Retirement Income

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Why the extra cost of ‘buy now, pay later’ is still enticing

<p>Zip Co’s “buy now, pay later” service is fast becoming a ubiquitous payment option in Australia. Retailers from Bunnings and Best &amp; Less to Target and Tigerair offer it. All up, the company now boasts 10,000 retail partners and more than <a href="http://zipmoneylimited.com.au/files/Credit_and_financial_services_targeted_at_Australians_at_risk_of_financial_hardship_Public%20Final.pdf">850,000 customers</a>.</p> <p>It’s part of the phenomenal upsurge of “buy now pay later” services. In the past three years, according to Australia’s corporate watchdog, the number of Australians using such services has jumped from 400,000 to 2 million.</p> <p>Their rising popularity has to do with technology making electronic payments easier and more secure, more online shopping, increasing distrust of banks and younger people shying away <a href="https://www.businessinsider.com.au/afterpay-success-fintech-secrets-millennials-2018-10">from credit card use</a>.</p> <p>But the way a service like Zip operates has consumer advocates worried. Zip says it <a href="https://help.zip.co/en/articles/20-will-you-run-a-credit-check-as-part-of-my-application">may do a credit check</a> before approving an application, but its business model means it can avoid the responsible lending requirements of the <a href="https://www.legislation.gov.au/Details/C2019C00053">National Consumer Credit Protection Act</a>. The potential it will entice those with low income and bad credit has attracted the scrutiny of the <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Economics/Creditfinancialservices">Senate inquiry into credit and financial services</a>.</p> <p>So let’s look at how Zip’s business model works, and why it is proving so popular.</p> <h2>How Zip works</h2> <p>Zip has two slightly different products: one offering credit more than $A1,000 is called Zip Money; the other offering credit up to $A1,000 is called Zip Pay.</p> <p>Let’s focus on Zip Pay as the company’s most popular and profitable service.</p> <p>Zip Pay is particularly convenient in that you can access credit at the point of purchase with minimum hassle and little delay. Its automated application process is quick. It says it may perform a credit check but there is no explicit income verification procedure.</p> <p>Zip Pay promotes itself as “interest-free”. It instead charges a flat fee of $6 a month on whatever is owed, and an additional $5 if the minimum monthly payment of $40 is not made on time. It also charges a 4% upfront fee to the retailer; that is, it pays the retailer A$960, then collects $1,000 from the customer.</p> <h2>Implicit costs</h2> <p>Despite the “interest-free” boast, Zip Pay’s $6 monthly fixed fee is in fact a quasi-interest charge, equivalent to paying 7.4% interest annually on a $1,000 debt.</p> <p>Because you still pay $6 even if you owe less than $1,000, the fee structure is also highly regressive. The less you owe, the greater the effective interest rate you pay. For example, if you owe $500, the $6 fee translates to a 15% annualised interest rate.</p> <p>If you owe $100, it equals an annual interest rate of more than 100%.</p> <hr /> <p><iframe id="TsbIB" class="tc-infographic-datawrapper" src="https://datawrapper.dwcdn.net/TsbIB/1/" height="400px" width="100%" style="border: none;" frameborder="0"></iframe></p> <hr /> <p>This fact could encourage you to take advantage of the full $1,000 of credit, on the basis it doesn’t cost you any more in monthly charges. That might, of course, be Zip’s plan, because the more you owe the longer it may take you to pay the debt off.</p> <p>But if you feel confident you will have more money in the future than you have now, this easy credit option could be a highly attractive means to “manage” the disconnect between the things you want and when you can afford these.</p> <h2>Theories and consequences</h2> <p>If that’s the case, you fit the common profile, with <a href="https://download.asic.gov.au/media/4957540/rep600-published-07-dec-2018.pdf">90% of “buy now pay later” credit consumers</a> feeling the debt “helps” them better manage their finances.</p> <p>What makes individuals regard debt as manageable is of great interest to entrepreneurs and economists alike.</p> <p>It was Milton Friedman, winner of the 1976 Nobel Prize for economics, who first hypothesised that an individual’s spending habits were based not only on current income but also on anticipated future income. This idea, from his 1957 book <a href="https://www.nber.org/books/frie57-1">A Theory of the Consumption Function</a>, has become known as as the “permanent income hypothesis”.</p> <p>Typically those who are younger and well-educated have greater expectation that their income will increase over time, and will therefore be more inclined to borrow money to fund current consumption.</p> <p>This explains why almost a quarter of Zip customers are under the age of 24, and more than 60% are under 36.</p> <p>It also helps explain why items bought using Zip are mostly non-essential. By drilling down into the data behind the figures in Zip’s <a href="https://www.asx.com.au/asxpdf/20180928/pdf/43yrz8lys9lzvk.pdf">2018 annual report</a>, we know customers are using Zip to pay for fashion items, clothes and restaurant meals, rather than to pay energy bills or buy medicine.</p> <hr /> <p><iframe id="1Wadd" class="tc-infographic-datawrapper" src="https://datawrapper.dwcdn.net/1Wadd/3/" height="400px" width="100%" style="border: none;" frameborder="0"></iframe></p> <hr /> <p>Easy access to credit also encourages individuals to take on more <a href="https://www.jstor.org/stable/2077863?seq=1#page_scan_tab_contents">debt</a>.</p> <p>Not surprisingly, research by the <a href="https://download.asic.gov.au/media/4957540/rep600-published-07-dec-2018.pdf">Australian Securities and Investments Commission</a> shows the majority of “buy now pay later” users admit easy credit has led them to spend more money, with one in six reporting some negative impact as a result. These impacts include becoming overdrawn, borrowing money from family or friends, or using another loan provider to cover their debts.</p> <p> </p> <p>For savvy consumers confident they can manage their finances, willing to pay that quasi-interest rate to fund their immediate consumption desires, Zip’s service may make sense. But don’t get carried away by wishful thinking and overconfidence. Without financial discipline and proper budgeting, it’s an easy path to over-commitment and financial hardship.</p> <p><em>Written by <span>Saurav Dutta, Head of School at the School of Accounting, Curtin University; Harjinder Singh, Senior lecturer, Curtin University, and Nigar Sultana, Senior Lecturer, Faculty of Business and Law, Curtin University</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/how-zip-pay-works-and-why-the-extra-cost-of-buy-now-pay-later-is-still-enticing-110429" target="_blank"><em>The Conversation</em></a><em>. </em><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p>

Retirement Income

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Why Australia’s building codes need to be rewritten

<p>A prestige apartment building in Sydney built by a well-known developer is undergoing a second replacement of a terrace waterproof membrane five years after replacement of the first one, which had leaked from completion. The second membrane almost certainly complied with the <a href="https://ncc.abcb.gov.au/ncc-online/About">National Construction Code</a> (NCC) and was certified as compliant; the first one might also have complied. Yet, for 15 years, owners and tenants living under the terraces have put up with mouldy walls, carpets and ceilings because the code does not adequately control waterproofing materials and methods.</p> <p>A key assumption made by governments and regulators has been that confidence will return to the market if apartments are built to meet National Construction Code requirements. As the story above shows, complying with the code alone will not be enough to fix many common defects. Public confidence will still be lacking.</p> <p>In 2017, the <a href="https://www.industry.gov.au/regulations-and-standards/building-and-construction/building-ministers-forum">Building Ministers’ Forum</a>, the group of federal, state and territory ministers responsible for building regulation in Australia, commissioned a report from Peter Shergold and Bronwyn Weir. Their <a href="https://www.industry.gov.au/sites/default/files/July%202018/document/pdf/building_ministers_forum_expert_assessment_-_building_confidence.pdf?acsf_files_redirect">report said</a> there was “… diminishing public confidence that the building and construction industry can deliver compliant, safe buildings which will perform to the expected standards over the long term”.</p> <p>Since then, the high-profile structural failure and <a href="https://theconversation.com/the-big-lesson-from-opal-tower-is-that-badly-built-apartments-arent-only-an-issue-for-residents-109722">evacuation of Opal Tower</a> on Christmas Eve 2018, the <a href="https://theconversation.com/cladding-fire-risks-have-been-known-for-years-lives-depend-on-acting-now-with-no-more-delays-111186">cladding fire at Neo200</a> in February 2019 and the structural failure and <a href="https://theconversation.com/buck-passing-on-apartment-building-safety-leaves-residents-at-risk-119000">evacuation of Mascot Towers</a> in June 2019 have kept this issue in the media spotlight. If anything, the public <a href="https://www.afr.com/news/politics/national/the-apartment-building-crisis-explained-20190716-p527k0">crisis of confidence</a> has deepened.</p> <h2>Part of the problem is the code itself</h2> <p>The National Construction Code originated as a minimum standard to deliver structural integrity and fire safety. It was never intended to provide effective control over all the aspects of building work that make houses or apartments liveable and durable. This might come as a surprise to many people, including those in government, but it is inherent to the “minimum standard” approach that underpins the structure and objectives of the code.</p> <p>The objectives on page 9 of volume 1 of the code, which covers apartments, are instructive:</p> <blockquote> <p>1) ensure requirements have a rigorously tested rationale; and</p> <p>2) effectively and proportionally address applicable issues; and</p> <p>3) create benefits to society that outweigh costs; and</p> <p>4) consider non-regulatory alternatives; and</p> <p>5) consider the competitive effects of regulation; and</p> <p>6) not be unnecessarily restrictive.</p> </blockquote> <p>In attempting to consider “competitive effects”, avoid being “restrictive” and by encouraging “non-regulatory alternatives”, including self-certification and self-regulation, the code has opened the door to an “anything goes” mentality on many fronts.</p> <p>Waterproofing requirements for houses and apartments under section F of the code are clearly ineffective, for a start.</p> <p>The relevant Australian Standards, <a href="https://infostore.saiglobal.com/preview/315369811573.pdf?sku=120285_SAIG_AS_AS_252122">AS 4654.1</a> and <a href="https://infostore.saiglobal.com/preview/315378204076.pdf?sku=120284_SAIG_AS_AS_252120">AS 4654.2</a>, were written with a lot of input from the building materials supply industry. The standards permit the use of unsuitable waterproofing membranes in many situations, particularly where ceramic tiles are directly bonded to an inappropriate liquid-applied membrane. As the example at the start of this article shows, this solution rarely lasts longer than four or five years and considerably less in some cases.</p> <p>Rectification is expensive and inconvenient. It involves hacking up and replacing all the tiles.</p> <p>In addition, every apartment building built without a step in the slab at the junction between walls and floors will probably develop leaks within a similar timeframe.</p> <p>These practices are driven by the desire to save a few dollars in construction cost, not by a commitment to deliver a required standard of durability. Durability is not part of the code objectives.</p> <h2>How can the code be fixed?</h2> <p>We could improve the code in a number of simple ways:</p> <ol> <li> <p>Class 1 (houses) and class 2 (apartments) buildings should both be in volume 2, which would be dedicated to housing intended for sale. Houses and apartments should be required to be “fit for purpose” with a clearly stated objective to provide protection to the buyer. These should include a mandatory minimum statutory warranty of seven to ten years, backed by government.</p> </li> <li> <p>The required durability of waterproofing membranes and details for all housing, and class 2 apartments in particular, must be clearly stated. Waterproofing should be required to last at least 25 years without significant maintenance, and perhaps 40 years for buildings where access to the waterproofing element requires demolition or is fundamentally difficult. Details that are not durable, including slabs without steps at wall junctions, or terrace and balcony tiles directly bonded to liquid-applied waterproof membranes, should be banned.</p> </li> <li> <p>The structure of an apartment should be required to last with no substantial maintenance for at least 50 to 60 years. The minimum expectation for durability for any envelope component and associated finishes on buildings over three storeys should be 25 years, and perhaps 40 years for taller buildings.</p> </li> <li> <p>The “performance requirements” of section F of the code, “Health and Amenity”, should be expanded to ensure apartments are comfortable, economical to maintain and <a href="https://theconversation.com/dont-forget-our-future-climate-when-tightening-up-building-codes-113365">sustainable</a>.</p> </li> </ol> <p>Some developers are already delivering well-designed apartment buildings that are durable and fit for purpose. They are to be commended. The <a href="https://theconversation.com/lack-of-information-on-apartment-defects-leaves-whole-market-on-shaky-footings-127007">problem for buyers is identifying these</a> amid a sea of dross.</p> <p>For new houses and apartments, we need to ensure the National Construction Code matches community expectations on fitness for purpose and durability. This requires a return to more active and interventionist regulatory framework, including putting independent “eyes on the site” to inspect work during construction.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/126678/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Geoff Hanmer, Adjunct Lecturer in Architecture, UNSW</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/to-restore-public-confidence-in-apartments-rewrite-australias-building-codes-126678" target="_blank"><em>The Conversation</em></a><em>. </em></p>

