On pension levels

As a long-term recipient on psychiatric grounds of the Australian Disability Support Pension, I have a direct pecuniary interest in seeing its plausible maintenance and increase. Nonetheless, it seems worth bearing in mind a few factors which could militate against excessive recourse to the begging-bowl at present.

All else being equal, in fairly stable countries times of relative economic declension tend to affect long-term pensioners less negatively (or even positively in some cases) than others in the community. Since our income is fixed, deflation in commodities, rent and consumer goods allows it to go further in such times.

While our continued spending may serve to some extent as a demand-sink for the economy, governments may find themselves constrained by reduced revenue from precipitately increasing individual pension payments to those whose position remains stable, especially since more volatile sectors such as Construction or Commodities tend to disproportionately be adversely affected by recessions.

Contrariwise, we would tend to be at greater need of assistance when the economy is booming. Incidentally, I’d say the same of responsible landlords since rental yields tend to decline disproportionately compared to other asset classes in such fecund times.

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Filed under Economics, Government, Political, Revenue

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