY, NSW / The Sydney Morning Herald / National Times / August 7, 2011

By Michelle Grattan, Political Editor of The Age

WHEN it releases a major report on aged care tomorrow, the government will unleash a debate that, if not handled carefully, could turn into a fresh nightmare for Julia Gillard. The PM wants to make dealing with the practicalities of an ageing population another front for ''decision and delivery''. But seniors' policy, broadly defined, is fraught.

Bob Hawke had a dreadful time over putting an assets test on pensions - it dominated the 1984 election. Early in his government, John Howard was embroiled in a damaging row over aged-care accommodation bonds. Both these governments were in strong shape when these controversies arose. The Gillard government is in anything but.

Baby boomers are at the centre of several interesting discussions around aged care. Photo: David Wicks

While we are yet to see the full detail of tomorrow's Productivity Commission (PC) report, Caring for Older Australians, if it follows the January draft version it will contain some strong meat. The draft proposed greater competition in the system and a more user-pays approach for those who can afford it. The recommendations were complicated but the message was spelt out at the time by the PC deputy chairman, Mike Woods. Under its proposals, Woods said, people on low income and with few assets would certainly be protected while ''those who have high wealth or high incomes'' would be expected to pay more for their care.

The argument for this may be logical and fair but the political difficulties are another matter. The PC operates in a framework of economic rationality. The community argument over aged care is usually conducted in an atmosphere of emotional heat; obviously, this is a highly sensitive matter for individuals and families. This issue is also tailor-made for Tony Abbott to exploit, as then opposition leader Andrew Peacock did in 1984.

Gillard has said the government won't announce decisions immediately. But how long can it safely let the debate, and surrounding uncertainty, run? Should it rule out some extreme measures quickly? If anyone is looking for a test of political management, this is a doozy.

If the politics suggests a rerun of earlier controversies, the changing nature of the ageing issue is a challenge not just for government but for the community generally and for employers in particular.

Gillard last week highlighted a couple of interesting points. We have two generations of seniors - the baby boomers coming into or towards retirement and their parents - the 65-year-old and his 90-year-old mum. And the ''me'' generation baby boomers will be highly demanding ''me'' retirees, wanting choice as well as the more traditional wish for security.

Many of the baby boomers, however, will be working longer, full time or part time. The government has already committed to phasing in a later pension age. Even by necessity, the ''young aged'' will have to soldier on. That will require changes in the attitude of some employers who, while accepting in theory the desirability of older employees, are not so welcoming in practice.

As the debate on ageing again comes centre stage, former Hawke government minister Susan Ryan has just become the inaugural Age Discrimination Commissioner. Ryan says her priorities are keeping older people who want to work in employment and keeping the frailer aged in their homes when possible. In her new job, Ryan finds herself in a growth industry.

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