Retirement Income

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“Shamefully weak”: Product recalls have tripled since 1998

<p><span>Australia’s product safety law has been slammed as “shamefully weak” and “unacceptable” as new figures revealed recalls have tripled in the past two decades.</span></p> <p><span>According to an analysis by consumer advocate group CHOICE, the number of annual product recalls in Australia have risen from under 200 in 1998 to more than 600 in 2018.</span></p> <p><img style="width: 500px; height: 281.25px; display: block; margin-left: auto; margin-right: auto;" src="https://oversixtydev.blob.core.windows.net/media/7833082/recalls2.jpg" alt="" data-udi="umb://media/eec5d6fa65a8411f8094254dbaab6e21" /></p> <p><span>One in four Australian households are exposed to potential hazards from the 6.6 million individual products currently under voluntary recall, new data from the Australian Competition and Consumer Commission (ACCC) showed. </span></p> <p><span>Another <a href="https://www.accc.gov.au/media-release/unsafe-goods-should-be-illegal-to-sell">ACCC figures</a> found that there are 780 deaths and 52,000 injuries per year from consumer products commonly found in Australian homes, ranging from appliances and electronics to baby cots and toys.</span></p> <p><span>CHOICE product safety campaigner Amy Pereira called on the federal government to review the “shamefully weak” laws.  </span></p> <p><span>“Australia has been let down by successive governments over the last two decades who have allowed unsafe products to flood into our homes … that’s millions of unsafe products that should have been stopped before they got to shelves, now in people’s homes,” Pereira said.</span></p> <p><span>“Businesses selling products in Australia have no general obligation to make sure the products they sell are safe. </span></p> <p><span>“Weak product safety laws harm people … Without stronger product safety laws, these unnecessary deaths and injuries will continue.”</span></p> <p><span>In a submission to the Treasury, CHOICE urged the federal government to establish a product safety system that includes clear laws and penalties for breaches. </span></p> <p><span>“With product recall rates skyrocketing in recent years, now is the time to reform,” the group said.</span></p>

Retirement Income

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The shocking truth buried in your super

<p><span data-contrast="none">A recent review by ASIC (the Australian Security and Investment Commission) has made </span><span data-contrast="none">shocking findings</span><span data-contrast="none"> into the design of TPD (total permanent and disability) benefits within basic life insurance policies. For example, </span><span data-contrast="none">over 12 million Australians automatically pay for TPD through their super</span><span data-contrast="none"> but in the case that the TPD is an “ADL” style of coverage, it’s been found that </span><span data-contrast="none">60% of claims are denied</span><span data-contrast="none">.*</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><span data-contrast="none">Imagine not only having your health permanently taken away from you, but years and years of premiums as well – now down the drain. So much for a nice big super fund to help you retire. ASIC went as far as to say that </span><span data-contrast="none">Australians were still being sold “junk policies” – yes, even by superannuation providers!</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><span data-contrast="none">A fast and easy way to compare TPD cover on your own terms is to use the online tool at </span><a rel="noopener" href="https://lifeinsurancecomparison.com.au/form/stepn/?utm_source=over60&amp;utm_medium=sponsoredarticle&amp;utm_campaign=lic-december&amp;utm_content=shocking-truth-buried-in-your-super" target="_blank"><span data-contrast="none">Life Insurance Comparison</span></a><span data-contrast="none">. A friendly team of experts can help you find cover so that you don’t have to rely on a default policy that may have been automatically set up and is sucking funds out of your super as you sleep.</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p aria-level="3"><strong>Here’s How It Works: </strong></p> <p><strong>Step 1:</strong><span data-contrast="none"><strong> </strong>Select your current </span><span data-contrast="none">age below.</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><strong>Step 2:</strong><span data-contrast="none"><strong> </strong>Once you answer a few questions, you will have the opportunity to compare quotes from up to 9 of Australia’s largest insurers. You may also be entitled to a free consultation.</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><a rel="noopener" href="https://lifeinsurancecomparison.com.au/form/stepn/?utm_source=over60&amp;utm_medium=sponsoredarticle&amp;utm_campaign=lic-december&amp;utm_content=shocking-truth-buried-in-your-super" target="_blank"><img style="width: 500px; height: 281.25px;" src="https://oversixtydev.blob.core.windows.net/media/7832974/life-comparison-insurance-1.jpg" alt="" data-udi="umb://media/0a4e45fd838746e595065ab90ceadaa1" /></a></p> <p><span data-contrast="none">TPD cover is supposed to provide you financial protection in the case that you ever get so sick and injured that you can never work again. It’s a reality we don’t like to think about, but it’s one that can befall absolutely anyone.</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><strong>So what type of TPD cover is ADL? </strong></p> <p><span data-contrast="none">ADL stands for ‘activities of daily living’. This kind of policy typically only pays out in the most dramatic of circumstances, such as a permanent situation where you are unable to feed, dress or wash yourself.</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><span data-contrast="none">If you are permanently injured or disabled enough to no longer work, an ADL policy may reject your claim on the grounds that you’re still at least able to care for yourself.</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><span data-contrast="none">That means even if you’re one day put in a wheelchair unable to do your regular line of work, the TPD insurance in your super may still not pay you a cent!</span><span data-contrast="none"> Is that a safety net you’re comfortable with?</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><span data-contrast="none">The 60% decline rate on this narrow type of TPD insurance (ADL) is five times higher than the average declined claim rate for all other TPD claims. Other structures of TPD, however, do exist and have a much lower declined claim rate of 12%.**</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><span data-contrast="none">These include: own occupation and any occupation, which are designed to cover you when you can no longer work in your own or any occupation at all. This is a much broader type of coverage that many people generally think of when they seek TPD insurance.</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><span data-contrast="none">Insurance lawyer John Berrill recently explained to the Australian Financial Review (AFR):</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><span data-contrast="none">“To be eligible for a standard TPD definition, a person needs to be permanently unfit to do their usual job or any other suitable work given their education, training or experience, perhaps with a retraining clause added.</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><span data-contrast="none">In contrast, to satisfy an ADL definition, a person must be unable to do two or more daily living activities such as feeding, bathing, dressing, toileting, walking and transferring from bed,” he said.</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><span data-contrast="none">Keep in mind that any TPD cover can be paid 100% through your super, although your preferred type may not be what has been set up for you when you first joined your superannuation provider.</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><span data-contrast="none">At </span><a rel="noopener" href="https://lifeinsurancecomparison.com.au/form/stepn/?utm_source=over60&amp;utm_medium=sponsoredarticle&amp;utm_campaign=lic-december&amp;utm_content=shocking-truth-buried-in-your-super" target="_blank"><span data-contrast="none">Life Insurance Comparison</span></a><span data-contrast="none">, we typically assist Australians with approval for own occupation TPD policies, and a range of other popular life insurance products. Comparing cover and understanding what your policy actually looks like is a crucial step to protecting yourself and your family for the future.</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><span data-contrast="none">Not sure where to start? </span><span data-contrast="none">Leave it to the experts</span><span data-contrast="none">. Our service helps take the guesswork out of life insurance and can help set you up with quality cover that will pay out when it’s supposed to.</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><strong>Compare now for policies that aren’t “junk.” </strong></p> <p aria-level="3"><strong>Get Started Now: </strong></p> <p><strong>Step 1:</strong>Select your <strong>state below.</strong></p> <p><strong>Step 2:</strong><span data-contrast="none"><strong> </strong>After answering a few questions, you will have the opportunity to compare quotes in your area and could be eligible for significant savings.</span><span data-ccp-props="{&quot;201341983&quot;:0,&quot;335559739&quot;:420,&quot;335559740&quot;:276}"> </span></p> <p><a rel="noopener" href="https://lifeinsurancecomparison.com.au/form/stepn/?utm_source=over60&amp;utm_medium=sponsoredarticle&amp;utm_campaign=lic-december&amp;utm_content=shocking-truth-buried-in-your-super" target="_blank"><img style="width: 500px; height: 281.20516499282644px;" src="https://oversixtydev.blob.core.windows.net/media/7833020/cta.jpg" alt="" data-udi="umb://media/eab7b5deeeb74516807699ac980077a5" /></a></p> <p><a rel="noopener" href="https://lifeinsurancecomparison.com.au/form/stepn/?utm_source=over60&amp;utm_medium=sponsoredarticle&amp;utm_campaign=lic-december&amp;utm_content=shocking-truth-buried-in-your-super" target="_blank"><em>LifeInsuranceComparison.com.au's</em></a><span data-contrast="none"><a rel="noopener" href="https://lifeinsurancecomparison.com.au/form/stepn/?utm_source=over60&amp;utm_medium=sponsoredarticle&amp;utm_campaign=lic-december&amp;utm_content=shocking-truth-buried-in-your-super" target="_blank"> </a>online quote comparison tool makes it easy to get quotes from 9 Australia's biggest life insurers. </span></p> <p><a rel="noopener" href="https://lifeinsurancecomparison.com.au/form/stepn/?utm_source=over60&amp;utm_medium=sponsoredarticle&amp;utm_campaign=lic-december&amp;utm_content=shocking-truth-buried-in-your-super" target="_blank"><img style="width: 0px; height: 0px;" src="https://oversixtydev.blob.core.windows.net/media/7833021/cta-2.jpg" alt="" data-udi="umb://media/6fb16e715c38466a9e8b7dd4d345384b" /></a></p>

