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Select Committee on the Future of Work and Workers
04/05/2018

LAWSON, Ms Meagan, Chief Executive Officer, Council on the Ageing New South Wales

[14:24]

CHAIR: I now welcome the representative from the Council on the Ageing New South Wales. Thanks very much for joining us, Ms Lawson. I understand that information on parliamentary privilege and the protection of witnesses and evidence has been provided to you. I now invite you to make a short opening statement and we'll have some questions, but Senator Stoker just wanted to mention something to you.

Senator STOKER: Ms Lawson, I want to apologise in advance: I'm going to have to leave shortly. When I walk out, please don't take that as disrespectful or that I'm not interested in what you have to say.

Ms Lawson : Not because I was boring you or didn't have sexbots for you!

Senator STOKER: I'm sure you are just as interesting in your own way as the previous person!

Ms Lawson : Thank you for the opportunity to be here today. This is an issue that COTA is obviously thinking a lot about at the moment, and I'm pleased to have the opportunity to speak to you about the issues we see for older workers. You might know about COTA, but, if you don't: we're a federated structure. We have organisations in each state and territory as well as a national organisation and we've been around for more than 60 years. I'm from COTA New South Wales, so I'm best placed to speak most specifically about issues in New South Wales, but obviously issues of work and workers cross borders and are applicable outside of New South Wales.

COTA is a not-for-profit, consumer based organisation. As you might expect, we spend a lot of time talking to older people. We define that as being anyone over 50. When we talk about employment, we hear lots of different things. I don't want to tell you how to suck eggs, but it's important to remember that older people are very diverse and there are lots of them, and so their issues are quite different depending on who they are and where they sit.

There is a range of issues older workers currently encounter. Some of that is about the changing structures of work and the workplace. Some of it is about rapid technological change. A lot of it is about discrimination. We also hear a variety of views about working as an older person. Often lower-skilled and lower-paid job workers—people who work in manual occupations—talk about the fear of being forced out of work or the fear of having to work longer through economic circumstance. They don't feel that their bodies can continue to work, but they have to keep working because they don't have enough retirement savings and because the pension age is rising.

Other people talk about the insecurity of work, of being made redundant and not being able to find new work. We know that if, for example, if you're unemployed at 50 for more than 12 months, you're likely not to work again. So those people struggle financially like most people on unemployment benefits, but they also have an increased risk of living in poverty in older age.

Other people talk about wanting more flexibility in their work as they age. In some research that we did at the New South Wales Department of Family and Community Services in preparation of the New South Wales ageing strategy, 84 per cent of people between 50 and 59 indicated that they would like to phase their retirement—that is, to work less as they near retirement age—but are unable to access flexible workplace arrangements that allow them to do that. And we know that flexible work arrangements are important for people with kids, but it's equally an issue for older people.

Older people also struggle with flexibility to deal with caring responsibilities. Many older people take on part-time care of their grandkids to assist their children with returning to work or have to take on caring responsibilities for older parents or a sick partner, and they also struggle to find work arrangements that work for them. This is especially the case for older women, who still do most of the caring work in families.

The gig economy is also affecting older people. You might have noticed—I do; I probably look out for it—but there are lots of older people driving for Uber at the moment, and that affects them in the same way that it affects other workers in that economy: it's insecure work and there's a lack of super payments and all the things that go with that.

We hear a lot about discrimination in finding work, in accessing training to keep skills current and in keeping work. We hear about people not feeling valued for their skills and the attributes that they bring to the workplace. Just this morning I had an inquiry from a journalist about partnership contracts at the big accounting law firms stating that partners have to agree to retire at 60. While these people are certainly far better off financially than the other people I was talking about, it's still a potential loss of knowledge and skills to the workforce.

It seems illogical to me that, at a time when we know that the ratio of workers to those not working is decreasing to something like two to one by 2050, we're not changing structures and encouraging people to find ways to remain active participants in the workforce. Australia performs poorly in participation rates for older workers. The 2014 PwC Golden Age Index report shows Australia at 16th in the world, last out of similar economies like New Zealand, the US, Korea, Japan and Canada. The report also shows the potential boost to GDP of increasing the participation of older workers. If we were able to increase participation to the levels of Sweden, the first-ranked country, GDP would rise by around 4.7 per cent, or $69 billion, which I imagine would be a boost for the economy and tax revenue and would probably pay a lot of bills at the national level.

