Longevity and Social Change in Australia

This new text covers a wide range of issues, including health, retirement incomes, aged care, family relations, employme...

Author: Allan Borowski | Sol Encel | Elizabeth Ozanne

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This new text covers a wide range of issues, including health, retirement incomes, aged care, family relations, employment, housing and town planning. Special attention is given to the particular structural disadvantages affecting women, Aboriginal Australians and ethnic minorities. This comprehensive new volume will be an essential reference for policy makers and for students in social policy, sociology, gerontology and public health. It constitutes a distinctive Australian contribution to international debates on the implications of an ageing world. ‘Ageing is everybody’s business as we enter previously uncharted demographic waters with pundits warning of a geriatric tidal wave and dangerous demography. In this excellent book we have Australia’s leading scholars of ageing – demographers, sociologists, health economists and social policy analysts – assembling and analysing new evidence on ageing. Our baby boomers are entering retirement and face the contradictions of longer life, better health, but greater chronicity, more wealth, but financial uncertainty. These and more contradictions pose enormous policy challenges for governments and communities. DR ADAM GRAYCAR Head, Cabinet Office, Government of South Australia and Australia’s first Commissioner for the Ageing (in South Australia) from 1985 to 1990

UNSW

PRESS

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Longevity and SOCIAL CHANGE in AUSTR ALIA

B OROW SK I E NC E L OZ A N N E

UNSW PRESS

LONGEVITY and SOCIAL CHANGE in AUSTRALIA

Australia, like other industrialised countries, confronts the prospect of a steadily ageing population. The expectation of life has increased spectacularly during the past century, putting Australia second only to Japan.

BOROW SK I

 E NC E L  OZ A N N E

8/3/07 11:39:42 AM

Longevity and SOCIAL CHANGE in AUSTRALIA

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Longevity and SOCIAL Change in Australia

Edited by Allan Borowski, Sol Encel and Elizabeth Ozanne


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A UNSW Press book Published by University of New South Wales Press Ltd University of New South Wales Sydney NSW 2052 AUSTRALIA www.unswpress.com.au © Allan Borowski, Sol Encel and Elizabeth Ozanne 2007 First published 2007 This book is copyright. Apart from any fair dealing for the purpose of private study, research, criticism or review, as permitted under the Copyright Act, no part may be reproduced by any process without written permission. While copyright of the work as a whole is vested in the editors, copyright of individual chapters is retained by the chapter authors. Inquiries should be addressed to the publisher. National Library of Australia Cataloguing-in-Publication entry Longevity and Social Change in Australia. Bibliography. Includes index. ISBN 9780868408897. 1. Older people - Government policy - Australia. 2. Older people - Legal status, laws, etc. - Australia. 3. Older people - Health and hygiene - Australia. 4. Older people Australia - Finance, Personal. 5. Older people - Housing Australia. 6. Older people - Education - Australia. I. Borowski, Allan. II. Encel, Solomon, 1925- . III. Ozanne, E. IV. Title. 305.260994

Design Di Quick Cover photo Getty Images Printer Ligare This book is printed on Australian paper using fibre supplied from plantation or sustainably managed forests.


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Contents

1

list of tables

vii

contributors

ix

foreword – Norman Swan

1

introduction

4

the dimensions and implications of australian

15

population ageing

A llan Borowski and Peter McDonald

2

the health of older australians

40

Colin D Mathers

3

indigenous australians: ageing without longevity?

65

Philippa Cotter, Ian A nderson and Len R Smith

4

gender and ageing

99

Cherry Russell

5

ethnicity and ageing

117

Donald T Rowland

6

age and employment

142

Sol Encel and Rob Ranzijn


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7

health policy for a long-lived society

167

Hal Swerissen and Stephen Duckett

8

retirement income policy for a long-lived society

189

A llan Borowski and Diana Olsberg

9

housing policy for a long-lived society

219

Hal Kendig and Catherine Bridge

10

ageing in space: transport, access and urban form

239

Mike Berry

11

uncertain prospects: aged care policy for a

265

long-lived society

Michael Fine

12

the politics of ageing

296

Sol Encel and Elizabeth Ozanne

13

lifelong education and lifelong learning

316

Sheila Rimmer

14

family and intergenerational relationships in

334

the long-lived society

Elizabeth Ozanne

15

ageing and the law

363

Terry Car ney index


386

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List of tables

Table 1.1 Proportion of the population in select age groups, 30 1901–2101 Table 1.2 Past and projected youth, age and total dependency 31 ratios, 1901–2101 Table 2.1 Prevalence of disability by health conditions reported 48 and self-reported severity, Australians aged 65 years and over, 1998 Table 2.2 Ten leading causes of disability burden among older 53 Australians (ages 65 and over): YLD (per cent of total) by sex, Australia, 1996 Table 2.3 Ten leading causes of the burden of disease and injury 54 among older Australians (ages 65 and over), by sex, Australia, 1996 Table 3.1 Proportion of HACC clients by age and Indigenous 80 status Table 3.2 Indigenous population aged 50 years and over, by 81 location, 2004 Table 3.3 Indigenous aged care recipients per 1000 Indigenous 82 people aged 50 years and over, by location, 2004 Table 5.1 Birthplaces of persons aged 65 years and over, 118 Australia, 1996–2026


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longevity and social change in australia

Table 5.2 Groups of the ethnic aged according to recency of arrival and proficiency in English, 2001 Table 5.3 Age and sex-specific usage rates (per 1000) for permanent residential care by English-speaking status, 2001 Table 6.1 Employment status by age and gender, 2003 Table 6.2 Projected participation rates, 2005–41 (%) Table 6.3 Participation rates by education, gender and age, 2002 (%) Table 6.4 Unemployment rates by education, gender and age, 2002 Table 10.1 Trips by mode, selected countries, 1984–94 Table 10.2 Sydney person trip rates by selected mode by age Table 10.3 Driving licence requirements for older drivers, by state and territory Table 11.1 Recurrent government expenditure on aged care services, 2000–01 and 2003–04 ($m current prices) Table 11.2 Long-term care arrangements for older people (aged 65+), Australia, 2003–04 Table 11.3 Estimated resident population and allocatable health expenditure, 2000–01 Table 11.4 Financing aged care, government and consumer contributions, 2002–03 to 2042–43 (Hogan Report) Table 11.5 Funding options for aged care Table 14.1 Overview of demographic and societal characteristics related to the first and second demographic transitions in western Europe


125 133

144 145 146 147 245 250 259 269 273 274 284 287 338

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Contributors

Ian Anderson is Professor and Director of the Centre for Health and Society and Onemda VicHealth Koori Health Unit in the School of Population at the University of Melbourne. Mike Berry is Professor of Urban Studies and Public Policy in the School of Global Studies, Social Science and Planning at RMIT University. Allan Borowski is Professor and a former Head in the School of Social Work and Social Policy at La Trobe University. Catherine Bridge is Director, Home Modification Information Clearinghouse in the Faculty of Health Sciences at the University of Sydney. Terry Carney is Professor and Director of Research in the Faculty of Law at the University of Sydney. Philippa Cotter is Research Associate in the School for Social and Policy Research at Charles Darwin University. Stephen Duckett is Executive Director, Reform and Development of Queensland Health and former Dean of the Faculty of Health Sciences at La Trobe University.


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Sol Encel is Emeritus Professor and Honorary Fellow in the Social Policy Research Centre at the University of New South Wales. Michael Fine is Associate Professor in the Department of Sociology and Deputy Director of the Centre for Research on Social Inclusion at Macquarie University. Hal K endig is Research Professor of Ageing and Health in the Faculty of Health Sciences at the University of Sydney. Peter McDonald is Professor and Head of the Demography and Sociology Program in the Research School of Sciences at the Australian National University. Colin D Mathers is Senior Scientist, Evidence and Information for Policy Cluster, in the World Health Organization, Geneva. Diana Olsberg is Senior Lecturer and Head of the School of Sociology and Anthropology at the University of New South Wales. Elizabeth Ozanne is Associate Professor and Head of the School of Social Work at the University of Melbourne. Rob R anzijn is Senior Lecturer and Program Director in the School of Psychology at the University of South Australia. Sheila Rimmer is former President of both the New South Wales Council on the Ageing and the Australian Council on the Ageing, and is currently a member of the Medical Services Advisory Committee, Commonwealth Department of Health and Ageing. Donald Rowland is Reader in the School of Social Sciences at the Australian National University. Cherry Russell is Associate Professor in the Faculty of Health Sciences at the University of Sydney. Len Smith is Associate of the Australian Centre for Population Research at the Australian National University. Hal Swerissen is Professor and Acting Dean of the Faculty of Health Sciences at La Trobe University.


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Foreword

This is a unique moment in human history. We have never lived longer. But the curious thing is that, anecdotally, when you talk to people, it seems they have never felt sicker. We are not necessarily happy in our extended mortal coils. It is important to understand where these extra years of life have been coming from, because it perhaps helps to explain this apparent contradiction. If you were to walk down the streets of Sydney or Melbourne in the mid-19th century, there would have been plenty of older people around. The main reason that life expectancy was about 40 years less than it is now was the appalling perinatal, infant and child mortality rates. They brought the average down. Over the next 100 years, though, better nutrition and housing, safer obstetric care, immunisation and, indeed, higher female literacy rates, ensured that the vast majority of babies reached adulthood. So life expectancy at birth improved dramatically, but what did not change much right up to the Second World War was life expectancy at age 50 or 60. And it is that metric which has made the difference to life expectancy over the last 50 years. These days, if we reach middle age, we can expect it to be truly that: the middle of our lives, not the penultimate coda as our grandparents expected.


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This has enormous implications. Developmental psychologists, for example, have tended to stop their research at adolescence and, disturbingly, little is known about developmental stages in mid- and late-life. We tend to take an approach based on pathology and do not really understand normality. So, for example, we dismiss the male middle-age crisis as somehow pathetic, yet are relatively ignorant of the natural history of our minds into extreme old age. We are not prepared for these added years and issues, such as feeling economically squeezed with 40 years to go – a feeling that may be affecting our sense of wellbeing. It is also time to reflect on why this expansion of life after middle age has occurred. There is not much doubt that, when you look at the 19th and early 20th centuries, the gains were made from public health and other sectors such as education rather than curative medicine. The story in the last 50 years, however, is far less clear. Some are suggesting that the impact of curative medicine on life expectancy is fast catching up on public health interventions where, arguably, most of the gains have been made with the exception of the poorest, least educated and especially Indigenous populations. But even there, medical care is having an impact that has not been properly measured. For instance, a fascinating cohort study of obese people in the United States has shown that the BMIs (Body Mass Index) for obese people today are healthier, with lower blood pressures and blood fats, for example, than 30 years ago. Some of this may be increased fitness, but some of the difference will inevitably be from drugs, surgery and other things that health services do. The argument that public health should have all the kudos is pervasive and perhaps allows politicians and bureaucrats to think that what is done in hospitals and doctors’ surgeries does not matter that much, when it actually does. If, for the first time in human history, medicine is having a large and measurable impact on how long we live as a population, then issues such as fairness, being able to receive good medical care and access to increasingly expensive, yet possibly life-extending, technologies will become even more explosive political issues than they are at the moment.


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foreword

When the community realises what is really at stake, sit back and watch the fireworks. What better time for a thorough review of ageing and the new longevity? Dr Norman Swan Host, The Health Report ABC Radio National


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Introduction

Like its predecessor, Ageing and Social Policy in Australia (eds Borowski, Encel & Ozanne 1997), the present volume has been designed to reflect the ever-increasing breadth and depth of research and discussion in the field of gerontology, as well as major developments in government policy at both national and state levels. The earlier book appeared shortly after the election of a Liberal–National coalition government in Canberra in 1996. The current book examines important policy shifts in the subsequent decade. The main themes covered in the succeeding chapters are summarised below. In chapter 1, Allan Borowski and Peter McDonald trace the fertility and mortality revolutions that have produced the current demographic picture, one that departs radically from the traditional population pyramid. The chapter focuses upon the changes in the proportionate size, numbers and composition of the older population and the demographic processes that underlie population ageing. Borowski and McDonald also explore some of the policy implications of the demography of ageing in Australia. Colin Mathers extends this analysis in chapter 2 by reviewing changing health patterns. He notes that Australians are now second only to the Japanese and French in terms of life expectancy. Mathers reviews evidence on recent trends in mortality, causes of death and disability prevalence rates for older Australians. Chapter 2 also examines the extent


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introduction

of health problems in older Australians, and the causes of those problems in terms of diseases, injuries and risk factors. The chapter concludes with a discussion of projected future health trends and implications for older Australians and for Australian society. International evidence, as well as Australian data, suggests that there will be further improvements in health, but with increasing levels of disability. The next three chapters examine the impact of ageing on specific subgroups in the population – Indigenous Australians, women, and people of non-English-speaking background (now commonly referred to as ‘culturally and linguistically diverse’, or CALD). In chapter 3, Philippa Cotter, Ian Anderson and Len R Smith examine the radically different patterns of morbidity, mortality and life expectancy in the Indigenous population. Their discussion focuses on the links between health, community services and aged care policy at a national level. In chapter 4, Cherry Russell explores the differential impact of ageing on men and women and the unresolved issue of whether age or gender has the greater influence on the lives of older women. She also examines the specific problems of ageing in the case of homosexual couples. Donald Rowland deals with the ‘ethnic aged’ and the value of ethno-specific aged care services in chapter 5. Another group with a distinctive profile are ‘mature-age’ workers, especially men and women over 50 years of age. In chapter 6, Sol Encel and Rob Ranzijn note how demographic and economic changes have forced a reconsideration of the role of paid work in later life. Pressure on the pension system because of sharp increases in longevity has led governments to introduce a range of policy incentives and disincentives designed to prolong labour force participation, to abandon previous policies aimed at encouraging early retirement, and to legislate against age discrimination in employment. The chapter also describes the damaging effects of long-term unemployment on older workers. Although issues of government policy are touched on in most chapters, policy is the explicit concern of the next five chapters, which deal with health, retirement incomes, housing, transport and infrastructure, and the political process itself. In chapter 7, Hal Swerissen and Stephen Duckett examine the use of hospital and medical care services for older people and look at current problems, including access to services, waiting


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times, and challenges to the continuity of health care arising from federalism. Allan Borowski and Diana Olsberg describe the evolution of retirement income arrangements in Australia and the shifting forces that have shaped them in chapter 8. They outline the main features of Australia’s retirement income system prior to the 1980s and the objectives of the reform process that began in the 1980s. They describe some of the major changes that have been introduced, what they have achieved and how and why a number of objectives remain much further from being realised than was initially expected. The chapter, which concludes by outlining the challenges that remain for Australia’s retirement income system, gives particular attention to an especially important distributive issue, that concerned with the economic security of older women. Housing is another policy area that is attracting increased attention. In chapter 9, Hal Kendig and Catherine Bridge consider policy prospects as the large baby boom cohort enters old age over the next decades. A comparative perspective is used to illuminate the distinctiveness of the Australian situation and possible new policy directions. The influence of Commonwealth and state government policies is assessed in terms of single-family homes, higher-density housing, and specialised forms of housing including retirement homes, caravans and boarding houses. Housing is closely related to transport and other public services. Mike Berry examines the relationships between housing, mobility and geographic location in chapter 10. Mobility depends on historical and current policies regarding transport, particularly public transport. Marginalised location and poor access to both private and public transport creates a class of ‘transport poor’. The rapid growth in the numbers of older women living alone poses special problems in terms of the provision of safe, reliable and affordable transport services. Mobility and access are directly related to housing policies, transport and urban planning policies, and retirement incomes. Changes in policies relating to aged care are discussed in detail by Michael Fine in chapter 11. He focuses on the concept of care, evidence of the need for care, political responses and building a new vision. Fine observes that aged care first emerged as a distinct field of policy in the 1950s. Residential aged care providers tend to exaggerate their role, whereas the cost of health care for the aged is much greater than that


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introduction

of aged care. Further, the amount of care provided within families is also much more important than the activities of the aged care industry. He examines the findings of several recent reports dealing with nursing homes and community care, and concludes by describing attempts to develop a more imaginative approach to aged care than that presented by the rather limited range of options found in official policy discussions. Political processes are the vehicle for the implementation (or nonimplementation) of policy. In chapter 12, Sol Encel and Elizabeth Ozanne examine various aspects of this relationship. They review attempts to shift responsibility for aged care from the Commonwealth to the states, a political manoeuvre that has not succeeded. The Liberal–National coalition has, however, placed much more emphasis on ‘user-pays’ policies to meet the rising costs of aged care. They also examine the political preferences of older voters, noting that they continue to vote for conservative parties. Pressure groups representing older persons have increased in importance and have succeeded in obtaining benefits from both national and state governments. However, the notion of ‘grey power’ remains largely mythical. The final three chapters deal with a range of matters including lifelong education, intergenerational relations, and legal issues. In chapter 13, Sheila Rimmer describes the historical development of institutions of adult and further education, and notes a shift of emphasis since the 1980s away from traditional concepts of adult education towards training and retraining in the workforce. Elizabeth Ozanne comments on changes in intergenerational relations as the result of increased longevity in chapter 14. Established ideas about the place of older people in society, and in family relationships, are under strain. Today, it is likely that four, or even five, generations of a family will survive together, moving in and out of what were previously much more age-standardised roles of child, parent, grandparent and great-grandparent. As a result of demographic shifts, the body of descendants available to support the growing number of elders has shrunk, while at the same time welfare provisions have been cut back because of pressure on state revenues. In chapter 15, Terry Carney examines the role of the law in mediating social changes associated with population ageing, including the balance between work and retirement, and the provision of non-labour market


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incomes. Demographic ageing, in combination with neo-liberal economic measures, are serving to dissolve historic boundaries between work and retirement, blurring choices between universal and selective policies, or public and private provision. In the second part of the Introduction, we examine some of the outstanding issues arising from the ageing of the population. What are the justifications for the recurrent presentations of ageing as a crisis or a ‘demographic time bomb’? Is it possible to view increased longevity as an achievement rather than a problem? What will be the impact of the impending retirement of large numbers of the baby boom generation? These and related topics are explored in detail in the various chapters of the book, to which the following pages constitute a brief prologue.

Ageing – threat or promise? Contemporary society is faced with the dilemma of deciding whether increased longevity is a boon or a threat, so that much of the discussion about population ageing is couched in terms of crisis. The fact that people are living longer has come to be called the ‘new longevity’, or the ageing of the aged. Confronted with the new longevity, society appears less and less certain about the roles to be assigned to older people. One pessimistic conclusion is that older people, especially after retirement from the labour force, can only assume a ‘roleless role’ (eds Riley, Kahn & Foner 1994). The erosion of traditional communities and family networks increases the difficulty of establishing a harmonious relationship between the aged and the rest of society. Unfortunately, these difficulties encourage talk of a ‘crisis’. The language of crisis presents ageing as the new population problem of our times. Peter Peterson, an American investment banker who served as Secretary of Commerce during the Nixon presidency, has used the imagery of the Titanic to depict the imminence of the crisis which, he declares, will ‘daunt the public policy agendas of developed countries and force the renegotiation of their social contracts’ (Peterson 1999). The combination of a worldwide decline in birth rates and an increase in life expectancy has created what is sometimes described as a gerontological drift. Using the age dependency ratio (that is, the ratio between the


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introduction

retired population and the working population), the proponents of crisis claim that, in a short time, Western-type industrialised societies will find it impossible to carry the burden of ever-growing numbers of elderly people. Reinforcing these apprehensions is concern about declining fertility rates. The Australian Treasurer, Peter Costello, has developed this theme in several public statements. In 2004, he urged women to have ‘one child for the husband, one for the wife, and one for the country’. He returned to the topic in a television interview before presenting the Budget to parliament in May 2006, announcing a cash incentive so that families would ‘think about one for the country as well’ (Sydney Morning Herald 2006). The marginalisation of older people is reflected in the prevalence of age discrimination in the labour market, an issue examined in chapter 6. Older workers, particularly men, constitute a disproportionately large share of the long-term unemployed and the so-called ‘discouraged job seekers’. In effect, the duration of working life has been shortened, which in turn increases the pressure on the welfare system. Although the policies of governments have moved towards an emphasis on retaining older workers in the labour force, little progress has been made in this direction because of the attitudes of employers, backed up by the arguments of some economists that the preference for younger workers is economically rational (Lazear 1995). To a large extent, employers reflect widespread social attitudes, epitomised by maxims such as ‘You can’t teach old dogs new tricks’ and ‘The old should make way for the young’. British economist Phil Mullan has debunked the idea of a demographic time bomb. Societies are ageing, but this is not a major source of contemporary social problems. Populations have been ageing, he observes, since the beginning of the 20th century, and societies have coped without incurring apocalyptic crises as a result. Industrialised societies are already productive enough to generate sufficient wealth to provide for the present aged population, and even low levels of economic growth will satisfy the most extreme projections for the future rate of ageing. Furthermore, he stresses that most old people are neither ill nor disabled and do not need looking after. The improvement in living conditions during the 20th century is the main factor in increased


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longevity, and a continued improvement will make contemporary and future generations of older people fitter and healthier than their predecessors (Mullan 2000). Mullan’s views are endorsed by a number of other demographers and economists. American demographer Richard Easterlin, among others (for example, Schulz, Borowski & Crown 1991), has criticised the use of the age dependency ratio as a basis for the notion of a crisis. Easterlin observes that use of the ratio is characterised by a lack of historical and comparative data and an excessive reliance on simple projections. He points out that dependency ratios in the 1880s were actually higher in the United Kingdom and the United States than in the 1980s. The real issue, he maintains, is not economic but political: ‘how to capture via taxation the savings of households from supporting fewer younger dependants to fund the cost of more older dependants’ (Easterlin 1991). Easterlin was responding to the widespread talk of a crisis in the American social security (that is, social insurance) system, touched off by the report of a commission appointed by US president Jimmy Carter. A detailed critique of the Carter commission’s report points out that its calculations ignore the contribution made by older people to the welfare of younger people in the form of direct services or of cash payments that drew upon accumulated capital or pension income. The real problems arose not from a crisis in the pension system, but from the effects of prolonged unemployment and inflation (Friedmann & Adamchak 1983). The language of crisis also made a considerable impact in Australia, as pointed out in chapter 12. It was rebutted in terms similar to those quoted above. A report by the National Population Council argued that increased labour force participation by women would cut the dependency ratio (National Population Council 1991). Research by the Australian Institute of Family Studies has emphasised the extent to which older family members are involved in assisting other family members (Edgar 1991). The fact that older people are no longer seen as rare survivors – a small minority within a fixed framework – has led to increasing emphasis on the possibilities of a healthy and productive life in later age. It is even claimed that active, successful and productive ageing has taken on a ‘moral significance’ (Daatland & Biggs 2003). Daatland and


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introduction

11

Biggs argue that the 20th century welfare state has ‘decommodified’ later life, allowing for rising standards of living among retired people by creating a free-floating class of non-producers. This has led to changed expectations about the way in which later life should be spent. The concept of ‘positive ageing’ owes much to the work of the late Peter Laslett, who popularised the idea of a ‘Third Age’ of life, which he described as one of personal fulfilment. The Third Age, he wrote, was a new phenomenon in human history, which could become an age of personal achievement and self-realisation (Laslett 1989). Similarly, American writer Ken Dychtwald described older people as an untapped resource for society (Dychtwald 1991). Echoing these views, wellknown Australian public figure Barry Jones observes that ‘the wealth of experience of the aged must be used as an asset rather than having the aged generally characterised as a liability’ (Jones 1993: 19).

The baby boomers The demographic future will be strongly influenced by the progressive entry of the baby boom generation (1946–64) into the age groups of the over-60s. The implications of this transition have been spelt out in detail in a study by British research centre Demos, in collaboration with Age Concern, the largest age-related charity in Britain. Their findings are summarised below (Huber & Skidmore 2003). • Demographic trends are an insufficient basis for predicting the implications of an ageing society. Our assumptions about the future are rooted in the concepts applicable to past generations. The baby boomers have transformed every stage they have passed through, and show no sign of stopping in old age. We have to consider the values and attitudes that the baby boomers will take with them as they move into older age. • Two particularly important characteristics of the baby boomers are their individualism and their liberalism. However, they do not conform to any single stereotype any more than previous generations. There are significant differences between them in affluence, longevity, education and ethnicity. It is essential to distinguish between baby boomers as a homogeneous cultural construct and baby boomers as


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12


a heterogeneous, fragmented cohort. • Current responses have tended to treat issues affecting baby boomers as an individual rather than a social matter. This narrows the range of policy instruments for the future. Policies that require baby boomers to remain longer in the labour force are likely to arouse resentment and animosity. • In comparison with older generations, baby boomers have lower levels of social bonding or ‘social capital’ because of higher levels of divorce and separation, with serious implications for the provision of care and support. They also have fewer networks and are more likely to be disconnected from the wider community. This suggests the need to invest in a number of areas such as housing and neighbourhood design, health and fitness, lifelong learning, and online technologies. Investments like these could offset some of the costs of providing for old age by encouraging older people to be healthier and fitter. In Australia, the cultural differences between baby boomers and their elders have been explored by MacKay (1997) and Salt (2003). Like the Demos researchers, Salt considers that baby boomers have ‘forged new cultures at every stage of the life cycle’ (2003: 94). He predicts that they will have enough political influence to steer budgets away from education to health. Ageist attitudes and stereotypes will be attacked, so that terms like ‘pensioner’ and ‘senior citizen’ will be viewed as patronising or downright offensive.

Conclusion The picture of the older people as a dependent group, burdening society with excessive expenditures on health and aged care, is based on assumptions about biological inevitability. Social construction is probably more important as expressed through the introduction of pensions, compulsory retirement, institutional residential care, and other economic and social policies and practices that treat the ‘aged’ as a distinct group. Dependency and ageism go hand in hand. While there may be problems arising from a ‘mortality revolution’


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introduction

13

that will generate significant numbers of very old people (90 years of age and over) in the medium term, such problems are exaggerated. This is especially because the current and expected population of people over 60 are better off in terms of health and material resources than any previous generation. In addition, concern about dependency ignores the substantial contributions made by older people, especially the ‘young old’, to family members in a wide range of areas of need. Such concerns also underrate the significance of increased labour force participation by women. Interdependence between generations is a much more appropriate description of the actual social situation, and provides a more equitable and realistic basis for social policies addressed to the growth in the proportion of older people in society. As a recent study of population observes, the ageing of the population should be seen as a transition rather than a crisis, with opportunities as well as challenges. The main challenge is to promote healthy and productive ageing and to adjust social structures to include older people as contributors to society (Healy 2004). A similar view is expressed in a discussion paper issued by the Commonwealth Government in 1999 which stresses that population ageing presents both challenges and opportunities, observing that ‘the fact that greater numbers of people are reaching old age is a major achievement reflecting improved living conditions and the control of disease’ (Bishop 1999). References Bishop, B (1999) The National Strategy for an Ageing Australia, Background Paper, Minister for Aged Care, Canberra. Borowski, A, Encel, S & Ozanne, E (eds) (1997) Ageing and Social Policy in Australia, Cambridge University Press, Cambridge. Daatland, SO & Biggs, S (2003) Ageing and Diversity, Policy Press, Bristol. Dychtwald, K (1991) Age Wave: How the Most Important Trend of Our Time will Change Your Future, Bantam Books, New York. Easterlin, RA (1991) The Economic Impact of Prospective Population Changes in Advanced Industrial Countries, Journal of Gerontology, 46(6): S299–309. Edgar, D (1991) Ageing: Everybody’s Future, Family Matters, 30: 15–19. Friedmann, EA & Adamchak, J (1983) Societal Aging and Intergenerational Support Systems. In A Guillemard (ed.) Old Age and the Welfare State, Sage, London, pp. 53–73. Healy, J (2004) The Benefits of an Ageing Population (Discussion Paper no. 63), The Australia Institute, Canberra. Huber, J & Skidmore, P (2003) The New Old: Why the Baby Boomers Won’t be Pensioned Off, Demos/Age Concern, London.


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Jones, B (1993) The Challenge of an Ageing Society. In K Sanders (ed.) Ageing: Law, Policy and Ethics – Directions for the 21st Century, School of Social Work, University of Melbourne, pp. 6–19. Laslett, P (1989) A Fresh Map of Life, Weidenfeld & Nicolson, London. Lazear, E (1995) Personnel Economics, MIT Press, Cambridge, MA. MacKay, H (1997) Generations: Baby Boomers, Their Parents and Their Children, Pan Macmillan, Sydney. Mullan, P (2000) The Imaginary Time Bomb, IB Tauris, London. National Population Council (1991) Population Issues and Australia’s Future, Australian Government Publishing Service, Canberra. Peterson, PG (1999) Gray Dawn: The Global Aging Crisis, Foreign Affairs, January/February: 43–62. Riley, MW, Kahn, RL & Foner, A (eds) (1994) Age and Structural Lag, Wiley, New York. Salt, B (2003) The Big Shift, 2nd edn, Hardie Grant Books, Melbourne. Schulz, JH, Borowski, A & Crown, WH (1991) The Economics of Population Aging: The ‘Graying’ of Australia, Japan and the United States, Auburn House, New York. Sydney Morning Herald (2006) Tax Cuts for All, Cash for Families, Sydney Morning Herald, 8 May, p. 1.