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How Westpac is alleged to have broken anti-money laundering laws 23 million times

<p>Australia’s second-biggest bank, Westpac, is poised to overtake the biggest, the Commonwealth Bank. Not in terms of assets, earnings or market capitalisation, but in having to pay the heftiest fine in Australian corporate history.</p> <p>Westpac is accused of breaching laws aimed at hindering criminal money laundering and the financing of terrorism. With some of those breaches involving supicious transactions in South-East Asia, it is alleged Westpac has potentially facilitated the most heinous of crimes – the commerce of child sex abuse.</p> <p>Each breach carries a penalty of up to A$63,000. Westpac is accused of 23 million breaches.</p> <p>That means it could potentially be fined more than A$1 trillion. The actual fine is likely to be bargained down, as Commonwealth Bank did in agreeing to pay <a href="https://www.abc.net.au/news/2018-06-04/commonwealth-bank-pay-%24700-million-fine-money-laundering-breach/9831064">A$700 million</a> in 2018 for its own breaches of anti-money-laundering provisions.</p> <p>Even so, Westpac is still likely to be up for more than A$1 billion.</p> <p>So what exactly is it accused of doing wrong, and what should it have done? Here’s a quick guide to how Australia’s anti-money-laundering laws work.</p> <h2>Know your customer</h2> <p style="text-align: center;"><a href="https://images.theconversation.com/files/303305/original/file-20191124-74599-8meo8z.JPG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img style="display: block; margin-left: auto; margin-right: auto;" src="https://images.theconversation.com/files/303305/original/file-20191124-74599-8meo8z.JPG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt="" /></a> <span class="caption">Know your customer.</span> <span class="attribution"><a href="https://www.austrac.gov.au/sites/default/files/2019-06/austrac-A3-poster-gambling_05.pdf" class="source">AUSTRAC poster</a></span></p> <p>The Australian Transaction Reports and Analysis Centre (<a href="https://www.austrac.gov.au/">AUSTRAC</a>) requires organisations that handle big amounts of money, such as banks and casinos, to monitor transactions and report suspicious ones.</p> <p>AUSTRAC assembles intelligence and passes it onto partner agencies such as the Australian Federal Police.</p> <p>The requirements spring from Australian legislation and obligations under international agreements.</p> <p>One of the better-known requirements is an obligation to report any cash transaction exceeding A$10,000.</p> <p>Less well-known, but perhaps more onerous, is the obligation to “know your customer”.</p> <p>“<a href="https://www.austrac.gov.au/business/how-comply-and-report-guidance-and-resources/customer-identification-and-verification/customer-identification-know-your-customer-kyc">Know your customer</a>” means banks and other financial services organisations must collect information about their customers and assess their legitimate business behaviours before entering into an agreement, such as the provision of international money transfer services.</p> <p> </p> <p>Banks must then monitor ongoing customer transactions. If, for example, a business makes a large number of small cash transactions remitted to one overseas address then the bank needs to understand the purpose of the transactions and the legitimacy of the receiver.</p> <h2>What it’s alleged Westpac did</h2> <p style="text-align: center;"><a href="https://images.theconversation.com/files/303308/original/file-20191124-74542-dk6sre.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img style="display: block; margin-left: auto; margin-right: auto;" src="https://images.theconversation.com/files/303308/original/file-20191124-74542-dk6sre.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt="" /></a> <span class="caption"></span> <span class="attribution"><a href="https://www.austrac.gov.au/sites/default/files/2019-11/20191120%20Westpac%20Concise%20Statement%20FILED%2019008953.pdf" class="source">Federal Court notice of filing</a></span></p> <p>AUSTRAC expects each organisation to identify patterns of risky transactions, such as third parties undertaking transfers to and from accounts for no apparent reason, or regular international funds transfers to high-risk jurisdictions.</p> <p>AUSTRAC claims Westpac <a href="https://www.austrac.gov.au/about-us/media-release/civil-penalty-orders-against-westpac">failed</a> to appropriately assess transactions to the Philippines and South East Asia that have known financial indicators relating to potential child exploitation risks.</p> <p>Westpac is also accused of failing to understand and monitor transactions of money from its accounts to small intermediary banks located in countries where terrorist organisation are known to operate.</p> <p>This does not necessarily mean money was transferred to terrorists. It does mean there was a risk, and AUSTRAC should have been informed.</p> <h2>‘Fallen short’</h2> <p>The senior management of banks and other cash-handling organisations is expected to fully support anti-money-laundering and counter-terrorism-financing efforts. Among other things, a compliance officer is expected report to the board and be given the authority and resources to ensure the organisation is meeting its obligations.</p> <p>On Wednesday AUSTRAC accused Westpac’s senior management of indifference and failure to adequately invest in the technology and programs needed to monitor and report patterns of potentially suspicious transactions.</p> <p style="text-align: center;"><a href="https://images.theconversation.com/files/303311/original/file-20191124-74557-1vvydfy.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img style="display: block; margin-left: auto; margin-right: auto;" src="https://images.theconversation.com/files/303311/original/file-20191124-74557-1vvydfy.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt="" /></a> <span class="caption"></span> <span class="attribution"><a href="https://cdn.theconversation.com/static_files/files/791/FINAL_Media_Release_-_Response_Plan.pdf?1574568052" class="source">Westpac's weekend response.</a></span></p> <p>On Sunday Westpac’s chairman Lindsay Maxsted said based on its current understanding, the board did not believe that there has been any indifference by any member of the executive team, including its chief executive.</p> <p>But he said Westpac had “fallen short”.</p> <p>He understood “the gravity of the issues” and had “deep sorrow for failings by Westpac”.</p> <p>The bank would withhold all or part of bonuses from its executive team subject to the outcome of an external investigation, which would be made public.</p> <p>In the meantime Westpac announced a <a href="https://cdn.theconversation.com/static_files/files/791/FINAL_Media_Release_-_Response_Plan.pdf?1574568052">response plan</a> that includes closing one of the products used to facilitate transactions, lifting screening standards, and “protecting people” by, among other things, spending A$18 million over three years to tackle online sexual exploitation of children in the Philippines.</p> <p><img src="https://images.theconversation.com/files/303313/original/file-20191124-74588-15ry74a.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="" /> <span class="caption"></span> <span class="attribution"><a href="https://cdn.theconversation.com/static_files/files/791/FINAL_Media_Release_-_Response_Plan.pdf?1574568052" class="source">Extract from Westpac's weekend response.</a></span></p> <h2>Not alone</h2> <p>Two years ago it was <a href="https://www.austrac.gov.au/austrac-seeks-civil-penalty-orders-against-cba">Commonwealth Bank</a> that fell foul of AUSTRAC for allowing money to go out of the country without checks.</p> <p>Earlier this month the <a href="https://www.abc.net.au/news/2018-11-02/nab-working-with-austrac-on-money-laundering-counter-terrorism/10457136">National Australia Bank</a> confirmed that it too was also in discussions with AUSTRAC.</p> <p>The banking royal commission exposed ways in which elements within financial institutions seemed to regard strict compliance with the law as optional. AUSTRAC has has made it clear it is not, when it comes to money laundering.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/127518/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Ian Fargher, Lecturer in Accounting, University of Wollongong</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/how-westpac-is-alleged-to-have-broken-anti-money-laundering-laws-23-million-times-127518" target="_blank"><em>The Conversation</em></a><em>.</em></p>

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Why economic growth isn't enough to guarantee more prosperous Australia

<p>Despite <a href="https://theconversation.com/vital-signs-sure-economic-growth-is-low-but-think-about-whats-gone-right-122973">28 years</a> of uninterrupted economic growth, future generations of Australians face <a href="https://www.sdgtransformingaustralia.com/#/2788/1276//">being worse off</a> due to <a href="https://www.sdgtransformingaustralia.com/#/1249/2659//">increasing household debt</a>, <a href="https://www.sdgtransformingaustralia.com/#/1252/1347//">cost-of-living pressures</a>, <a href="https://www.sdgtransformingaustralia.com/#/1251/1372//">rising wealth inequality</a>, <a href="https://www.aidr.org.au/media/6682/national-resilience-taskforce-profiling-australias-vulnerability.pdf">climate change impacts</a> and <a href="https://soe.environment.gov.au/key-findings-all">environmental degradation</a>.</p> <p>But our <a href="https://www.nature.com/articles/s41893-019-0409-9">new research</a> finds a fairer, greener and more prosperous Australia is possible – so long as political leaders don’t focus just on economic growth.</p> <h2>Evaluating Australia’s progress by 2030</h2> <p>We modelled four development scenarios for Australia through to 2030:</p> <ul> <li>“Growth at all Costs”, emphasising economic growth</li> <li>“Green Economy”, emphasising environmental outcomes</li> <li>“Inclusive Growth”, emphasising social equality</li> <li>“Sustainability Transition”, balancing economic, social and environmental outcomes.</li> </ul> <p>Each scenario involved different policy and investment settings, particularly around tax and subsidies, government expenditure and private investment.</p> <p>We then evaluated each scenario against the <a href="https://www.un.org/sustainabledevelopment/sustainable-development-goals/">Sustainable Development Goals</a>, an internationally recognised set of targets and indicators that measure national progress in 17 major areas. These include economic growth, poverty, inequality, education, health, clean water and clean energy.</p> <h2>Goals, targets and indicators</h2> <p>Each goal involves multiple targets and indicators. Goal 8, for example, is “Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all”. This involves 10 targets including per capita economic growth, decoupling economic growth from environmental degradation, and protecting labour rights. Each target comes with at least one indicator (for example, the growth rate of real GDP per capita, material consumption per GDP, and the rate of occupational injuries).</p> <p>In all, the 17 goals cover 169 targets. Because Australia has not adopted SDG targets, we chose 52 of those (with about 100 indicators) then modelled Australia’s progress in 2030 using our four scenarios.</p> <p>The graph below shows each scenario’s score (with 0% meaning no progress, 100% target achieved) on each of the 17 goals. We also calculated an average score for each scenario across all goals to aid comparison.</p> <h2>Growth alone is not the answer</h2> <p>Our model projects a business-as-usual approach will achieve progress of about 40% across all goals and targets. The “Growth at all Costs’ scenario scored only slightly better: 42%.</p> <p>Economic growth – defined as an increase in a nation’s production of goods and services – is generally measured by the annual change in real gross domestic product (GDP).</p> <p>Our "Growth at all Costs” scenario involves accelerating economic growth through higher population growth and lower taxes. Net migration is modelled as being 350,000 a year by 2030, with the population reaching just over 30 million. The government’s tax revenue as a proportion of GDP is 10% less than now as a result of lower tax rates.</p> <p>Government spending is about 15% less (as a percentage of GDP), with cuts particularly to health, education and social security, but more spending on transport infrastructure. There are no new measures to tackle greenhouse gas emissions, land degradation or other environmental concerns.</p> <p>In our modelling this scenario increases GDP growth to about 2.6% a year, with low unemployment and declining government debt. But it comes at the expense of income inequality and the environment.</p> <p>Even on the one goal it might be expected to do relatively well – Goal 8 – this scenario performs quite poorly. That’s because the goal measures per capita GDP growth, not just the total GDP growth most politicians talk about, along with a range of social and environmental indicators.</p> <p>The following graphs show how the four scenarios compare on real GDP (i.e. adjusted for inflation), per capita GDP, income inequality and greenhouse gas emissions.</p> <h2>Sustainability transition</h2> <p>With an overall score of 70%, the “Sustainability Transition” scenario is the clear winner.</p> <p>This scenario modelled slower population growth and higher taxes on consumption, income and profits and trade. With net migration of 100,000 a year by 2030, the population reaches about 28 million. Tax revenue as a percentage of GDP is about 8.5% higher than now. This funds more spending on health, education and social security, as well as the equivalent to 1% of GDP on the sustainability of transport, water, energy, agriculture and energy systems.</p> <p>The overall result is economic growth of about 2.1% a year, with government debt 10% higher than our business-as-usual projection.</p> <p>But per capita GDP is higher. Unemployment and income inequality are lower. Fewer people live in relative poverty, and life expectancy is higher. Energy, water and resource consumption is down. So are greenhouse gas emissions. There is more forested land. This delivers a more prosperous, fairer and greener nation in 2030.</p> <h2>Possible futures</h2> <p>These results run contrary to the “growth and jobs” narrative that <a href="https://www.businessinsider.com.au/heres-how-many-times-scott-morrisons-budget-speech-used-the-catchphrase-jobs-and-growth-2016-5">dominates political debate in Australia</a>. Both sides of politics emphasise economic growth as the key to prosperity. But this narrative is clearly flawed when we look at a broader set of issues.</p> <p>The Sustainable Development Goals seek to capture all of these issues in a coherent way. Our study explores four plausible futures, and there are many other possible combinations that could be explored with worse or better results.</p> <p>What is clear is that business as usual certainly won’t ensure Australia has a more prosperous, fairer and environmentally sustainable society.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/126823/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Cameron Allen, Researcher, UNSW; Graciela Metternicht, Professor of Environmental Geography, School of Biological Earth and Environmental Sciences, UNSW, and Thomas Wiedmann, Associate Professor, UNSW</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/we-modelled-4-scenarios-for-australias-future-economic-growth-alone-cant-deliver-the-goods-126823" target="_blank"><em>The Conversation</em></a><em>.</em></p>