The report recommends a range of measures to facilitate participation, later retirement, better access to ongoing training to improve employability and reduction of employment barriers like insurance. It also means ensuring that discrimination laws are enforced to ensure older people don't face discrimination in finding and keeping work. It means that business would need to more widely adopt flexible workplace policies which support the older workforce. There are some really good examples—places like Westpac and Australia Post do some really good work in this area—but we need to be encouraging a wider adoption of these kinds of strategies. We also know that people age better if they work for longer, because it is a way to stay engaged and active in their communities. It isn't just about economic benefits; there are social benefits as well. For COTA, the most important thing is that older people are able to make the choices that work for them and that the structure of the workforce now and into the future allows them to do it.

CHAIR: Thank you very much. I might let Senator Stoker go first.

Senator STOKER: Thinking about the gig economy, does it present a net risk or a net benefit to older Australians who want to have some flexibility as they age and an ability to fashion their own stepped retirement?

Ms Lawson : I think it comes back to the diversity of older people. If you've always been in a low-skilled, low-paid job, then the gig economy is just a different way to do that. It has the same issues that other insecure work has. However, you're right: there is a group of people who see it as being a way to say: 'I've retired from work, but I'd like to keep doing a bit of stuff to keep me engaged.' For those people, it's quite beneficial—and this is obviously only anecdotal because it's gathered from my Uber trips around the city.

Senator STOKER: That's okay; I do research the same way.

Ms Lawson : But there are a lot of older men—and it is predominantly older men—who are employed, not older women, who are driving Ubers. They see it as a way to extend their working life a bit. They talk about having retired and not really liking it, because they haven't prepared for it particularly well. Men don't volunteer as much as women, so the kinds of structures that support women in retirement don't seem to work in the same way for men. They quite like that kind of engagement. They like being able to talk to people, get around a bit and make a bit of pocket money to do things. I spoke to one guy who had two Airbnb properties and also did Uber, and he had another property in Thailand. It allows him the flexibility to make a bit of money out of each of those things and it keeps him going.

For some people who don't have good super arrangements or good retirement savings, it's a way to bolster those. Again, I would say that, if you are in a situation where you are already in insecure work, it's just another way to be more insecure and for longer.

CHAIR: You mentioned you'd been contacted by a journalist about the partnerships issue—we actually had some representatives from one of those firms here this morning, and I asked them about that. What is your organisation's view of compulsory retirement ages?

Senator STOKER: We don't think there should be compulsory retirement ages. I think we're looking at a group of people now who are the healthiest they've ever been at this age. When the age pension was introduced in 1909—from memory—about four per cent of people got there. The average life expectancy at that point was 56, so you were doing pretty well to get to 65. Because of those health advances, we can't do anything but say that that period of life has been extended and there are a whole lot of people who want to keep working. I'm sure you would come into contact, as I do, with a bunch of people who've worked high-level jobs who then sit on boards or committees and really enjoy that kind of way of still participating.

Like I said, there are still groups of people who may not want to work full time but want to segue in and out of work. Some people talk about doing contracts for three months of the year and then going travelling. Other people talk about going down to three days a week so they can care for grandkids or do that other kind of stuff. We certainly are not in favour of compulsory retirement ages.

CHAIR: I don't know whether your organisation's already expressed a position on this, but there's obviously a proposal currently to increase the pension qualification age to 70. Have you got a position on that?

Ms Lawson : New South Wales doesn't. We don't obviously usually talk about those federal matters that COTAA does, but I can't tell you if we do. I think there's a general acceptance amongst the kinds of people that I work with that that will probably happen—you've got that improvement in life expectancy and you have people who are more willing, and often more able, to work for longer. What worries me about that are the people who I talked about at the beginning who have worked manual jobs. Their bodies are not necessarily able to continue working beyond that age, and they face a really difficult future if the qualification age keeps pushing out. There are lots of people who are in that circumstance. You think about cleaners and those kinds of jobs, but even more skilled labour jobs. My dad was a carpenter; his body—he just wouldn't be able to work at 70. It's that simple.

CHAIR: Have you got any particular recommendations as to what we should be doing around the training system to retrain older workers who might be displaced through technology?