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1 The dimensions and implications of Australian population ageing Allan Borowski and Peter McDonald

Introduction Demographic forces can have profound impacts on societies. This chapter seeks to capture the dimensions, causes and some of the consequences and policy implications of one of these forces, namely, population ageing, or the growth in the percentage of the population in older ages. The changes brought about by population ageing in Australia (and elsewhere) have demanded, and will continue to demand, a range of policy responses geared towards institutional change. Indeed, the chapters in this collection are largely concerned with the past, present and especially the future directions of Australia’s public policies for the aged. As a lifelong process, ageing permeates people’s lives regardless of life cycle stage – whether through their own ageing or through the older people that they know (Nusberg 2000). Clearly, then, at the individual level, ageing and old age are not novel phenomena. And similarly at the


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aggregate level: demographers have long recognised age as an underlying structural feature of populations. However, it is only in the last three decades or so that close attention has been paid in Australia to population ageing. This closer attention stems from the projected future upsurge in the absolute and relative numbers of older Australians for which the social, health, economic and other consequences have steadily come to be recognised. Demography is the scientific study of populations in terms of population size, growth or decline, composition, geographic distribution and the factors that shape population change, namely, births, deaths and migration. The analysis of the demography of ageing in this chapter focuses upon, first, the changes in the proportionate size, numbers and composition of the older population and, second, the demographic factors or processes that underlie population ageing. The chapter then explores some of the policy implications of the demography of ageing in Australia. Before turning to the first section, however, it is important to comment upon both the definition of the aged used in this chapter and the nature of population projections. Defining an aged person in terms of chronological age is complex, not least because the various bases for defining old age (for example, the scientific/biological, economic, political and cultural) keep changing. This complexity is reflected in the fact that studies of the aged in Western societies have included people who range in age from as young as 50 years of age to those who are at least 75 years of age. The most commonly used lower age limit is 65 years, a choice that has its origins in the retirement age specified under the provisions of some of the first modern collective retirement income arrangements introduced in the late 19th and early 20th centuries. Furthermore, over 90 per cent of Australians aged 65 and over are not in the labour force. Thus, 65 years is also the lower limit that is used in most of this chapter. In the discussion below, frequent reference is made to population projections. Population projections supply information about prospective developments. They are the source of our knowledge about population futures. Those who participate in the policy debates on the implications of population ageing often seem to treat projections as if they were precise


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dimensions and implications

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predictions. It needs to be borne in mind, however, that population projections are ‘empirically based calculations of future … population numbers under specified assumptions about changes in population growth or its components’ (Rowland 2003a: 437). They show what the future population would be under specified assumptions, assumptions that are based on past trends and an assessment of their likely future dynamics. There is no certainty, however, that the assumptions will be correct or prevail over the projection period. Further, population projections ignore non-demographic factors or conditions that may influence the future course of population growth, such as fluctuations in the level of economic activity, natural or man-made disasters and shifts in social values. Thus, the longer the time frame covered by the projections, the greater the likelihood that they will depart from the actual path of future population growth and change. As Niels Bohr, the prominent physicist, once observed, ‘it is very difficult to make predictions, especially about the future’! In sum, then, population projections, although of great importance for social and other forms of planning, should not be treated as definitive statements of the size and characteristics of the future population. Nevertheless, this chapter draws upon the long-term projections of the Australian Bureau of Statistics (ABS) because these are the ones that most commonly enter into current policy debates. The three main projection series cover three scenarios for future population growth – high (Series A), medium (Series B) and low (Series C). This chapter mainly reports data derived from the ABS’ ‘middle’ (Series B) projections.

Ageing in Australia

The proportion of aged Australians Demographic ageing has been in train in Australia for well over a century. In 1861, 1 per cent of Australia’s population was 65 years of age and over, while, in 1881, the proportion was 2.5 per cent. In the year of Federation (1901), the aged comprised 4 per cent of the population, a proportion that had doubled by the early post-Second World War period (1947). As a result of the postwar baby boom and high levels


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of immigration, population ageing slowed. Indeed, between 1966 and 1971, the portion of older Australians declined from 8.5 per cent to 8.3 per cent. The early 1970s, however, marked the beginning of a reversal in Australia’s long-term demographic outlook from a rapidly growing and comparatively young population to a declining, older one (Rowland 2003b: 239). By the next quinquennial Census of Population and Housing (1976), the aged represented 8.9 per cent of the population. Five years later (1981), this proportion had increased to 9.8 per cent, and to 11.3 per cent and 13 per cent in 1991 and 2004 respectively. According to the most recent ABS projections, the aged will comprise 18–19 per cent of the population in 2021, 26–28 per cent in 2051 and 27–31 per cent of the population in 2101 (Borowski & Hugo 1997; ABS 2005). How does Australia’s experience of population ageing compare with that of other countries? In 2004, 7.1 per cent of the world’s population (about 461 million people out of a total world population of 6.5 billion) were 65 years of age and over. By 2050, it is expected that 16.5 per cent of the world’s population (1.5 billion people out of a projected world population of 9.1 billion) will be aged 65 years and over. This world ‘profile’ is a combination of the profiles of a large number of countries that are at very different stages of economic development. With regard to the more developed countries, they, like Australia, have been ageing for well over a century. In most less developed countries, however – countries that today are home to 279 million older people – this process began recently and is being compressed into just a few decades. While ageing is currently viewed as a challenge primarily facing developed nations, by 2050, only 22 per cent of the world’s older people will live in what today are the more developed countries (Kinsella & Phillips 2005; Wilson 2005). There are also major regional differences in population ageing that broadly mirror the differences just described. At the dawn of the 21st century, the proportion of the population 65 years of age and over in Europe was at the historically unprecedented level of 14.7 per cent. In North America, Asia, Latin America and the Caribbean, the Middle East and North Africa and sub-Saharan Africa, the proportion of aged was


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12.4 per cent, 5.9 per cent, 5.6 per cent, 4.4 per cent and 2.9 per cent respectively. In less than three decades (by 2030), these proportions are projected to be 24.3 per cent in Europe, 20.3 per cent in North America, 12 per cent in Asia, 11.6 per cent in Latin America and the Caribbean, 8.1 per cent in the Middle East and North Africa and 3.7 per cent in subSaharan Africa (Kinsella & Velkoff 2001). Comparatively, then, Australia today may be described as occupying a transitional position between the demographically young populations of Asia, Latin America and Africa and the old populations of Europe in general (and those of western and southern Europe in particular that are especially mature, such as Sweden, Italy and Greece). Australia’s age structure is similar to that of Canada, New Zealand and the United States. Within a few decades, however, by which time many of today’s developing nations will be demographically old, Australia will be one of a large group of developed nations with very old populations (Hayward & Zhang 2001).

Changes in the median age of the population Another way of looking at population ageing is to trace changes in the median age of the population over time. The median age is the age at which half of the population is older and half is younger. The median age of the Australian population has fluctuated over the course of the last century or so. The overall trend, however, has been one of gradual increase. In 1881, the median age of the Australian population was 20.1 years. At the turn of the century, it stood at 22.5 years. Almost 50 years later (1947), the median had reached 30.7 years. However, the 1954, 1961, 1966 and 1971 Censuses all showed a steady fall in the median age, a fall attributable to the postwar baby boom and high levels of immigration. Since 1976, the median age has increased steadily. The median age was 30.5 years in 1984, 33.4 years in 1994 and 36.4 years a decade later. The median age is projected to be between 39.9 years and 41.7 years in 2021, between 44.6 years and 48.2 years in 2051 and between 46.1 years and 49.3 years in 2101 (Borowski & Hugo 1997; ABS 2005).


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The number of aged Australians In considering the growth of the aged population, it is important to take account not only of changes in the proportion of the older persons but also the numbers of older persons in the total population. The absolute numbers are especially important because they reflect changes in the demand for pensions, health services, housing and other specialised services for the aged. In 1901, there were 150 837 people aged 60 years or more in Australia. Six decades later, this figure was 894 000. Those 65 years of age and over numbered 1.46 million in 1981, 2.11 million in 1994 and, in 2004, just over 2.6 million – an increase of 58 500 people (2 per cent) from June 2003. The growth rate in the number of older Australians has been rapid and much higher than that of the population as a whole. This is expected to continue through to 2021, when there will be 4.5 million older Australians out of a total population of about 24 million. This rate will then start to slow. By 2051, there are projected to be over 7 million older Australians out of a total population of about 28 million (Borowski & Hugo 1997; ABS 2005).

The ageing of the aged population A significant feature of population ageing in Australia is the ageing of the aged population itself. Because morbidity and disability are positively associated with old age, especially at advanced old ages, the ageing of the aged population will increase the absolute number of physically and/or mentally ill and disabled people. Indeed, many of the costs and policy challenges associated with ageing occur in relation to those aged 85 years and over – the ‘old-old’. There is considerable variation within the aged population in terms of age. Of the 2.6 million Australians who were 65 years of age and over in 2004, 298 300 people (1.5 per cent of the total population) were aged 85 years and over – an increase of 114 per cent in the space of 20 years (since 1984), during which time the total population increased by 29 per cent. By 2051, the number of old-old is projected to be 1.6 million (6–8 per cent of the total population) and between 1.7 and 2 million (7–10 per cent of the total population) in 2101. These proportions mirror


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the fact that this old-old age group is projected to experience the highest growth rate of all age groups (ABS 2005, 2006).

Determinants of population ageing The age structure of a society is shaped by the processes of fertility, mortality and international migration. Each of these demographic processes has differentially contributed to the growth in the number of older Australians and their proportionate representation in the national population. The size of the older population at any single point in time is determined by, first, the number of births that occurred 65 or more years earlier in Australia; second, the number of people born overseas 65 or more years earlier and who subsequently migrated to and settled in Australia and, third, the extent to which these two groups have experienced mortality and emigration in the intervening period.

Fertility Fertility is usually measured by the total fertility rate (TFR) – the average number of children a group of women would have during their lifetimes if they experienced the fertility rates recorded at each age in a given year. There has been considerable fluctuation in Australian fertility rates over the last century. The 1910s and 1920s were periods of relatively high fertility. In 1921, the TFR was 3.1, but it declined to 2.1 in the 1930s during the depths of the Great Depression. Indeed, the period 1907–34 overall was a period of fertility decline. During the postwar baby boom (1946–64), the TFR rose and peaked at 3.6 births per woman in 1961. Subsequently, however, it fell sharply and, since 1962, except for a couple of periods when it plateaued, has been declining. After steadying at 2.8–2.9 births per woman between 1967 and 1971, the TFR again fell steeply. It fell below replacement (2.1 births per woman) in 1976 and has remained below this level ever since. In 1978, it was 1.9 births per woman. Carmichael and McDonald (2003) suggest that the steep fall in the TFR during the 1970s was a result of the combination of a delay in childbearing and reduced childbearing across the lifetime.


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The TFR remained at around this level until the early 1990s, but from 1992, when the TFR was 1.89, it once again declined, albeit slowly and steadily. Since 1998, the TFR appears to have again plateaued between 1.73 and 1.76 births per woman. In 2003, the TFR was 1.75 births per woman (Carmichael & McDonald 2003; ABS 2005), but McDonald (2005a) suggested that it would climb to 1.8 in 2005 and remain at least at that level for the next decade. With regard to this apparent cessation in the still further decline of the TFR in recent years, McDonald maintained that: It is at least partly due to the continuation of good economic times … low fertility is caused in large measure by increased risk aversion on the part of young including greater insecurity and intense levels of competition. Risk aversion is undoubtedly muted by the continuation of good economic times. (McDonald 2005b: 18)

It is generally recognised that reductions in fertility have been the major factor contributing to population ageing. As Serow (2001: 87) points out, ‘decreases in the absolute number of children in the population have the immediate effect of increasing the proportion of all other age groups’. Indeed, the continued ageing of the Australian population portrayed in the ABS projections is underpinned by assumptions about future fertility levels made with regard to recent trends in the TFR. Even the ‘high’ fertility scenario in the ABS’ projections (Series A) assumes that the TFR will not exceed 1.9 over the projection period. To what can the long-term decline in fertility be attributed? There is a sizeable body of literature that has sought to address this question. Reviews by Castles (2003) and Weston (2004) highlight the postponement of first births, the consequent shortening of childbearing years and the increased risk of having no children at all. The postponement of first births is reflected in (1) the increase in the median age of all mothers who gave birth from 26.9 years in 1983 to 30.5 years in 2003 and (2) the highest fertility rates shifting from 25–29-year-old women to 30– 34-year-old women as well as a marked increase in the fertility rate of women aged 35–39 years (ABS 2006). And with regard to childlessness, the proportion of women in their reproductive years who have not given birth has increased markedly over the last few decades. Castles and Weston


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point to such underlying factors, for example, as women’s increasing participation in education and the labour market, technological changes, and shifts in the beliefs and values of prospective parents and others. McDonald (2006) has further argued that the emergence of low fertility is associated with two waves of social change that have had profound effects upon family formation behaviour in the past 40 years. The first wave of change, beginning in the 1960s but consolidated in the 1970s, was a rapid expansion of social liberalism (also termed ‘reflexive modernisation’). The second wave, beginning in the 1980s and consolidated in the 1990s, was a sharp shift to economic deregulation including, most importantly for low fertility, labour market deregulation (also termed ‘new capitalism’). In varying degrees, all advanced countries have been subject to these two waves of social change, but they have produced a cultural divide in fertility rates across advanced countries. The dividing point is a fertility rate of 1.5 births per woman, a level below which demographers consider that fertility is critically low. The advanced countries with fertility rates above 1.5 (Group 1 countries) include all of the Nordic countries, all of the English-speaking countries and all of the French- or Dutch-speaking western European countries. On the other hand, all of the southern European countries, all of the German-speaking western European countries and all of the advanced east Asian countries have fertility rates below 1.5 (Group 2 countries). According to McDonald (2006): In broad terms, the Group 2 countries are countries in which there is a strong, traditional value that family and state are separate entities and that families should support their own members without intervention from the state. Accordingly, states in these regions have been slow to implement family assistance measures. With some exceptions, the opposite is the case in the Group 1 countries; in general, they are notable for the family-friendly institutional arrangements that they have implemented in the past 20 years and for relatively higher levels of gender equity within the family. (McDonald 2006: 498–99)

The cultural divide indicates that differences between countries with very low fertility and those with moderately low fertility are due to institutional factors rather than to individual ones.


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Mortality Mortality is a second factor that determines the demographic characteristics of a population. During the 20th century, Australia underwent a major mortality transition. There were unprecedented reductions in premature death, yielding dramatic improvement in life expectancy. The impact of reductions in mortality on the age structure of the population depends upon the ages at which they occur (Serow 2001: 89). If they occur at the beginning of life – if they are concentrated among infants and children – then the demographic consequences are similar to an increase in fertility, namely, a marked growth in the number of young people in the population. This was Australia’s experience during the first half of the 20th century, a period that witnessed major reductions in infectious diseases that affected mainly younger age groups due to improved living conditions. However, if the declines in mortality occur at the other end of the lifespan, the resulting increases in life expectancy have an immediate impact in increasing the proportion of the population in the older age groups. This has been the case for Australia since the 1970s as deaths from chronic diseases affecting older age groups have decreased with improvements in drugs and medical technology and such public health measures as mass immunisations. (The increasing importance of disease and death attributable to noncommunicable diseases, such as cardiovascular diseases and cancers, in comparison with those caused by infectious diseases, has been termed the ‘epidemiological transition’.) The reductions in mortality have had two major effects – more rapid population growth than would otherwise have been the case and population ageing arising from increased longevity (Booth 2003). Kippen and McDonald (2000) have estimated that there are around 1 million Australians living today, almost all at older ages, who would have been dead if the death rates of the early 1970s had remained constant over the past 30 years. A succinct indicator of the improvement (that is, decline) in mortality is the expectation of life. Life expectancy has steadily improved throughout Australia’s history. During the course of the last century, male life expectancy at birth increased from 55.2 years in the period 1901–10 to 77.8 years by the beginning of the 21st century. Over the


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same period, female life expectancy increased from 58.8 years to 82.8 years. During the last 20 years or so, life expectancy has increased each year by about 0.30 years for males and 0.25 years for females. The largest growth occurred between 1998–2000 and 1999–2001, when male life expectancy increased by 0.47 years and female life expectancy by 0.37 years. Clearly, not only has life expectancy steadily improved (and there is no sign that the trend is coming to an end) but there has also been a narrowing in the gap between the male and female expectations of life (ABS 2005). Particularly noteworthy has been the improvement in life expectancy at older ages. Newcastle University’s Professor Tom Kirkwood, in his 2001 Reith Lecture for the BBC, observed that: ‘Never in human history has a population so wilfully and deliberately defied nature as has the present generation. How have we defied it? We have survived!’ Kirkwood was referring to the improvements in life expectancy, both at birth and at older ages. Thus, for example, life expectancy at age 65 has increased from 14 years for males and 18 years for females in 1983 to 18 years for males and 21 years for females in the period 2001–03 (ABS 2006). What are the future prospects for longevity? In a recent study, Booth and Tickle (2004) examined the longevity prospects of today’s population 50 years or older. Using probabilistic (rather than traditional crosssectional or cohort) forecasting methods, they found improvements in longevity over the lifetime of the cohorts now alive – a longer life expectancy than previous estimates, suggesting that official population projections underestimate the true extent of future ageing. For example, Booth and Tickle found a life expectancy at age 50 (today’s baby boomers) of 88.8 years for females and 84.4 years for males. Their forecasts point to the need to re-examine existing analyses of the financial implications of ageing for the public provision of income support and health and aged care services. One aspect of improved longevity that has caught the public’s attention in recent years has been the impact of increasing levels of obesity. While life expectancy at birth has been steadily increasing, it has been suggested that it may, given the positive relationship between obesity and mortality, be slowed in the future. In a recent study, Reynolds, Saito and Crimmins


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(2005) sought to estimate the effect of obesity on the length of life. They found that obesity has little effect on the life expectancy in adults aged 70 years and older. However, obese people are more likely to become disabled; that is, obese older people were found to live more years and spend a higher proportion of their remaining years disabled. Reynolds, Saito and Crimmins concluded that obesity-related death among the old is less of a concern than disability in this age group.

International migration Australia is a country of immigrants. It has had an active immigration program since the latter part of the 1940s and almost one-quarter of the population is overseas-born. Over the last decade, net migration (the excess of arrivals over departures) has ranged from a low of 46 500 in 1993–94 to a high of almost 118 000 in 2003–04 (ABS 2006). Australia’s population growth has mainly come from natural increase (the excess of births over deaths), although there have been some years in which net migration has been a larger contributor to population growth than natural increase. Since 1998–99, net overseas migration has comprised at least 45 per cent of population growth. Clearly, immigration plays an important role in contributing to Australian population growth. Kippen and McDonald (2000) have estimated that international migration added 7 million people to Australia’s population from 1947 to 2000. Its contribution today, however, is proportionately smaller than it was in the 1950s, 1960s and 1980s (Birrell 2003: 155). While postwar immigration has had a massive impact on the size of Australia’s population and upon its labour supply, Kippen and McDonald (2000) have shown that its impact on Australia’s age structure was very small in comparison with the impacts of changing fertility and mortality rates. The commonly held view that postwar immigration has kept Australia’s population young is incorrect. The impact of international migration upon ageing of a population is contingent upon the difference between the average age of immigrants and emigrants (net migration) and the average age of the population. When fertility is only moderately below replacement level, this difference tends to be small. However, when fertility falls to very low levels (under 1.5 births per woman),


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the average age of the population rises rapidly and the difference in age between the population and the immigrants becomes wider. In a very low fertility situation, increased levels of immigration will gradually bring down the average age of the population, so, once more, the difference in age between the population and the immigrants becomes small. In other words, in terms of slowing down the ageing of the population, there are decreasing returns to scale from immigration. This has been demonstrated for Australia by McDonald and Kippen (1999) and for a range of countries by the United Nations (2000). Replacement migration is not a long-term solution to population ageing because migrants also age (Niessen & Schibel 2002). The most recent study on this issue (Kippen & McDonald 2004) has further confirmed that immigrants are not a substitute for births. The study found that while immigration initially (during the first 40 years) has beneficial impacts on the age structure – especially at net intake levels of around 90 000 people (Productivity Commission 2005) – populations with low fertility and high migration age more rapidly thereafter (Kippen & McDonald 2004: 26).

The changing composition of the aged population The composition of each generation of older people is distinctive. The shifts in the composition of the aged population that arise over time do so as a result of cohorts entering the ranks of the aged having different characteristics from those of preceding cohorts. Some characteristics may be altered through changes occurring among older people themselves (for example, shifts in the male–female mortality/longevity differential), while others may be a product of behavioural factors (such as shifts in the patterns of family formation and dissolution). Still others are a function of past experiences, a result of the unique circumstances that prevailed during the period when the cohort passed through crucial life stages (Borowski & Hugo 1997). Thus, those Australians who will begin to retire in very large numbers in 2011 (the baby boom generation) will differ considerably from the current aged population because they will


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have lived through vastly different events. For instance, those who will soon begin to retire in large numbers will have reached school age during the postwar expansion of education that saw much higher proportions of students proceeding to later high school and tertiary education than was the case with cohorts moving into those ages in the 1920s, the 1930s and the 1940s. Three elements of the changing composition of Australia’s aged population are briefly considered here: the gender mix, ethnic diversity and the spatial/geographic distribution of the aged.

Sex composition Historically, women have experienced a higher life expectancy than men. This has directly affected the sex ratio at older ages. In 1984, the sex ratio of those aged 65 and over was 72 males per 100 females. Twenty years later, it had increased to 81 males per 100 females. For the population that is 85 years of age and older, the sex ratio was 47 males for every 100 females or more than twice as many females as males (ABS 2006). This discrepancy between the numbers of males and females at older ages is due to the fact that females typically outlive their male peers. In strict demographic terms, these sex ratios underscore the fact that ageing has been predominantly a female phenomenon and many of the problems associated with old age are disproportionately those of females. These are examined in chapters 2, 4, 8 and 11. However, this situation is changing as the difference in mortality between older aged men and women falls. Between 2001 and 2016, the population of men aged 75 and over is projected to grow by 54 per cent compared to 35 per cent for women (Temple 2005). Consequently, services that have become very used to dealing with older aged women will need to adjust to serving much larger numbers of men in the future.

Ethnicity While, to a degree, the problems of ageing are universal, there is no doubt that people from cultural and linguistic backgrounds different from those of the majority population can experience particular difficulties. An important characteristic of the aged population in Australia is its ethnic heterogeneity. This growth in the numbers of culturally and


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linguistically diverse older Australians first became apparent in the 1980s and 1990s as the first waves of postwar immigrants from eastern and southern Europe entered the retirement age groups. The number of people aged 65 years and over from culturally and linguistically diverse backgrounds will grow from 393 000 (17.8 per cent of the total older Australian population) in 1996 to 654 000 (22.5 per cent of the total older Australian population) in 2011. Growth is high for those born in Italy, Greece, Germany, the Netherlands and China. This has major implications for the delivery of aged services in culturally appropriate ways. There are also implications arising from the relatively low levels of competency in English among many older persons (Gibson et al. 2001). The topic of ethnicity and ageing is addressed in more detail in chapter 5.

The spatial distribution of the aged Ageing in Australia is very much a regional phenomenon. Temple (2005) has shown that, by 2016, in a projection where the proportion of the total Australian population aged 65 and over will be 16 per cent, the proportion of Sydney’s population aged 65 and over will be 14 per cent while that of the rest of New South Wales will be 22 per cent. By 2016, the statistical divisions of Mid-North Coast and Richmond-Tweed in New South Wales would have 27 per cent and 24 per cent of their populations 65 years of age and over respectively, while in Outer Sydney South this proportion would be just 13 per cent, about the same as the current proportion of Australians who are 65 years of age and over. In small country towns in which young people have been leaving, ageing is especially dramatic. This spatial clustering of the aged in particular communities means that: … services targeted specifically for the aged need to be similarly clustered. An appreciation of the patterns of distribution of the aged and an understanding of how they are changing is … important in planning the provision of services for them, especially since many in that group have low levels of mobility. (Borowski & Hugo 1997: 36)


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Some policy implications In Australia’s contemporary national conversation about the impacts of population ageing, this demographic phenomenon is often portrayed, if only implicitly, as an apocalyptic social problem – a demographic villain that disrupts basic social institutions (Schulz, Borowski & Crown 1991). This conversation has been cast quite narrowly. The focus of policy analysts and the public alike has been largely upon the baby boomers in their Third and Fourth Ages. The construction of ageing as a problem has its roots in concerns about the increase in the size of the aged population relative to the size of the working-age population rather than the absolute increase in the number of older persons per se. Because it is workers who provide the tax revenues required to sustain society’s non-working members, population ageing has raised concerns about the ability of the public purse to pay for Australia’s relatively comprehensive government-funded support systems for the aged. Pessimism about the fiscal sustainability of population ageing derives from the analysis of dependency ratios. These ratios measure the number of ‘dependants’ per 100 ‘workers’.

The analysis of dependency ratios Table 1.1 presents data on the past, current and projected proportions of the population in three broad age groupings: 0–14 years, 15–64 years and 65 years of age and over.

Table 1.1 Year Total population (’000) 0–14 years (%) 15–64 years (%) 65 years and over (%) SOURCE

Proportion of the population in select age groups, 1901–2101 1901

1947

1971

2002

2021

2051

2101

3 773.8

7 579.4

13 067.3

19 662.8

23 684.4

26 421.5

26 355.7

35.1

25.1

28.7

20.3

16.1

14.0

13.8

60.8

66.8

63.0

67.1

64.9

58.9

57.2

4

8.1

8.3

12.6

19

26.1

28.9

Adapted from ABS 2006: 114, table 5.16


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The age dependency ratio is the ratio of persons aged 65 years and over to those broadly considered to be available for work, namely, the 15–64 years age group. It represents the number of people aged 65 and over per 100 workers. Similarly, the youth dependency ratio is the ratio of persons under 15 years of age to those aged 15–64 years. Past and projected youth, aged and total dependency ratios calculated from the data presented in table 1.1 appear in table 1.2. Table 1.2 indicates that there has been a steady rise in the age dependency ratio over the course of the 20th century. The rate of increase will accelerate markedly in the second and third decades of the 21st century as the survivors of the baby boom generation retire and the rate of growth in Australia’s working age population slows to a snail’s pace. Between 2020 and 2030, Australia’s working age population will grow by just 14 000 per year, compared with about 180 000 today (Withers 2004). By mid-century, the age dependency ratio will have deteriorated quite significantly – from 18.8 today (or 5.3 people in the (potential) workforce for every person aged 65 or more years) to 44.3 (2.2 people). It is this trend in the age dependency ratio – the growth in the numbers of aged Australians that will have to be supported relative to the number of tax-paying workers – that has aroused concern about the fiscal sustainability of the public costs of population ageing. Some major government initiatives have been introduced, at least in part, in response to this concern. For example, major reforms of Australia’s retirement income system have sought to progressively move away from an intergenerational system of support for the aged in the form Table 1.2

Past and projected youth, age and total dependency ratios, 1901–2101

Year Youth dependency ratio Age dependency ratio Total dependency ratio SOURCE

1901

1947

1971

2002

2021

2051

2101

57.7

37.6

45.6

30.3

24.8

23.8

24.1

6.5

12.1

13.2

18.8

29.3

44.3

50.5

64.2

49.7

58.8

49.1

53.1

68.1

74.6

Calculated from the data presented in Table 1.1 above.