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Changing NDIS: What you need to know

<p>National Disability Insurance Scheme (NDIS) Minister Stuart Robert this month announced a number of “practical changes” to the scheme.</p> <p>Acknowledging the NDIS is not consistently living up to expectations, he said these improvements will put it “<a href="https://ministers.dss.gov.au/speeches/5266">onto a business as usual even keel for the long term</a>”.</p> <p>While the proposed changes have promise, there remain some fundamental challenges plaguing the scheme that these reforms are unlikely to address.</p> <h2>A scheme under pressure</h2> <p>The NDIS represents a massive policy reform process, so it’s <a href="https://theconversation.com/ndis-hiccups-are-expected-as-with-any-large-scale-social-reform-75693">unsurprising it should face teething problems and challenges</a> during implementation.</p> <p>Official figures show more than 310,000 people now have plans in place, with the scheme intended to reach around <a href="https://www.ndis.gov.au/understanding/what-ndis">460,000 by full roll out</a> next year. This has all been achieved at <a href="https://www.theage.com.au/national/cash-strapped-disability-support-groups-warn-of-service-cuts-20191119-p53c1l.html">significant pace</a>.</p> <p>Yet in recent months, we’ve seen continued criticism of the scheme and the agency that administers it (the National Disability Insurance Agency, or the NDIA).</p> <p>Grievances relate to issues including failure to <a href="https://www.9news.com.au/national/prices-for-ndis-services-under-review/4a57c732-b0b0-44bf-a994-38d30bf2b173">pay service providers enough</a> to cover costs; <a href="https://www.theguardian.com/australia-news/2019/jun/26/ndis-allegations-surge-as-25-operators-kicked-off-scheme">provider fraud allegations</a>; the <a href="https://www.abc.net.au/news/2019-11-05/tasmanian-parents-struggling-to-access-speech-treatment-for-kids/11670702">inability of people with disability</a> to access services; and the <a href="https://www.canberratimes.com.au/story/6443093/ndia-gets-new-ceo-800-extra-staff/">remuneration level</a> of the NDIA’s new CEO.</p> <p>Added to these are concerning accounts of abuse and neglect beginning to emerge from the <a href="https://disability.royalcommission.gov.au/hearings/Pages/hearings/2019/brisbane-public-sitting.aspx">disability royal commission</a>.</p> <h2>Delivering the last 20%</h2> <p>Minister Robert described the NDIS as “<a href="https://ministers.dss.gov.au/speeches/5266">about 80% there, with 20% left to go</a>”. He acknowledged the last 20% is often the hardest.</p> <p>The government’s plan for the NDIS focuses on <a href="https://ministers.dss.gov.au/speeches/5266">six key aims</a> including quicker access and quality decision making, equitable and consistent decisions and better long-term outcomes for participants.</p> <p>While critical of the “<a href="https://www.everyaustraliancounts.com.au/man-with-a-plan-minister-stuart-robert-announces-big-changes-for-the-ndis/">jargon and gobbledegook</a>” in the recent announcements, consumer groups have welcomed a number of the minister’s plans, identifying these as areas they have been advocating for over the last few years.</p> <h2>Some positive changes</h2> <p>Among the promises that should have a positive impact is the announcement people will be able to use their funding more flexibly. Currently funds are locked into particular categories of supports and activities and it’s not easy to move resources between these.</p> <p>The reality is people’s lives do not fit neatly into administrative categories and the flexibility to use funds differently should make a big difference.</p> <p>Further, from April next year people will be able to see a draft of their plan before it’s approved. At present most participants see their plan for the first time when they formally receive it after the planning process. Any mistakes made typically require a full review, causing delays in getting services in place and adding to the planning workload.</p> <p>Participants will also be able to make small changes to their plan without it undergoing a full review, which will be a relief to those who have become mired in endless plan reviews due to changes in their situation.</p> <p>Soon people will also be able to request <a href="https://www.smh.com.au/politics/federal/minister-reveals-practical-changes-to-make-ndis-more-flexible-20191117-p53bc9.html">longer plan durations</a>, of up to three years. Currently most plans last one year. For people who have relatively stable disability – that is, their health and capacity isn’t getting any worse or any better – this will be a relief. The move also cuts some unnecessary red tape and will reduce planners’ workloads.</p> <p>But it does require people to have a clear sense of their priorities and needs. It may be detrimental to people whose circumstances are more changeable – they could become locked into a plan that no longer suits their needs.</p> <p>We will also see the roll out of independent assessments to be paid for by the NDIS. This should have a positive impact as people currently either have to pay for their own assessments or wait for a significant length of time on a public waiting list. In terms of equitable access this is a significant improvement.</p> <p>Finally, plans will be made accessible in additional formats including large font, audio, e-text and braille. For many outside the system it will come as a surprise this is not standard practice.</p> <h2>The devil is in the detail</h2> <p>There’s no doubt we’ve seen some real improvements in the scheme in recent months. The wait time for children to receive a plan halved over the last quarter (<a href="https://www.ndis.gov.au/about-us/publications/quarterly-reports">to 48 days</a>). The number of people waiting for assistive technologies (like wheelchairs or communication devices) has reduced by <a href="https://www.ndis.gov.au/about-us/publications/quarterly-reports">nearly two-thirds</a>. This is good but around 5,000 people are still waiting.</p> <p>So progress can be made, but these new promises come with little detail about how they will be delivered.</p> <p>Meanwhile, the system is already creaking at the seams with little spare capacity.</p> <p>In 2014, a staffing cap was placed on the NDIA, restricting the numbers employed to <a href="https://www.theguardian.com/australia-news/2018/aug/08/labor-pledges-to-scrap-ndis-staff-cap-over-outsourcing-concerns">3,000</a>, though the government has committed to increasing the cap gradually to <a href="https://probonoaustralia.com.au/news/2018/08/government-set-increase-ndia-staff-cap/">3,400</a> in 2020-21. Although reducing the number and frequency of full plan reviews will reduce demand for planners, it’s difficult to envision how this will free up sufficient spare capacity to support all these changes.</p> <p>A number of organisations have also criticised the <a href="https://socialequity.unimelb.edu.au/projects/choice-control-and-the-ndis">quality of planners</a>, who often have limited training and experience in disability services. There seems to be little in these announcements to tackle this.</p> <p>It’s also important to note having a plan doesn’t guarantee being able to access services. In many parts of the country we’re seeing significant waiting lists for even the most common supports (for example, occupational therapy).</p> <p>A new report found nearly one-third of disability providers reported <a href="https://www.theage.com.au/national/cash-strapped-disability-support-groups-warn-of-service-cuts-20191119-p53c1l.html">a loss of income in the last financial year</a> and several were concerned for their long term viability. There is an urgent need to address issues of supply within the system before we see even greater gaps emerge.</p> <p>While these recent promises edge the NDIS in the right direction, the scheme is still facing some fundamental challenges. These will need to be addressed if the NDIS is to live up to the aspirations of those accessing it.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/127223/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Helen Dickinson, Professor, Public Service Research, UNSW</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/the-ndis-is-changing-heres-what-you-need-to-know-and-what-problems-remain-127223" target="_blank"><em>The Conversation</em></a><em>. </em></p>

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$5 ALDI wine crowned Australia's favourite