Ms Lawson : Again, it's a quite complex thing. One of the things we hear a lot is that older people who are in work are not offered the same training opportunities as their younger counterparts, and so that impedes their ability to actually apply for other jobs or to change and be flexible through the workplace. In terms of the technology training, again it's a quite difficult one. You've got people who have worked entire careers without ever having to use a computer. Again, I would say my dad is one of those. He was a builder. Other people did his books; he never had to do that kind of stuff. So for someone like that coming in cold to try to learn computer skills is actually quite difficult. But the biggest thing we see is that people don't get access to the training that they want, that they think would help them to get to work. That's the bigger issue; it's about having the accessibility for people to be able to get into the training that they want to do.

CHAIR: And this might also be a matter for your federal organisation rather than for you, but do you have any views on whether our social security system—I'm particularly thinking of the age pension, but the social security system more generally—is adequately built for the current era, where more and more people are juggling multiple insecure jobs?

Ms Lawson : The most thinking that I have done around that is about how that works for superannuation. I'm not telling you anything you don't know, but if you look at people who have phases in and out of work, and that is predominantly women, they have much lower superannuation balances than other people, which means, in the end, that they are forced to rely on pensions. And for someone like that in a rental market like Sydney—there was the Anglicare report earlier this week that found there were something like four houses available to rent at a reasonable rate for people on a pension—it just isn't enough money. I think we need to be reviewing things like superannuation and how people can contribute to that. I think part of that is about removing some really easy barriers, like the $450 a month limit. I think some of it is about looking at how you keep superannuation payments going while people are out of the workforce on maternity leave or carers leave. A lot of these structures are actually not fit for purpose in the world that we live in now. They were made at a time when jobs were a lot more secure and they were full time and they were done by men. I think we really do need to be reviewing a lot of those structures.

CHAIR: It does feel that way. That's the message we've been getting in other hearings as well.

Senator PATRICK: You mentioned in your description of what older people were telling you that some people felt that they didn't necessarily want to participate anymore: their body was a bit tired or they just felt comfortable resting, if you like. I wonder how much is attributable to that feeling versus biases in the workplace in relation to older people not participating?

Ms Lawson : There are a really broad range of older people and there are a broad range of circumstances. There are just so many older people that it's hard to try to knock it into one area. There are definitely people who feel that they are not capable of doing the work that they've always done and they don't see an easy way to get into other work that they could do instead. That's definitely a group of people, but, equally, there are people who feel that they are being discriminated against in their workplace. A lot of this is anecdotal. This folder of stuff is what I've been reading because we're about to do a forum on employment. There are so many reports written about this that I don't feel like I'm telling you much that's new.

There are people who feel discriminated against in trying to find work. We hear stories about people who say: 'I've got this job. I don't really like it. I'd like to do something else, but I'm too scared to leave this one because I don't know if I'll get another one.' We get people who feel like, if there are redundancies or people are being laid off, they're the first to be targeted to go.

I think that is about bias of perception. I think there is a definite bias by many employers that older people can't learn new skills or that they're not as adaptable as younger people. That really isn't backed up by evidence. What the evidence does show us is that they don't have access to training and they don't get the same access as other people. I also think there is a really quite pronounced bias in recruitment strategies or recruitment practices. Even when I talk to recruiters who are recruiting people at the higher end of the job market, they will say that they have trouble getting older people interviews. People will look at the CVs and say, 'No, I don't want to interview them.' So to get those people into the first interview they actually have to talk them up a lot more than they would a younger person. There are some things that you could do with older workers to help them through that—basic stuff like taking out some of the jobs and phrasing things a little bit differently in CVs. I think the HR industry needs to be doing some training around recruiting and thinking differently about recruiting as well.

To go back to some of those companies I mentioned earlier—people like Westpac, Australia Post, Cbus—there are a whole bunch of organisations that do blind recruiting. That is not just for older people; that's for anyone who doesn't have a name that sounds Anglo or those kinds of things. It takes out all of those kinds of markers. It takes out the names of the universities that people went to, because we know that there's a bias towards some universities over others. When you have those kinds of practices people end up with a more diverse range of employees than they do if they just go off CVs alone. So there's a whole range of things that we could be doing with the HR industry to improve recruitment practices to make sure people at least get past the first base in terms of going through that kind of process.