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of the publicly funded age pension to one that encourages individual workers to assume substantial responsibility for providing their own income needs in retirement through occupational superannuation (see chapter 8). But as Schulz, Borowski and Crown (1991) have pointed out, an overreliance on age dependency ratios can be quite misleading for policy purposes. The total dependency ratio offers a more complete picture of the dependency situation as it acknowledges that the aged are not the sole ‘dependent’ segment of the population. Indeed, table 1.2 shows that the total dependency ratio at mid-century will be about the same as it was at Federation (1901). Clearly, this is due to the steady increase in aged dependency being substantially offset by the decrease in youth dependency. The extent to which decreased youth dependency offsets the age-sensitive fiscal burden of growing aged dependency, however, depends upon the public costs of supporting the young compared to the aged. Since the latter costs are generally three times larger per head than the public spending on younger dependent Australians (Hugo 2001), the total dependency ratio picture is not as ‘fiscally redeeming’ as it may first appear. The simple ratios described above can be refined very considerably. On the labour force side of the equation, we should take account of how many of the population of working age (15–64) are actually employed, for how many hours and at what levels of productivity. On the dependency side, we would need to consider the degree of dependency of aged people in terms of disability, illness, capacity for self-support from private means and access to family support. Without these refinements, the analysis of dependency is cursory or indicative only. However, no Australian study has ever addressed these refinements in a comprehensive way. Two recent reports that have addressed the issue of dependency to some degree are the Treasury’s 2002 Intergenerational Report and the 2005 report of the Productivity Commission, Economic Implications of an Ageing Australia.

The Intergenerational Report and the report of the Productivity Commission The most prominent recent markers of the national conversation on the impacts of population ageing are the Commonwealth Government’s


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33

Intergenerational Report (Department of Treasury 2002) tabled as part of the 2002 Federal Budget papers, and the more recent report of the Productivity Commission, Economic Implications of an Ageing Australia (Productivity Commission 2005). These reports add further gravitas to the negative picture portrayed by the analysis of dependency ratios. The Intergenerational Report underscored the tax burden that will have to be borne by the future workforce arising from population ageing. According to the report, the Commonwealth’s ‘demographic spending’ is predicted to rise by just over five percentage points, from 13.9 per cent of gross domestic product (GDP) in 2000 to 19.2 per cent of GDP 40 years later. If tax revenues remain the same proportion of GDP as they are now, the gap between revenue and expenditure could grow to $40 billion (in today’s dollars) by 2042. The Intergenerational Report argues, therefore, that ageing will place unsustainable pressure on the Federal Budget. Resolving this budget shortfall will demand that a heavier tax burden be borne by future generations, reductions in spending, increased government debt or some combination of these. In a similar vein, the Productivity Commission’s (2005) report, Economic Implications of an Ageing Australia, examined the productivity, labour supply and fiscal implications of projected demographic trends over the next 40 years. The Productivity Commission report found that the fiscal gap for all levels of government will reach 6.4 per cent of GDP by 2044–45. Dowrick and McDonald (2002), Day and Dowrick (2004) and Guest (2004), among others, have offered considered critiques of the Intergenerational Report. They point out, for example, that the report assumes that the needs of the aged and the existing policy settings will remain essentially unchanged over the projection period when, in fact, there is a range of policy options from which to choose. The particular choices made could markedly alter the assumptions of the model that inform the report’s analysis. (Some of these policy options are outlined in the chapters in this volume, including chapters 7 and 11.) They further point out that the projection period of four decades is too short, that the Intergenerational Report ignores state government and household budgets, that higher consumption expenditures in the future will yield higher goods and services tax (GST) revenues, that the report understates the potential variability of outcomes that could arise from varying levels


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of future mortality, and that its predictions about future levels of male and female labour force participation and, indeed, the labour force participation of older workers, are much too conservative. And they also underscore the impact of the huge improvement in women’s educational attainment in mitigating the effects of rising dependency rates by raising the growth in productivity. In sum, they believe that the Intergenerational Report is overly pessimistic about the future impacts of population on the Federal Budget’s age-sensitive spending. The Productivity Commission report estimates a somewhat higher ‘fiscal gap’, the gap between government revenue and expenditure, than does the Intergenerational Report. According to the Commission, the fiscal gap by 2045 would be almost 7 per cent of GDP. However, the Commission acknowledged some of the critiques that had been made of the Intergenerational Report’s conclusions. The method used to project future health expenditure in the Intergenerational Report was very rudimentary, especially because no allowance was made for the changing age distribution of the population across time. The Productivity Commission report corrects this by making age-specific estimates of future health expenditure and by incorporating assumptions about the impacts of technology and demand on per capita costs for each health component. This is important because almost all of the estimated future fiscal gap is due to additional health costs. This is where the action is. It is difficult to argue with the report’s conclusion that ‘improvements in the cost effectiveness and productivity of Australia’s health system would play a direct role in reducing the costs associated with the demographic transition’ and that ‘there is considerable scope for such gains’ (Productivity Commission 2005: XLIII). However, the Commission also acknowledges, as pointed out by critics of the Intergenerational Report, that Australian living standards will be considerably higher in 2045 (90 per cent higher is the Commission’s estimate) thus providing considerable scope for the fiscal gap to be met from increased real incomes. The government reports on ageing can be criticised for their treatment of future demography as being independent of future economic trends. Of the ‘three Ps’ (population, participation and productivity), these reports tend to dismiss population as having any policy relevance. The conventional economic models treat demographic factors (births, deaths


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35

and migration) as exogenous. However, it is plain that birth rates will fall and migration levels will be low if the future economy is weak and the opposite will be the case if the future economy is strong. Rather than future demography being predetermined inevitably and inexorably by past trends in demography, estimates of future demography should be made in consort with projections of likely future economic and social trends. The economic reports themselves project a future of good economic times, with living standards roughly doubling over the next 40 years. With increases in living standards, the ageing of the population and the need for Australia to invest heavily in new infrastructure to improve the environment, water supplies, energy conversion, transport and communications, there is likely to be a strong future demand for labour that will put upward pressure on migration levels. The projections made by government agencies also have the fertility rate falling, although the most recent trend has been sharply upward. The government has also been engaged in implementing a range of new family policies that, besides assisting individual families with their financial and services needs, tend to have an influence on the birth rate (McDonald 2005a). With slightly increased fertility and higher migration levels, the extent of ageing can be somewhat more muted and the increase in the proportion of the population aged 65 years and over by 2050 could be as much as 30 per cent lower than that obtained by the ABS Series B projection used by the Productivity Commission. This is not a trivial reduction. The two government reports are also very conservative in their assumptions about potential changes in labour force participation rates for men, despite the fact that the government is very actively engaged in achieving higher participation rates. For example, the Productivity Commission report projects male participation rates between the ages of 30 and 54 to fall sharply. Given government policy, there seems no logical reason for this other than that it is the result of a statistical projection that inputs only past trends. The Commission’s projections even go so far as to project higher labour force participation rates for women than for men between the ages of 45 and 54 by the end of the projection period (Productivity Commission 2005: figure 3.16). These sorts of criticisms of the Intergenerational Report and the Productivity Commission report are consistent with similar critiques (for


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example, Burtles 2005) of analyses undertaken elsewhere in response to proponents of the view that population ageing represents a serious economic threat. Finally, absent from this discussion has been an effort to articulate a set of public values that might inform policy decisions for the ageing of the baby boom and subsequent aged cohorts; for example, the preferred roles of families and society for older people, the roles and responsibilities of older people themselves, the quality of life that society desires for its older people, and so on (Cornman & Kingson 1996).

Conclusion In the next 30 years, the large generation that were born in the 30-year period following the Second World War, the baby boom generation, will replace the small generation born from 1915 to 1945 at the oldest ages of the Australian population. In the context of birth rates that have been low for the past 30 years and a sharply rising expectation of life over the same period, this generational change ensures that Australia’s population will age substantially over the coming three decades. This is not a crisis because it will occur gradually, because there is time to plan and because Australia will have the resources to deal with the transformation. Nevertheless, the transformation will be more efficient and more beneficial to the wellbeing of both young and old if long-term planning for the future is implemented. The Australian Government certainly shares this point of view, as is evident from its Intergenerational Report and the report of the Productivity Commission, but, reflecting their origins, these reports are narrow in their conception of potential future policy directions. The most basic way in which the government reports are narrow is in their dismissal of the potential to change population futures in a way that reduces the speed and level of ageing. In the continuation of good economic times and in the right policy environment, birth rates may rise slightly and remain at higher levels. Again presuming good economic times, higher living standards, the ageing of the population and the need to renew infrastructure will almost certainly push up the level of immigration to Australia. Secondly, the reports are narrow in their failure


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to consider the potential for family and community supports for aged people. The young-old potentially will be a major source of support for the old-old, both as volunteers or low-wage service workers. Indeed, many will be the children of the old-old. Family and community support will be more effective and more efficient if it is conducted in partnership with government aged care services. Thirdly, the government reports fail to deal with regional aspects of an ageing Australia. In general, ageing will be much more of an issue outside of the major cities than in the cities themselves. Some large outer areas of major cities will hardly age at all in proportional terms, although some of the largest numeric growth of older people will be in these same areas. Government reports ensuing from economic agencies tend to suggest economic solutions. The Australian Government has focused on the two other Ps, participation and productivity. Given government policy emphasis on participation, it is remarkable that the reports from government agencies are so pessimistic about future labour force participation rates for men, especially for men aged 35–54. This leaves the final P, productivity. Productivity is sometimes narrowly conceived as output per hour of work, providing a focus upon reform of the labour market. In the area of ageing, increased productivity is more a matter of society-wide, institutional arrangements, such as better and more efficient delivery of health care, more efficient infrastructure, and so on. The following chapters of this book address ways in which Australia could improve its productivity in aged support while at the same time increasing the wellbeing of older people. References Australian Bureau of Statistics (ABS) (2005) Population Projections, Australia, 2004–2101 (Cat. no. 3222.0), Australian Bureau of Statistics, Canberra. —— (ABS) (2006) Year Book Australia 2006, Australian Bureau of Statistics, Canberra. Birrell, B (2003) The Management of Immigration: Patterns of Reform. In S Khoo & P McDonald (eds) The Transformation of Australia’s Population 1970–2030, UNSW Press, Sydney, pp. 129–57. Booth, H (2003) The Changing Dimensions of Mortality. In S Khoo & P McDonald (eds) The Transformation of Australia’s Population 1970–2030, UNSW Press, Sydney, pp. 104–28. Booth, H & Tickle, L (2004) Beyond Three Score Years and Ten: Prospects for Longevity in Australia, People and Place, 12(1): 15–27. Borowski, A & Hugo, G (1997) Demographic Trends and Policy Implications. In A Borowski, S Encel & E Ozanne (eds) Ageing and Social Policy in Australia, Cambridge University Press, Cambridge, pp. 19–53.


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Burtles, G (2005) Can Rich Countries Afford to Grow Old? Paper presented at the conference on An Ageing Society, Technical University of Lisbon, Portugal, 19–20 May. Callaghan, G (2005) Why We Need More Babies, The Weekend Australian Magazine, 26–27 November, pp. 24–31. Carmichael, GA & McDonald, P (2003) Fertility Trends and Differentials. In S Khoo & P McDonald (eds) The Transformation of Australia’s Population 1970–2030, UNSW Press, Sydney, pp. 40–76. Castles, FG (2003) The World Turned Upside Down: Below Replacement Fertility, Changing Preferences and Family-Friendly Public Policy in 21 OECD Countries, Journal of European Social Policy, 13(3): 209–27. Cornman, JM & Kingson, ER (1996) Trends, Issues, Perspectives, and Values for the Aging of the Baby Boom Cohorts, The Gerontologist, 36( 1): 15–26. Day, C & Dowrick, S (2004) Ageing Economics: Human Capital, Productivity and Fertility, Agenda, 11(1): 1–20. Department of Treasury (2002) Budget Paper No 5: Intergenerational Report 2002–03, Commonwealth of Australia, Canberra. Dowrick, S & McDonald, P (2002) Comments on Intergenerational Report, 2002–03, Australian National University, Canberra. Gibson, D, Braun, P, Benham, C & Mason, F (2001) Projections of Older Immigrants: People from Culturally and Linguistically Diverse Backgrounds, 1996–2026, Australia (AIHW Cat. no. AGE 18), Australian Institute of Health and Welfare, Canberra. Guest, R (2004) Australia’s Older and Wealthier Future, Policy, 20(2): 3–9. Hayward, MD & Zhang, Z (2001) Demography of Aging: A Century of Global Change, 1950–2050. In RH Binstock & LK George (eds) Handbook of Aging and the Social Sciences, 5th edn, Academic Press, San Diego, pp. 69–85. Hugo, G (2001) Demographic Perspectives on Social Policy and Intergenerational Equity. Paper prepared for the Australian Council of Social Service Annual Congress, Melbourne, 25–26 October. Kinsella, K & Phillips, DR (2005) Global Aging: The Challenge of Success, Population Bulletin, 60(1): 5–42. Kinsella, K & Velkoff, V (2001) An Aging World: 2001 (US Census Bureau Series P95/01-1), US Government Printing Office, Washington DC. Kippen, R & McDonald, P (2000) Australia’s Population in 2000: The Way We Are and the Ways We Might Have Been, People and Place, 8(3): 10–17. —— (2004) Can Increased Immigration be a Substitute for Low Fertility? People and Place, 12(3): 18–27. McDonald, P (2005a) Has the Australian Fertility Rate Stopped Falling? People and Place, 13(3): 1–5. —— (2005b) Population Ageing: Chaos, Caution or Complacency? The WD Borrie Lecture 2005, The Australian Population Association. —— (2006) Low Fertility and the State: The Efficacy of Policy, Population and Development Review, 32(3): 485–510. McDonald, P & Kippen, R (1999) The Impact of Immigration on the Ageing of Australia’s Population, Department of Immigration and Multicultural Affairs, Canberra. Niessen, J & Schibel, Y (2002) Demographic Changes and the Consequences for Europe’s Future: Is Immigration an Option? Migration Policy Group, Brussels. Nusberg, C (2000) Towards a Society for All Ages. In FG Caro, R Morris & JR Norton (eds) Advancing Aging Policy as the 21st Century Begins, The Haworth Press, New York, pp. 31–39. Parliament of Australia (2005) Australia’s Immigration Program (Research Note no. 48) Department of Parliamentary Services, Canberra, 10 May.


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Productivity Commission (2005) Economic Implications of an Ageing Australia, Productivity Commission, Canberra. Reynolds, SL, Saito, Y & Crimmins, EM (2005) The Impact of Obesity on Active Life Expectancy in Older American Men and Women, The Gerontologist, 45(4): 438–44. Rowland, D (2003a) Demographic Methods and Concepts, Oxford University Press, Oxford. —— (2003b) An Ageing Population: Emergence of a New Stage of Life? In S Khoo & P McDonald (eds) The Transformation of Australia’s Population 1970–2030, UNSW Press, Sydney, pp. 238–65. Schulz, JH, Borowski, A & Crown, WH (1991) Economics of Population Aging, Auburn House, New York. Serow, WJ (2001) Economic and Social Implications of Demographic Patterns. In RH Binstock & LK George (eds) Handbook of Aging and the Social Sciences, 5th edn, Academic Press, San Diego, pp. 86–102. Temple, J (2005) Older Australians as Consumers: The Role of Selected Demographic Variables in Explaining Expenditure on Necessities, PhD Thesis, The Australian National University, Canberra. United Nations (2000) Replacement Migration: Is it A Solution to Declining and Ageing Populations? Population Division, Department of Economic and Social Affairs, United Nations Secretariat, New York. Weston, R (2004) Having Children or Not, Family Matters, 69 (Spring/Summer): 4–9. Wilson, T (2005) New United Nations World Population Projections, People and Place, 13(1): 14–22. Withers, G (2004) Australia’s Population Future, Business Council of Australia.


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2 The health of older Australians Colin D Mathers

Introduction This chapter provides an overview of the health of older Australians. Older Australians now have the third highest life expectancy in the world, after the Japanese and the French. For most of the 20th century, the life expectancy of older Australians increased slowly and at oldest ages remained fairly static. This has now changed. Commencing in the late 1960s, life expectancies for older Australians started to increase significantly and this increase shows no signs of ending. This has raised the question of whether increases in life expectancy at older ages are accompanied by more disability (through keeping sicker people alive longer) or less disability (through primary prevention of major disabling conditions). There is no doubt that the growth and ageing of the Australian population will have important implications for health expenditures and demand for aged care services, as well as broader social implications for social security and retirement policies, retirement funding, research priorities and changes in individual behaviour and social goals. Many have worried that increasing longevity will create a new burden of health and long-term care needs for an increasingly sick and disabled elderly


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population. The impact of population ageing will be less important if disability prevalence is decreasing among older people than if it is increasing. Apart from the economic and social impacts of population ageing, it is important to keep sight of the value of longer life itself to Australians, particularly if those extra years of life are relatively healthy. This chapter reviews evidence on recent trends in mortality, causes of death and disability prevalence rates for older Australians. It also examines the extent of health problems in older Australians, and the causes of those problems in terms of diseases, injuries and risk factors. The chapter concludes with a discussion of projected future health trends and implications for older Australians and for Australian society.

Historical trends in the health of older Australians Since the mid-19th century, the populations of developed countries like Australia have experienced one of the most important and dramatic changes in the history of the species – a near doubling of the expectation of life at birth from around 40 years to around 80 years. Between 1901– 10 and 2001, life expectancy at birth for Australian men increased from 55.2 years to 77.4 years and for Australian women it increased from 58.8 years to 82.6 years. At the same time, a substantially increasing proportion of people are surviving to older ages where the prevalence of disability and handicap is high and, according to some indicators, increasing.

Life expectancy of older Australians The increases in life expectancy that occurred in the first half of the century were the result of rapid declines in mortality, particularly for infectious diseases, for infants, children and younger adults. Today, mortality rates in younger and middle-aged Australians are so low that the complete elimination of mortality before the age of 50 would increase life expectancy at birth by less than three years. During the period 1875 to the 1960s, there was very little change in life expectancy for Australians who reached the age of 65 years. For example, male life


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Figure 2.1

Trends in life expectancy at age 65, Australia, 1875–2001

Expectation of life (years)

22 20

women men

18 16 14 12 10 1860

1880

1900

1920

1940

1960

1980

2000

Year source

Data from ABS 1967–1996; AIHW 2005; Cumpston 1989

expectancy at age 65 increased only slightly from 11.1 years in 1875 to 12.2 years in 1971. However, since the early 1970s, the life expectancy of older Australians has increased rapidly, with an almost 50 per cent increase for males in the last 30 years, and a 30 per cent increase for females (see figure 2.1). In 2002, life expectancy at age 65 was 17.9 years and 21.0 years for men and women respectively. These improvements reflect sustained declining death rates at older ages, and the declining death rates from cardiovascular diseases and from tobacco-caused lung cancer, discussed further below. These longevity and health gains for older Australians in the wider Australian community have not been shared by Aboriginal and Torres Strait Islander peoples, whose life expectancy remains 20 years shorter than for other Australians (ABS & AIHW, 2003).

Mortality trends The overall death rates for Australians aged 65 years and over have declined by 40 per cent for men and 32 per cent for women over the


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43

30-year period 1971–2001. This reflects major declines in overall death rates for cardiovascular diseases (62 per cent for men and 55 per cent for women), for lung cancer in men (the 1971 death rate was three times higher than the 2001 death rate), and chronic respiratory diseases in men (the 1971 death rate was double the 2001 death rate). During the last decade, falls in the age-specific death rates for older Australians were greatest in the 65–74 year age group (a 25 per cent fall for men and a 21 per cent fall for women), almost as great a reduction for the 75–84 year age group, and a much smaller fall of 7–8 per cent for those aged 85 years and over. Trends in cause-specific mortality rates reflect two factors: changes in age-specific death rates and ageing of the population. The latter results in higher proportions of the older population being in the oldest age groups, which have higher death rates in general than younger age groups. Thus, declines in age-specific death rates will generally be offset by population ageing. Figure 2.2 shows trends in age-standardised mortality rates for the major causes of death in older Australians from 1950 to 2001. Age standardisation removes the effects of changes in the population age distribution by applying the observed age-specific death rates to a standard population (in this case, the 2001 total Australian population aged 65 years and over). Between 1971 and 2001, for example, age-standardised death rates for all causes declined by 50 per cent for men and 49 per cent for women. Most of the overall reduction in age-specific death rates between 1971 and 2001 was due to large falls in the death rates for cardiovascular diseases, attributed mainly to changes in lifestyle risk factors and improvements in medical care (see figure 2.2). For men, the agestandardised death rates for cardiovascular diseases fell by 67 per cent. The reductions in the rates for females were very similar. Reductions in rates for the two leading cardiovascular conditions (coronary heart disease and stroke) were also similar for this period. Age-standardised death rates for cancer increased slightly between 1971 and 2001; however, the rate of increase was lower for older males (2 per cent) than for older females (5 per cent) because of a major decline in the prevalence of tobacco smoking among males since the 1960s. For older males, lung cancer mortality rates started to decline during the


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Figure

2.2

Trends in age-standardised death rates due to major causes of death, Australian males and females aged 65 years and over, 1950–2001. Age-standardised to the 2001 total population aged 65 years and over. Older men

Age-standardised death rate per 1000

100

80 injuries other non-communicable diseases

60

Chronic respiratory diseases

40

Cardiovascular diseases neuropsychiatric conditions

20

Cancers

0 1950

Communicable diseases

1960

1970

1980

1990

2000

Year

Age-standardised death rate per 1000

Older women 80 injuries other non-communicable diseases

60

Chronic respiratory diseases

40

Cardiovascular diseases neuropsychiatric conditions

20

Cancers

0 1950

Communicable diseases

1960

1970

1980

1990

2000

Year source


Author’s analysis of Australian death registration data, 1950–2001 (provided by ABS)

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45

1980s and fell by 24 per cent between 1981 and 2001. In contrast, lung cancer mortality rates for older women increased by 92 per cent over the same period, reflecting increasing rates of smoking among women since the 1960s. Age-standardised death rates for chronic respiratory diseases for older men remain almost double those for older women, although they have declined by 36 per cent over the period 1981–2001, whereas those for older women increased by 39 per cent over the same period. Definitional changes occurring between revisions 9 and 10 of the International Classification for Diseases and Related Health Problems, and the introduction of an automated coding system for coding causes of death, also contributed to the increase in recorded death rates from nervous system diseases during the last decade (AIHW 2004). As shown in figure 2.2, communicable disease death rates among older Australians have declined fairly continuously over the last 50 years, and now account for only 4 per cent of deaths in this age group, mostly due to pneumonia. Injury death rates have also declined over this period, and now account for few deaths among older Australians. In 2001, cardiovascular disease was the leading cause of death for older Australians, accounting for 40 per cent of male deaths and 47 per cent of female deaths. Cancer deaths were the second leading causes of death, accounting for 31 per cent of male deaths and 22 per cent of female deaths. In the age group 65–74 years, cancer deaths exceeded cardiovascular deaths in 2001, making them the leading cause of death in this age group.

Chronic illnesses and disability The three major sources of data on the health status of the Australian population that provide time series spanning more than two decades are the five national health surveys of the Australian Bureau of Statistics (ABS) carried out from 1977–78 to 2001, the four ABS national surveys of disability and ageing carried out from 1981 to 1998 and the National Heart Foundation’s risk factor surveys carried out in 1980, 1983 and 1989. These surveys increased the information available about the health of the older population, including those who do not enter hospital or use health services. As well, such surveys have allowed individual-level social and economic factors to be associated with measures of health


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status and risk factors (Mathers 1994). However, most of these health and disability surveys have relied on individuals reporting on their own health problems, which can introduce the possibility of bias and raise questions about comparability across cultures or over time. Perceived health and chronic illness In the 2001 National Health Survey by the ABS, older Australians reported overwhelmingly that they had good, very good or excellent health. Only one-third of men and women aged 65–74 years reported that their health was fair or poor as opposed to good, very good or excellent. This proportion rose to 40 per cent for women aged 85 years and over, but actually dropped slightly to 27 per cent for men aged 85 years and over. The latter figure may reflect a healthy survival effect, in that older men with poorer health are more likely to die before 85, but it may also reflect changing norms and lower expectations of health as men age. Despite these perceptions of good health among older Australians, there is no doubt that the process of ageing is often associated with the onset of disabilities associated with chronic health problems. The national health surveys have collected information on chronic health conditions. The reported prevalence of one or more long-term health conditions among adult Australians has increased from 45 per cent of the total Australian population in 1977–78 to 66 per cent in 1989–90, and 75 per cent in 1995. In the 2001 National Health Survey, 99 per cent of older Australians reported one or more long-term health conditions. The most common conditions reported included arthritis, long-sightedness and hypertension, all with a prevalence in the range 40–50 per cent in those aged 65 years and over (ABS 2001). Despite the high levels of reported chronic conditions, the majority of older Australians consider themselves to have good health. Clearly, many of the reported chronic conditions are minor conditions, or risk factors such as high blood pressure, that are not necessarily associated with current disease or functional limitations. Additionally, it is difficult to interpret changes in levels of reported conditions, since such reporting is very sensitive to social norms for labelling health problems, to knowledge of health problems influenced by contacts with the health system, and to changes in screening and diagnostic practices.


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47

Disability The four population surveys of disability and ageing in Australia in 1981, 1988, 1993 and 1998 used generally comparable methodology and definitions, although there were some more significant changes to the 1998 instrument. They defined a person with a disability as having one or more of a number of health-related conditions that had lasted or were likely to last for six months or more. These conditions include impairments, disabilities, and a handicap, as defined in the WHO International Classification of Impairments, Disabilities, and Handicaps framework, and even some health conditions, and should perhaps be viewed as defining a wider population likely to contain those persons with a disability (Mathers 1996). Unlike the National Health Surveys, these surveys included non-private dwellings such as hospitals and residential aged care facilities within their samples. This is particularly important for measuring conditions such as dementia, where a high proportion of sufferers are in institutional care. According to the 1998 ABS Survey of Disability, Ageing and Carers, 54 per cent of Australians aged 65 or over reported a disability that had lasted, or was likely to last, for at least six months and that restricted everyday activities. This proportion was almost the same for men and women, but more older women (25 per cent) than men (16 per cent) reported a severe or profound core activity restriction, meaning that they sometimes or always needed personal assistance or supervision with activities in the areas of self-care, mobility and communication. The rate of severe or profound restrictions increased with age, from 11 per cent for those aged 65–74 to 65 per cent for those aged 85 or more. Table 2.1 summarises the main diseases reported by people aged 65 years or more in 1998, the proportions of people with those diseases and the level of disability associated with the disease. The disease that caused the highest levels of severe or profound disability was dementia (96 per cent of persons with dementia suffer from a severe or profound disability). The main conditions associated with a disability among older males were hearing loss (30 per cent of males aged 65 or more), arthritis (22 per cent), stroke and other cardiovascular diseases (21 per cent) and other musculoskeletal problems (17 per cent). The main conditions associated with a disability among older females were arthritis (29 per cent), hearing


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48


Table 2.1

Prevalence of disability by health conditions reported and self- reported severity, Australians aged 65 years and over, 1998 Prevalence (%) (a)

Number and severity (b) Estimated number of Per cent persons profound or (’000) severe

Male

Female

Dementia, incl. Alzheimer’s Other mental & behavioural Stroke

3.3

5.0

64.1

98.1

7.9

13.4

54.4

35.2

7.4

6.9

49.5

78.1

Other cardiovascular disease Respiratory

14.0

12.5

132.4

21.5

9.8

7.3

115.5

21.9

Cancer

3.1

1.5

24.8

19.1

Diabetes

6.3

5.5

65.0

14.5

Vision

8.2

10.9

76.9

42.8

Hearing

29.6

21.0

164.6

8.3

Arthritis

21.7

29.2

412.3

23.0

Other musculoskeletal

17.1

19.0

263.8

24.3

(a) Based on all reported health conditions, not just the main reported health condition. (b) Only persons reporting the condition in the survey as the main condition. SOURCE

AIHW 2004: tables 8.14 and 8.15

loss (21 per cent), stroke and other cardiovascular diseases (19 per cent) and other musculoskeletal problems (19 per cent). Disability trends among the older population In Australia, there has been a consistent increase in the overall reported rate of disability for almost two decades. The ageing of the population aged 65 years and over has had some impact on disability prevalence among older Australians, but the most significant change was a dramatic increase in reported prevalence of disability between 1981 and 1988. Compared with the 1981 disability survey, the three later surveys (1988, 1993 and 1998) reported substantially higher rates of disability for the older population. The disability rates for people aged 65 and


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over increased from 43 per cent in 1981 to over 50 per cent in the later surveys. The rate of severe or profound restrictions for people aged 65 and over also increased between 1993 and 1998, from 17 per cent to 20 per cent. The estimated number of people reporting severe or profound restriction also increased substantially among those aged 75 or over, although this is mostly attributable to changes in survey methods and population ageing (AIHW 2003). Possible factors involved in the substantial increase in reported disability and handicap prevalence levels in Australia during the 1980s include: • Most of the increase in prevalence occurred at the milder levels of the disability and handicap and it is important to note that the survey definition of disability includes quite mild levels of disability. • Self-assessment of limitations or need for assistance in relation to specified activities may have changed in line with changing community perceptions of disability and handicap. • Changing attitudes may have resulted in people being more aware of disabling conditions, or more willing to report such conditions and may also have affected how people interpreted ‘need’ and ‘difficulty’, concepts used to determine presence and severity of handicap. • Changes in the availability of aids for disabled people may have also contributed, since use of an aid was one factor defining mild handicap in the surveys. Government programs for provision of aids expanded during the 1980s and may have contributed to the increase in selfreported prevalence of handicap.