<p><span>The $4.99 wine has earned experts’ approval throughout the years, with a slew of independent awards from numerous wine shows. </span></p> <p><span>The South Point Estate Rosé has taken out the top spot in a nation-wide poll of ALDI shoppers.</span></p> <p><span>On Monday, ALDI announced the wine as the winner of People’s Pick title in the alcohol category, beating out other popular drinks such as the $21.99 Veuve Monsigny Brut Champagne.</span></p> <p><span>The People’s Picks awards celebrates the most popular out of over 500 products in the ALDI range. The German supermarket’s fans and employees voted for their favourites in a four-week draw.</span></p> <p><iframe src="https://www.facebook.com/plugins/post.php?href=https%3A%2F%2Fwww.facebook.com%2FALDI.Australia%2Fposts%2F2928939837163498%3A0&amp;width=500" width="500" height="614" style="border: none; overflow: hidden;" scrolling="no" frameborder="0" allowtransparency="true" allow="encrypted-media"></iframe></p> <p><span>In the fridge, dairy and eggs category, the Cowbelle Tasty Cheese </span><span>won the People’s Pick, beating some stiff competition such as the Emporium Selection Le Pave Cheese, which was brought back as a permanent product following popular demand last year. </span></p> <p><span>The $1.25 Di-San Ultra Degreaser Pre Wash Lemon Stain Remover won the cleaning and laundry category, while the $2.99 Storck Knoppers came out on top in snacks and sweets.</span></p> <p><span>“We are very particular about what we sell, especially with our limited range of products. Every item passes through a rigorous quality control process to ensure that it exceeds the high standards our customers have come to expect,” said Scott Tyler, Quality Assurance Director, ALDI Australia.</span></p> <p><span>The category winners are as follows: </span></p> <ul> <li><span>Alcohol – South Pinot Estate Rosé, $4.99</span></li> <li><span>Baby – Mamia Fragrance Free Baby Wipes, $1.89</span></li> <li><span>Bakery – Bakers Life Lower Carb, Higher Protein Bread, $4.99</span></li> <li><span>Beauty and Personal Care – Confidence Toilet Tissue 3ply, $7.99</span></li> <li><span>Cleaning and Laundry – Di-San Ultra Degreaser Pre Wash Lemon Stain Remover, $1.25</span></li> <li><span>Freezer – Urban Eats Feta &amp; Spinach Gozleme, $3.99</span></li> <li><span>Fridge, Dairy and Eggs – Cowbelle Tasty Block Cheese, $7.49</span></li> <li><span>Meat, Small Goods and Deli – Berg Middle Bacon, $8.99</span></li> <li><span>Pantry – Brookdale 100% Pure Canadian Maple Syrup, $5.69</span></li> <li><span>Snacks and Sweets – Storck Knoppers 8pk, $2.99</span></li> </ul> <p><em>Photo credit: ALDI Unpacked</em></p>

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How to manage your finances after injury or illness

<p><span>When you’re ill or injured, you may have to deal with more than physical pain. Financial impacts can be harrowing too, creating emotional turmoil that can set your recovery back further.</span></p> <p><span>We don’t know if—or when—we may be impacted. Unintentional falls are the most common form of injury requiring hospitalisation in Australia, according to the </span><a href="https://www.aihw.gov.au/reports-data/health-conditions-disability-deaths/injury/overview"><span>Australian Institute of Health and Welfare</span></a><span>, followed by transport accidents.</span></p> <p><span>Yet while we may not have that crystal ball to tell us if/when we may be impacted by illness or injury, we know that, sure as the sun rises in the east and sets in the west, there will still be bills to pay.</span></p> <p><span>How do we then manage finances in the face of injury or illness? </span></p> <p><strong><span>Your greatest asset</span></strong></p> <p><span>One of the first questions I ask my clients is, “What’s your greatest asset?” You are your greatest asset! That’s why having appropriate personal insurances is one of the five pillars to financially standing on your own two feet. Health, income protection, trauma (or ‘critical illness’ cover) and disability insurance all have a role to play in protecting you, and your family, from the financial impacts of injury or illness. If it’s been a while since you’ve reviewed your personal insurances, I encourage you to do so now with a professional financial adviser. </span></p> <p><strong><span>Pays to ask</span></strong></p> <p><span>In terms of injury, there may be compensation (whether work-related or personal). Compensation aside, sometimes we don’t know what we’re entitled to. It actually pays to ask the person who brokered your personal insurances as a first stop. It was only a casual passing comment about how hard it was doing things one-handed that alerted me, for example, to my client Janet’s predicament. She’d hurt herself and while technically, she could still work and go to meetings, driving was an issue: she was paying a fortune for taxis, and then there were the medical expenses. Her situation was not going to pass the income protection test because there were not enough days off to meet the waiting period, however she had ticked a ‘special disability benefit’ on her policy. This enabled her to access a one-off payment of more than $10,000 which helped with bills and support.  </span></p> <p><span>You may be entitled to a disability support pension from Centrelink (dependent on the type of injury/illness and your income and investments). If you are being taken care of, your family member may be able to get a carer’s allowance and/or carer’s payments.</span></p> <p><strong><span>Balancing debt and income</span></strong></p> <p><span>Professional advice also is invaluable in helping you best determine how to manage debt and future income.   </span></p> <p><span>Medical expenses may be accumulating on the debt side of your ledger. Have you maxed out your credit card or increased your mortgage to help with daily living costs? Perhaps you owe family members or friends. </span></p> <p><span>And what of future health-related costs: will operations be needed as a result of the injury, when and how many; will the home need modifications for wheelchair accessibility: likewise, the car; and will support workers be employed for additional care?  Such scrutiny helps when planning how to make ends meet and make investments work for you.</span></p> <p><strong><span>Handling a payout</span></strong></p> <p><span>The biggest mistake people make when receiving a lump sum—whether it is a lottery or personal injury payout or an inheritance—is to go wild and spend it.  When the money is gone, it’s <em>gone. </em> In the case of a payout due to injury or illness, look at this sum as reimbursement of lost income, payment for future income and a means of paying for medical expenses already incurred and likely in the future.</span></p> <p><span>If you look after the money well and let it work for you, you can enjoy the money your money is generating, rather than eroding it. Take for example, my own experience with an injury. A few years ago, I was rear-ended by a driver, distracted by his mobile phone. While not seriously injured, I do live with permanent damage to my neck and requires regular chiropractic care. That’s an ongoing medical cost I had no way of foreseeing. I received a small payout for the injury and invested it in a way that grows against inflation so that ongoing medical treatments are covered. That’s smart and it ensured my medical bills for an injury weren’t creating another pain in the neck.</span></p> <p><em><span>Helen Baker is a licenced Australian financial adviser and author of two books: </span></em><span><a href="http://www.onyourowntwofeet.com.au/">On Your Own Two Feet</a> – Steady Steps to Women’s Financial Independence<em> and </em>On Your Own Two Feet Divorce – Your Survive and Thrive Financial Guide<em>. Proceeds from the books’ sales are donated to charities supporting disadvantaged women.  </em></span></p> <p><em>*Note this is general advice only and you should seek advice specific to your circumstances.</em></p>

Retirement Income

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"The system is broken": 200 aged care homes at the brink of collapse

<p>Close to 200 aged care providers housing more than 50,000 senior Australians are at great risk of going broke. </p> <p>The national body for providers, Leading Aged Services Australia (LASA), has revealed a worrying amount of older Australians are at the brink of collapse. </p> <p>LASA’s accountants went over publicly available financial reports of aged cares between 2018-2018 and found an alarming 197 providers faced financial strains. </p> <p>It believes an extra $1.3 billion in federal government funding is necessary before christmas to keep the aged care providers afloat. </p> <p>"The scale of this risk is alarming for residents and their families, as well as stressed staff, financially stretched providers and the government," chief executive Sean Rooney said on Tuesday, according to<span> </span><em><a rel="noopener" href="https://www.news.com.au/" target="_blank">news.com.au.</a></em></p> <p>This report comes after a scathing review of a Gold Coast nursing home made headlines for forcibly closing their doors and evacuating residents after it went into administration. </p> <p>That report found federal aged care regulators had failed to appreciate the mounting risk at Earle Haven.</p> <p>Eight of the 69 residents were sent to the hospital after the Queensland government organised an evacuation and since then - three people have died. </p> <p>One death includes a person who suffered a fall during the evacuation. </p> <p>Mr Rooney said over  half of the aged care operators were running at a financial loss.</p> <p>He has called for structural adjustment programs in the aged care industry to let financially distressed operators bow out, while other operators can step in to take their place.</p> <p>Mr Rooney told<span> </span><em>AAP</em><span> </span>this would help avoid the "unplanned chaos" of situations like Earle Haven.</p> <p>"We can't just keep putting money into the system if the system is broken," Mr Rooney said.</p> <p>Aged Care Minister Richard Colbeck told parliament on Tuesday the government would be making “additional investment into the aged care sector prior to Christmas".</p> <p>"The government has taken significant efforts over recent times to repair the aged care system," Senator Colbeck said, in an answer to a Labor question about the LASA report.</p>

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The Netflix scam you should look out for

<p><span>Australian Netflix customers have been warned of a new phishing scam.</span></p> <p><span>The email scam, which uses the same branding and username seen with official Netflix correspondence, asks users of the streaming service to update their payment information through a supplied link.</span></p> <p><span>“We recommend that you update your payment information immediately to secure your account otherwise you will not be able to use our services,” <a href="https://www.9news.com.au/technology/netflix-email-scam-tells-victims-to-update-your-payment-information-news-update/b7b72815-bd27-4e12-9aff-a109d67e42bc">one of the emails</a> read.</span></p> <p><span>The link takes users to a phishing site designed to look like the real Netflix site, where they are prompted to enter their account credentials and credit card details.</span></p> <p><span>Typing in the requested information will result in theft of users’ confidential data and Netflix account. </span></p> <p><span>In September, <a href="https://www.mailguard.com.au/blog/phishing-email-brandjacks-netflix-claims-users-subscriptions-are-canceled">cybersecurity firm MailGuard</a> issued an alert following a wave of malicious emails sent to Netflix users claiming that their subscription has been cancelled.</span></p> <p><span><a href="https://www.whistleout.com.au/PayTV/News/Netflix-Australia-Scam-Email">Another scam</a> claims that multiple login attempts had been detected on the user’s account. “We now need you to re-confirm your account information to us,” the email read.</span></p> <p><span>Netflix customers who receive one of these emails are encouraged to delete them immediately without clicking on any of the provided links. </span></p>

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Why the government is persisting on cashless debit cards for welfare recipients

