Leader of the Opposition Bill Shorten and Prime Minister Malcolm Turnbull shake hands before a Leaders Forum at Windsor RSL as part of the 2016 election campaign in Sydney, Friday, May 13, 2016. (AAP Image/Mick Tsikas) NO ARCHIVING

Misleading claims on political pensions are overdue for retirement

AAP FactCheck April 22, 2021

The Statement

A Facebook meme claims Australian politicians have changed the age of retirement to 70 but left the age at which they can collect their own “fat pension” as 60. The meme invites people to share the post “if you think it should be the same rules for everyone”.

The meme was posted by the “I Grew Up in Australia” Facebook page in July 2017, but it remains popular nearly four years later. At the time of writing, the meme is still being shared hundreds of times daily and has been viewed more than 200,000 times in the past three months.

The 2017 post has been shared more than 59,000 times since it was published, while it has since been posted to several other Australian Facebook pages, generating hundreds more shares (see examples here and here).

A meme about politicians' pensions
┬áA meme claims politicians get access to their “fat pensions” at the age of 60.┬á

The Analysis

The claim that politicians raised the retirement age to 70 was partly true when the meme was first published in 2017 but is now outdated. However, the claim about politicians keeping their own pension age at 60 is incorrect.

Under a now-closed parliamentary pension scheme, politicians could access a payment on retirement regardless of their age, while the current parliamentary superannuation scheme ÔÇö in place since 2004 ÔÇö is subject to the same rules as apply to all retirees, meaning politicians can access their retirement savings at between 55 and 60 years of age.

The meme’s first claim is based on a plan announced by the federal government in 2014. As part of the 2014 budget, then treasurer Joe Hockey announced the government’s intention to raise the qualifying age of the age pension to 70 by 2035. However, Prime Minister Scott Morrison scrapped the plan in 2018 before it came into law.

The current qualification age for an age pension is between 66 and 67 depending on when the recipient was born. The pension is also subject to an income and asset test.

The meme’s second claim, about politicians keeping their own “pensions” eligibility age at 60, is inaccurate. As previously explained by AAP FactCheck, federal politicians are covered by two distinct retirement schemes. The age at which they can access those funds depends on when they were elected to parliament and their age.

MPs who took their seats before the 2004 election and have served at least eight years in parliament qualify for a now-discontinued parliamentary contributory pension scheme that offers generous lifelong pensions to retired politicians.

Under that scheme, most pension holders are entitled to payments immediately upon retirement, whatever their age. The exception is for retired MPs who were first elected between the 2001 election and the day before the 2004 election; they cannot begin receiving pension payments before the age of 55.

The old parliamentary pension scheme still applies for sitting and retired MPs elected before 9 October 2004, but it is closed to new entrants. It has since been replaced by a superannuation contribution scheme for MPs elected at the 2004 federal election or later. That scheme operates in line with regular Australian superannuation rules.

The Commonwealth pays 15.4 per cent of an MP’s salary into a superannuation fund, which MPs can top up with additional contributions. Superannuation rules are the same for all Australians, regardless of their job. All superannuation holders can begin accessing their fund at between 55 and 60 years of age, known as the “preservation age”, depending on their date of birth.

The meme includes a picture of Malcolm Turnbull and Bill Shorten, the prime minister and federal opposition leader at the time the meme was published. Both men were elected too late to qualify for the old parliamentary pension scheme, meaning they will instead be enrolled in parliament’s current superannuation scheme.

Malcolm Turnbull and Bill Shorten
 Neither Malcolm Turnbull nor Bill Shorten, who are seen in the meme, qualify for lifelong pensions. 

The Verdict

When the meme was first published in 2017, it was accurate to say the government planned to raise the pension age to 70. However, the policy was never put into law and was later scrapped by Prime Minister Scott Morrison.

The meme is mostly wrong in saying that politicians can access their own pensions at 60. Some MPs could access their pensions earlier than 60 under the old parliamentary pension scheme. However, contrary to the meme’s implied two-tier system, the same superannuation access rules now apply for both politicians and the public.

Partly False ÔÇô Content that has some factual inaccuracies.

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