Have older Australians become healthier as they live longer? Three major hypotheses have been advanced for the evolution of population health in low-mortality countries like Australia. The ‘expansion of morbidity’ hypothesis postulates that the decline in mortality is largely due to decreasing fatality rates for diseases rather than to reductions in their incidence or progression (Gruenberg 1977; Kramer 1980). Consequently, the decline in mortality is accompanied by


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an increase in chronic illness and disability. Olshansky and colleagues (Olshansky et al. 1991) developed further arguments from evolutionary biology supporting this hypothesis. The second hypothesis, ‘compression of morbidity’, was first proposed by Fries (Fries 1989), who suggested that adult life expectancy is approaching its biological limit, so that, if the incidence of incapacitating disease can be postponed to later ages, then morbidity will be compressed into a shorter period of life. The third hypothesis was proposed by Manton (Manton 1982), who suggested that the decline in mortality may be partly due to decreased fatality rates, but at the same time the incidence and progression of chronic diseases may be decreasing, leading to a ‘dynamic equilibrium’. Because we may be trading off longer life against quality of life, there has been considerable interest in health expectancy indices that combine mortality and morbidity into a single composite indicator that measures some form of expected healthy years of life. Such indicators, including disability-free life expectancy (DFLE) and healthy life expectancy (HALE), provide an attractive tool for monitoring long-term trends in the evolution of population health and for addressing the question of compression or expansion of morbidity (Mathers 2002; Robine et al. 2003). I have previously analysed trends in disability-free and handicap-free life expectancy for Australia using data from the 1981, 1988 and 1993 ABS disability surveys (Mathers 1996). Between 1981 and 1988, disabilityfree life expectancy at birth declined significantly in Australia – by 0.8 years for males and 1.0 years for females – whereas total life expectancy increased by 3.6 and 2.5 years for males and females respectively (see figure 2.3). This reflected the substantial increase in reported prevalence of disability between 1981 and 1988 (discussed above). Between 1981 and 1998, expected years free of disability remained roughly constant, while expected years of disability increased in line with increasing overall life expectancy. This suggests a possible expansion of morbidity in Australia, though this has been most apparent at the lower levels of severity. Earlier reviews in the 1990s of international health expectancy time series (Robine, Mathers & Brouard 1996) have suggested that there is no evidence of expansion of morbidity based on more severe measures of disability prevalence. Overall, these time series suggested that since the 1970s, when mortality rates at older ages began to decline significantly,


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Disability-free life expectancy at age 65 (years)

Figure 2.3

51

Trends in disability-free life expectancy (DFLE) and total life expectancy (LE) at age 65, by sex, Australia, 1981–98

25 20

Le – female Le – male

dfLe – female dfLe – male

15 10 5 0 1980

1985

1990

1995

2000

Year SOURCE

Mathers 1996 and unpublished data from the ABS Survey of Disability, Ageing and Carers

disability levels increased during the 1970s and 1980s, but these increases were confined to the less severe end of the disability spectrum. Recently reported declines in disability prevalence among the older population in some OECD countries, such as the United States, have been a subject of vigorous debate. Different trends (increases or decreases) in disability prevalence have been reported among the OECD countries (Deeg, Kriegsman & van Zonneveld 1994; Jacobzone, Cambois & Robine 2000; Manton, Corder & Stallard 1997; Manton & Gu 2001; Schoeni, Freedman & Wallace 2001). Freedman and Martin found large declines in functional limitations, particularly in the oldest old, from 1984 to 1993 for Americans aged 50 years and over in the Survey of Income and Program Participation (Freedman & Martin 1998). These declines were not explained by changes in population composition, device use, or survey design, although changes in role expectations and standards were not controllable in the analysis.


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Two European studies have found evidence for long-term declines in disability prevalence in older people whose reporting of perceived health status did not similarly improve (Deeg et al. 1997; Spiers, Jagger & Clarke 1996). In most countries, DFLE at age 65 is increasing, although the results are less clear in Australia, New Zealand and Norway (Jacobzone, Cambois & Robine 2000). As yet, Australian health expectancies do not provide persuasive evidence of any compression of morbidity, even at the severe end of the disability spectrum.

Burden of disease We turn now to an examination of the disease, injury and risk factor causes of loss of health among older Australians. In 1999, the Australian Institute of Health and Welfare published a comprehensive assessment of the burden of diseases and injuries in Australia in 1996 (Mathers, Vos & Stevenson 1999). This study used the Disability Adjusted Life Year (DALY), developed by Murray and Lopez for the Global Burden of Disease Study (Murray & Lopez 1996), as a common currency or metric for measuring the contribution of diseases, injuries and risk factors to loss of health and mortality. One DALY can be thought of as one lost year of ‘healthy’ life and the burden of disease as a measurement of the gap between current health status and an ideal situation where everyone lives into old age free of disease and disability. DALYs for a disease or health condition are calculated as the sum of the years of life lost due to premature mortality (YLL) in the population and the years lost due to disability (YLD) for incident cases of the health condition. YLD for a condition are calculated by multiplying the number of new cases in a given year by the average duration of the condition and a severity weight. The severity weight quantifies the loss of healthy life in comparison with total loss of life and ranges between zero (full health) and 1 (very severe states considered equivalent to death). Close to half the total burden of disease among Australians in 1996 was concentrated in people aged 65 years and over, reflecting both the increasing incidence and severity of health problems with age and the concentration of deaths in older ages. Just under 40 per cent of the total burden of disease for males in 1996 occurred in men aged 65 years and


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53

over. For females, almost 47 per cent of the total burden as measured in DALYs occurred in women aged 65 years and over. Years lost due to disability Dementia was the leading cause of YLD among older Australians in 1996, accounting for nearly 17 per cent of their disability burden (see table 2.2). The burden of Alzheimer’s disease and other forms of dementia was nearly 70 per cent higher for women than men, reflecting the greater numbers of women alive at older ages where the prevalence of dementia is higher. The next leading causes of YLD were hearing loss (8 per cent), stroke (7 per cent), followed by vision disorders, osteoarthritis and coronary heart disease (all 6 per cent). Vision disorders and cataracts were both in the top ten causes of YLD for older women, reflecting their greater prevalence in women than men, whereas the hearing loss burden was 40 per cent higher for older men than older women, reflecting the substantially higher prevalence of hearing loss in men. Table 2.2

Ten leading causes of disability burden among older Australians (ages 65 and over): YLD (per cent of total) by sex, Australia, 1996

Males

% of total

Females

1 Dementia

13.2

1 Dementia

2 Adult-onset hearing loss

10.1

2

% of total 19.9

Vision disorders

9.1

3 Stroke

8.9

3 Osteoarthritis

7.0

4

6.4


6.4

5 Benign prostatic hypertrophy

6.3

5 Stroke

6.0

6 Osteoarthritis

5.0

6 Parkinson’s disease

5.8

7 Prostate cancer

5.0

7

5.6

(a)

3.6

8 Breast cancer

9 Parkinson’s disease

3.5

9 Diabetes mellitus

10

2.9

10

Coronary heart disease

8 Diabetes mellitus COPD(b)

Coronary heart disease

Cataracts

2.9 (b)

2.5 2.3

(a) Includes Type 1 and Type 2 diabetes. (b) Chronic obstructive pulmonary disease (chronic bronchitis and emphysema). SOURCE

Mathers, Vos & Stevenson 1999


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54


Table 2.3

Ten leading causes of the burden of disease and injury among older Australians (ages 65 and over), by sex, Australia, 1996

Males

1

% of total DALYs Coronary heart disease

21.7

Females

% of total DALYs

1 Ischaemic heart disease

20.3 10.7

2 Stroke

8.6

2 Stroke

3

Lung cancer

6.9

3 Dementia

8.9

4

COPD(a)

5.8

4

4.0

5

Dementia

5.3

5 Breast cancer

3.6

6 Prostate cancer

5.1

6

Colorectal cancer

3.4

7

Colorectal cancer

3.8

7

Lung cancer

3.1

8 Diabetes mellitus

3.0

8 Age-related vision disorders

2.8


2.9

9 Diabetes mellitus

2.8

10 Benign prostatic hypertrophy

1.9

10 Osteoarthritis

2.2

COPD(a)

(a) Chronic obstructive pulmonary disease (chronic bronchitis and emphysema). SOURCE


Despite the declining incidence and mortality for coronary heart disease and stroke, these two cardiovascular conditions remained responsible for 15 per cent of the disability burden in older men and 10 per cent of the disability burden in older women (see table 2.2). Osteoarthritis was another significant cause of disease burden for both older men and women. Prostate enlargement and prostate cancer were also among the top ten causes of disability for older men. Breast cancer was among the top ten causes of disability for older women. In contrast to the mortality burden, the total disability burden was smaller for males than for females. Older women generally have greater incidence and prevalence of the more common non-fatal health problems, whereas older men have greater incidence of the major diseases and injuries associated with high case fatality. Thus, some of the years of the longer lifespan that women enjoy are lived at the expense of a greater loss of quality of life.


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Burden of disease Coronary heart disease and stroke were the leading causes of disease burden among older Australians, even though death rates for these causes have been declining steadily for three decades. Together, these two causes accounted for 32 per cent of the total disease burden among older Australians in 1996 (see table 2.3). These were followed by senile dementia (7.2 per cent), lung cancer (5.0 per cent) and chronic obstructive pulmonary disease (4.9 per cent). Hearing loss and benign prostate enlargement were among the top ten causes of disease burden for older men. Vision loss and osteoarthritis were among the top ten causes for older women. More than 95 per cent of the burden of disease in older Australians is due to non-communicable diseases. Communicable diseases, mainly pneumonia, account for only 2 per cent of the burden and the remainder is due to injuries. Among the non-communicable diseases, cardiovascular diseases and cancers together account for over 60 per cent of the disease burden in older Australians, followed by disorders of the nervous system (see figure 2.4). The latter category includes Figure 2.4 %

Main causes of disease burden (DALYs) in older Australians, Australia, 1996 musculoskeletal disorders

1%

4%

diabetes mellitus %

%

Chronic respiratory diseases nervous system disorders Cancers

1%

Cardiovascular diseases 4%

SOURCE

other



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senile dementia and Parkinson’s Disease. Despite declines in smoking prevalence among older Australians (see below), lung cancer remained the third leading cause of burden of disease among older men, reflecting high levels of smoking among older men when they were younger. Also among the ten leading causes of disease burden for older men were colorectal cancer and prostate cancer. Breast cancer, lung cancer and colorectal cancer were also among the ten leading causes of burden of disease for older women (see table 2.3). Diabetes mellitus was among the top ten causes of burden for both older men and older women. In addition to its direct sequelae, diabetes also contributes to increased risk of ischaemic heart disease, stroke and peripheral vascular disease. Inclusion of the attributable burden of cardiovascular disease due to diabetes increased the burden of diabetes from 3 per cent to 7 per cent of total DALYs for older Australians. The main risk factor for type 2 diabetes prevalent in older Australians is overweight and obesity. The increasing levels of overweight and obesity among older Australians (see below) are likely to lead to increased burden of diabetes mellitus. Among older men, road traffic accidents, falls and suicide were the leading causes of injury burden. Among older women, road traffic accidents and suicide were less important causes of the injury burden, which is dominated by falls. Eighty per cent of the burden associated with falls in older women was attributable to osteoporosis. Burden attributable to risk factors Major preventable risk factors for disease and injury in older Australians include smoking, overweight and obesity, inadequate physical activity, high blood pressure, high blood cholesterol, poor diet and nutrition, and falls. There has been a substantial fall in the prevalence of smoking among older Australians over the last decade. Between 1989–90 and 2001, the prevalence of smoking dropped from 20 per cent to 12 per cent in males aged 65–74 years, and from 14 per cent to 9 per cent for females aged 65– 74 years. In the 75 years and over age group, the prevalence of smoking dropped from 11 per cent to 7 per cent for males, and from 6 per cent to 5 per cent for females (AIHW 2004).


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In contrast, there was a substantial rise in the proportions of older Australians who were overweight or obese between 1989–90 and 2001. The percentage of men who were obese increased from 9 per cent to 15 per cent for 65–74-year-olds and from 4 per cent to 9 per cent for those 75 years and over. The increases for women were from 11 per cent to 20 per cent for 65–74-year-olds and from 7 per cent to 11 per cent for those 75 years and over (Bennett, Magnus & Gibson 2005). Between 1980 and 2000, the prevalence of high blood pressure halved for Australians aged 25–64 years. Population-level data on blood pressure distributions for older Australians have only been available since 1995, and there may be problems of comparability between the 1995 data from the ABS National Nutrition Survey and the data for the 1999–2000 AusDiab Study. These data appear to show an increase in prevalence of high blood pressure among Australians aged 65 years and over from 67 per cent in 1995 to 71 per cent in 1999–2000 (AIHW 2005). Data on cholesterol levels among older Australians are even more limited. According to the AusDiab study, around 50 per cent of men and 70 per cent of women aged 65 years and over had high blood cholesterol in 2000. Evidence from younger ages does not suggest that cholesterol levels have been changing substantially over the last decade (AIHW 2005). The continuing high levels of blood pressure and of high blood cholesterol among older Australians indicate that there remains substantial scope for prevention of cardiovascular disease among older Australians. A high proportion of men and women aged 65 and over were sedentary or exercised at low levels – 68 per cent and 80 per cent respectively in 2001. There was little change in these numbers from 1989–90 (ABS 2001). Inadequate exercise is a risk factor for cardiovascular disease, diabetes mellitus (through overweight), for musculoskeletal disorders and falls, for depression and for some cancers. The Australian burden of disease study estimated that known risk factors, such as smoking, alcohol consumption, physical inactivity, hypertension, high blood cholesterol, obesity and inadequate fruit and vegetable consumption, were responsible for up to 50 per cent of the total burden of disease among older Australians in 1996 (Mathers, Vos & Stevenson 1999). The leading risk factor was tobacco smoking (responsible for 16 per cent of total burden in older men and 9 per


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cent in older women), followed by high blood pressure (10 per cent), physical inactivity (9 per cent), then high cholesterol and obesity (each around 4 per cent). Among older Australians, alcohol consumption prevented around 3 per cent of the total disease burden as the ill health associated with harmful and hazardous drinking was more than offset by benefits from moderate alcohol consumption in the prevention of cardiovascular disease.

Future prospects for the health of older Australians The population aged 65 years and over is projected to nearly double over the next 20 years. Is it possible to project future prospects for the health of older Australians also? Will mortality rates continue to fall? The marked reductions in death rates at older ages and consequent increases in life expectancies observed over the last three decades are historically unprecedented. Fries has argued that the maximum life expectancy of humans is fixed at around 85 years by biological limits and that life expectancy is fast approaching this limit (Fries 1980, 1989). It is clear from the recent trends in life expectancy at older ages in Australia that compression of mortality has not yet started to occur in Australia, if indeed there is such a biological limit to life expectancy. It is possible that physiological and genetic factors that limit lifespan will start to constrain improvements in life expectancy at some time in the future. But there is also a significant probability that new discoveries, particularly in the genetic area, may cause outward shifts in maximum lifespan. There is still scope for very substantial decreases in mortality rates at older ages in Australia, as evidenced by the large differentials in mortality within the older Australian population according to socioeconomic status (Mathers 1994) and the significant proportion of disease that is known to be preventable through modification of individual and collective risk factors. ABS projections for life expectancies of older Australians suggest that these will continue to increase over the next two decades and that life expectancies at age 65 may reach 21.2 years for men and 23.8 years for women by 2021 (ABS 2000).


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Projected burden of disease in 2016 The Victorian Burden of Disease Study projected a 25 per cent drop in the rate of age-standardised all-cause DALYs for Victorian males and a 17 per cent drop for Victorian females over the period 1996–2016 (Public Health Division 1999). Mortality was forecast to drop considerably faster than disability. The large gap in projected changes between YLL and YLD rates suggests that some of the further gains in life expectancy may occur at the expense of loss of quality of life. Cancer will be the largest cause of burden in 2016 because improvements in cardiovascular health will outpace the slower improvements in cancer. An increase in the burden from degenerative diseases due to ageing of the population will increase the size of the burden of neurological, sense and musculoskeletal disorders relative to other conditions. The burden of dementia will increase for both sexes, and for women, may take over from ischaemic heart disease as the largest cause of DALYs in Victoria in 2016. Diabetes, prostate cancer and hearing loss in men and lung cancer in women are other conditions that will increase in the ranking order. Will disability rates rise or fall? As noted above, recent studies are providing some evidence that disability prevalence may be declining at all severity levels in some developed countries. This has generally been interpreted optimistically to reflect real changes in population health, although Freedman and Martin do note the influence of social roles and expectations on self-reports (Freedman & Martin 1998). Unfortunately, the problems with interpretation and comparison of self-report data over time are equally present when there are apparent improvements as when there are apparent declines in health. The question of whether compression of morbidity is occurring can only be answered if we can measure health in a way that is truly comparable across time. There is as yet no clear evidence that age-specific disability rates are falling in Australia. But it should be noted that even if these rates fall over the next decade or two, it is fairly certain that the overall prevalence and severity of disability will continue to increase due to the ageing of


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the population, because higher proportions of the older population will be in older age groups where disability levels are higher. Dementia provides a particular example of this issue. The prevalence of dementia appears to approximately double every five years after age 65. Older people who have a form of dementia as their main clinical condition are more likely to have profound or severe activity restriction. Assuming age-specific dementia prevalence rates remain constant, the ageing of the population will result in a doubling in the prevalence of dementia by 2030. The last three decades have seen historically unprecedented rises in life expectancy for older Australians, associated with substantial declines in death rates at older ages, largely due to major declines in death rates for cardiovascular diseases for both men and women. The burden of disease among older Australians remains dominated by cardiovascular diseases, together with dementia, with significant contributions also from hearing loss, sight loss, musculoskeletal conditions, chronic respiratory diseases and lung, colorectal, prostate and breast cancer. The burden among older Australians of non-fatal diseases, such as osteoarthritis and hearing loss, has been seriously underestimated by traditional approaches that take into account only deaths and not disability. The continuing high levels among older Australians of tobaccorelated diseases and of risk factors for cardiovascular disease and diabetes suggest that there remains substantial scope for reducing mortality and disability rates among older Australians. Projections of the burden of disease to 2016 highlight the adverse trends in tobacco-related diseases for women, and diabetes for men, and the impact of population ageing in increasing the disability burden. These findings suggest that tobacco control, physical inactivity and overweight and obesity should be continuing priorities for public health action and that clinical health services need to increasingly focus on treatment for low fatality and non-fatal conditions that result in considerable disease burden among older Australians.


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Conclusion Evidence is mixed on whether compression or expansion of morbidity is occurring among older Australians as mortality risks continue to decline. The international evidence suggests that health will continue to improve, but that certain causes of disability will become more prominent. Expansion of morbidity will occur if decreases in mortality rates at older ages are predominantly due to treatment interventions that reduce case fatality without reducing disabling outcomes. On the other hand, if further mortality reductions are predominantly due to prevention and treatment interventions, and possibly to healthier lifestyles among a more affluent and better educated older population, then there should be reductions in disability prevalence and severity among older people. Sometimes the expansion of morbidity scenario is seen by policymakers and lay people alike as a negative outcome. While clearly much less desirable than the compression of morbidity alternative, it should be remembered that as long as people value the extra years of life (with their concomitant disability and morbidity) as more desirable than death, then those extra years are a net benefit to individuals and to society. Some scientists, such as Jay Olshansky and colleagues, continue to argue that we are rapidly approaching biological limits to average life expectancy and that substantial further progress in longevity is unlikely (Carnes, Olshansky & Grahn 2003). Additionally, Olshansky has argued that the survival of large numbers of people into older ages, where evolutionary selection pressures have not applied, may see the emergence of new infectious and auto-immune diseases that will increase the risk of death and disability (Olshansky et al. 1991; Olshansky 2005). Other demographers argue that life expectancy will continue to increase by around 2–3 years per decade, so that life expectancy in Australia would reach 100 years some time in the second half of the 21st century (Oeppen & Vaupel 2002). Oeppen and Vaupel pointed out that the maximum observed life expectancy for a population in the world has grown at a steady and unbroken rate of 2.4 years and 2.2 years per decade for women and men respectively, for the last 160 years, despite the repeated predictions of experts that limits to life expectancy were being reached. While there have been many predictions that population ageing will result in skyrocketing health expenditure, numerous studies have shown


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that, given continuation of current trends, the effect of population ageing per se on health expenditures is relatively small compared to the effects of the expanding development and increased use and costs of medical technologies and drugs (Coory 2005). Based on trends over the last 20 years, ageing per se adds around 0.5 per cent per year to health expenditures, compared with a real health expenditure growth rate totalling around 4.5 per cent a year (Productivity Commission 2005). The increasing technological intensity of medicine dominates almost all other sources of health care cost growth and is likely to become even more dominant if there are breakthroughs in life-extending technologies or in modifying the ageing process itself. Some commentators have foreseen increases in health expenditures over the next 30 years to reach levels of 20 or 25 per cent of gross domestic product in a scenario where there are major breakthroughs in new medical technologies for life extension. Goldman and colleagues have recently examined the potential impact on health spending of ten promising new medical technologies, with estimated increases in health expenditure in 2030 ranging from 0.5 per cent to 70 per cent (Goldman et al. 2005). Fogel (2004) reminds us that as we grow richer we can afford and will want to spend more money on improving both the quality and length of our lives. Longer and healthier life will give us opportunities that people will value, while at the same time will likely result in major social changes in the organisation of work, family and social support. Increasing health expenditures, if those expenditures are on effective prevention and treatment interventions equitably funded, need not be a calamity but rather ‘a sign of the remarkable economic and social progress of our age’ (Fogel 2004: 107). References Australian Bureau of Statistics (ABS) (1967 to 1996) Deaths Australia 1966 to 1995 (Cat. no. 3302.0, Australian Bureau of Statistics, Canberra. —— (ABS) (2000) Population Projections Australia 1999 to 2101 (Cat. no. 3222.0, Australian Bureau of Statistics, Canberra. —— (ABS) (2001) National Health Survey 2001 (Cat. no. 4364.0), Australian Bureau of Statistics, Canberra. Australian Bureau of Statistics & Australian Institute of Health and Welfare (ABS & AIHW) (2003) The Health and Welfare of Australia’s Aboriginal and Torres Strait Islander Peoples 2003 (ABS Cat. no. 4704.0.


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AIHW Cat. no. IHW11 edn), Australian Bureau of Statistics, Canberra. Australian Institute of Health and Welfare (AIHW) (2003) Disability Prevalence and Trends (Cat. no. DIS 34 edn), Australian Institute of Health and Welfare, Canberra. —— (2004) Australia’s Health 2004, Australian Institute of Health and Welfare, Canberra. —— (2005) AIHW Analysis of the 1980, 1983 and 1989 Risk Factor Prevalence Surveys, 1995 National Nutrition Survey and 1999–2000 Australian Diabetes, Obesity and Lifestyle (AusDiab) Study, Australian Institute of Health and Welfare, Canberra. Bennett, SA, Magnus, P & Gibson, D (2005) Obesity Trends in Older Australians (Bulletin no. 12. AIHW Cat. no. AUS 42) Australian Institute of Health and Welfare, Canberra. Carnes, BA, Olshansky, SJ & Grahn, D (2003) Biological Evidence for Limits to the Duration of Life, Biogerontology, 4(1): 11–45. Coory, MD (2005) Aging and Healthcare Costs in Australia: A Case of Policy-Based Evidence? Medical Journal of Australia, 180: 581–83. Cumpston, JHL (1989) Health and Disease in Australia: A History, ed. MJ Lewis, Department of Community Services and Health, Australian Government Publishing Service, Canberra. Deeg, DJH, Kriegsman, DMW & van Zonneveld, RJ (1994) Trends in Fatal Chronic Diseases and Disability in the Netherlands 1956–1993 and Projections 1993–1998. In CD Mathers, J McCallum & JM Robine (eds) Advances in Health Expectancies, Australian Institute of Health and Welfare, Australian Government Publishing Service, Canberra, pp. 80–95. Deeg, DJH, Smit, JH, Kriegsman, DMW & Zonneveld, RJ (1997) Transitions in Health Limitations in the Netherlands: Comparison Across Four Decades. Paper presented to the World Congress of Gerontology, Adelaide, August 19–23. Fogel, RW (2004) The Escape from Hunger and Death, Cambridge University Press, New York. Freedman, VA & Martin, LG (1998) Understanding Trends in Functional Limitations Among Older Americans, American Journal of Public Health, 88(10): 1457–62. Fries, J (1980) Aging, Natural Death, and the Compression of Morbidity, New England Journal of Medicine, 303(3): 130–35. —— (1989) The Compression of Morbidity: Near or Far? Milbank Quarterly, 67(2): 208–32. Goldman, DP, Shang, B, Bhattacharya, J, Garber, AM, Hurd, M, Joyce, GF, Lakdawalla, DN, Panis, C & Shekelle, PG (2005) Consequences of Health Trends and Medical Innovation for the Future Elderly, Health Affairs, [Epub ahead of print], p. hlthaff. Gruenberg, EM (1977) The Failures of Success, Milbank Memorial Fund Quarterly/ Health and Society, 55: 3–24. Jacobzone, S, Cambois, E & Robine, JM (2000) Is the Health of Older Persons in OECD Countries Improving Fast Enough to Compensate for Population Ageing? OECD Economic Studies, OECD, Paris, pp. 149–90. Kramer, M (1980) The Rising Pandemic of Mental Disorders and Associated Chronic Diseases and Disabilities, Acta Psychiatrica Scandinavica, 62(285): 282–97. Manton, KG (1982) Changing Concepts of Morbidity and Mortality in the Elderly Population, Milbank Memorial Fund Quarterly/ Health and Society, 60: 183–244. Manton, KG, Corder, L & Stallard, E (1997) Chronic Disability Trends in Elderly United States Populations: 1982–1994, Proceedings of the National Academy of Sciences of the United States of America, 94(6): 2593–98. Manton, KG & Gu, X (2001) Changes in the Prevalence of Chronic Disability in the United States Black and Non-Black Population Above Age 65 from 1982 to 1999, Proceedings of the National Academy of Sciences of the United States of America, 98(11): 6354–59. Mathers, CD (1994) Health Differentials Among Older Australians, Australian Institute of Health and Welfare, Canberra. —— (1996) Trends in Health Expectancies in Australia 1981–1993, Journal of the Australian Population Association, 13(1): 1–16.


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—— (2002) Health Expectancies: An Overview and Critical Appraisal. In CJL Murray, JA Salomon, CD Mathers, AD Lopez (eds) Summary Measures of Population Health: Concepts, Ethics, Measurement and Applications, World Health Organization, Geneva, pp. 177–204. Mathers, CD, Vos, T & Stevenson, C (1999) The Burden of Disease and Injury in Australia, Australian Institute of Health and Welfare, Canberra. Murray, CJL & Lopez, AD (1996) The Global Burden of Disease: A Comprehensive Assessment of Mortality and Disability from Diseases, Injuries and Risk Factors in 1990 and Projected to 2020, Harvard University Press, Cambridge. Oeppen, J & Vaupel, JW (2002) Broken Limits to Life Expectancy, Science, 296: 1029–31. Olshansky, SJ (2005) Projecting the Future of US Health and Longevity, Health Affairs, 16 (September) (early web-based publication). Olshansky, SJ, Rudberg, MA, Carnes, BA, Cassel, CK & Brody, JA (1991) Trading Off Longer Life for Worsening Health: The Expansion of Morbidity Hypothesis, Journal of Aging and Health, 3(2): 194–216. Productivity Commission (2005) Economic Implications of an Ageing Australia, Productivity Commission, Canberra. Public Health Division (1999) Victorian Burden of Disease Study: Morbidity, Department of Human Services Victoria, Melbourne. Robine, JM, Jagger, C, Mathers, CD, Crimmins, EM & Suzman, RM ( 2003) Determining Health Expectancies, John Wiley & Sons, Chichester. Robine, JM, Mathers, CD & Brouard, N (1996) Trends and Differentials in Disability-Free Life Expectancy: Concepts, Methods and Findings. In G Caselli & AD Lopez (eds) Health and Mortality Among Elderly Populations, Clarendon Press, Oxford, pp. 182–201. Schoeni, RF, Freedman, VA & Wallace, RB ( 2001) Persistent, Consistent, Widespread, and Robust? Another Look at Recent Trends in Old-Age Disability, Journals of Gerontology, Series B, Psychological Sciences & Social Sciences, 56(4): S206–S218. Spiers, N, Jagger, C & Clarke, M (1996) Physical Function and Perceived Health: Cohort Differences and Interrelationships in Older People, Journals of Gerontology, Series B, Psychological Sciences & Social Sciences, 51(5): S226–S233.