<p>It would be nice if the “facts” being thrown around in the debate over the Cashless Debit Card were peer-reviewed, or even just evidence-based.</p> <p>Instead, there are <a href="https://www.anneruston.com.au/joint_media_release_expanding_the_cashless_welfare_in_hervey_bay_and_bundaberg">anecdotes</a>. And it’s these that are being used to justify the government’s decision to spend <a href="https://parlinfo.aph.gov.au/parlInfo/download/chamber/hansards/91962b64-398e-400e-ae19-98cf415623ec/toc_pdf/Senate_2019_07_31_7091_Official.pdf;fileType=application%2Fpdf">A$128.8 million</a> over four years continuing the existing trial of the cashless debit card in five sites in Western Australia, Queensland and South Australia and extending it to Cape York and all of the Northern Territory.</p> <p>The extension will lift the number of people on the card from 11,000 to 33,000. Most will be Indigenous people - its disproportionate targeting has already attracted the attention of the <a href="http://docs.wixstatic.com/ugd/b629ee_01e1002bbfc748459d2a323d278d9300.pdf">National Congress of Australia’s First Peoples and the Human Rights Commission</a>.</p> <p>The cashless card was recommended to Prime Minister Tony Abbott in a <a href="https://www.niaa.gov.au/sites/default/files/publications/Forrest-Review.pdf">report</a> from mining billionaire Andrew Forrest in 2014. He initially called it the “<a href="https://theconversation.com/healthy-welfare-card-begins-here-where-next-50756">Healthy Welfare Card</a>”.</p> <p>It wasn’t a new idea. Some A$1 billion dollars had already been spent on income management programs in the past, many of which had <a href="https://caepr.cass.anu.edu.au/highlights/evaluating-new-income-management-northern-territory-final-evaluation-report-and-summary">failed to meet their stated objectives</a>.</p> <p><strong>It’s been tried before</strong></p> <p>The biggest was the Basics Card introduced as part of the 2007 Northern Territory Emergency Response (the “<a href="https://en.wikipedia.org/wiki/Northern_Territory_National_Emergency_Response">Intervention</a>”) which was only made possible through the suspension of the Racial Discrimination Act.</p> <p>Research published by the Australian Research Council funded <a href="https://www.arc.gov.au/2020-arc-centre-excellence-children-and-families-over-life-course">Life Course</a> Centre of Excellence found its introduction was correlated with negative impacts on children, including reductions in <a href="https://www.lifecoursecentre.org.au/research/journal-articles/working-paper-series/do-welfare-restrictions-improve-child-health-estimating-the-causal-impact-of-income-management-in-the-northern-territory/">birth weight</a> and <a href="https://www.lifecoursecentre.org.au/research/journal-articles/working-paper-series/the-effect-of-quarantining-welfare-on-school-attendance-in-indigenous-communities/">school attendance</a>.</p> <p>It points to several possible explanations, including increased stress on mothers, disrupted financial arrangements within households, and confusion about how to access funds.</p> <p>The government has not addressed these serious issues. Instead, it now seeks to place those who have been left on the basics card for over ten years now, on to the cashless debit card.</p> <p><strong>What was ‘Basics’ has become ‘Indue’</strong></p> <p><img src="https://images.theconversation.com/files/167621/original/file-20170503-4096-12pb3xf.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt="" /> <span class="caption">The 2016 Indue Cashless Debit Card.</span> <span class="attribution"><span class="source">indue.com.au</span></span></p> <p>The “Indue” Cashless Debit Card trials underway since 2016 direct 80% of each payment to the card (<a href="https://www.niaa.gov.au/sites/default/files/publications/Forrest-Review.pdf">Forrest asked for 100%</a>) where it can only be spent on things such as food, clothes, health items and hygiene products. Purchases of alcohol and withdrawals of cash are not permitted.</p> <p>The trials are compulsorily for everyone living in the trial sites receiving a disability, parenting, carer, unemployment or youth allowance payment.</p> <p>My own research in the East Kimberley found it makes those people’s <a href="https://openresearch-repository.anu.edu.au/handle/1885/147866">lives harder</a>.</p> <p>Those targeted are a broad group needing support for a broad range of reasons, yet all are treated as if they have issues with alcohol or drugs or gambling.</p> <p>Most of the people on it do indeed have a common problem: that is trying to survive on meagre payments in remote environments with a chronically low supply of jobs.</p> <p>Of all the claims made for the card, the least believable is that it gets its users into jobs.</p> <p>What it does do is limit access to cash needed for day to day-to-day living. It makes it hard to buy second-hand goods, transport and (at some outlets) food, and can make living more expensive.</p> <p>For anyone actually struggling with addiction, it can’t substitute for treatment, a concern raised by medical specialists.</p> <p>While the government says the trials have been community-led, in reality consultation has been limited to a small group of people not subject to the card.</p> <p>When leaders in the East Kimberley who had agreed to the card <a href="https://www.theguardian.com/australia-news/2017/aug/23/aboriginal-leader-withdraws-support-for-cashless-welfare-card-and-says-he-feels-used">withdrew their support</a>, the government continued with the trial.</p> <p><strong>Its success has not been established</strong></p> <p>In addition to relaying on anecdotes, the government continues to cite a <a href="https://www.theguardian.com/australia-news/2017/sep/18/cashless-welfare-card-report-does-not-support-ministers-claims-researcher-says">widely condemned report</a> by <a href="https://www.dss.gov.au/about-the-department/feature/cashless-debit-card-trial-evaluation-final-evaluation-report">Orima Research</a>. Among others, the Australian National Audit Office <a href="https://www.anao.gov.au/work/performance-audit/implementation-and-performance-cashless-debit-card-trial">found this report was inadequate</a> to draw any conclusions from.</p> <p>Profiting from the Cashless Debit Card has been <a href="https://www2.indue.com.au/">Indue</a>, a private company whose <a href="https://nationals.org.au/our-team/federal-management-committee/">deputy chairman</a> up until 2013 is now the present President of the National Party, Larry Anthony.</p> <p>Indue’s involvement is helping to create a <a href="https://www.researchgate.net/publication/285590411_Is_the_Cashless_Welfare_Card_the_forerunner_to_a_Banking_Underclass">two tiered banking system</a> in which most people have a choice of financial providers, but those subject to the card are restricted to one, which provides a very different product to the others.</p> <p>Indue is also not a member of the Australian Banking Association, and so is not bound by the consumer protection provisions of its <a href="https://theconversation.com/the-new-banking-code-looks-impressive-but-what-will-it-achieve-120582">Banking Code of Practice</a>.</p> <p>The inquiry is due to report <a href="https://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Community_Affairs/CashlessCardTransition">next week</a>. Given the expensive and harmful consequences of the trial, it ought to find the extension is not justified. There are better ways to spend $128.8 million that would actually help vulnerable Australians.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/123763/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Elise Klein (OAM), Senior Lecturer in Development Studies, University of Melbourne</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/theres-mounting-evidence-against-cashless-debit-cards-but-the-government-is-ploughing-on-regardless-123763" target="_blank"><em>The Conversation</em></a><em>. </em></p>

Retirement Income

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Growing numbers of renters are trapped for years in homes they can't afford

<p>Low-income tenants in Australia are increasingly likely to be trapped in rental stress for years. <a href="https://www.pc.gov.au/research/completed/renhters/private-renters.pdf">New evidence</a> from the Productivity Commission shows almost half of such “rent-burdened” private tenants are likely to remain stuck in this situation for at least half a decade.</p> <p>Rental stress is where a low-income tenant faces housing costs that leave them without enough income for food, clothing and other essentials. The scale of the problem – <a href="https://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/1370.0%7E2010%7EChapter%7ERental%20stress%20(5.4.2.1)">commonly defined as when rent eats up more than 30% of income</a> – is usually presented as a “point in time” or snapshot statistic.</p> <p>As the Productivity Commission report reveals, the snapshot number in this situation has increased from 48% of low-income renters in 1995 to 54% in 2018. That’s around 1.5 million people pushed into poverty by high housing costs.</p> <p>For some, of course, this will be only a temporary problem. On this basis, it is sometimes argued that concerns over Australia’s high rate of rental stress are overstated.</p> <p>However, the Productivity Commission report, <a href="https://www.pc.gov.au/research/completed/renters/private-renters.pdf">Vulnerable Private Renters: Evidence and Options</a>, highlights longitudinal survey evidence showing that a low-income tenant’s experience of rental stress is increasingly likely to be long-term – not a passing problem. As the commission notes:</p> <blockquote> <p>[…] a growing number of households find themselves stuck in rental stress.</p> </blockquote> <p><strong>What is the evidence for this?</strong></p> <p>This conclusion stems from a comparison of two different tenant cohorts experiencing rental stress as revealed by survey data for 2001 and 2013. Less than a third (31%) of the 2001 cohort remained in stress five years later. But almost half (46%) of the 2013 cohort were.</p> <p><a href="https://images.theconversation.com/files/296994/original/file-20191015-98657-1evkw2.PNG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/296994/original/file-20191015-98657-1evkw2.PNG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="" /></a> <span class="caption">While many people exit rental stress quickly, the proportion of private. low-income renters in long-term rental stress has increased significantly.</span> <span class="attribution"><a href="https://www.pc.gov.au/research/completed/renters/private-renters.pdf" class="source">Vulnerable Private Renters: Evidence and Options, Productivity Commission</a>, <a href="http://creativecommons.org/licenses/by/4.0/" class="license">CC BY</a></span></p> <p>So, it’s not just that more low-income earners are paying unaffordable rents at a particular point in time. This is increasingly a situation that affected private tenants cannot escape.</p> <p>Beyond the obvious welfare impacts, <a href="https://cityfutures.be.unsw.edu.au/documents/515/Full_Report_Final_edited_logos.pdf">recent work</a> argues that excessive rent burdens may also damage human capital and, as a result, reduce economic productivity.</p> <p>The commission’s findings seem to suggest the ongoing restructuring of Australia’s labour market and housing system is eroding socioeconomic and/or housing mobility. The report notes the significant fall in the numbers who manage to move from renting to owning – from 13.6% of renters in the period 2001-04 to 10.0% from 2013-16.</p> <p>Perhaps slightly more surprising is the commission’s explanation for the rising rate of (point in time) rental stress for all low-income tenants. According to the report, this results not from increasing unaffordability for the <em>private renter</em> cohort specifically, but from the growing dominance of private rental housing as <em>the tenure in which low-income households live.</em></p> <p><a href="https://images.theconversation.com/files/296993/original/file-20191015-98661-b2ne0v.PNG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/296993/original/file-20191015-98661-b2ne0v.PNG?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="" /></a> <span class="caption">The number of private renters has grown as the proportions of owner occupiers and public housing tenants have fallen.</span> <span class="attribution"><a href="https://www.pc.gov.au/research/completed/renters/private-renters.pdf" class="source">Vulnerable Private Renters: Evidence and Options, Productivity Commission</a>, <a href="http://creativecommons.org/licenses/by/4.0/" class="license">CC BY</a></span></p> <p> </p> <p>This, of course, results from the post-1990s <a href="https://theconversation.com/australia-needs-to-reboot-affordable-housing-funding-not-scrap-it-72861">failure of Australian governments</a> to expand the supply of social housing to match population growth. By 2018, well over two-thirds (71%) of low-income tenants were <a href="https://www.pc.gov.au/research/completed/renters/private-renters.pdf">renting in the (relatively expensive) private market</a> – rather than from a (rent-limiting) social landlord. Back in 1996, barely half (52%) of them were renting privately.</p> <p><strong>What does this mean for policy?</strong></p> <p>The report presents some useful discussion of possible policy directions.</p> <p>For example, while dismissing rent control as liable to advantage existing tenants at the expense of potential tenants, the report is implicitly critical of residential tenancy laws in most states and territories.</p> <p>The report advances the broad case that <a href="https://theconversation.com/an-open-letter-on-rental-housing-reform-103825">tenancy law reforms</a>, “if well designed”, can enhance tenant welfare “without substantially increasing the cost of renting”. Longer notice periods are particularly favoured because these will “provid[e] vulnerable families more time to find new accommodation and prepare for the move”.</p> <p>Slightly more controversially, the commission strongly hints at support for outlawing no grounds evictions. The landlord power to end a tenancy without any need to justify the move persists across most states and territories. Discussing this power the report states:</p> <blockquote> <p>It increases the bargaining power of landlords […] and decreases that of tenants. Landlords’ incentives to carry out obligations, such as repairs and maintenance, decrease when no grounds evictions are available, since this provides them with an avenue to terminate leases in the event of a dispute.</p> </blockquote> <p>However, having highlighted a private rental affordability problem that is both growing in scale and becoming demonstrably more entrenched, the report is timid on solutions beyond modestly improving tenancy conditions.</p> <p>It argues in general terms for an increase in <a href="https://www.dss.gov.au/housing-support/programmes-services/commonwealth-rent-assistance">Commonwealth Rent Assistance</a> but – beyond tentatively floating a 10% rise in maximum payments – advances no specific proposal.</p> <p>Expanding the social housing stock as part of the broad-ranging housing strategy Australia badly needs is scorned as “an expensive option”. This is a reference to the narrowly scoped analysis in the commission’s <a href="https://www.pc.gov.au/inquiries/completed/human-services/reforms/report/human-services-reforms.pdf">2017 Human Services report</a>. It favoured market solutions to provide low-income housing – on efficiency grounds.</p> <p>The “expensive option” assertion is out of line with the more broadly framed analysis of the Productivity Commission’s predecessor, the Industry Commission. The latter <a href="https://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id:%22publications/tabledpapers/HPP032016005137%22;src1=sm1">concluded</a>:</p> <blockquote> <p>Public housing and <a href="https://www.ahuri.edu.au/policy/ahuri-briefs/what-is-head-leasing">headleasing</a> [when social housing providers sublease private rental properties] are assessed to be more cost-effective than cash payments and housing allowances.</p> </blockquote> <p>While the Industry Commission report admittedly dates from 1993, the subsequent failure of overwhelmingly private provision for low-income renters surely presents compelling reasons to revisit the investment case for social housing.</p> <p><em>Written by <span>Hal Pawson, Associate Director - City Futures - Urban Policy and Strategy, City Futures Research Centre, Housing Policy and Practice, UNSW</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/growing-numbers-of-renters-are-trapped-for-years-in-homes-they-cant-afford-125216" target="_blank"><em>The Conversation</em></a><em>. </em></p>

