Friends of Fair Go For Pensioners are among those saddened by the passing of David Gragg. He was a member of our current Executive Committee. Before, this served for many years as the delegate of the Victorian Trades Hall Council on our Steering Committee.

Our condolences go out to his family and friends.

David didn’t just appear on the scene. His journey begun when he joined the Federated Ironworkers Association at Titan Nails, s BHP company, at Port Melbourne. He became an active unionist, and this led to his election as an official in the Australian Workers Union in 1991. From 2009 t0 2018, he served as the elected Assistant Secretary of the Australian Trades Hall Council.

David gave a lifetime of service to the union movement, and his efforts for age pensioners were a continuation of this service. He was enthusiastic, a fighter and capable of listening and working well with others, even those who did not share all his views. David operated as part of a team.

Over the years, and even in his retirement, David put special attention into fighting for better workers compensation for all injured at work.

During his time as Trades Halll Council Secretary, he served as the Council’s representative of the Sterring Committee of Fair Go For Pensioners. After his retirement in 2018, he remained active in Fair Go For Pensioners and became an active member of our Executive Committee.

David was known for his keen interest and knowledge of union history.

For instance, he played an important role in the current campaign for a better age pension, taking the issue into the union movement, the Labor Party, and more broadly than this. He felt that serious action was needed to address the cost-of-living crisis and the need for millions of Australians for decent and affordable housing.

Although hr had a private funeral, his wake at Trades Hall in Melbourne attracted a big crowd of unionists, politicians, and others. The turnout was a testimony to the high regard for him.
David will be seriously missed by all who knew him. He will no be forgotten.

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Most Australians know that the majority have been finding themselves worse off as the share of wealth drifts upward to the few richest in the country. The third edition of Monash University’s Transforming Australia report confirms that 40 percent of Australians have seen a fall in their share by almost a third since 2004. The top 5 percent hold 24 percent of the wealth, and the top 10 percent 57 percent.

The report makes it perfectly clear that unless reversed, the fall will continue, and Australia will lag further behind the rest of the developed world. Changing course depends on long-term planning, something that is spectacularly absent in the political system. More importantly, there is the lack of political will to be any different. This is the Canberra consensus.

Transforming Australia uses long-term data sources covering 80 indicators, including inequalities in income, housing, and health. The indicators show that 12.7 percent of the Australian population was already living below the poverty line in 2020.

The data compares with other similar countries like the United States, where, unsurprisingly, the gap is even bigger, and the one percent hold 34.9 percent of that nation’s wealth, and the top 10 percent hold 70.7 percent.

There is a limit on what the Wealth share tells us. Wealth refers to assets held rather than income. Assets in the hands of the wealthiest are income producing, from interest, dividends, rates, debentures, and speculative bubbles. The assets of the 1 percent are mostly of this type. Those in the 10 percent may have this advantage in part. The rest don’t have income producing assets.

A better measure of day-to-day standard of living is income. Here too the years have seen a shift upwards in Australia. By 2019, aa massive 93 percent of all income gains went to the top 10 percent, and the rest shared only 7 percent.

This reflects assets-based income growth next to stagnant wages.

Inequality of this sort increased during the Covid era, and has only reversed marginally since, well below the rate of inflation. Real wages have therefore fallen more than the nominal numbers suggest. And economists predict more pain in the time ahead.

The official poverty line in Australia is based on a proportion of nominal wages provided by the Australian Bureau of Statistics. The value of Australian wages has fared worse than in other comparative nations as the graph below shows.

The line represents the United States dollar and the green and red blocks the Australian changes at certain points. Note that through the years in question, the value of wage increases remained at much less than $5 a day, and well below the growth in the United States. More often than not, there was a decline during these years, and this trend continues. The only difference is that the gap has become bigger. Note that the Australian Bureau of Statistics provided the estimates.

This suggests that the rise in poverty is higher than that determined by those below the poverty line. A poverty line measured as a proportion of income means less when real wages are falling.

In addition to the failure to address this rising inequality, The Monash University report also shows big lags on progress on the other goals adopted by United Nations members in 2015, and to which Australia is supposed to be committed. Another area of underperformance is education. Maths proficiency, for example, has declined by 25 percent since 2018, and 34 percent since 2004. This is only a partial view of our overall performance as a nation.

Overcoming these problems, especially the growing wealth gap, depends on changing the nation’s priorities. Failure to do this promises to further erode trust in the existing political leadership and the political system. This fall in trust inevitably leads to pollical polarisation as the population seeks different answers.

We already have the start of this, and it will play out in the coming federal election. We don’t know how yet. Reversing the upward drift in the wealth share is the critical issue. Failure to address this, and its link to the cost-of-living crisis, has already put the political elite into disrespect. Eventually, this may transform into a palpable anger that will demand new answers.

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No one could argue that the Age Pension in Australia provides a decent standard of living to those who depend on it. But there has been a great deal of disinformation to paper over this reality. Now that the nation has entered a federal election phase, this is as good a time as any to tell a few truths.

To begin with, Australia is a wealthy enough country, up there with the rest of the western nations grouped in the Organisation for Economic Cooperation and Development (OECD). We have 23 percent of those over 65 living in poverty according to the OCD figures, compared to 14 percent for Germany, and 13, 13, 12, and 9.4 percent for the United Kingdom. Canada, and Sweden.

It’s hard to argue against this. Seniors are getting a raw deal when it comes to the age pension. The OECD figures say that the Australian age pension is the second lowest, around 33 percent of average earnings, when for other OECD nations it averages around 61 percent.

This stark picture contrasts with the narrative long favoured by politicians and sections of the media that have long insisted seniors, including those on the age pension are well looked after. It counters the other assertion that seniors are a burden on younger generations.

The Australian economy might have its troubles. So do those of the rest of the OECD nations. Some of them are significantly worse off. The difference is in attitude. Seniors are valued more there than they are here. It’s a matter of what are the national priorities.

Superannuation doesn’t save the day. Most retiring now with superannuation, come out to around $370,000. This won’t last long. Future retirees will have more, but not enough to last the next couple of decades. A sobering reality is that the disproportionate payout form Australia’s superannuation funds go to those on the top income brackets. Exactly what this amounts to, is not available from government sources nor from the OECD.

The Graph below shows that Few across all age groups will accumulate anywhere near $3 million worth of superannuation on retirement. These are from older on the left to younger on the right.

The next graph shows that the richest get the biggest payouts and the poorest the smallest.

The current government has at least tried to balance this out a bit more fairly, by trying to impose a 30 percent tax rate on any part of a payout that exceeds $3 million. This has been falsely called a tax on all superannuation payouts by representatives of the well-heeled and media outlets like The Australian. The point is that it remains well below the top tax income bracket of 45 percent. Secondly, it counters some of the benefits enjoyed by the few and denied to the rest.

Australia must turn this around. This begins with recognition of the contribution to the Australian economy and has been made over a lifetime by those who have now retired. They built the nation. Recognition must be given to the fact that they continue to contribute their time and effort, often as unpaid volunteers. Imagine where Australia would be without this contribution.
Australia must honour its obligations under Article 125.1 0f the International Covenant of Economic, Social, and Cultural Rights, to which our nation is a signatory. This is mirrored in the policy of the Attorney-General’s Department (Right to an Adequate standard of living, including food, water, and housing).

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