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3 Indigenous Australians: Ageing without longevity? Philippa Cotter, Ian Anderson and Len R Smith

Introduction There are two main groups of Indigenous peoples in Australia, namely, the Aboriginal peoples from the Australian continent and the island of Tasmania and Torres Strait Islanders from the Torres Strait north of Cape York. Before the colonisation of Australia in 1788, there were hundreds of different Indigenous language groups. Today, many Aboriginal and Torres Strait Islander people refer to important local clan and tribal identities as well as more regional identities such as Koori (from the south-east of Australia) or Anangu (parts of central Australia). This chapter refers to Aboriginal people or uses regional collective names when it is clear that the source material is referring to only one of these groups. Otherwise, the terms ‘Indigenous Australians’ or ‘Indigenous people’ are used, which include Aboriginal peoples and Torres Strait Islander peoples. Indigenous people were 2.4 per cent of the total Australian population in the 2001 Census, or 458 500 people (ABS & AIHW 2005). While Aboriginal and Torres Strait Islander peoples are culturally diverse, they


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share many population characteristics and experience similar levels of disadvantage. The demographic changes taking place in Australia do not apply uniformly across all population subgroups: the Indigenous Australian population is not ageing in the same way as the rest of the Australian population. On the one hand, the number of aged people in the Indigenous population is increasing as rapidly as in the total population – yet the Indigenous population still has a relatively young age structure. It is well documented that the Indigenous population has worse health outcomes across all age groups relative to non-Indigenous Australians. But it is not clear whether the lower life expectancy that Indigenous people experience is associated with an earlier onset of the pattern of disease and disability that we commonly associate with elderly nonIndigenous Australians. Despite these demographic distinctions, Indigenous people should not be excluded from discussions about an ageing Australia. In an opening address to a conference on healthy ageing and longevity in 2005, the Minister for Ageing, the Hon. Julie Bishop MP, talked about the aged care system, confidently stating her belief ‘that it meets the needs and expectations of our current older generation’ (Bishop 2005). We are not confident that this is the case for Indigenous people. Before we can consider the adequacy of future plans for older Indigenous people, we need to look at how well the system is meeting the needs of the current cohort.

Demographic trends and health status

Population trends The ageing of the Australian population is primarily the result of the substantial decline in the birth rate that began in the mid-1960s. This has resulted in an increase in the proportion of the population above retirement age. More recently, this has been accentuated by the increase in survival resulting from the continuing decline in mortality, especially at ages over 75 (Booth & Tickle 2003). Indigenous Australians have also been through a baby boom followed by a baby bust over the last half century, although the Indigenous baby boom was more extreme, and the Indigenous baby bust much more


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indigenous australians

67

moderate, than in the general population (Gray 1985; Kinfu & Taylor 2002). Because of the high levels of mortality prevalent in the Indigenous population in the past, there are very few survivors to older ages. About 20 per cent of the total Australian population are over 60 (about 4 million people), but less than 5 per cent of Indigenous people (25 000 people) are above that age. There are only 4000 Indigenous people above age 75. Consequently, this demographic analysis is restricted to those 60 or 65 and above. The proportion of the Indigenous population over 60 is small because of the high Indigenous birth rate and, in contrast to the total population, has barely changed over the last 20 years (see figure 3.1). The reasons for this are complex, and there is some uncertainty about the size of the population and its birth and death rates. When the numbers over 60 are considered in relation to the population from 20 to 59 (giving a rough indication of the number of retirees per person of working age), the comparative picture is slightly different (see figure 3.1). Again, there is virtually no change in the Indigenous ratio, but in the total population the ratio increases somewhat less, especially among women, reflecting the impact of the decline in the birth rate since 1970. Conversely, if we look at absolute numbers rather than relative proportions, it appears that the older Indigenous population has been increasing much faster than the older general population. Since 1991, there has been a high growth rate of the Indigenous population with a spectacular increase in numbers over earlier Censuses, as figure 3.2 shows. While the numbers in the total population over age 60 have increased by only 50 per cent, the Indigenous number has increased by over 200 per cent. Part of this increase may be due to the improved enumeration of Indigenous people that mainly occurred between 1986 and 1991. Since this time, the two populations have been increasing at about the same rate.

Survival Because of inadequacies in the reporting of Indigenous deaths and in the Census enumeration, there is debate about how to construct a life table to describe Indigenous mortality. The Bureau of Statistics has released


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Figure 3.1

Proportion of population over 60 and ratio of population over 60 to population 20–59, Indigenous and total males and females, 1981–2001 Male

35 30

As a percentage of total males 20–60 As a percentage of total males As a percentage of Indigenous males 20–60 As a percentage of Indigenous males

Percentage

25 20

Total males over 60

15 10 5 0 1980

Indigenous males over 60

1985

1990

1995

2000

2005

2010

Year Female

35 30 Percentage

25

As a percentage of total females 20–60 As a percentage of total females As a percentage of Indigenous females 20–60 As a percentage of Indigenous females

Total females over 60

20 15 10 5 0 1980

Indigenous females over 60

1985

1990

1995

2000

2005

2010

Year

SOURCE


Analysis of ABS Censuses, 1981–2001

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69

Indexed numbers of Indigenous and total males and females aged 60 and over, 1981–2001

Figure 3.2

350 300

Indexed numbers above age 60 – males Indigenous males Total males

Percentage

250 200 150 100 50 0 1981

1986

1991

1996

2001

Year 350 300

Indexed numbers above age 60 – females Indigenous females Total females

Percentage

250 200 150 100 50 0 1981

1986

1991

1996

2001

Year

SOURCE

Analysis of ABS Censuses, 1981–2001


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0


two ‘experimental’ life tables in the last few years (McLennan 1998; Trewin 2004), covering the periods 1991–96 and 1996–2001. The main difference is that the estimated mortality at very young ages is lower in the more recent estimates. There is no indication whatsoever of improving survival at older ages. For example, whereas over 85 per cent of men in the total population survive to the age of 65, only 45 per cent of Indigenous men survive to this age. In the total population, when a man reaches this age, he can expect to live for another 18 years; Indigenous men can expect to live only about another 11 years.

Self-reported health and disability Information on the health and disability status of older people is available from two ABS sources, the National Health Survey and the National Aboriginal and Torres Strait Islander Survey (Trewin 2002; ABS 2004).

Percentage

Figure 3.3

Life table survival curves, Indigenous and total males and females

Male survival

100 90 80 70 60 50 40 30 20 10 0

Indigenous Non-Indigenous

0

10

20

30

40

50

60

70

80

90

100

Age (years)

ercentage

SOURCE

LongevityText2proof.indd

Analysis of Trewin 2004

100 90 80 70 60 70 50 40

Female survival

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1

Percentage

Figures 3.4 and 3.5 compare the self-reported health of the Indigenous and non-Indigenous populations from these two surveys. Consistently, Indigenous people reported worse health. Around age pension age, compared to the non-Indigenous population, only about half the Male survival proportion of Indigenous people reported that their health was excellent 100 or very good, while about twice as many reported it was only fair or 90 poor. This discrepancy tended to increase at higher ages. In terms of the 80 age gap, the level of poor health of Indigenous people was equivalent to 70 that of non-Indigenous people about 20 years older. The difference was 60for women, where the gap in those reporting excellent or very larger good50health was almost 25 years. 40 Despite these findings, the reported levels of disability or long-term Indigenous 30 are identical for Indigenous and total males, while Indigenous illness Non-Indigenous 20 above age 60 actually report lower levels of disability than total females females 10 (see figure 3.6). This apparent contradiction with analyses of selfreported 0 health requires further investigation. There are several possible 0 10 20 30 40 50 60 70 80 90 100

Percentage

Age (years) Female survival

100 90 80 70 60 50 40 30 20 10 0

Indigenous Non-Indigenous

0

10

20

30

40

50

60

70

80

90

100

Age (years)


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Proportion of Indigenous and non-Indigenous men and women reporting health as excellent or very good

Figure 3.4

Male Excellent/Very good

80

Health Survey Indigenous

70

NATSISS Indigenous

Percentage

60

Health Survey Non-Indigenous

50 40 30 20 10 0 0

10

20

30

40

50

60

70

80

90

Age (years) Female Excellent/Very good

80


70

NATSISS Indigenous

Percentage

60


50 40 30 20 10 0 0

10

20

30

40

50

60

70

80

90

Age (years)

SOURCE


Analysis of Trewin 2002 and ABS 2004

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Figure 3.5

Proportion of Indigenous and non-Indigenous men and women reporting health as fair or poor

Male Fair/Poor

90


80

NATSISS Indigenous

70 Percentage

73


60 50 40 30 20 10 0 0

10

20

30

40

50

60

70

80

90

60

70

80

90

Age (years) Male Fair/Poor

90


80

NATSISS Indigenous

Percentage

70


60 50 40 30 20 10 0 0

10

20

30

40

50

Age (years)

SOURCE



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4


explanations: Indigenous people may have lower expectations, or be more stoic, which may reflect cultural or socioeconomic differences. Self-reported data can be affected by factors such as language spoken and employment status (Cunningham, Sibthorpe & Anderson 1997). It is unlikely to represent a healthy survivor effect, since it prevails throughout the age range. As expected, Indigenous people experience an increase in the rate of ill-health and disability with increasing age, but our understanding of the details and determinants of the observed pattern for older age groups is far from complete.

Indigenous experiences of ageing and concepts of ‘aged’ The anthropologist Catherine Berndt summarised existing ethnographic data on ageing in Indigenous society in 1981 (Berndt 1981). Berndt observed that, as in many societies, ‘old’ does not refer to a fixed age category or a

Percentage

Figure 3.6

Proportion of Indigenous and total populations reporting disability or long-term health problem

Disability or long-term health problem – Males

100 90 80 70 60 50 40 30 20 10 0

Indigenous male Total male

0

10

20

30

40

50

60

70

80

90

100

Age (years)

rcentage

SOURCE

LongevityText2proof.indd


100 90 80 70 60 74 50

Disability or long-term health problem – Females Indigenous female Total female 6/3/07 3:47:03 PM


Percentage

single life-stage. Berndt contrasts the great respect given to elders with the more dismissive treatment of those who are ‘close-up dead’ and too old to take an active part in daily life, emphasising that traditional authority rests on knowledge of tribal law and custom and ‘mythological sanction’ (Elkin, cited in Berndt 1981). Still today, being old does not automatically Disability long-term health problem – Malesthe links make one an elder. Olderor Indigenous people continue to provide 100past and tradition – important elements of Indigenous identity. A to the 90 of land and native title claims have relied on the old people to number Indigenous male 80 substantiate ongoing connection with the land as senior generations of Total male claimant 70 groups are assumed to provide the most reliable evidence (for example, 60 Myra Hayes v Northern Territory (1999) FCA 1248). Indigenous society is generally painted as one that values reciprocity 50 and 40 looks after its old people and there are descriptions of great care (such30 as Reid, Yunupingu & Yunupingu 1978). Conversely, older Indigenous people frequently have a significant role in caring for others 20 – not10just in a support role, but as primary carers or surrogate parents in extended families where parents are absent (Tripp 1993). We know 0 0

10

20

30

40

50

60

70

80

90

100

Percentage

Age (years) Disability or long-term health problem – Females

100 90 80 70 60 50 40 30 20 10 0

Indigenous female Total female

0

10

20

30

40

50

60

70

80

90

100

Age (years)


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little about how community and intergenerational attitudes and roles may be changing. Berndt described how the status of some older Aboriginal people was enhanced when ‘full bloods’ became eligible for pensions in the 1960s. It is likely that this remains an important way that older Indigenous people contribute to families who are likely to be economically disadvantaged. Arch et al. (2000) note that aged pensioners in Central Australia have some of the highest incomes and are often required to assist others financially. The information on Indigenous experiences and concepts of ageing is patchy. Although a comprehensive review of ethnographic sources was not undertaken for this chapter, much of what is readily available is dated and concentrates on northern, more remote areas of Australia. Therefore, its relevance to all contemporary contexts cannot be assumed. Nevertheless, we can say that there is no unitary ‘indigenous aged experience’. More information on the subjective experiences of Indigenous people would be a useful policy resource.

Different histories Policy-makers and researchers tap the life stories of the baby boom generation. Similarly, the life stories of older Indigenous people are illuminating. Aboriginal Elders’ Voices is a collection of Victorian Indigenous elders’ life stories and oral histories (ACES 2003). These stories document a wide range of experiences, but there are common threads in the legislation, policies, attitudes and events that shaped their lives. The impacts of the protection and assimilation eras feature in all the histories with vivid descriptions of the missions and the rules and regulations that controlled their lives until the 1960s. Few were unaffected by the policy of removal of children (the ‘stolen generations’). Experiences of racism and discrimination are common. Many describe poverty, deprivation and frequent deaths in their families and the majority struggled to get education and employment. The oral histories also trace some of the early steps in the fight for Indigenous rights. For many, the stories of struggle are balanced by those of solidarity – Koori people sticking together, looking after each other and maintaining


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a connection to land, culture and kin. Others talk about their dislocation from this community and their discovery of an Aboriginal identity later in life. The following are excerpts from the story of Olive Jackson, a Yorta Yorta Wiradjuri woman, born in 1930 near Griffith, New South Wales: Us kids were in big danger of being stolen by the welfare when Mum died. The government was really stealing a lot of Koorie [sic] kids in those days – no one was safe from the kidnapping … We lived on the move, never staying anywhere long, always moving on before the welfare caught up to us … Avoiding the welfare meant we missed what little education Koories could get back then … The depression was very hard for Koories. There was no work around and what there was went to Gubbahs (non-Aboriginal people) – we’d always been last in line for jobs. It was very hard to feed a family and keep the kids in school. What Granny did for us to keep us alive. We lived on the move until I was about eight years old and then Gran took us to Cummeragunja. Gran decided it was time for us to be with our mother’s people. Cummera was a place where all the Koorie families were together and we kept to a lot of our old ways … Of course, the other side of things was that we were now living under the control of the government. The mission had a manager and he was in charge of everything we did. On the mission, we got rations once a week – never enough to live on, but we had to be grateful for what we got. Well, a lot of us got malnutrition! (ACES 2003: 18–22, 24)

This is part of Brian Kennewell-Taylor’s story: When I was about eight years old, my sister Esma and I lived in a tent on the bank of the Murray River, at Johnson’s Bend, Mildura. We lived out of cardboard boxes on the riverbank, moving camp every couple of weeks. Prejudice was very bad back there in the 1950s in Mildura. We couldn’t even go into a café or anything because they wouldn’t serve Nanna. I was taken to this Lutheran family in Mildura … They used to talk about Aboriginal mission stations … I thought they were called Aboriginal permission stations. That made sense to me because us Koories always seemed to have to get government permission to do anything – permission to leave the mission, permission to work, permission to marry, permission to be exempted from the restrictions of the Aboriginal Acts. (ACES 2003: 139, 141, 147–48)


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We can compare the histories of the current older generation, which includes Olive Jackson, and the next generation, which includes Brian Kennewell-Taylor. A cursory examination suggests that there are more similarities between these two cohorts than differences – but there are large differences between these and the non-Indigenous histories. As Olive Jackson says, ‘Looking back on my life, I’ve lived a lot of different ways and battled through hardships that many white people wouldn’t even know about’ (ACES 2003: 33). Further investigation is needed to determine the major ruptures that might mark out different generations of Indigenous people and mould different values and aspirations. While the influences and timelines are likely to vary in different places, we cannot assume that the cut-off points for generations are the same as for the non-Indigenous population.

Aged care service utilisation The major aged care services that may be accessed by older Indigenous people are outlined in box 3.1. Primary care and hospital services are important parts of the system of care for older people. However, they are not discussed in this section. Evaluation of service use by Indigenous people is constrained by incomplete or variable Indigenous identification. Analysis is also affected by the lack of data on Flexible Care Services and MPSs. An estimated 30–40 per cent of Indigenous people receive aged care services through Flexible Care Services (Commonwealth of Australia 2001a). However, the majority of available data is about mainstream aged care services. At June 2004, there were 29 Aboriginal and Torres Strait Islander residential aged care services providing approximately 700 places and 29 Aboriginal and Torres Strait Islander Flexible aged care services (SCRGSP 2005). The number of flexibly funded places has increased since their introduction in 1994, with 246 places in 1997 and 599 in 2004 (SCRGSP 2005). The majority of Aboriginal and Torres Strait Islander Flexible aged care services operate in remote and very remote areas (AGDHA 2005). There are no data available on the characteristics of people using these services. In comparison to non-Indigenous people, Indigenous people have higher age-specific usage rates of CACPs at all ages and higher usage of


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Box 3.1 Major aged care services Residential aged care services • A mainstream residential aged care facility. • An Aboriginal and Torres Strait Islander residential aged care service: a residential aged care facility that is funded and operated in the same way as a mainstream facility, but the majority of residents are Aboriginal and Torres Strait Islander people. Community care services • Community Aged Care Packages (CACPs): a coordinated package of community care services, such as bathing, meals and home help, equivalent to low-level residential care. • Extended Age Care at Home (EACH) packages: a fledgling program that provides a package of community care services equivalent to high-level residential care. • The Home and Community Care (HACC) program: provides basic community care services to frail aged and younger people with disabilities, and their carers. Flexible services • An Aboriginal and Torres Strait Islander Flexible aged care service: provides a mix of residential and community services that can change as community needs vary. A fixed annual subsidy is paid, based on average client numbers and types of service rather than on occupancy or service use. • A Multipurpose Service (MPS): MPSs operate in rural communities lacking the population to support stand-alone services and provide a range of health and aged care services under a single management structure. residential aged care among those less than 75 years. In national agestandardised comparisons, combined use of CACPs and residential aged care is about 80 per cent higher for Indigenous people. This picture varies from state to state: there is little difference between Indigenous people and the national average in Victoria, South Australia, Tasmania and the Australian


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Capital Territory. However, the difference ranges from 25 to 270 per cent higher in the remaining jurisdictions – Western Australia, Queensland, New South Wales and the Northern Territory (SCRGSP 2004). We get a different picture if we compare utilisation to the Australian Government’s population-based target ratios for allocation of aged care places. The target populations used in planning are Indigenous people aged 50 and over and non-Indigenous people aged 70 and over. The target ratio is set at 108 places per 1000 people in the target population (SCRGSP 2005). Utilisation of services, at 50 per 1000 Indigenous persons in the target population, is lower than the 94 per 1000 non-Indigenous persons (SCRGSP 2005) and falls below the target ratio. In 2004, Indigenous people made up 1.4 per cent of all aged care service users. This proportion varies greatly by jurisdiction. Over the last decade, there has been a shift from residential to community care, but there does not seem to have been a significant increase in the overall use of aged care services by Indigenous people compared with the rest of the population (SCRCSSP 2000; SCRGSP 2005). The use of CACPs has increased across all locations. The age profile of Indigenous CACP recipients is much younger than non-Indigenous recipients. In 2002–03, of the 950 Indigenous recipients, 56 per cent were aged less than 70 years, compared with 11 per cent of the 25 204 non-Indigenous recipients (AIHW 2004). The younger age profile is also evident among HACC service users.

Table 3.1

Proportion of HACC clients by age and Indigenous status Indigenous (%)

Non-Indigenous (%)

Aged under 50 years

29.7

11.3

50–69 years

40.8

19.2

70 years and over

29.5

69.5

Note: The source of this data does not provide the total number of Indigenous HACC clients, but does state that 2.4 per cent of the 707 207 HACC clients are Indigenous; that is, approximately 17 000 people. SOURCE SCRGSP 2005: table 12A.33


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Compared to non-Indigenous HACC clients, Indigenous HACC clients were less likely to live alone but more likely to speak a language other than English at home, to receive four or more service types and to receive a higher number of hours of service (6.3 hours per month compared to 3.5 hours) (SCRGSP 2005). The distribution of Indigenous aged care service recipients does not reflect the distribution of the older Indigenous population. Although the Indigenous population is less urbanised than the Australian population as a whole, a significant proportion live in urban areas. The following tables suggest that Indigenous people living in major cities and inner regional areas are receiving less of some service types than Indigenous people in remote and very remote locations. Analysis of the distribution of other service types, particularly HACC, is needed to complete this picture. Conclusions about access also need to take into account the greater dispersion of population in remote areas, which increases the distances travelled, compared to urban areas, for a given level of supply (Gibson, Braun & Liu 2002). It is not possible to draw conclusions on whether there is differential need for services by Indigenous people in different localities. While the Indigenous population appears to have a greater level of need for services at younger ages than the broader aged population, this is just one factor that affects service use. Other factors include geographic location, availability of informal support, knowledge of available services, a person’s values or priorities, the capacity of services, or even the biases of those who recommend care.

Table 3.2 2004 population (n = 50 800)

SOURCE

Indigenous population aged 50 years and over, by location, 2004 Major cities

Inner regional

Outer regional

Remote

Very remote

29%

19.5%

23%

9.5%

19%

SCRGSP 2005: table 12A.2


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Table 3.3

Indigenous aged care recipients per 1000 Indigenous people aged 50 years and over, by location, 2004 Major cities

Inner regional

Outer regional

Remote

Very remote

High-care residential

12.4

6.3

18.5

25.4

17.4

Low-care residential

5.7

2.1

9.9

14.5

14.2

EACH

0.1

0.1

1.1

-

-

CACPs

17.1

25.2

24.6

32.4

40.3

Total

35.3

33.7

54.1

72.3

71.9

Note: Includes Aboriginal and Torres Strait Islander Flexible care services. SOURCE

SCRGSP 2005: table 12A.17

The information on Indigenous people’s perspectives on services is limited. The preference of many older Indigenous people to remain in the community has been convincingly documented (for example, WoenneGreen 1995). While this desire is not unusual among the aged population in general, the significance of land or country is distinct. The majority of Indigenous people have a deep attachment to their traditional lands or own home country, which is understood to embody kin, history, ancestral connections and spiritual identity (Anderson & Devitt 2004; ABS & AIHW 2005). The importance of being in or near to one’s own home country at the time of death is widely supported (Anderson & Devitt 2004). There is also evidence of a preference for services run and delivered by Indigenous people (for example, Dance et al. 2004). However, the expressed preference for care close to home country and higher use of CACPs over residential care cannot be extended to conclude that Indigenous people prefer CACPs. Greater understanding of the factors that impact on Indigenous service use is required to ensure that service utilisation is commensurate with higher need. The survey conducted by Dance et al. (2004) in the Australian Capital Territory provides a good example of research on the characteristics, needs and preferences of older Indigenous people in a region using an approach that contributed to improved services.


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The policy context

Aged care policy and Indigenous people Over the last few decades, there have been a number of changes in aged care policy specific to Indigenous people. Here we flag some of the key developments. The Home and Community Care Act 1985 identified Aboriginal people as one of a number of priority groups within the target population for the program. Sykes (1988) interviewed several Aboriginal people newly employed under HACC-funded programs and it is evident that this new program created fresh avenues of service provision for older Aboriginal people. The report of the Aged Care Reform Strategy Mid-Term Review described a preference among Indigenous people for HACC projects over residential care, as they provided better coverage of age groups and allowed older people to remain with their families (Commonwealth Department of Health, Housing and Community Services 1991, cited in Jenkins 1995). A National Aboriginal and Torres Strait Islander Reference Group has supported the program’s implementation since 1997 (Sindely 2004). The HACC program is frequently also the vehicle for current initiatives in Indigenous aged care, such as a recent Aboriginal Dementia Awareness Program in New South Wales (DADHC 2004). However, the focus on Indigenous people within HACC has not been consistently integrated with directions or planning in other aged care programs. Throughout the 1970s and 1980s, aged care services for Indigenous Australians were primarily delivered through hostel accommodation funded through Aboriginal Hostels Limited – a company owned by the Australian Government (Sindely 2004). In the early 1990s, there was growing concern about whether the aged care sector was meeting the needs of older Indigenous people. An interdepartmental committee was established in 1993 and national consultations were conducted. The major recommendation of the committee was a move to more flexible service delivery and funding (Gray 2001). This was achieved through the 1994 Aboriginal and Torres Strait Islander Aged Care Strategy (hereafter the 1994 Strategy). The 1994 Strategy established Aboriginal and Torres Strait Islander Flexible aged care services. Within these services, a fixed annual subsidy is paid for


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each notional high, low and community care place operated by the service. Places provided under the 1994 Strategy operate outside the Aged Care Act 1997. The service can exercise discretion as to the services it offers and these can change as community needs vary (AGDHA 2005). Existing services were given the opportunity to move to the new model and new services were established, initially as pilot projects (Sindely 2004). The number of flexibly funded services has grown steadily, particularly in remote areas that have been viewed as having the greatest need. The role of Aboriginal Hostels Limited was changed and clarified by the 1994 Strategy. However, it continues to provide services. During the initial phases of implementation, the 1994 Strategy also supported specific funding for training and education, needs assessments, establishment grants and financial assistance for services in financial difficulty (Sindely 2004). The needs of Indigenous older people received some additional attention within the reforms and legislation introduced by the Howard government. Under the Aged Care Act, Aboriginal and Torres Strait Islander people are identified as one of a number of ‘special needs groups’, together with people from rural and remote areas, people from culturally and linguistically diverse backgrounds and those who are financially disadvantaged. The reforms established specific provisions for special needs groups in the planning process and allocation of places and grants so that equitable access would be maintained under the Act. The Two-Year Review of Aged Care Reforms concluded that Aboriginal and Torres Strait Islander representation in care had remained stable since the reforms, with a continuing trend towards Indigenous people accessing care outside capital cities (Gray 2001). From 1994, a primary focus of the Australian Government was establishing services (Sindely 2004). More recently, emerging issues include establishing a quality assurance framework for all Aboriginal and Torres Strait Islander services, ensuring long-term sustainability of services and workforce development (Sindely 2004). States and territories have responded unevenly to the emergence of Indigenous aged care as a policy issue. In addition to the HACC program initiatives we have already noted, strategies targeting older Indigenous


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people have been included in recent written policy documents in some jurisdictions. These concentrate on different issues, consistent with the different responsibilities of the states and territories in aged care. Queensland has noticeably given the area greater emphasis. The Queensland Aged Care Strategy outlines measures to improve Indigenous access to assessment and service delivery and to increase support for carers and communities. It explicitly seeks to address coordination issues through partnerships for planning and delivering services that include the Aboriginal and Torres Strait Islander health forums, Aboriginal community-controlled health services and other agencies (Queensland Health 2004).

Indigenous affairs and health strategy The evolution of Indigenous health policy and strategy and changes in Indigenous affairs provides a broader context for the evolution of services and policy for older Indigenous people. The major developments have been described elsewhere (Anderson 2004) and we focus here on some relevant recent developments. The National Strategic Framework for Aboriginal and Torres Strait Islander Health was endorsed by the Australian Health Ministers Conference in July 2003 (hereafter the National Framework). The National Framework sets a reform agenda for the next decade in nine key result areas. Within the key result area addressing wider strategies that impact on health, there are five areas for joint action nominated for aged and disability services. These are: • Increase the availability of Community Aged Care Packages (CACPs) to Aboriginal and Torres Strait Islander peoples. • Improve the coordination between Home and Community Care (HACC) services and community health services and involve the health forums established under the Framework Agreements in planning of CACP and HACC services. Improve links between community health and medical services and Aged Care Assessment Teams. • Design carer support measures specifically for Aboriginal and Torres Strait Islander families caring for the frail aged or people with disabilities.


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• Examine ways of coordinating care for people with complex needs, including the development of pooled funding arrangements and other care management models. • Develop an implementation plan under the Commonwealth, State and Territory Strategy on Healthy Ageing (2000) specifically targeting Aboriginal and Torres Strait Islander peoples (NATSIHC 2004: 23). There are many other objectives in the National Framework that are relevant to services for older Indigenous people, such as improving access to the full range of health services and supporting the principles of community control of services (NATSIHC 2004). The needs of older Indigenous people receive more attention in the National Framework than in its predecessor, the 1989 National Aboriginal Health Strategy. While the National Framework attaches more importance to interventions across the lifespan and identifies a greater range of sectors that impact on health, the Indigenous aged population is still on the fringe of Indigenous health policy. Given the younger age profile of the population, the focus on areas such as maternal and child health is to be expected. The emphasis on improving life expectancy is also appropriate, but is it replicating the problem now seen in the non-Indigenous population by assuming that interventions directed at improving quality of life must wait for increased life expectancy?