Retirement Income

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Scam alert: ATO warns of text fraud

<p><span>The Australian Taxation Office has issued a warning about an SMS scam that asks people to update their personal details through a fake myGov link.</span></p> <p><span>In an example scam text that the ATO shared, the message reads: “Last warning update your details”.</span></p> <p><img style="width: 500px; height: 281.25px; display: block; margin-left: auto; margin-right: auto;" src="https://oversixtydev.blob.core.windows.net/media/7832295/tax-embed.jpg" alt="" data-udi="umb://media/f475bd5fab1a4c1eba6e8afead75ad61" /></p> <p style="text-align: center;"><em>Source: ATO</em></p> <p><span>“The website instructs users to login to what looks like their myGov account,” the ATO said on its <a href="https://www.ato.gov.au/general/online-services/identity-security/scam-alerts/#October">website</a>. “It then asks them to update their bank and credit card details. Do not click on these links and do not disclose the information requested.”</span></p> <p><span>The ATO said it will never send an email or text message asking to access online services via a link.</span></p> <p><span>Australians are urged to manage their tax affairs in ATO online services through their genuine myGov account, which is accessible at <a href="https://my.gov.au/">my.gov.au</a>. </span></p> <p><span>If you or someone you know has paid or provided sensitive personal information to a scammer, or if you are unsure whether an ATO communication is genuine, call the ATO on 1800 008 540 to report or verify.</span></p>

Retirement Income

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Thinking about downsizing? Here’s what you need to know

<p><span>After the initial relief of your children leaving the nest, you might find you’re left with a home that’s too big to make the most of. It can be hard to let go of a family home, especially if you’ve been living in the same place for many years. Plus, selling your home and finding a new one can sound like too much of a hassle.</span></p> <p><span>However, there’s definitely a range of benefits to downsizing and a number of signs that might be telling you that it’s time. Selling your home can be a long process, but by following a few steps and getting help from the right people, you’ll be ready in no time. </span></p> <p><strong>Is it time to downsize?</strong></p> <p><span>If your children have all moved out and you’re finding it hard to maintain your home or use up all the space, this is usually the biggest sign that it’s time to downsize. A smaller home will be easier to take care of. Moving might also give you the option to live closer to family and friends, or closer to certain amenities. </span></p> <p><span>Another huge reason why many people downsize is the increase in cash flow. You may be able to reduce or eliminate your mortgage entirely. For those who have already paid off property, you might still be able to make a profit, giving you more freedom to enjoy the finer things in life. </span></p> <p><span>On the flip side, downsizing might not be for everyone. If you enjoy having more space, it could be worth it for you to stay in your current home. You might also find that living in a smaller property or in your desired location, won’t actually work out cheaper for you. If you have age pension entitlements, you should also look into whether these will be affected if you move.</span></p> <p><strong>How to sell your home</strong></p> <p><span>Before selling a home, you’ll want to get to know your local market; see whether it’s currently a sellers’ market, compare similar properties to <a href="https://www.openagent.com.au/openestimates">find out how much your home is worth</a> etc. </span></p> <p><span><a href="https://www.openagent.com.au/openestimates"><em>Find out what your home is worth in today’s market.</em></a> </span></p> <p><span>When you sell your home, finding a top real estate agent should be high on the priority list. We truly believe that finding the right agent helps to reduce stress throughout the selling process <em>and</em> helps you to sell your home for more. When <a href="https://www.openagent.com.au/">finding a local agent</a>, look for someone who understands your needs, has an intimate knowledge of your area, a proven track record for selling properties like yours and the emotional intelligence to communicate and deal with potential buyers effectively.</span></p> <p><span><a href="https://www.openagent.com.au/smartsearch/"><em>Find and compare top local agents now. </em></a></span></p> <p><span>Once you’ve got an agent on board, you’ll need to prepare your property for sale and put together a marketing plan. Getting your home ready could involve decluttering, cleaning, renovating etc. Your chosen agent will be able to give you advice on what needs to be done to your home to get a bumper sales price. Your agent will also work with you to market your property whether it be with professional photography, advertising in newspapers, advertising online, or a mixture of different methods. </span></p> <p><span>Finally, your agent will need to secure a buyer, negotiate and deal with all the legalities. For instance, you’ll need a Contract of Sale and Vendor’s Statement that lay out the terms, conditions, property details etc. You’ll then need to prepare for settlement by making sure all terms and conditions are met before handing over your keys. </span></p> <p><strong>Options for downsizing</strong></p> <p><span>Whether you decide to buy first and then sell, or sell first and then buy, you’ll want to start weighing up your options early on. For your new living arrangements, you can consider:</span></p> <ul> <li><span> </span><span>Renting</span></li> <li><span> </span><span>Purchasing a smaller house</span></li> <li><span> </span><span>Apartment living</span></li> <li><span> </span><span>Villas and townhouses</span></li> <li><span> </span><span>Retirement villages or communities</span></li> <li><span> </span><span>Country living</span></li> <li><span> </span><span>Living with family</span></li> </ul> <p><span>If you’re ready for something new, downsizing could be the perfect change for you. It could lead to more convenience, more cash flow, a more exciting lifestyle and an overall better quality of life. The transition can be smooth, especially with the right people to help you along the way. </span></p> <p><strong><span>Related links:</span></strong></p> <ul> <li><span> </span><span><a href="https://www.openagent.com.au/blog/cost-selling-house">What is the cost of selling a home?</a></span></li> <li><span> </span><span><a href="https://www.openagent.com.au/findagents/31?hl=3">Get your free smart sellers guide</a></span></li> <li><span> </span><span><a href="https://www.openagent.com.au/blog/top-9-things-devalue-property">Top things that can decrease the value of your home</a></span></li> </ul> <p><strong><em><span>Guest author</span></em></strong><em><span>: Ellen Orton is the Head of Business Operations at </span></em><span><a href="https://www.openagent.com.au/"><em>OpenAgent.com.au</em></a><em>, an online agent comparison website helping Australians to sell, buy and own property.</em></span></p>

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What the royals would earn if they had real-life jobs

<p><span>As members of the royal family, the Dukes and Duchesses might be <a href="https://www.oversixty.com.au/travel/international-travel/the-world-s-richest-royal-in-2019-revealed/">worth millions of dollars</a> – but how much would they earn as a commoner?</span></p> <p><span>Training and qualifications provider <a rel="noopener" href="http://www.theknowledgeacademy.com/" target="_blank">The Knowledge Academy</a> has analysed the royals’ skills and qualifications to discover the job and the salary they would have if they were part of today’s job market.</span></p> <p><span>Duchess Meghan came out as the top earner with an expected annual salary of £350,000 (around AU$655,000) thanks to her acting experience, while Prince Harry and Prince William could earn between £21,000 and £55,000 ($39,000 and $103,000) as a charity worker or a major in the army.</span></p> <p><span>Duchess Kate – the first royal bride with a university degree – could earn up to £23,000 ($43,000) in a corporate administrative or marketing role, considering her experience working for high-end retailer Jigsaw and her parents’ party supplies company Party Pieces.</span></p> <p><span>Sophie, Countess of Wessex would earn £40,000 ($74,800) with her secretarial training and PR experience. Her husband Prince Edward, who had worked in production for theatre and television, could earn up to £28,000 ($52,400) as an experienced production assistant.</span></p> <p><span>Princess Anne and Duchess Camilla, who had limited work experience, were expected to have a salary of £19,000 ($35,500) and £17,500 ($32,800) as a charity worker and a secretary respectively.</span></p>

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Why Australia paints Qantas CEO Alan Joyce as a superhero

