MILITARY SUPERANNUATION INDEXATION CALL TO ACTION
Friday, 23 October 2009

The Defence Force Welfare Association has asked that the following be disseminated as widely as possible.
Please read it carefully and act as suggested.
APPVA Reference: Combined ESO Response to Fed Govt Review of Pension Indexation Arrangements in ComSuper Schemes - 30 Sep 2009


MILITARY SUPERANNUATION INDEXATION

CALL TO ACTION - NOW!


Members should by now be aware of our campaign to improve the indexation of Military Superannuation Pensions. The Association has done much on your behalf but we now need YOU to take some action.

BACKGROUND

The Government has endorsed the four recommendations of the Matthews Report into the indexation of Military and other Commonwealth Superannuation. This means that those on Military Superannuation pensions will remain disadvantaged by continuing to have their superannuation pensions indexed by the Consumer Price Index (CPI) - whereas welfare and Age Pensions are indexed at a higher rate (the greater of CPI or Pensioner and Beneficiary Living Cost Index (PBLCI) or Male Total Average Weekly Earnings (MTAWE)) and pre-2004 MP's and High Court Judges pensions are wage based indexed to the salaries of serving backbench MP.

In the period 1989 to 2008 military superannuation pensions rose by 68%, Age Pensions rose by 110% and those of retired MP's rose by 131%!

The purpose of pension indexation is to maintain the purchasing power of YOUR pension. Until 1997 CPI was considered the relevant index but the Australian Bureau of Statistics (ABS) concluded that "the tight nexus between movements in the CPI and wage and salary adjustments no longer exists." In 2001 ABS said that "...CPI is not a measure of the cost of living."

In 1997 the Government acted to maintain the purchasing power of Age and other welfare pensions by changing indexation to CPI or MTAWE whichever was the greater. More recently it included another index factor, the New Pensionary and Beneficiary Living Cost Index (PBLCI).

Nothing however has been done for Military Superannuants, even though six parliamentary inquiries have recommended a form of wage based indexation. The Chair of the recent 'Senate Inquiry on the Effect of Cost of Living Increases on older Australians' said that "It is hard to explain to Commonwealth superannuants why their pensions, to which they contributed during their working life, should fall behind the pension increases of those who have generally not made provision for their retirement."

WHAT DO WE WANT?

Put simply, a fair, equitable and reasonable indexation method that includes the CPI together with an outlay based living cost index and with reference to a wages based index such as the MTAWE.

WHY DO WE WANT IT?

To maintain the purchasing power of your military superannuation pensions so you can maintain your standard of living. Is that not an unreasonable expectation? After all welfare recipients and politicians superannuation benefits have this... why shouldn't you?

HOW WOULD WE BENEFIT?

Apart from your standard of living being maintained, other benefits of fairer indexation include:

The Economy: the multiplier effect of increased military superannuation pensions recirculated into the financial system by expenditure and return as taxes will increased stimulate the Australian economy.

The Government: from the goodwill generated within the Defence Force Family by a demonstrable reaffirmation of the PM's own words that "we have a particular responsibility towards those who have worn the nation's uniform".

The Defence Family: from the correction of an injustice and the correction of a declining standard of living to superannuants. Fairer indexation will have a positive impact on ADF morale and re-enlistments.

The Community: from recognition of the Government's support to the defence family leading to positive impacts on ADF recruiting and national security.

IF YOU WANT FURTHER INFORMATION go to www.dfwa.org.au and start at the 'What's New' page. Alternatively, contact the National Office on 02-62659530 (email: national@dfwa.org.au) and ask for Information to be sent to you.

WHAT WE ARE ASKING YOU TO DO:

We ask all military superannuation pensioners, the Defence family and supporters to write to their local Federal MP's and in their own words outline their concerns on the matter.

WHY ? The strong advice from politicians is that this matter MUST be seen as a national issue affecting all electorates. Therefore all members of Parliament need to be approached by their constituents (the more the better) so that they in turn raise the matter on the party floor.

Only individuals, writing to their members, can make this happen.

When writing to your local member, use some of the information above and also include the following three questions:

1. Are you aware of the Matthews Report and its recommendations?

2. What is your personal position on the Matthews' recommendations which will see the further erosion of the purchasing power of military superannuation pensions? Do you agree, disagree or have no opinion on them?

3. Will you raise the indexation of military superannuation pensions in your party room and on the floor of the House of Representatives?

In writing we suggest you:

1. Be courteous, avoid anger statements

2. Make it clear how your standard of living has deteriorated,

whilst other pension and superannuant recipients have been better treated

3. Ask for a written response. Do not accept a phone response!

4. Write again if you have not received a written response, say within six weeks.

Please forward a copy of any responses received to DFWA, PO Box 4166, KINGSTON ACT 2604 or e-mail national@dfwa.org.au (so we can track the responses of every politician in order to plan further lobbying).

Your MP's electoral office address is available at: www.aph.gov.au/House/members/memlist.pdf

If you have any questions, call DFWA on 02 6265 9530