Key issues for Indigenous aged care policy An earlier volume on Australian ageing and social policy noted in its introduction that the topic of Indigenous people and ageing had been largely neglected (Borowski, Encel & Ozanne 1997). In the intervening period, while ageing and aged care public policy has changed significantly, commentary on Indigenous people and ageing remains scarce. Policy development in the area seems to have been largely intuitively based rather than empirically informed and research activity has lagged behind. Despite this, there has been noticeable progress in some areas. While we know that Indigenous people have a relatively higher need for services at younger ages than non-Indigenous people, we still do not have a clear idea of the needs and expectations of older Indigenous people against which to


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measure service provision. Against this backdrop, there are a number of other issues and questions to be raised. Not old Current aged care policy recognises the lower life expectancy of Indigenous Australians and provides aged care services at a younger age, but there has been limited exploration of the implications of this. The Indigenous population aged 50 years and over is not old. The underlying assumption is that the Indigenous population aged over 50 years has the same set of age-associated conditions and care needs as the non-Indigenous population aged over 70. We have earlier raised questions about the empirical basis for such assumptions. Certainly, some, such as Gibson and Griew (2002), suggest that Indigenous people do not age earlier but die earlier than other Australians. They ask: is it appropriate to use aged care facilities to provide chronic disease care services to people in their fifties? (Gibson & Griew 2002). Key aspects underlying this question are the goals of care, resources, access to interventions, coordination of care across settings and the ability to meet psychosocial needs. End-of-life events and needs might be different if you are not as far from the beginning of life, and service providers may be confronted with a mix of needs that are difficult to meet with resources from just the aged care sector. Does inclusion of 50–70-year-olds in an ‘aged care’ bracket divert attention from all their health care needs and exclude this group from Indigenous population health strategies? Does it reinforce an uncritical acceptance of early deaths? For example, in response to the controversial death of a 45year-old Aboriginal man in a remote community, the Northern Territory Health Department ‘refused to comment except to say the man died of old age’ (ABC Darwin 2005). There are parallels with the debate about young people with disabilities in aged care where the facilities’ capacity to meet varying needs is also questioned. At the highest need level, residential care attracts less funding than disability accommodation services (Senate Community Affairs Committee 2005). These problems, in both cases, are accentuated by the division of responsibilities. The divides between federal and state, between health and welfare sectors and between community and residential care are not a new problem in the aged care sector (Kendig


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2004) but may have a greater impact on those with greater need. There is already concern about the unmet acute and chronic health needs in residential aged care and the lack of availability of appropriate medical, allied health and rehabilitation care in this setting (Flicker 2002). The increasing number and proportion of older people aged 85 years or over in the general population (AIHW 2002) makes this issue more compelling: Can the same approaches to care meet the needs of people at both ends of an age range of around 50 years? The essential challenge to current strategy is whether, while sympathetic to lower life expectancy, it is an overly pessimistic one that provides ‘young old’ Indigenous people near the end of life with fewer resources; that manages their decline rather than offering more positive interventions. Culturally appropriate aged care There is considerable emphasis on the provision of culturally appropriate aged care. Anderson and Devitt’s observation of the palliative care sector readily applies to Indigenous aged care: ‘A certain circularity along the following lines is often apparent: the problem is that clients are culturally different: the answer is culturally appropriate practices/services/resources’ (Anderson & Devitt 2004: 46). Though it is difficult to generalise about culture across Indigenous communities, the difference between Indigenous Australian and nonIndigenous cultures is significant. The need for culturally appropriate care is not disputed, but it is often applied in a narrow or oversimplified way. Differences in client response are not all explained by culture. The different demography, socioeconomic status, histories, locations and life opportunities of older Indigenous people can all shape responses and interactions. Anderson and Devitt stress that ‘culture’ is rarely proposed as an essential variable in relation to Anglo-Australians: ‘The notion of “culture” is (mis)understood as a meaningful attribute only of those who are different, rather than as an attribute of all’ (Anderson & Devitt 2004: 10). Their proposed approach for addressing social and cultural diversity combines more reflective practice by individual practitioners with responses at a system level. We will not provide in this chapter a detailed consideration of what this might look like. However, as illustrated in the following case study,


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involving people in service design, planning and delivery contributes a great deal to culturally appropriate care. Providing culturally appropriate care is not cheap. A Western Australian study of an Aboriginal health service found that for every dollar spent on services that might be deemed equivalent to mainstream, there were 75 cents spent on ‘culturally secure’ aspects of care (Wilkes et al. 2001, cited in Mooney 2003). Indigenous aged care providers face other challenges to viability. Many are small organisations serving small populations, so there can be difficulty achieving economies of scale and sharing infrastructure across a range of services. The majority of residents are financially disadvantaged, reducing the ability of services to raise capital through accommodation bonds. Together, these factors build a case for resource allocation to Indigenous aged care in line with greater need and the real costs of service delivery. This concurs with a finding of the recent major review of pricing arrangements in residential aged care, which recommended that existing arrangements for financial supplements be extended to particular groups with specific care needs, including Indigenous Australians (Hogan 2004). Residential versus community care The shift in the balance of care from residential to community-based care that has taken place in national aged care policy and service delivery since the mid-1980s (Kendig 2004) is also apparent in Indigenous aged care service utilisation and raises some important issues. Firstly, substituting residential care with lower-funded, communitybased care is not a simple trade-off for people with complex needs. Community care services are already providing higher levels of support to Indigenous people than to non-Indigenous people. This leads to pressure on resources and/or pressure to reduce the level of service to clients with low need (Commonwealth of Australia 2001a). Extended Aged Care at Home (EACH) packages may have the potential to relieve this pressure. However, the organisational capacity of Indigenous aged care service providers to expand in this way may be a limiting factor. In a more detailed discussion of this issue, Gibson and Griew (2002) question whether provision of community-based care to high-need clients can sustainably deliver cost containment and point out that, while there is a degree to which residential


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Box 3.2 Case study: The Aboriginal Community Elders Service The Aboriginal Community Elders Service (ACES) was incorporated in 1987. ACES’ centre, the Iris Lovett Gardiner Aboriginal Elders Caring Place, opened in Melbourne in 1992 and is an Aboriginal and Torres Strait Islander Flexible Aged Care Service. ACES provides residential care, CACPs, a day centre and a cultural program. There are a number of system features of ACES that promote services that are responsive to the needs of Aboriginal Australians: • ACES has Aboriginal people in decision-making positions as well as operational positions. It is an Aboriginal-managed corporation with a governing Committee of Elders. The Committee of Elders reinforces the cultural authority of elders and self-determination for older Aboriginal people. • ACES liaises with local Aboriginal groups across Victoria and incorporates their views and interests relevant to aged care provision. ACES also mediates between different communities and other bodies concerned with aged care. • ACES employs Aboriginal staff. Their cultural knowledge and sensitivity to the social and historical circumstances of clients promotes understanding of how to respond to diversity (for example, what to call people, food preferences, consent issues). ACES has a policy for induction of new non-Aboriginal staff to help increase their awareness about consulting clients or Indigenous staff on these issues. • ACES provides practical assistance that is culturally relevant, such as transport to, and support at, funerals and accommodation for family members around the time of death or illness. • ACES actively links aged care with cultural renewal and reconciliation. For example, it collects stories and oral histories of older Aboriginal people and provides a place for communities and individuals who want to learn from the lives of the elderly.


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• ACES sees itself as the extended family of the people it serves and a community place rather than an ‘aged’ place. It values the role of Koori elders in community life and facilitates their involvement, particularly with young Koori people. For example, ACES arranges for elders to participate in child protection committees and the children’s court system. • ACES provides advice, education, training and resources to mainstream organisations about culturally appropriate aged care services. (ACES 2001) care can be substituted with community care, for many people they are not equally viable choices. Secondly, it is well recognised that secure housing is essential for the sustainable delivery of community care (Kendig 2004 and chapter 9 of this volume). However, Indigenous people are more likely than nonIndigenous Australians to lack stable housing tenure (ABS & AIHW 2005). The housing situation and needs of older Indigenous people are not well understood. One of the few studies undertaken in this area, the Victorian Indigenous Elders and Housing Study, found that older Indigenous people in Victoria experienced many of the housing-related problems faced by other Indigenous people and other older people. However, their age, health and role in the community gave rise to some particular issues (Berry et al. 2003). For example: problems associated with inappropriate design or poor construction standards had a greater impact on older people and raised safety concerns; problems experienced with inadequate maintenance extended to long waits for home modifications; and older Indigenous people were often required to support extended family, but housing policies did not always take this into account. National Indigenous housing policy does not ignore the fact that people’s needs may vary at different life stages and it seeks to collaborate with the community service sector (HMAC 2001). Yet, to date, there is no clear policy direction linking community aged care to secure housing for older Indigenous people (Gibson & Griew 2002). Current calls to make more CACPs available to Indigenous people may match the desire of most Indigenous people to remain near their home country, but to conclude that Indigenous people prefer CACPs


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is not empirically justified. Although the intent is supported, there are ramifications of being too prescriptive about the model of care. Carers Support for carers has steadily gained a higher profile in the aged care system. A number of themes and issues concerning Indigenous carers are identified in the literature. These include: • Kin and family play a central role in Aboriginal and Torres Strait Islander life. • Older Indigenous people are not only the object of care; they are frequently in the role of primary carer. • There may be problems associated with community-based care in communities suffering high levels of social problems, such as security issues and stress. • The health of the Indigenous population impacts on the number of people requiring care, the intensity of care and the capacity of people to undertake a caring role. • The pressures of family obligations may start young, particularly for girls, and can impact on participation in education and employment. • Severe levels of stress can be experienced by families supporting and managing the needs of a relative. Carers are often not adequately trained, lack emotional support and experience financial hardships. • Income support for carers does not recognise that there may be more than one person involved in caring. • Value judgments by non-Indigenous health care providers about the way Indigenous older people are cared for may contribute to their institutionalisation. (Anderson & Devitt 2004; Sykes 1988; Tsey et al. 1998; Tripp 1993) Little is known about the characteristics of the informal care sector in the Indigenous population, nor about how the shift towards communitybased care has affected carers. These fragments from the literature suggest that the needs of Indigenous carers may differ to non-Indigenous carers


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and that this is another area where further investigation is needed to inform policy and practice.

Marginalised by policy for the future? The impact on demand for services of increasing numbers of older Indigenous people, their relatively worse health status and the lack of commentary in this area makes the focus on the current aged care system in this chapter a pragmatic choice. But we will now turn our attention to the future. Government policy for an ageing Australia is largely a response to the increasing proportion of the population above retirement age. The different demographics of the Indigenous population will have different social implications. There is a need to consider the impact of long-term plans on Indigenous people and the attention given to this population in major policy documents. The predominant policy frame of healthy ageing may not serve well the interests of elderly Indigenous people. Policy on healthy ageing is a response to the longer life that the majority of the population can now expect and an attempt to make sure that this does not involve increased years of illness and disability. In this context, it is not surprising that improving Indigenous life expectancy is prominent. However, it is noticeable that strategies to promote Indigenous healthy ageing in these documents generally do not go beyond the health sector, as if quality of life for older Indigenous people cannot be tackled at the same time as life expectancy. In its section on healthy ageing, the National Strategy for an Ageing Australia (NSAA) acknowledges the lower life expectancy and poor health status of Indigenous people compared to the Australian population and the need to reduce inequalities in health status; but it does not say how this will be done and there is no goal on this issue (Commonwealth of Australia 2001b). The life expectancy issue is picked up more vigorously in the Commonwealth, State and Territory Strategy on Healthy Ageing, which strongly articulates the goal of addressing Indigenous disadvantage ‘systematically and effectively’ (Commonwealth, States and Territories of Australia 2000: 6). In contrast, the New South Wales Healthy Ageing Framework 1998–2003 not only emphasised addressing lower Indigenous life expectancy, but also


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proposed specific strategies for Indigenous people in relation to housing, community attitudes, participation in the community and information provision (NSW Health Ageing and Disability Department 1998). The NSAA touches on services for Indigenous people in the discussion of world-class care and recommends flexibility in aged care service provision for this group. Indigenous Australians are otherwise not specifically mentioned in other themes. The NSAA states that ‘given the number of baby boomers, the attributes of this generation will most likely redefine old age’ (Commonwealth of Australia 2001b: 7). This future aged population is depicted as better educated, with greater financial means and higher expectations. Is the government’s planning agenda for the baby boomers relevant for future older Indigenous people? We can make some inferences based on data available for the whole Indigenous population. Financial security in retirement is a cornerstone of the Australian Government’s long-term strategy. Retirement income policies are directed to encouraging greater self-provision and to reducing future demand on the age pension (Commonwealth of Australia 2002; see also chapter 8 in this volume). Indigenous people have less potential for self-provision through voluntary savings because of lower incomes, lack of education and lower participation in the workforce relative to other Australians (ABS 2004). The applicability of strategies on lifelong learning and mature-age participation in the workforce for Indigenous people also needs to be examined in light of these figures. The NSAA maintains that ‘the centrality of home ownership to financial security particularly in older age will remain’ (Commonwealth of Australia 2001b: ix). However, Indigenous people are far less likely than nonIndigenous people to be living in dwellings that are being purchased or owned outright (ABS 2004). The components of financial planning in the Australian Government’s policy assume that older Australians will enjoy an extended retirement period. The importance of continuing to improve Indigenous life expectancy is axiomatic and the various documents on healthy ageing acknowledge this. But inequality in life expectancy is not the only point of difference that needs policy attention. The debate is missing a deeper appreciation of the needs, demographics, values, life opportunities and


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histories of the Indigenous people who will age alongside the baby boom generation. Recognition of this difference needs to have a higher priority in long-term policy and planning for Australia’s changing demography, or the increasing numbers of Indigenous people who live to old age may be pushed further to the margins.

Conclusion A common theme in the issues raised in this chapter is that many of the ideas underpinning policy directions for older Indigenous people are underdeveloped. However, perhaps the most significant factor limiting broader thinking is the way the issues are framed. Unlike the general population, relatively few Indigenous people live to old ages. Does inclusion of Indigenous people from age 50 in an ageing framework force ideas, such as the kinds of service and funding models considered and where responsibility for these lies, to run on a certain track? As Australia’s changing demography is redefining views of old age, perhaps it is also time to redefine the way we see the policy problems and solutions for older Indigenous people.

References Aboriginal Community Elders Service (ACES) (2001) Submission to House of Representatives Standing Committee on Aboriginal and Torres Strait Islander Affairs: Inquiry into the needs of urban dwelling Aboriginal and Torres Strait Islander peoples, viewed 22 August 2005, . —— (ACES) (2003) Aboriginal Elders’ Voices: Stories of the ‘Tide of History’, Victorian Indigenous Elders’ Life Stories and Oral Histories, Language Australia Ltd, Melbourne. Anderson, I (2004) Recent Developments in National Aboriginal and Torres Strait Islander Health Strategy, Australia and New Zealand Health Policy, 1: 3, . Anderson, I & Devitt, J (2004) Providing Culturally Appropriate Palliative Care to Indigenous Australians: Discussion Paper. In Mungabareena Aboriginal Corporation, Wodonga Institute of TAFE, & Mercy Health Service Albury for the Australian Government Department of Health and Ageing, Providing culturally appropriate palliative care to Indigenous Australians: Introduction to resource kit, Commonwealth of Australia, Canberra, pp. 1–71. Arch, M, Milyika, P, Ducasse, E & McManus, D (2000) Care for Frail Older People on the Anangu Pitjantjatjara Lands. In W Weeks & M Quinn (eds) Issues Facing Australian Families: Human Services Respond, Pearson Education Australia, Sydney, pp. 191–200. Australian Broadcasting Corporation (ABC) Darwin (2005) The Northern Territory Opposition Says it Can’t Understand the Government’s Reaction to the Death of a 45 year-old Man on


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Groote Eylandt, Radio News item, 7:00 am, 11 November 2005, Media Monitors summary ID A00019897233. Australian Bureau of Statistics (ABS) (2004) National Aboriginal and Torres Strait Islander Social Survey (Cat. no. 4714.0), Australian Bureau of Statistics, Canberra. Australian Bureau of Statistics & Australian Institute of Health and Welfare (ABS & AIHW) (2005) The Health and Welfare of Australia’s Aboriginal and Torres Strait Islander Peoples 2005 (Cat. no. 4704.0), Australian Bureau of Statistics, Canberra. Australian Government Department of Health and Ageing (AGDHA) (2005) Aboriginal and Torres Strait Islander Residential Aged Care Sector, viewed 12 May 2005, . Australian Institute of Health and Welfare (AIHW) (2002) Older Australia at a Glance 2002, 3rd edn (Cat. no. AGE 25, AIHW & DOHA), Canberra. —— (AIHW) (2004) Community Aged Care Packages in Australia 2002–03: A Statistical Overview (Cat. no. AGE 39, AIHW), Canberra. Berndt, C (1981) Ageing in Aboriginal Society: Traditional and Contemporary Perspectives. In A Howe (ed.) Towards an Older Australia: Readings in Social Gerontology, University of Queensland Press, Brisbane, pp. 271–85. Berry, M, Briskman, L, Costello, S & Ngwenya, T (2003) Victorian Indigenous Elders and Housing Study Final Report, Aboriginal Housing Board of Victoria, Melbourne. Bishop, J (2005) Opening Address to the 2nd International Conference on Healthy Ageing and Longevity 18 March 2005, viewed 5 July 2005, . Booth, H & Tickle, L (2003) The Future Aged: New Projections of Australia’s Elderly Population, Australasian Journal on Ageing, 22(4): 196–202. Borowski, A, Encel, S & Ozanne, E (1997) Ageing and Social Policy in Australia, Cambridge University Press, Cambridge. Commonwealth of Australia (2001a) Commonwealth Grants Commission Report on Indigenous Funding, Commonwealth of Australia, Canberra. —— (2001b) National Strategy for an Ageing Australia, Commonwealth of Australia, Canberra. —— (2002) 2002–03 Budget Paper No. 5: Intergenerational Report, Commonwealth of Australia, Canberra. Commonwealth, States and Territories of Australia (2000) Commonwealth, State and Territory Strategy on Healthy Ageing, Commonwealth of Australia, Canberra. Cunningham, J, Sibthorpe, B & Anderson, I (1997) Occasional Paper: Self-assessed Health Status, Indigenous Australians, 1994 (Cat. no. 4704.0), Australian Bureau of Statistics, Canberra. Dance, P, Brown, R, Bammer, G & Sibthorpe, B (2004) Aged Care Services for Indigenous People in the Australian Capital Territory and Surrounds: Analysing Needs and Implementing Change, Australian and New Zealand Journal of Public Health, 28(6): 579–83. Department of Ageing Disability and Home Care (DADHC) (2004) Dementia Awareness Week 19–25 September: Campaign Targets Dementia in Indigenous Communities, media release, viewed 12 April 2005, . Flicker, L (2002) Clinical Issues in Aged Care: Managing the Interface between Acute, Subacute, Community and Residential Care, Australian Health Review, 25(5): 136–39. Gibson, D, Braun, P & Liu, Z (2002) Spatial Equity in the Distribution of Aged Care Services in Australia, Australasian Journal on Ageing, 21(2): 80–86. Gibson, D & Griew, R (2002) New Models and Approaches to Care, Research paper, The Myer Foundation 2020 Vision Project, viewed 14 October 2004, . Gray, A (1985) Aboriginal Fertility: Trends and Prospects, Journal of the Australian Population Association,


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7(1): 57–77. Gray, L (2001) Two-Year Review of Aged Care Reforms, Commonwealth of Australia, Canberra. Hogan, WP (2004) Review of Pricing Arrangements in Residential Aged Care: Report, Commonwealth of Australia, Canberra. Housing Ministers’ Advisory Council (HMAC) Standing Committee on Indigenous Housing (2001) Building a Better Future: Indigenous Housing to 2010. Australian Housing Ministers’ Ten Year Statement of New Directions for Indigenous Housing, NSW Aboriginal Housing Office, Sydney. Jenkins, A (1995) Aged Care Service Use by Aboriginal and Torres Strait Islander Peoples, Aboriginal and Torres Strait Islander Health Information Bulletin, 21: 59–68. Kendig, H (2004) Will the New Directions in the Budget Transform Aged Care? Paper presented to the 2004 Board and Leadership Conference, Aged and Community Services Australia, In Submission to Senate Community Affairs Committee Inquiry into Aged Care, viewed 29 April 2005, . Kinfu, Y & Taylor, J (2002) Estimating the Components of Indigenous Population Change 1996–2001, Centre for Aboriginal Economic Policy Research, Discussion Paper 240/2002, Canberra. McLennan, W (1998) Experimental Projections of the Aboriginal and Torres Strait Islander Population (Cat. no. 3231.0), Australian Bureau of Statistics, Canberra. Mooney, G (2003) Debate: A Possible 10-point Plan for ‘Dr McGinty’s’ WA Health Service? SPHERE Debating Paper 01/03, Curtin University, Perth, viewed 10 July 2005, . National Aboriginal and Torres Strait Islander Health Council (NATSIHC) (2004) National Strategic Framework for Aboriginal and Torres Strait Islander Health: Framework for Action by Governments, Commonwealth of Australia, Canberra. NSW Health Ageing and Disability Department (1998) NSW Healthy Ageing Framework 1998–2003, NSW Government, Sydney. Queensland Health (2004) Directions for Aged Care 2004–2011, viewed 11 April 2005, . Reid, J, Yunupingu, L & Yunupingu, D (1978) Caring for the Aged and Dying in an Australian Aboriginal Community, Australasian Nurses Journal, Aug 7(12): 22–26. Senate Community Affairs Committee (2005) Quality and Equity in Aged Care, Commonwealth of Australia, Canberra, viewed 27 June 2005, . Sindely, C (2004) Aged Care in Aboriginal and Torres Strait Islander Communities: Lessons from the Past, Paper presented to the 2004 Colloquia, The Australasian Centre on Ageing, Brisbane August 2004. Full paper provided by author, summary viewed 12 April 2005, . Steering Committee for the Review of Commonwealth/State Service Provision (SCRCSSP) (2000) Report on Government Services 2000, Productivity Commission, Canberra. Steering Committee for the Review of Government Service Provision (SCRGSP) (2004) Report on Government Services 2004 Indigenous Compendium, Productivity Commission, Canberra, viewed 15 April 2005, . —— (SCRGSP) (2005) Report on Government Services 2005, Productivity Commission, Canberra. Sykes, R (1988) Issues Affecting Older Aboriginal People: A Discussion Paper, Commonwealth Office for the Aged, Sydney. Trewin, D (2002) National Health Survey: Aboriginal and Torres Strait Islander Results, Australia (Cat. no. 4715.0), Australian Bureau of Statistics, Canberra. —— (2004) Deaths 2003 (Cat. no. 3302.0), Australian Bureau of Statistics, Canberra. Tripp, M (1993) Extended Family Pressures: On Grannies and the Role of Women in Both Urban


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and Traditional Communities, Aboriginal and Islander Health Worker Journal, 17(3): 25–26. Tsey, K, Morrish, J, Lucas, A & Boffa, J (1998) Training in Aged Care Advocacy for Primary Health Care Workers in Central Australia: An Evaluation, Australasian Journal on Ageing, 17(4): 167–71. Woenne-Green, S (1995) ‘They might have to drag me like a bullock’: The Tjilpi Pampa Tjutaku Project. The Rights, Needs and Care Options of the Senior Men and Women of the Ngaanyatjarra, Pitjantjatjara and Yankunytjatjara Communities in the Cross-Border Region of Central Australia, Ngaanyatjarra, Pitjantjatjara Yankunytjatjara (NPY) Women’s Council Aboriginal Corporation, Alice Springs.


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4 Gender and ageing Cherry Russell

Introduction The existence of gender-related differences on a range of outcomes in later life – including longevity itself – is a characteristic feature of the Australian population. Average life expectancy at birth is 77 years for men and nearly 83 years for women. In 2042, these figures are projected to increase to 83 years and 88 years respectively (House of Representatives Standing Committee on Health and Ageing 2005). Because of women’s greater longevity, there are proportionately more older women than men, especially in the oldest age groups. The number of women aged over 65 years is 25 per cent higher than the number of men. For people aged over 85 years, there are more than twice as many females as males (ABS 2001). In 1999, women made up 69 per cent of the 85 years and over group. While this is projected to fall to 59 per cent by 2052, based on the current trend for men’s life expectancy to improve more rapidly than women’s (Andrews 2001), the ‘feminisation’ of later life will continue to be a defining feature of the new longevity. This chapter begins with an overview of the main ways in which gender has been examined and interpreted in relation to population ageing. I characterise the dominant approach as a paradigm of ‘competitive suffering’ in which claims are made about whether men or women are ‘worse off’ in old age. I propose that this is not the only


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important question about the significance of gender in the long-lived society, and may not even be a particularly useful one. Certainly gender matters in old age, but it does so in complex ways that are not yet fully understood. I illustrate something of this complexity by looking at how gender is related at a ‘macro’ level to unequal access to resources in later life, highlighting the existence of important cross-cutting sources of diversity, such as class and partnership status. This is followed by a discussion of more qualitative differences, at the ‘micro’ level, in the ‘lived experience’ of being an older woman or man, about which much less research evidence exists.

Gendering the new longevity Gender has always been identified as a key marker of diversity over the life course of individuals. However, interpretations of the meaning and significance of gender differences in later life have varied. The dominant approach, reflecting the fact that the study of ageing overall has been dominated by a problem-oriented perspective, has been to focus on gender as a dimension of disadvantage. According to early 20th-century sociologists like Talcott Parsons (1942), the ‘problem of old age’ was primarily the problem of old men. Parsons believed that the main problem facing older people was their increasing segregation from public life. This occurred because of the effects of industrialisation and urbanisation and, in particular, the impact of compulsory retirement. The loss of the work role was seen to create a major crisis of identity, and work was at that time a social role central only or predominantly to the lives of men. Ageing women, by contrast, supposedly experienced continuity of identity through the ongoing performance of their central social role – domestic reproduction (Gibson 1998). In the 1970s, feminist scholars began to challenge what they described as a ‘masculinist bias’ in gerontological research and its preoccupation with men’s retirement. They pointed out that women are the numerically larger group of older persons and that more women than men had low incomes, were widowed, experienced poor health and lived in residential


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care facilities. The term ‘double jeopardy’ was coined to characterise the combined effects of ageism and sexism on the circumstances of older women (Sontag 1972). The ‘problem of old age’ became the problem of old women, and the following decades witnessed a ‘veritable deluge’ of research on older women (Gibson 1998). By the 1990s, claims that the issues associated with ageing are predominantly ‘women’s issues’ had become commonplace (for example, Arber & Ginn 1991; Heycox 1997) and it is not unusual today for a report describing itself as a ‘gender study’ to include only discussion of women. More recently, this perspective too has come under challenge. Research has shown that late life vulnerability is not unique to women (Russell et al. 2001). Thompson (1994) and others have criticised the ‘invisibility’ of older men in social research, and calls have emerged for the sociology of ageing to be fully rather than partially gendered, with an explicit focus on the category of older men (Hearn 1995; Arber, Davidson & Ginn 2003). The emerging consensus appears to be that neither a ‘feminist’ nor ‘masculinist’ bias captures the complexities of gender-based diversity and inequalities in old age.

A macro perspective At any age, people’s chances of being able to fulfil their needs and pursue a satisfying lifestyle are related to their capacity to access key resources. According to Rowland (1991), the most important of these resources for older people are ‘wealth, health and family’. As noted above, recent research on gender and ageing has been dominated by a political economy framework in which gender has been examined as a marker not just of diversity in old age but of inequalities in life chances, with women faring worse (for example, Estes 2003). However, as the following discussion shows, it is not enough merely to enumerate differences between women and men. Attention must simultaneously be paid to the cross-cutting effects of other markers of diversity, notably class and partnership status, in order to understand why some women – and some men – experience particular disadvantage in later life in terms of their access to the key resources of wealth, health and social support.