<p>Alan Joyce is Australia’s <a href="https://www.abc.net.au/news/2019-09-17/ceo-bonuses-soar-as-qantas-boss-alan-joyce-tops-list/11518356">highest-paid chief executive</a>.</p> <p>Alan Joyce is one of the Financial Review’s <a href="https://www.afr.com/work-and-careers/leaders/australia-s-10-most-covertly-powerful-people-20190828-p52lon">ten most covertly powerful people</a>.</p> <p>Alan Joyce writes <a href="https://twitter.com/Qantas/status/1104924677175169026">heartwarming notes to children</a>.</p> <p>Alan Joyce is <a href="https://www.msn.com/en-au/news/australia/qantas-boss-alan-joyce-53-announces-hes-set-to-marry-his-partner-after-20-years-together/ar-AAIbJ0e?li=BBU4PL8">getting married</a>.</p> <p>And he is apparently some sort of <a href="https://www.news.com.au/finance/money/wealth/qantas-chief-executive-alan-joyce-deserved-to-make-24-million-in-2018/news-story/5b25597a186e24adedd01887165e398c">superhero</a>.</p> <p>Something about chief executives brings forth testimonials <a href="https://www.news.com.au/finance/money/wealth/qantas-chief-executive-alan-joyce-deserved-to-make-24-million-in-2018/news-story/5b25597a186e24adedd01887165e398c">like this</a>, published in the News Corporation tabloids last month, which followed the revelation that Joyce was Australia’s highest paid corporate chief (taking home <a href="https://www.abc.net.au/news/2019-09-17/ceo-bonuses-soar-as-qantas-boss-alan-joyce-tops-list/11518356">A$24 million</a> in 2018-19).</p> <p>Penned by Angela Mollard, a journalist specialising in celebrities, it <a href="https://www.news.com.au/finance/money/wealth/qantas-chief-executive-alan-joyce-deserved-to-make-24-million-in-2018/news-story/5b25597a186e24adedd01887165e398c">said he had</a></p> <blockquote> <p>turned around a failing company, put thousands of dollars in shareholders’ pockets, boosted the superannuation of Mr and Mrs Average and prevented thousands from losing their jobs.</p> </blockquote> <p>Joyce, and all the best chief executives, she argued, were</p> <blockquote> <p>alchemists, strategists, innovators and geniuses. They have the sort of agile brains that produce solutions to problems which seem intractable. They lead not from a textbook but from an internal well of brilliance that seems constantly replenished.</p> </blockquote> <p>Further, executives like Joyce deserved to be rewarded for</p> <blockquote> <p>the risks they take, the entrepreneurship they exhibit, the education they’ve invested in and the particular brand of brilliance that comes along all too rarely.</p> </blockquote> <p><strong>It’s been said before</strong></p> <p>I’ve been examining the language used to describe Australia’s elite executives over the past 100 years, and what’s being said about Joyce is familiar - right down to the use of the word “genius”.</p> <p>This kind of talk, repeated for more than a century now, leads us astray if we keep repeating it. It creates misunderstandings about how large companies work. Chief executives aren’t superhuman, their characteristics are not those of their companies, they don’t single-handedly determine the fate of those companies or personally employ their workers, they aren’t necessarily selfless or patriotic, and they don’t necessarily have the best interests of the nation at heart.</p> <p><a href="http://adb.anu.edu.au/biography/mackellar-sir-charles-kinnaird-7382">Sir Charles Mackellar</a>, chairman of the Mutual Life &amp; Citizens’ Assurance Company and a director of a host of other companies including the Colonial Sugar Refining Company was labelled a “<a href="https://trove.nla.gov.au/newspaper/article/15572188">genius</a>” when he died in 1914.</p> <p>FA Govett, the London-based head of Australia’s Zinc Corporation was labelled as a “<a href="https://trove.nla.gov.au/newspaper/article/45952519">man of exceptional ability</a>” in 1926.</p> <p>Often they had higher ideals.</p> <p><a href="http://adb.anu.edu.au/biography/raws-sir-william-lennon-840">Sir William Lennon Raws</a>, a director of four of Australia’s biggest companies including BHP and Elder Smith, was a “<a href="https://trove.nla.gov.au/newspaper/article/146726001">well-meaning capitalist with a dream</a>”.</p> <p>Like Joyce and his contemporaries that work their “<a href="https://www.news.com.au/finance/money/wealth/qantas-chief-executive-alan-joyce-deserved-to-make-24-million-in-2018/news-story/5b25597a186e24adedd01887165e398c">butts off to do the right thing</a>”, Raws was</p> <blockquote> <p>palpably rich and could be richer; but I doubt if the making of another million would be as much to him as the achievement of one of his cherished hopes.</p> </blockquote> <p><strong>It’s their own work</strong></p> <p>Executives have long been seen as the sole reason for their company’s success. In 2019, Joyce single-handedly “<a href="https://www.news.com.au/finance/money/wealth/qantas-chief-executive-alan-joyce-deserved-to-make-24-million-in-2018/news-story/5b25597a186e24adedd01887165e398c">took a beleaguered company and transformed it</a>”.</p> <p>Similarly, in the late 1800s, BHP director <a href="http://adb.anu.edu.au/biography/jamieson-william-6827">William Jamieson</a> was <a href="https://trove.nla.gov.au/newspaper/article/45936299">solely responsible</a> for the development of the Broken Hill region.</p> <p><a href="http://adb.anu.edu.au/biography/philp-sir-robert-8040">Robert Philp</a> of Burns Philp and Company was an Australian patriot who “<a href="https://trove.nla.gov.au/newspaper/article/120184641">controlled her destinies during a critical period</a>”.</p> <p>Industrialist and car manufacturer <a href="http://adb.anu.edu.au/biography/holden-sir-edward-wheewall-7065">Edward Holden</a> worked tirelessly to “<a href="https://trove.nla.gov.au/newspaper/article/129208064">benefit the state and the company”</a>.</p> <p>Corporate director and university chancellor <a href="https://trove.nla.gov.au/newspaper/article/61634919">Sir Normand Maclaurin</a> was “endowed with talents of a very high order […] having at heart the welfare of the nation”.</p> <p><strong>They’re exceptional</strong></p> <p>Joyce’s success might be due to his “<a href="https://www.news.com.au/finance/money/wealth/qantas-chief-executive-alan-joyce-deserved-to-make-24-million-in-2018/news-story/5b25597a186e24adedd01887165e398c">big dick energy</a>”, but he wasn’t the first. In the early 1900s, <a href="http://adb.anu.edu.au/biography/pratt-joseph-major-8098">Joseph Pratt</a> – director of the National Bank of Australasia, the Land Mortgage Bank, the Melbourne Tramway and Omnibus Company and Metropolitan Gas Company – was described in the most masculine of terms as a <a href="https://trove.nla.gov.au/newspaper/article/145710392">big man</a></p> <blockquote> <p>tall, erect, well-made and muscular. He has a pleasant, manly face, indicative of straightforwardness and goodness of disposition, and upon which grows a russet beard, containing a few grey hairs…</p> </blockquote> <p><a href="http://adb.anu.edu.au/biography/sheldon-sir-mark-8411">Sir Mark Sheldon</a> - chairman of the Waterloo Glass Bottle Works, a director of the Australian Bank of Commerce, and vice president of the Sydney Chamber of Commerce - also <a href="https://trove.nla.gov.au/newspaper/article/245762056/26911232">also big </a>,</p> <blockquote> <p>big in his outlook, his ideas, and his accomplishments. Perhaps his height (6 feet, 1.5 inches) enables him to look a bit farther ahead than the ordinary man</p> </blockquote> <p>Painting corporate chiefs like this gives corporations a human face. It helps convince customers and investors that their money is in safe hands. If Alan Joyce is a ‘good man’, then the Qantas Group is seen as a good company.</p> <p>It also makes executives untouchable. After all, if they are blessed with unique or exceptional abilities, and if their company is doing well (whatever the reason), it is hard to argue with the millions being spent on them.</p> <p>Even if it’s $24 million, even if it’s more.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/124167/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: http://theconversation.com/republishing-guidelines --></p> <p><em>Written by <span>Claire Wright, Research Fellow, Centre for Workforce Futures, Macquarie University</span>. Republished with permission of </em><a rel="noopener" href="https://theconversation.com/painting-qantas-chief-executive-alan-joyce-as-a-superhero-is-part-of-a-long-australian-tradition-124167" target="_blank"><em>The Conversation</em></a><em>.</em></p>

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The financial guide to surviving widowhood

<p>That old cliché about the two certainties in life, death and taxes, becomes downright painful when they both hit you at the same time. But you can avoid this awful double whammy by making estate planning part of your financial roadmap.</p> <p>Planning for the death of your partner, and your own, is a morbid reality. After someone dies is not the ideal time to be trying to correct poor financial planning – or worse – realising there’s no plan at all. Thinking about it might be unpleasant, but the heartache of having to pick up the financial pieces after a loved one dies is much worse.</p> <p>There are a few key things you and your partner can put in place to set yourselves up properly should the worst happen.</p> <p><strong>Get intimate with your finances</strong></p> <p>Everyone’s situation is different but, in my experience, women often leave financial decisions to their husbands. Such women are unaware of their financial situation and how to move forward in the event of their husband’s death.</p> <p>I’ve worked on several cases where a client has been surprised by the financial realities following their partner’s death. It can be so overwhelming and emotional that it’s hard to make decisions, and delays can be costly.</p> <p>If you’re unsure of where you would stand financially in the event of your partner’s death, sit down as a couple and talk it through. It’s not an easy topic, but doing this will help you identify anything that needs to be addressed to protect your financial wellbeing.</p> <p><strong>Estate planning</strong></p> <p>Many people die intestate, which means without a will. And many others die with an outdated will. This can make things very tricky for the estate and any potential beneficiaries.</p> <p>The benefits of planning go way beyond convenience for the loved ones left behind. An estate can be set up in some very tax effective ways, including establishing a testamentary trust to help minimise tax paid on the total amount. I’ve had clients that have lost upwards of $40,000 to tax that could have been theirs with better estate planning.</p> <p>Speak to a good financial advisor with your estate planning lawyer and accountant to help you sort through the complexity.</p> <p><strong>Superannuation beneficiaries</strong></p> <p>Distributing superannuation after a death is not always cut and dry. A spouse is not an automatic beneficiary. Without a nominated beneficiary, the super fund can choose to distribute the funds between family members and dependents. Or if the information is out of date, the beneficiary could end up being a former spouse and you may have to make a claim to get the funds. It sounds far-fetched, but it happens more than you’d think.</p> <p>To avoid these headaches, make sure you nominate a beneficiary for your super and keep it up to date.</p> <p><strong>Paying the bills</strong></p> <p>One of the harshest realities for those impacted by a partner’s death is that the bills just keep coming in, despite the fact you're grieving. Add to that the pressure of now being on one income, or finding out some things you didn’t know about your financial situation, and things start to get really tough.</p> <p>Even if you are the sole beneficiary of your partner’s estate, you won’t have immediate access to the funds. So having an emergency fund is an absolute must. A bit of cash stowed away will give you some breathing space to sort things out.</p> <p><strong>Debt</strong></p> <p>Inheritance is usually talked about in the context of inheriting money and assets. But unfortunately, debt can also be inherited. Mortgage debt is the most common.</p> <p>If your partner dies, the money in their estate will used to pay any outstanding debts. If a debt is held in both of your names and your partner’s estate isn’t enough to cover it, you may be liable. To avoid this difficult situation, get a good understanding of the debts both you and your partner have, and what liabilities might exist if one of you dies. Once you know where you stand, you can seek advice on how to avoid any potentially disastrous consequences.</p> <p>It’s a bleak subject, but avoiding estate planning could lead to something much bleaker. Have the conversations now so you aren’t surprised later, and don’t underestimate the value of a skilled financial advisor, accountant and lawyer. If the unthinkable happens, you’ll be glad you had a plan.</p> <p><em>Helen Baker is a licenced Australian financial adviser and author of two books: </em>On Your Own Two Feet – Steady Steps to Women’s Financial Independence<em> and </em>On Your Own Two Feet Divorce – Your Survive and Thrive Financial Guide<em>. </em><em>Note this is general advice only and you should seek advice specific to your circumstances.</em></p>

Retirement Income