Senator PATRICK: You mentioned that a lot of older people get to a point where they feel like they have to retire, or they have been out of the workforce for a 12-month period and then basically give up. That leaves them in a poor economic situation. With super the way it is now, will that change as a function of time? In the future, will there be more people who are 'souped up' with super?

Ms Lawson : Yes, I think we're at a point at the moment where people have come into the super system halfway through their careers, so it hasn't done exactly as envisaged. However, I still think we need to be looking at the rules around super. We know that women retire with half as much money as men do. A lot of that is because if you take time out early in your career—you don't need me to explain it to you; you know what I'm talking about. They end up with a lot less. It is particularly women who miss out, so we need to look at ways to address that to make sure they're ending up with better retirement incomes.

People are very fearful, I think. One of the things with super is that how much you need depends on who you talk to. There are all kinds of calculations. The superannuation body have got one that ranks adequate, medium and wealthy retirement and things like that. People are quite fearful about how much they're going to need. While I would always argue that health science has done a great thing—we live much longer and much better lives—people are kind of fearful because they don't know when life is going to end and how long does their will have to last for. I think that's part of the decision-making process around working a bit longer—that you don't really know if it's going to last as long as it needs to.

Senator PATRICK: My final line of questioning relates to, in some sense, your evidence as a point-in-time piece of evidence. We're talking about the future, which may well be informed by the past. You have described the experience now. Going back 10 years or 20 years, was it a different situation? Do you think it will be different going forward 10 or 20 years?

Ms Lawson : I think people had different expectations of older age 20 years ago and I think we'll have very different expectations again in 20 years time. I think that's a function of how we change as a community. There is a lot of angst about moving the retirement age from 65, because people kind of see that as the end goal. If you started here and the goal is there, it's not great when it seems to move halfway through your game. So I think that is part of the thinking. I think we have similar kinds of issues around things like aged care—how people see that they were working in a system, that's the way it worked, that's what they were aiming for, and then it changed and it's not the same anymore. We get lots of comments from people about rules around retirement income and savings changing, where they've followed the rules and done the things they were supposed to, and then they change and that affects them in a negative way, and they don't like that.

Yes, I think it will be different in 20 years time, because I think we work differently now. I think, if you look at the generation of millennials, they have very different ideas around work and how work is structured, and I think work will start to change to reflect that stuff. We know, in this current economic situation, that to attract employees you're going to have to come up with more attractive jobs and more attractive employment circumstances. But I can't tell you what it's going to look like in 20 years time.

Senator PATRICK: Sure. Twenty years ago, or 30 years ago—and I might have this completely wrong—the feeling was that people started in a particular career and they ended in that career. Now we're moving to a situation where people diversify perhaps a little bit more, and I wonder if that would prepare them for later on in life, so that, when they hit retirement age in 20 years time, they're a bit more flexible and can maybe do a little bit more in terms of opportunities for ongoing work, even if it's part-time. Have there been any studies looking at how that all works?

Ms Lawson : I haven't seen any work. Again, I would say, anecdotally, people my age, or my kind of cohort of people, do think about work like that: I will do this and then I'll do that and then I'll kind of segue out by doing that. There is a group of people who look at—I can't think of the term they use now—kind of later-life career changes, and they think, 'Well, I'll finish my job at this thing, and then I'm going to go off and become a landscape gardener.' So there are people who already do that thinking.

I think in everything with older age you come up against human nature, which is that some people are planners and other people aren't. There is a group of people who think, 'I'll do that later,' and there are other people who just stumble across what happens next, because that's how they live their lives generally. Yes, I do think that's changing in the younger end of the cohort, even now. That 50-plus age group is changing.

Senator PATRICK: I just wonder if maybe you could give some thought to that and maybe come back to the committee, saying, 'I expect people to be retiring later but moving into part-time work more than perhaps they did 20 years ago.'

Ms Lawson : I think the FACS work was one of the first indicators that you've seen of that—that thing about 84 per cent of people wanting to step down. And they want to do it for different reasons. Some just want to do it because they want to work less; others want to do it because they want to do other things. But 84 per cent is a very clear indication that there is a group of people who see that kind of segue rather than just an end.

Senator PATRICK: Yes. Thank you.

CHAIR: Thanks very much for joining us today. It was very useful information.

Ms Lawson : Thank you.