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Wealth There is a decline in income with increasing age. The main reason for this is retirement from the workforce. While there has been a dramatic increase over the last 40 years in the number of women joining the workforce, the likelihood of still being employed at older ages remains strongly related to gender. Between 1980 and 2000, the employment rate for people aged between 55 and 59 years decreased for men (from 81 per cent to 70 per cent) and increased for women (from 28 per cent to 46 per cent). In the age range 60–64 years, these rates fall to 46.5 per cent and 20.3 per cent respectively. At the same time, more older men (4.8 per cent of those aged 55–64 years) than older women (2.2 per cent) were unemployed in 2000 (Australian Department of Health and Ageing 2002b). For the majority of retired Australians, the age pension is their sole or principal source of income. The age pension, introduced at the beginning of the 20th century, was designed to address the problem of aged poverty created by urban industrial capitalism. From the outset, this system was gendered; that is, ideas about gender were systematically ‘built in’ to the form the system took. The most obvious illustration of this is the establishment of differential ages of eligibility for men and women (65 and 60 respectively). The pension itself was conceptualised ‘as a right flowing from past labour service and taxpayer obligation’. As the language of the time made clear, the pension was seen as an entitlement of male workers, its purpose being ‘to afford equitable aid … without weakening individual initiative, or impairing the Anglo-Saxon characteristics of self-help and manly independence’ (Victorian Royal Commission on Old-age Pensions 1898, cited in Russell & Schofield 1986, emphasis added). Women’s entitlement to a pension was viewed through the lens of the prevailing patriarchal structure of the family; that is, as the economic dependant of her husband. Clearly, while the assumptions underpinning differential pension eligibility ages for men and women were paternalistic, they cannot be said to have disadvantaged women. Currently, the age requirement for the pension for women is being progressively raised to 65 years as a strategy for offsetting projected increases in pension expenditure (House of Representatives Standing Committee on Health


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and Ageing 2005). This reflects both the demographic feminisation of the older population and the emergence of social agendas for gender equality. Those most reliant on pensions – and older women account for 70 per cent of all age pensioners – have the lowest median incomes. However, while the rate of the means-tested age pension is relatively low in comparison with social insurance retirement benefits received in other countries, most older Australians are ‘rescued’ from poverty by high rates of home ownership. Older homeowners are substantially better off financially than non-homeowners, having ‘wider options in their spending compared with renters’ (Rowland 1991: 138). They spend, for instance, on average only 5 per cent of their income on housing (Giles 1993), whereas private renters often pay 50 per cent. Housing can have an important impact on the lives of older people both for its own sake, but also through access to wealth stored as equity. Housing tenure patterns are related to class and partnership status. Households on higher incomes are able to afford more and better housing. However, the most significant factor associated with home ownership is marriage (Baxter & McDonald 2005). The 1998 Disability, Ageing and Carers Survey (ABS 1999) shows that nine in ten non-single (married or de facto) older men are owners, compared to six in ten single (never married, divorced/separated or widowed) older men. People with the greatest resources cluster in the types of living arrangements preferred in Western societies; that is, conjugal and singleperson households that afford high levels of personal autonomy. Groups with limited resources cluster in less commonly favoured situations where autonomy is more restricted. For low-income older women, this is likely to mean the households of younger relatives (Rowland 1991: 115), while low-income single older men predominate among those in the least secure and desirable living arrangements, such as lodging houses and homeless shelters (Russell et al. 2001). Among former employees, a minority enjoys higher income derived from resources other than, or in addition to, pensions. The average income and expenditure of households receiving superannuation, for instance, is more than double that of pensioner households (Rowland 1991). Until the introduction in 1992 of the Superannuation Guarantee


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Charge, occupational pensions were available to relatively few workers, mainly middle-class men. In the 1980s, 50 per cent of professionals and managers were covered by superannuation, but only one-quarter of tradesmen and labourers. An even smaller proportion of employed women had superannuation cover. By 1991, 85 per cent of full-time employees and 50 per cent of part-time employees were covered by superannuation, although women continued to fare less well – 66 per cent coverage for employed women, compared with 76 per cent for employed men (Giles 1993: 6). Coupled with the fact that women have often spent less time in the workforce and have received lower pay during their employment, this means that they have had less opportunity as individuals to provide for their old age through employment. In the history of superannuation, women have clearly been discriminated against in relation to coverage in their own right. However, as McCallum (1997: 61–63) has pointed out, the assumption of women as married dependants meant that they were covered through their husbands. Overall, if 50/50 sharing between spouses is assumed, there is no difference between men’s and women’s income in retirement (McCallum 1990: 67). Moreover (and unlike male contributors), women were entitled to be paid a pension if they became widowed and are more likely to be alive to inherit the spouse’s benefits. ‘Given these complexities’, McCallum concludes, ‘it is an open question whether women are worse off than men in retirement income’ (McCallum 1990: 61–63).

Health At all stages of the life course, there are differences in the health experiences and behaviours of women and men. According to Mathers (1994: 20), these differences ‘reflect an as yet unknown combination of biological, behavioural and environmental factors’. Men die earlier and at a greater rate than women from all causes of death (Mathers 1994). Despite their superior longevity, older women have a higher rate of severe and profound handicap than their male counterparts. At age 85 years and over, half of men and two-thirds of women have a severe handicap. Many chronic nonfatal conditions are more commonly reported by women, while serious and fatal illnesses are much higher for men. As McCallum (1997: 67) concludes: ‘It is not easy to say who is worse off. [Men’s and women’s]


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Box 4.1 Case study: Older men in poverty The Ageing Men’s Health Project (Russell et al. 2001) has documented the appalling living conditions of some non-married male pensioners in inner-city rooming houses and private hotels. The lives of these men were characterised by a daily struggle merely to access adequate meals, in the absence of basic food storage and preparation facilities, or even a toilet (let alone a clean one), when the only such ‘amenity’ was a vermin-infested privy in the backyard or required those with serious mobility impairments to negotiate flights of stairs. The social relationships of these men bore little resemblance to the patterns characteristic of the majority of Australian older men. Primary ties with kin were attenuated or nonexistent and, for the most part, their social networks comprised other like-situated men. Contrary to the prevailing stereotype of skid row men as ‘under-socialised isolates’, the significance of friendships with other men emerged strongly in their interviews. Private renters, for instance, were reluctant to move to better and more affordable public housing out of the area because, as one man put it, ‘I know too many people around here, all my friends, and especially now that I’m less mobile …’. Similarly, many of the men who patronised emergency meals centres said that the ‘company’ and not the food was the main attraction.

death and disability experiences are simply different’. Older women may have higher levels of disability, but ‘they are also more likely to be alive’ (Gibson 1998). At the same time, closer analysis of health outcomes in old age reveals a much more complex picture. For example, inequalities in health associated with occupational class persist into later life. In the United Kingdom, rates of illness and disability are higher among working-class people in their sixties and seventies compared to professionals and managers (Arber, Davidson & Ginn 2003: 3), Similarly, in Australia there are ‘significant differentials in health status in older adults’ associated with family income (Mathers 1994: 54).


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It is also the case that unmarried people have higher death rates, worse self-reported health status and higher illness rates than married people at all ages, including among older people. Australian data show that marital status is linked to disability and handicap in gender-differentiated ways. Among Australian older men, the unmarried and previously married have a much higher prevalence rate of severe handicap than their married counterparts – 50 per cent higher for never-married men and 30 per cent higher for previously married men. For older women, however, the pattern is different: never-married women have a prevalence of severe handicap over double that of their married or previously married counterparts and, yet, they report a lower level of fair/poor health and of unhappiness than older married women (Mathers 1994: 30). Another important area of concern in the gender inequality debate is the provision and receipt of health care. Older women have more chronic health problems to manage than do older men and they use more health services (Estes 2003: 123). Thus costs associated with disability and health care are higher for women than for men. Australian data for 1989–90, for instance, show that women aged 60 years and over used on average more services (12.95) than did men in that age group (9.96) (Mathers 1994: 20). Similarly, of the 10 per cent of people over 70 years of age receiving permanent residential care, 72 per cent are women (House of Representatives Standing Committee on Health and Ageing 2005). Older women also account for the majority (64 per cent) of clients of Aged Care Assessment Teams (Australian Department of Health and Ageing 2002a).

Family The extent to which an older person is enmeshed within a social network of kin, friends and neighbours will greatly affect her or his experience of ageing. A great deal of research has been conducted into the social networks of older people. This term describes the structure of the social relationships or ties that individuals maintain with others (family, friends, work colleagues, and so on). These structural characteristics (like the size of the network, its composition, and so forth) vary not only between individuals but over time for the same individual as her/his circumstances change. The focus of research is on the various functions


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that an older person’s network performs, particularly in relation to social support. Social support can take various forms. Often, for instance, a distinction is made between instrumental and affective support; the former refers to practical assistance, such as help with everyday activities, and the latter to the more emotional dimensions of a relationship. Most support for older people is provided by relatives, and research has focused accordingly on the networks and relationships that older people maintain with their families. It has been well documented, in Australia and elsewhere, that spouses are the principal sources of support for those who need help with tasks of daily living. Publicly funded community services provide only a small part of the domestic and personal assistance received by frail older people. Within the ‘problem of old women’ scenario, much has been made of the fact that older women are more likely than older men to have their activities of daily living impaired by functional disabilities, yet are far less likely to have a spouse to provide care: ‘Whereas men can largely rely on their wives when care is required, women more often have to call upon adult children or formal services for help’ (Ginn & Arber 1995). Certainly it is the case that women’s greater longevity, coupled with the tendency for women to marry men older than themselves, means that while most older men are married, a substantial proportion of evermarried older women experience their later years as widows. Indeed, it has been said that ‘widowhood is normative for older women’ in Western societies. In Britain, for instance, half of women over age 65 are widowed and the duration of widowhood averages nine years. Yet, closer analysis shows that there are similar proportions of older men and women providing care for their spouse (Arber, Davidson & Ginn 2003: 6). The majority of older people who are widowed, divorced or never married live alone. Because of gender differences in life expectancy and marital status, the number of older women living alone is higher than the number of older men (Arber, Davidson & Ginn 2003). Older Australian women living alone outnumber their male counterparts by more than two to one (Bishop 2000: 14). Older people living at home alone are more likely to be recommended for residential care (38.6 per cent) than those living with other people


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(34.1 per cent) or living with their spouse (29.2 per cent). When older people living alone are recommended for residential care, they are more likely to be recommended for low-level care (26.2 per cent) than highlevel care (12.4 per cent). If an elderly person living with other people or with their spouse is recommended for residential care, it is most often high-level care. This suggests that the protective effect of being with a family member allows some people – who are statistically more likely to be male – to remain living in the community longer (Australian Department of Health and Ageing 2002a). At the same time, research has found that social ties beyond the family are also of considerable significance in the lives of older people. Friends and neighbours, whose role is often overlooked by service providers and policy-makers, can be important sources of support for elderly community dwellers. It has been consistently observed that older men have fewer friends than older women and older men who live alone are often more socially isolated and lonely than women who live alone (Arber, Davidson & Ginn 2003). A number of studies indicate that a major sociological predictor of social isolation is being a non-married male, infirm and living alone. A 1992 time use survey found that older men who live by themselves spend 85 per cent of their time, or 142 hours a week, alone. There is an increase with advancing age, so that men aged 75 spend 154 hours, or 91 per cent of the week, alone (Russell et al. 2001). There are also marked gender differences in primary sources of support. Older women are more likely than older men to report having a confidant among their more extensive social networks, whereas wives are the main confidants and carers of retired men (Arber, Davidson & Ginn 2003). Significant minorities of older men – and particularly working-class men – have no close friends. Here, too, we can see that gender per se does not adequately explain differential access to resources in later life. In the United Kingdom, Sara Arber and her colleagues have shown how the financial and social wellbeing of older people is related to a complex set of associations between gender and marital status: Older men who are never married or divorced are disadvantaged both socio-economically and in their social contacts, while married men are


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advantaged. The pattern is somewhat different for older women, with divorced older women materially disadvantaged, but this is less for single women. In contrast to men, marital status does not differentiate older women’s social contacts with family, friends and neighbours. (Arber, Davidson & Ginn 2003: 11)

Ageing, gender and ‘lived experience’ Some commentators have suggested that there may be important differences between how gender is manifest at the ‘macro’ level of social structures and in the ‘microworld of social interaction and in the dayto-day expression of the self’ (Silver 2003). Australian survey data, for instance, suggest that women define ‘old age’ as beginning later than men do (Australian Department of Health and Ageing 2002b). A small but growing body of research has focused on the experiential dimension of culture and personal meaning and the ways in which the ‘lived experience’ of being an older person may be gendered. Here the term ‘gendered’ refers to ‘ideas about gender: assumptions and beliefs on an individual level as well as societal level, and how they affect thoughts, feelings, behaviours and treatment of women and men’ (Arber, Davidson & Ginn 2003: 4). As noted earlier, much of this work has been carried out from a feminist perspective and has only collected data from and about older women. Of course, this in itself is not necessarily a bad thing. But it does mean that findings have tended to be interpreted from an a priori theoretical standpoint in which the ‘disadvantaged’ position of older women vis-a-vis older men is assumed rather than demonstrated. The picture that emerges is one of older women as oppressed and passive victims of ‘double jeopardy’. Following Sontag (1972), for instance, it is widely proposed that women’s ageing is more heavily penalised than men’s in relation to appearance, sexuality, and opportunities for intimate relationships. Following widowhood or divorce, for instance, older men are far more likely to repartner than are older women. This is usually attributed to the ‘competitive advantages’ of maleness in both demographic and sociocultural terms. The dominant interpretation is that ‘women grieve and men replace’ (Davidson 2002: 48).


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However, recent research suggests other possibilities. In the United Kingdom, interviews with older people who have been widowed identified different gender expectations and motivations for a new relationship: ‘for women it was the wish for companionship outside, and for men, inside the home’ (Davidson 2002: 51; emphasis in original). But findings did not support the view that those older widows who did not repartner lacked available and interested mates. Rather, it was a matter of choice: ‘the older widows in this study did not desire a new relationship’ (Davidson 2002: 58). Similarly, the growing phenomenon of ‘living apart together’ (LAT) relationships among older Swedish people appears to reflect women’s preferences and choices. While older men in a recent study overwhelmingly preferred married or unmarried cohabitation with a new partner, women were the driving force behind the establishment of these multi-household relationships. The authors conclude that this phenomenon may be interpreted, in part at least, as ‘the gender revolution continuing into old age’ (Karlsson & Borell 2002: 24), with older women reluctant to re-engage in an unequal distribution of household labour and caring responsibilities. Their motivations ‘revolve largely around autonomy’ (Karlsson & Borell 2002: 16–17; emphasis in original). Overall, there has been remarkably little systematic examination of how older women and men ‘do’ gender in their everyday lives, and the available evidence is open to different interpretations. Some studies, for instance, suggest that psychological and personality factors show fewer gender differences as individuals grow older (Baltes, Freund & Horges 1999). Developmental psychologist David Gutmann (1987) has proposed the existence of a ‘crossover effect’ in gender-defined behaviours in later life, with older men becoming freer to express ‘feminine’ behaviours and vice versa. Others (for example, Biggs 2003; Silver 2003) approach the idea of older age as the context for ‘de-gendering’ of identities by placing equal, if not greater, emphasis on the explanatory power of social structural processes, arguing that in post-industrial societies the loss of socioeconomic power and status among older people has created ‘an arena where patriarchal rules and gender-based expectations have been altered’ (Silver 2003). However, other studies exploring the ‘lived experience’ of ageing suggest that gendered identities continue to be alive and well at older ages.


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There is strong evidence, for example, of gender differences in people’s preferred lifestyles following retirement. A recurring finding from studies of associational behaviour in later life is the ‘feminisation’ of age-graded recreational, educational and cultural groups. More than three-quarters of the membership of Senior Citizens Clubs and Universities of the Third Age (U3As) in the United Kingdom and Australia is female and the majority of these are single, widowed or divorced (Williamson 2000). Various explanations have been proposed, including the ‘feminisation’ of the organisations themselves, which deters men’s involvement, and the female-oriented nature of the activities they offer (Davidson, Daly & Arber 2003). In a recent Australian study of U3A participation, the older members themselves were of the view that ‘men and women retire differently because they are basically different and do different things’ (Williamson 2000: 56). Some of my research suggests that gender differences may also exist in relation to other more privatised experiences, such as the meaning and significance of ‘home’ (Russell 1999). Research shows that older women, like their younger counterparts, continue to contribute disproportionately to household work following their husband’s retirement. It is often assumed in the literature that gendered power relations also continue into old age, with men exercising control over key life decisions, such as moving home or staying put in retirement. However, this assumption was not supported in my data: it was invariably the wife who had the final say in decisions about where ‘home’ will be. Overall, we know little about the ways in which men’s retirement from work and their reduced involvement with the public world impacts on the private social relations of home. It may be that women’s continuing control over, and identification with, the domestic sphere (including, paradoxically, their disproportionate contribution to the work it entails) becomes a source of power for wives when husbands lose their public, occupational bases of authority and identity. Nor do we understand much about what ‘masculinity’ itself means to older men, how it may be maintained or modified in the face of major life course transitions such as retirement, loss of physical strength, onset of illness or disability, declining sexual potency, and so forth.


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Box 4.2 Case study: Gendered meanings of home In my Home and Independence study (Russell 1999), several older married couples were interviewed together. There were significant gender differences in the meaning of ‘home’, with wives expressing much stronger feelings of attachment to their current dwelling. For example, Mrs W’s home: … means a lot to me. I was only six when my family moved into this house and I have never moved since … I like home! … Home is a bit like a security blanket to me … this is my little part of the world.

Her husband, on the other hand, said that he was not at all sentimentally attached to it: Oh no! I could pack up and go tomorrow. It would not worry me two hoots … I don’t attach any sentimental value to anything physical, I mean material. Once a thing has been used, I have no use for it any longer. I can discard it easily. My wife is not like that. She finds it very difficult to relinquish anything … As for me, I could walk out of this place right now and it would not worry me one little bit.

The other couples expressed similar differences. The husbands would, in fact, have preferred to move for a variety of reasons. But they described a situation quite the opposite to that assumed in the literature: they deferred to their wives’ preferences. Some, like the 72year-old married man quoted below, were ‘not unhappy’ where they were, but saw considerable practical benefits in relocating at this stage in their lives. In his account of the reasons for staying put, he echoes the construction of home as the ‘woman’s domain’: Yes I have [contemplated moving to a smaller place], but my wife hasn’t! She likes where she is. I would like to move closer to the water … It’s no use moving unless we both want to move, because I am not unhappy where we are. But moving would give us much more independence financially, because we’d get a lot of money for the place we are living in. We could buy a cheaper house and have that bit of capital. But she likes the area generally and she likes the garden … Would she be more emotionally attached to that home than you are? I don’t know. I’ve never thought of it that way. She just likes to


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be there. And how attached are you to that place? Oh, I like the place and I like the area, but to me it’s a house in a dormitory suburb. I’d prefer to move to a resort-type suburb … I feel that it would be wise for us to relocate now, but I feel it is not worth making an issue of it with my wife. Would you find it difficult to leave that house behind? No, I don’t think so. If we move, I’ll be able to make a clean break. I have no great passion invested in that house. We moved in in 1971 when it was a derelict place … we renovated every room. It would hurt me if someone took it over and did not look after it the way we did – to that extent it would irk me – but even if they did, I would not lose any sleep.

Similarly, little research attention has been directed towards better understanding the meaning and significance of non-familial relationships for older men. There is a tendency to assume that having a wife is a necessary – and sufficient – condition for ensuring the socioemotional wellbeing of men in later life. Again, some of my research (Russell 1996) challenges such a view. Even the married men in one of my studies made clear that they valued the company of other men and preferred to engage in traditionally gendered leisure activities (‘masculine’ crafts and hobbies, fishing, sports) that also provided opportunities for men to be with other men.

Conclusion Recent gerontological and policy discussion has tended to focus on the relative disadvantages faced by older women. The construction of latelife wellbeing in terms of disadvantaged old women with special needs and contented or dead old men with no needs either way has achieved considerable rhetorical power. But it is an oversimplified representation. In sociological terms, for instance, an emphasis on unequal social relations needs to recognise health, economic and social inequalities among older women and older men, and not simply between them. Of particular importance are differences in class and partnership status. Australian research, for instance, suggests that the future availability of family care may come to be a particularly salient issue for the most economically disadvantaged. Birrell and Rapson (1998) have documented


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major declines in partnering rates among men and women over the decade 1986–96. For men aged less than 40, the cause of declining partnering rates is more a product of failure to partner than marital break-up. Overall, the likelihood of being in a partnership is strongly related to occupational status and income, with those at the lower levels less likely to be partnered. Men who are not in full-time work are more likely to be unpartnered than other men. The authors conclude that the process of economic change over recent decades, particularly the deterioration of the male labour market, is primarily responsible for the lack of success of unemployed or underemployed men in the marriage market. In other words, future cohorts of older people are likely to include more men who lack adequate income and housing wealth, in poor health, and effectively outside an informal system of caregiving. This chapter has shown that men and women in ageing societies face different kinds of inequalities in accessing key resources of wealth, health and family. Far from being a homogeneous group, older Australians vary widely in their access to resources. According to numerous commentators (for example, Daatland 1997; Scheidt, Humpherys & Yorgason 1999), the trend worldwide is towards increasing diversity and difference in the circumstances of older people, and growing inequalities among them. At the same time, I have proposed that our understanding of the relationship between gender and ageing also needs to move to the level of individual experience. While sociologists quite properly are concerned to document the demographic, social and political forces and interests that shape the lives of older women and men, it is equally important to address the personal and cultural implications of population ageing as lived realities. References Andrews, K (2001) National Strategies for an Ageing Australia: An Older Australia, Challenges and Opportunities for All, Department of Health and Aged Care, Canberra. Arber, S, Davidson, K & Ginn, J (2003) Changing Approaches to Gender and Later Life. In S Arber, K Davidson & J Ginn (eds) Gender and Ageing: Changing Roles and Relationships, Open University Press, Maidenhead, pp. 1–14. Arber, S and Ginn, J (1991) Gender and Later Life: A Sociological Analysis of Resources and Constraints, Sage, London. Australian Bureau of Statistics (ABS) (1999) Disability, Ageing and Carers, Commonwealth of Australia, Canberra. —— (ABS) (2001) Population by Age and Sex, Australian States and Territories (Cat. no. 3201.0),


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Commonwealth of Australia, Canberra. Australian Department of Health and Ageing (2002a) Aged Care Assessment Program, National Minimum Data Set Reports (July 2000 – June 2001 data set), <www.health.gov.au/internet/wcms/ Publishing.nsf/Content/ageing-reports-acapmds.htmn>. —— (2002b) Ageing in Australia, Second World Assembly on Ageing, Madrid, Spain, 8–12 April, . Baltes, MM, Freund, AM & Horges, AL (1999) Men and Women in the Berlin Aging Study. In MM Baltes & UK Mayer (eds) The Berlin Aging Study: Aging from 70 to 100, Cambridge University Press, Cambridge, pp. 259–81. Baxter, J & McDonald, P (2005) Why is the Rate of Home Ownership Falling in Australia? AHURI Research & Policy Bulletin. 52 (March), Australian Housing and Research Institute, Melbourne. Biggs, S (2003) Age, Gender, Narratives, and Masquerades, Journal of Ageing Studies, 18(1): 45–58. Birrell, B & Rapson, V (1998) A Not So Perfect Match: The Growing Male/Female Divide 1986–1996. Centre for Population and Urban Research, Monash University, Clayton, Victoria. Bishop, B (2000) The National Strategy for an Ageing Australia: Attitude, Lifestyle and Community Support Discussion Paper, Commonwealth of Australia, Canberra. Daatland, SO (1997) Welfare Policies for the Old People in Transition? Emerging Trends and Comparative Perspectives, Scandinavian Journal of Social Welfare, 6: 153–61. Davidson, K (2002) Gender Differences in New Partnership Choices and Constraints for Older Widows and Widowers, Ageing International, 27(4): 43–60. Davidson, K, Daly, T & Arber, S (2003) Older Men, Social Integration and Organisational Activities, Social Policy and Society, 2(2): 81–89. Estes, CL (2003) Social Policy and Ageing, Sage Publications, Thousand Oaks, California. Gibson, D (1998) Aged Care: Old Policies, New Problems, Cambridge University Press, Cambridge. Giles, P (1993) Ageing in Australia 1982–1992: A Decade of Action, Australian Journal on Ageing, 12(1): 4–12. Ginn, J & Arber, S (1995) ‘Only Connect: Gender Relations and Ageing. In S Arber & J Ginn (eds) Connecting Gender and Ageing: A Sociological Approach, Open University Press, Buckingham, UK, pp. 1–14. Gutmann, DL (1987) Reclaimed Powers: Toward a New Psychology of Men and Women in Later Life, Basic Books, New York. Hearn, J (1995) Imaging the Aging of Men. In M Featherstone & A Wernick (eds) Images of Aging: Cultural Representations of Later Life, Routledge, London, pp. 97–115. Heycox, K (1997) Older Women: Issues of Gender. In A Borowski, S Encel & E Ozanne (eds) Ageing and Social Policy in Australia, Cambridge University Press, Cambridge, pp. 94–118. House of Representatives Standing Committee on Health and Ageing (2005) Future Ageing: Inquiry into Long-term Strategies to Address the Ageing of the Australian Population over the next 40 Years, Parliament of the Commonwealth of Australia, Canberra. Karlsson, SG & Borell, K (2002) Intimacy and Autonomy, Gender and Ageing: Living Apart Together, Ageing International, 27(4): 11–26. McCallum, J (1990) Winners and Losers in Retirement Income. In H Kendig & J McCallum (eds) Grey Policy: Australian Policies for an Ageing Society, Allen & Unwin, Sydney, pp. 55–73. —— (1997) Health and Ageing: The Last Phase of the Epidemiological Transition. In A Borowski, S Encel & E Ozanne (eds) Ageing and Social Policy in Australia, Cambridge University Press, Cambridge, pp. 54–73. Mathers, C (1994) Health Differentials among Older Australians, Australian Government Publishing Service, Canberra. Parsons, T (1942) Age and Sex in the Social Structure of the United States, American Sociological Review, 7: 604–16.


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Rowland, DT (1991) Ageing in Australia, Longman Cheshire, Melbourne. Russell, C (1996) Retirement Lifestyles: An Exploratory Study of Older Men in Southeastern Sydney, Southeastern Sydney Area Health Service, Health Promotion and Multicultural Health Unit, Sydney. —— (1999) Meanings of Home in the Lives of Older Women (and Men). In M Poole & S Feldman (eds) A Certain Age: Women Growing Older, Allen & Unwin, Sydney, pp. 36–55. Russell, C & Schofield, T (1986) Where it Hurts: An Introduction to Sociology for Health Workers, Allen & Unwin, Sydney. Russell, C, Touchard, D, Kendig, H & Quine, S (2001) Foodways of Disadvantaged Men Growing Old in the Inner City: Policy Issues from Ethnographic Research. In S Gauthier, DN Weisstub & DC Thomasma (eds) Aging: Culture, Health, and Social Change (Volume 10 of the International Library of Ethics, Law, and the New Medicine), Kluwer Academic Publishers, Dordrecht, pp. 191–215. Scheidt, RJ, Humpherys, DR & Yorgason, JB (1999) Successful Aging: What’s Not to Like? The Journal of Applied Gerontology, 18(3): 277–82. Silver, CB (2003) Gendered Identities in Old Age: Toward (De)Gendering? Journal of Ageing Studies, 17(1): 379–97. Sontag, S (1972) The Double Standard of Aging, Saturday Review, 23: 29–38. Thompson, EH (1994) Older Men as Invisible Men in Contemporary Society. In EH Thompson (ed.) Older Men’s Lives, Sage Publications, Thousand Oaks, CA, pp. 1–21. Williamson, A (2000) Gender Issues in Older Adults’ Participation in Learning: Viewpoints and Experiences of Learners in the University of the Third Age (U3A), Educational Gerontology, 26: 49–66.


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5 Ethnicity and ageing Donald T Rowland

Introduction Australia’s commitment to immigration as a basis of nation-building has continuing consequences for the country’s experience of population ageing. While immigration is currently having a small moderating effect on the percentage of older people in the population (Productivity Commission 2005), its long-run impact includes substantial increases in the numbers of older settlers. After three or four decades, workingage immigrants inevitably reach later life and most of them continue to value, or find essential, their identification with their cultural origins. At a time when population ageing itself is of growing importance in reshaping Australian society and its social and economic policies, the ageing of settlers is prominent because of the past high volume of immigration from diverse origins. It will long remain so because current trends in immigration guarantee, well into the future, a continuation of ‘the migrant presence’ at older ages. Between 2001 and 2026, the numbers of the ethnic aged, or persons from culturally and linguistically diverse backgrounds, are projected to almost double from about 480 000 to 940 000, with particularly rapid increases occurring before 2016 (see table 5.1). Their share of the total population aged 65 and over will remain in the range of 20–22 per cent, since the total aged population will also be increasing substantially at the same time, from about 2.4 million to 4.4 million (Gibson et al.


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Table 5.1 Year

Birthplaces of persons aged 65 years and over, Australia, 1996–2026 Culturally and linguistically diverse backgrounds

Main Englishspeaking backgrounds

Australianborn

Total

1996

392 800

288 749

1 521 445

2 202 994

2001

479 395

305 181

1 591 224

2 375 800

2006

567 944

336 619

1 681 553

2 586 116

2011

653 801

388 091

1 864 853

2 906 745

2016

780 743

458 686

2 178 779

3 418 208

2021

871 007

497 680

2 549 556

3 918 243

2026

939 822

535 355

2 957 845

4 433 022

Note: Although 1996 was the base year for projected figures in all the later years, the projected total figure for 2001 is only slightly below an authoritative estimate (2 440 600) of the total resident population, aged 65 years and over, in June 2001 (ABS 2002a: 85). SOURCE

Gibson et al. 2001: 4–5

2001: 4–5). The ethnic aged have long had numbers concentrated in the ‘young-old’ ages (65–74 years), because of expanding inflows from the working ages, but a significant change now occurring is the ageing of the ethnic aged, which is raising the proportions most likely to need aged care. The proportion aged 80 years and over could rise from 18 per cent in 2001 to 26 per cent in 2011, compared with corresponding figures of 24 per cent and 27 per cent for the total aged population. Another substantial change, emerging over several decades, will be the rising representation of elders of Asian origins, which will diversify ethno-specific needs in aged care (Andrews 2002: 4–5). In 2001, Australia had seven overseas-born groups from non-English-speaking countries whose numbers aged 65 and over exceeded 20 000 (ABS 2003: 112–13). The largest groups were from Italy, Poland, Germany, the former Yugoslavia, Greece, the Netherlands and China. By 2026, population projections indicate that there will be 16 such groups, six of which will be from Asian countries (Vietnam, China, Philippines, India, Malaysia and Sri Lanka) (Gibson et al. 2001: 4–5). A particular feature of Australia’s immigrant population, however, is the representation of around 200 different birthplaces and languages (DIMIA 2005), which


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creates diversity far beyond that implied in any count of the largest groups. Accordingly, recognition of ethnic diversity and adaptability to varied changes will be important prerequisites for effective responses to the ongoing procession of former immigrants into older age groups. Overseas-born populations typically have relatively high percentages in the older ages, mainly because their locally born children and grandchildren are counted as part of the Australian-born population. Birthplace, however, is an inaccurate measure of cultural ties, such as when the Australian-born sons and daughters of immigrants identify with their parents’ origins, or when religious or regional affiliations take precedence. Identification with a ‘people’ or ‘nation’ (Greek ethnos) is an essential characteristic of a person’s ethnicity, but more specific definitions of ethnicity are problematic. This reflects that ethnicity is multidimensional and includes culture, language, birthplace and religion as well as other dimensions, although ‘culture’ is sometimes taken to subsume all of these. Australian policy-makers in the field of ageing have mostly preferred not to define ethnicity but, in sociology, self-identification is the preferred approach to defining ethnicity, since it denotes a sense of belonging. Complications arise when people of mixed descent have dual or multiple ethnicities, or identify with different groups in different circumstances. Also, it has been argued that the concept of ethnic ‘community’ too can be problematic, since a high proportion of former immigrants from non-English-speaking backgrounds have little or no contact with organisations of people who speak the same language, whether through choice, lack of time, or geographical isolation (Deasey 1988: 42). For social policies, the ageing of people from diverse cultural and linguistic backgrounds is a particular concern because they are recognised as a ‘special needs’ group requiring culturally appropriate service provision and accommodation (Department of Health and Family Services 1995; Minister for Ageing 2005: 19). Accordingly, this chapter gives particular attention to special needs, their nature, prevalence and associated policy and program responses. The chapter also discusses the importance of including the ethnic aged in mainstream policy provision, such as that concerning healthy ageing, and the desirability of future policy directions towards fostering social capital-building and personal autonomy. Multiculturalism and policy-related concepts from ethnogerontology provide the setting for the chapter as a whole.


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The setting Australia’s principal contemporary response to the presence of settlers from diverse backgrounds is the policy of multiculturalism, the emergence of which heralded the beginning of social policies for the ethnic aged. Governments have redefined community relations in Australia at different times, in light of changing perceptions of the essential bases of national unity and social justice. Expectations that settlers should and could assimilate – that is, become absorbed into the host population – were predominant from Federation until the early 1970s, when integration, a blending of cultures, became the official policy. Multiculturalism followed soon after, in 1973, as the official policy, but has itself undergone rethinking and modification since then (Borowski 2000). In aged care policy, the assimilationist model and the dominance of people of Anglo-Celtic origins in the older ages formerly overshadowed other priorities. By the 1970s, both of these obstacles to public recognition of ethnic ageing were receding. Large cohorts of settlers from Europe were then entering the older ages and the proportion of the total aged population born in non-English-speaking countries was rising, probably passing 10 per cent in 1986 and 20 per cent in 2001 (Borowski 1985; Rowland 1991: 18; Gibson et al. 2001: 4). Multiculturalism is a key point of reference, given its importance as an ideology underpinning policies to ensure equitable approaches to aged care. Multiculturalism recognises the rights of groups to preserve their own cultures in Australia. It further implies equal access to programs and services, as well as entitlement to special provision where necessary. However, when describing the characteristics of the population, the concept of multiculturalism has the potential to create exaggerated impressions of ethnic pluralism and cultural maintenance. Living in Australia has made older settlers different from their peers who stayed in the country of birth, and different from each other because of their varied experiences. Many are well integrated into Australian society: they speak English, they identify with their Australian-born offspring – among whom marriage outside the ethnic group is common – and they value participation in the structures and organisations of Australian society. As a descriptive concept, multiculturalism is relevant only in the


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popular sense of denoting cultural diversity. Its stricter meaning of a pluralist society (Lewins 1988) does not adequately represent the nature of the ethnic aged population in which processes of mixing and change are influential. Coinciding with the beginnings of multiculturalism was a period in which overseas theories of ethnic ageing were background influences in Australia. Developed predominantly in the United States, the main theories describing and explaining the circumstances of ethnic aged population, as well as providing guidance for policy-making, were ‘double jeopardy’ and ‘institutional discrimination’. Double jeopardy has been one of the best-known theoretical perspectives to emerge from the study of ethnicity and ageing. It postulates that occupying two stigmatised statuses brings more negative consequences than occupying either status alone (Chappell & Havens 1980: 157). The expectation is that being old and a member of a disadvantaged ethnic group has more adverse effects than being younger, or being an older member of the majority population (Coon 1986). An opposing perspective is the ‘ageas-leveller hypothesis’, according to which ageing reduces the relative social and economic distinctions between ethnic groups (eds Gelfand & Barresi 1987: 10–11). Both hypotheses, however, are oversimplifications since vulnerability, or ‘jeopardy’, is multidimensional; focusing on age and ethnicity may cause neglect of additional sources of variation, such as gender inequality. ‘Institutional discrimination’ focused not on the characteristics of the aged, but on policies themselves, referring to inequalities resulting from policies and practices of institutions (Palmore & Manton 1973: 364). For example, in the past, social policies in the United States generally considered the aged to be white, English-speaking and relatively well educated, which either denied access to minorities or confronted them with culturally insensitive programs (Bengtson 1979: 13). This reflected differences between bureaucratic perceptions of needs and those of the minority groups themselves (Meyers 1980: 73). The policy of assimilation in Australia gave grounds for claims about institutional discrimination as growth occurred in the non-Anglo-Celtic component of the overseasborn population, but such concerns began to recede with the adoption of more enlightened approaches. For similar reasons, interest in double


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jeopardy has waned and there is less concern for conscious attempts to construct theories to underpin ‘ethno-gerontology’ as a distinctive field. Instead, ethnic disadvantage seems to be more commonly considered now with reference to the influence of social inequality and cultural differences.

Special needs The significance of ethnicity in ageing arises from the benefits to quality of life of being able to maintain continuity with life patterns established at younger ages (Holzberg 1982: 253; Gelfand, 1982: 41). Thus, in the first instance, special needs originate from the importance to the ethnic aged of their distinctive cultural and social circumstances and associated incompatibilities with attitudes and expectations that influence the provision of mainstream care. The ethnic aged have been considered a special needs group in aged care since the 1980s, and are identified as such in the Aged Care Act 1977. They are one of the largest special needs groups. Specific policies and programs seek to enhance their access to aged care services, as well as build capacity for aged care providers to deliver culturally appropriate care (Department of Health and Ageing 2005). The many cultural factors thought to be significant to the ethnic aged include language and communication, religious observance, support systems, dietary needs and preferences, roles within the family, values, traditions and norms. However, progress towards the development of a culturally relevant theoretical framework for the study of ageing (see box 5.1) is thought to have been impeded on account of the greater emphasis given to social inequality (Torres 1999). Indeed, the prominence of social inequality probably reflects a degree of scepticism about the relevance of culture as a consideration in planning, because its influence can vary by age, gender, class, level of education, and urban or rural background (Deasey 1988: 42). Discussions of special needs sometimes take for granted that the population ‘at risk’ is equivalent to the total numbers born in nonEnglish-speaking countries. Population size necessarily makes the ethnic aged a major interest group in planning and policy development, but total numbers cannot be equated with the population at risk of having


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Box 5.1 Culture and ageing There has been little progress towards the development of theories concerned with culture and ageing, but Torres’ (1999) ideas about culture and successful ageing illustrate possible directions, as well as the complexity of the task. She emphasised that in order to understand ageing in ethnic minorities, it is necessary to be informed about the specific culture – its distinctive way of life, beliefs, values and shared meanings. For example, ease of adaptation after migration depends on the fit between the immigrants’ value orientations and that inherent in the culture of the host society. Also, to Americans, self-perceptions of being ‘optimistic, courageous and motivated’ signify successful ageing, whereas to the Chinese aged it resides in others thinking of them as ‘tolerant and easy-going’. Torres argued that the way social groups perceive successful ageing depends on their value system and it is misleading to interpret the perceptions of one culture according to the values of another. In light of this, Torres proposed a theoretical framework for investigating successful ageing through understanding differences in value orientations, as illustrated in figure 5.1. Figure 5.1 Torres’ value orientation approach to the study of successful ageing

Understanding of successful ageing Value orientations regarding … Human nature Whether the innate character of human nature is thought to be predominantly good, evil or a combination of the two Man-nature Whether man wants to surrender to, live in harmony with, or master nature Relations Whether a culture orients itself in terms of its past, present or future


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Time Whether the modality of a culture is predominantly characteristic of being, being-in-becoming or doing Activity Whether linearity, collaterality or individuality is the preferred type of relation that man has to others. The foundations of value orientations (Political, economic and religious systems) SOURCE

Adapted from Torres 1999: 43, 45

ethno-specific needs in aged care at some time in their lives. This is partly because ethno-specific needs can be related to socioeconomic position and the extent of integration into the host society. Special needs in home and community care are likely to be especially pronounced among those with poor knowledge of English and low engagement with the wider community. Special needs in nursing home care are further related to having severe or profound disabling illnesses and conditions that, fortunately, the majority of people seem to avoid. For the Australian population as a whole, estimates suggest that only about a quarter of men and a third of women will ever be admitted to a nursing home (Liu 1998: 12). Although such figures imply that many of the ethnic aged will never require the highest levels of support, the proportions ever needing hostel care and care at home will be greater. Many characteristics enter into the assessment of vulnerability and special needs, but a first approximation of the numbers with different levels of risk can be obtained from Census statistics on duration of residence in Australia and proficiency in English, together with details of income and other characteristics. Based on 2001 Census data, table 5.2 provides estimates of the percentages of the ethnic aged in four groups differentiated according to their likelihood of ever having special needs in aged care. The table updates a more detailed analysis from the 1996 Census (Rowland 1999).


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Table 5.2

125

Groups of the ethnic aged according to recency of arrival and proficiency in English, 2001(a)

Group

%

‘More vulnerable’ groups Group 1: New arrivals 1996–2001

3.5 26.7

Group 2: Settlers with little or no English(b) ‘Less vulnerable’ groups Group 3: Settlers with good English(b)

42.0

Group 4: Settlers who speak only English at home

22.0 5.9

Inadequately described(c) Total born in non-English-speaking countries(d)

100.0

(a) Australian residents, aged 65 years and over in 2001, who were born in non-English-speaking countries. Includes persons in private and non-private dwellings, but excludes overseas visitors. (b) Arrived before 1996; excludes persons who did not state their year of arrival. (c) Persons who did not state their year of arrival and/or their proficiency in English. (d) The Census sample figures did not permit an estimate of the total population from non-Englishspeaking countries, because some countries in aggregated regions, such as ‘the Americas’, could not be included. The raw figures referred to about 91 per cent of the ethnic aged. The numbers may also differ from complete Census figures because of sampling error. ABS 2001 Census, Household Sample File (1 per cent sample of Census returns). In accordance with the requirements of the ABS on the use of confidentialised unit record files, it is stated that the results or views expressed are those of the author, and not necessarily those of the ABS. SOURCE

The more vulnerable ethnic aged consist of recent arrivals (Group 1) together with longer-established settlers who speak little or no English (Group 2 in table 5.2). Immigrants who move in their later years face particular difficulties in adapting to life in Australia and are sometimes unusually reliant on relatives for support. Nevertheless, the new arrivals were a small group comprising less than 4 per cent of the total ethnic aged in 2001 (Group 1 in table 5.2). Nearly two-thirds were from Asian countries, since family reunion migration has similar origins to recent migration waves. The immediate implications of their coming are minimal for aged care programs in Australia, but in the long run may generate the highest usage rates for ethno-specific services. This reflects a lesser likelihood of integration into mainstream society and often more limited personal resources for living independently. Close to


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60 per cent spoke little or no English – a similar proportion spoke Asian languages at home – and 30 per cent had no income. Far more numerous than the new arrivals were the others in the ‘more vulnerable’ category, namely, established settlers (arriving before 1996) who spoke English ‘not well’ or ‘not at all’ (Group 2 in table 5.2). Their numbers boosted the size of this category to 30 per cent of the ethnic aged population. Even after decades of residence in Australia, many settlers have learnt little English. This limits their ability to live independently in their later years and probably reinforces preferences for maintaining ethnic lifestyles. This second group is likely to be the main source of demand for ethno-specific aged care, because of their numbers and because they share the same vulnerabilities as the new arrivals, including low incomes. In 2001, 62 per cent of them received individual weekly incomes of less than $200 and more of them were living alone or in institutions. It is also notable that southern Europe and Asia were their main birthplaces. Whereas around 30 per cent of the total ethnic aged in 2001 did not speak English well, the figure for all older settlers from Italy and Greece was 43 per cent, while for those from Asia it was 48 per cent. Overall, at the 2001 Census, there were 141 587 overseas-born residents, aged 65 and over, who spoke English ‘not well’ or ‘not at all’; 60 per cent of them were women (ABS 2003). The other two groups – comprising the ‘less vulnerable’ category – had good proficiency in English. English language skills in the client population lessen the need for special staffing in aged care services and facilities. This does not mean that ethnic culture is unimportant among those proficient in English, only that communication with clients and provision of care confronts fewer difficulties. Where there are no language barriers, many aspects of care are less complicated, including: obtaining support, engaging in conversation, satisfying dietary choices, recognising religious observances, facilitating medical consultations and responding to cultural preferences regarding activities, entertainment and décor. Beyond this, English language skills are sometimes associated with other characteristics that denote greater integration into Australian society as well as greater relevance of mainstream care. Within the less vulnerable category, it is appropriate to distinguish between a third group who speak English well, but use another language


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at home – mainly European languages – and a fourth group who speak only English at home (see table 5.2). Both had characteristics more similar to those of the Australian aged generally as well as relatively high levels of home ownership (Rowland 1999). Nevertheless, many members of Group 3 might prefer some degree of ethno-specific support and accommodation if the need for care arose. The large numbers in Group 3 from countries, such as Germany, Italy and Greece, gives enhanced opportunities for support from their own ethnic community that may be unavailable to smaller communities. The least probable candidates for special provision are the fourth group, comprising settlers who speak only English at home. This characteristic, however, undoubtedly disguises a range of differences. Some arrived as children, some had an English-speaking mother and/or father, some married an Englishspeaking spouse, while others wish to use the language of their adopted country and that of their children and grandchildren. Census data provide only a first approximation of ‘the likelihood of special needs’ in aged care at some point in time, but the figures illustrate that members of the ethnic aged population are not equally vulnerable. The great majority are in the less vulnerable groups. Not all of the ethnic aged could be placed in a group, however, because about 6 per cent of them did not indicate their year of arrival and/or their proficiency in English (see table 5.2). Heightened needs for ethnospecific support are particularly related to adverse life events – especially widowhood, serious illnesses and the onset of disabilities. Even for some in the currently ‘less vulnerable’ groups, such support may be particularly welcome in certain circumstances, such as if language regression, mental impairments or profound disabilities intervene. Finally, it should not be overlooked that the ethnic aged have many similarities with the rest of the aged population: most prefer to remain in their own homes with outside help if they become dependent (Kendig 1986: 20); their reliance on spouses for support, followed by children and other family, parallels the general pattern of family support for the aged; and when faced with long-term disabilities most want dignity and autonomy without undue dependence on their offspring (Jakubowicz 1989: 450–52).


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Policies The implementation of the range of policies supporting the ethnic aged occurred relatively late and was greatly constrained by costs, the complexities of responding to diverse ethnic groups and insufficient knowledge about potential target populations and their needs. The mid1980s brought official recognition in Australia ‘that ethnic communities have enjoyed less than equitable access to services and facilities’, and the government made a commitment ‘to reducing the current service imbalance and to ensuring that general service programs meet their needs’ (Ethnic Aged Working Party 1987: 1). Care of the ethnic aged faces all of the issues in ‘grey policy’ generally, together with the complexities of supporting a clientele that is culturally and linguistically diverse, comprised of ethnic groups that vary greatly in size and spatial distribution, are continually changing in numbers and characteristics and, on a local scale, bring forth sudden shifts in demand for specialised services and support as individuals confront frailty, disabilities and illnesses. Yet the need has been not so much for new types of services, apart from translation and interpretation, but rather for cultural appropriateness in the provision of support. Providing culturally appropriate care in all cases requires a support system that is highly sensitive to small changes, highly flexible in funding arrangements in order to target specific needs, and highly competent in tailoring responses to individual requirements. These tasks are lessened where ethnic communities are large and spatially quite concentrated, but more fraught for recently arrived, smaller, dispersed and less cohesive groups, more so since the same groups usually lack experience in liaising with government to obtain assistance. Australia’s policies and programs have sought responsive and affordable approaches in this challenging environment. For individuals and families, the overarching goal should be to sustain wellbeing, while for communities and the whole society a prerequisite is that approaches should be economically and socially sustainable. Domiciliary support, through the Home and Community Care (HACC) program and Community Aged Care Packages, for example, serve the wishes of many to live at home for as long as possible, thereby contributing both to individual wellbeing and to national affordability of aged


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care. Policy-makers have long sought an appropriate balance between ‘mainstreaming’ (that is, meeting needs through general programs and services for the whole community) and ethno-specific provision catering for the distinctive needs of groups in relation to matters such as language, meals, living environment, activities and pastoral care. In recognition of the diversity of approaches needed, Victoria now has three models of policy response – generic, ethno-specific and partnership – with the choice of model depending on the best outcome for the consumer. This is indicative of the diversity of approaches used nationally (Department of Health and Aged Care 1999: 8). Between 1996 and 1999, about 1800 places were allocated nationally for services for the ethnic aged (Podesta 2002: 4). The services include provision of day care, social support, community options, respite, home care, meals, personal care, visiting, carer support, information, outreach and advocacy (Department of Health and Aged Care 1999: 8–9). There are also about 160 ethno-specific aged care homes covering 34 communities together with many ‘clusters’ of ethnic clients within mainstream aged care homes (Podesta 2002: 5). Formal support for smaller or geographically spread populations occurs chiefly within the mainstream aged care setting (Andrews 2002: 13), with ‘clustering’ providing a means of achieving culturally appropriate residential care (see box 5.2). On 30 June 2001, there were approximately 9000 aged permanent residents of nursing homes whose preferred language was not English (especially southern and eastern Europeans), together with only 173 respite residents (AIHW 2002: 41, 43). The Department of Health and Aged Care described good service provision as: providing services that are sensitive to individual cultural needs, fostering consultation with ethnic communities and their participation in service development and delivery, accurate targeting and assessment, effective promotion of service availability, employment of culturally responsive staff, use and availability of language services, ongoing staff training, funding of diverse approaches to service provision, and accountability for outcomes (Department of Health and Aged Care 1999: 8). ‘Grassroots’ input from communities is essential in identifying issues and designing strategies to preserve or enhance the quality of life of the ethnic aged.


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Box 5.2 Clustering Clustering provides a basis for meeting ethno-specific needs for small numbers of the ethnic aged in mainstream nursing homes. The first cluster projects began in New South Wales and Western Australia in the late 1980s. At this time, clustering, together with the establishment of small-scale, ethno-specific residential facilities, became recommended ways of meeting needs of the frail and disabled aged from smaller and spatially dispersed ethnic communities (Ethnic Aged Working Party 1987: 71–72; Gregory 1991: 130). Clustering entails locating together a small number of clients with the same ethnic background so that culturally appropriate care can be provided. It offers advantages in terms of planning food, staffing, pastoral care, bilingual support, entertainment and visits to social clubs. Also, cross-cultural training is easier to accomplish for nursing homes with clusters, since it can be tailored to particular requirements. Future growth in the numbers of the frail ethnic aged will increase the need for such arrangements, while making them easier to accomplish. Implementing clustering programs also raises new issues, however, such as the shortage of bilingual staff and the need for higher funding in recognition of the greater time spent in communicating with non-English-speaking residents. In 2002, there were 125 such clusters in residential care facilities in Australia; they each had at least three clients and covered 31 communities (Andrews 2002: 9). A training video, funded by the Commonwealth Department of Community Services and Health (1991) and entitled A Home for All: Cultural Care in a Nursing Home, provides valuable insight into the nature of a residential cluster. Clustering has potential applications in other areas as well, such as respite care, education and recreation. For example, senior citizens centres could run ‘ethnic days’ for small numbers of people from particular groups, while cluster groups for English language classes are more economical than home tutoring. The viability of clustering as a planning concept deserves to be explored further, examining its acceptability, advantages and disadvantages in a range of settings.


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A basis for improving the ethnic aged’s access to services is the Commonwealth’s Ethnic Aged Care Framework. This ‘seeks to improve partnerships between aged care providers, culturally and linguistically diverse communities and the Department of Health and Ageing and ensure that the special needs of older people from culturally and linguistically diverse backgrounds are identified and addressed’ (Senate Community Affairs References Committee 2005: 134). The Framework fosters a range of initiatives, including information and resource development, encouragement of best practice, improvements in choice and access to aged care services, and culturally sensitive assessment of aged care needs (Andrews 2002: 10). Elements of the Framework have been the Partners in Culturally Appropriate Care (PICAC) program, established in 1997, and the Ethnic Aged Services Grants (EASG). The latter operated from 1992 until the end of 2004, providing funding to specific communities to identify and reduce barriers in accessing aged care services (Department of Health and Ageing 2005). PICAC provides funding for eight organisations, one in each state and territory, to work with aged care providers and ethnic communities to improve choice and participation in the use of services, identification of special needs, dissemination of information among the aged care industry about high-quality culturally appropriate care practices, and provision of training and resources. PICAC–Victoria, for example, has produced the ‘Cultural Diversity Resource Kit for Residential and Community Aged Care Based Services’. This is a directory of information to assist service providers in responding to needs in culturally appropriate ways (Partners in Culturally Appropriate Care, Victoria 2004).

Concerns Despite progress, criticisms of the effectiveness of ethnic aged care have continued. One persistent concern has been the apparent underrepresentation of the ethnic aged among the clientele of community services and residential care. In 2001, 19 per cent of people aged 70 and over were from a non-English-speaking background, but only 7.1 per cent of people in residential aged care had such origins (NSW Council of Social Service 2004: 8). In 2004, only 9 per cent of HACC


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clients were people who spoke a language other than English at home (Senate Community Affairs References Committee 2005: 157). Underrepresentation is commonly perceived as evidence of unmet needs, cultural inappropriateness, preferences for family care and the better ability of more socially advantaged people to access formal sources of support. Some alternative explanations are becoming less relevant. One is the observation that overall demand might be expected to be lower because the age distribution of the ethnic aged is somewhat younger than that of the Australian-born aged – increasing flows over time into the young-old ages have kept the numbers in such ages relatively high. Yet, by 2001, age structure convergence was mounting: an estimated 18 per cent of the ethnic aged were more than 80 years old, compared with 26 per cent for the Australian-born (Gibson et al. 2001: 4–5). Another suggested reason for lower service usage is the health selectivity of migration (Andrews 2002: 7). This occurs through self-selection and screening at the time of migration, and can be reinforced through some healthy lifestyle practices, such as the ‘Mediterranean diet’. Nevertheless, the question of whether the ethnic aged have better or worse health has long been open to conflicting interpretations (Rowland 1997: 84); recent evidence suggests that they have poorer health and a greater need for assistance (Benham & Gibson 2000: 69–75). Negative factors curtailing the use of aged care include cultural inappropriateness, lack of paid staff and volunteers proficient in the community language, lack of access to information about services, and unavailability of needed services in particular locations – such as for shopping, housekeeping, meals and respite care. Similar factors affect access to residential care. The usage of permanent residential care by the non-English-speaking aged is substantially below that of the Englishspeaking aged, a situation indicative either of poor access to appropriate support or of reluctance to use it. For example, in 2001, at ages 75–79 and 85 and over, the usage rates of residential care by non-English-speaking people were less than half those of non-English speakers (see table 5.3). Preferences for family support potentially lead to adverse consequences for the aged and their families. Such preferences can arise from culturally based expectations about family roles and responsibilities, especially the caring role of women. Lack of income and assets also limit the option of


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Age and sex-specific usage rates (per 1000) for permanent residential care by English-speaking status, 2001

Table 5.3 Age

133

Non-English-speaking

English-speaking

Females

Males

Persons

Females

Males

Persons

50–64

0.5

0.5

0.5

1.8

1.9

1.9

65–74

4.9

3.8

4.3

12.4

11.9

12.2

75–84

32.0

18.7

25.9

74.1

45.5

62.4

85+

140.2

74.2

114.6

322.0

180.6

279.4

SOURCE

AIHW 2002: 50

purchasing accommodation in a retirement village and accessing higher levels of care in a similar environment if needed. Yet, preferences for family care probably contribute to a solid uptake of Community Aged Care Packages (CACPs) in the ethnic aged population, a sign that some of the burden is being shared. The ethnic aged receive around 23 per cent of the CACPs, of which a total of nearly 29 000 were funded at 30 June 2004 (NSW Council of Social Service 2004: 8; Minister for Ageing 2005: ix). Further concerns came to light in a national stocktake of HACC policy and service provision for people with a diverse cultural and linguistic background (Department of Health and Aged Care 1999: 1–4), as well as later in submissions to a Senate inquiry (Senate Community Affairs References Committee 2005: 157). These included: (1) rising demand for HACC services among the ethnic aged; (2) inadequate access to services, partly because policies lack clarity about the roles and responsibilities of the Commonwealth, the states, mainstream organisations and ethnic organisations; (3) insufficient skills and training for effective provision of services to the ethnic aged with many, or most, generic mainstream providers having difficulties in responding to this rapidly growing client group; (4) lack of HACC standards or indicators enabling comprehensive measurement of outcomes for ethnic aged clients; (5) lack of cost-effective and efficient language services; (6) insufficient funding of ethno-specific social support and in-home respite programs; (7) insufficient data collection and reporting.


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Clearly, the number of concerns is considerable and will require varied responses. A way forward is to provide a substantial increase in funding for special needs groups, as recommended in the report on Quality and Equity in Aged Care (Senate Community Affairs References Committee 2005: 159).

The future Awareness of concerns about current policies and programs is vital for future progress, but so too is debate about the potential for alternative approaches. An inherent disadvantage of current policies for the ethnic aged is their emphasis on dependency and special needs rather than fostering independence and the overall sustainability of population ageing. Continuing growth in the numbers of the ethnic aged will make these increasingly important considerations in the future. An initial framework for identifying future strategies here focuses on needs and responses for four levels at which policy interventions may be targeted, namely, the society, communities, families and individuals. Initiatives supporting the welfare of the ethnic aged, as well as that of the population generally, need to be taken at different scales, since there are necessarily varying priorities and approaches for each. As noted earlier, at the level of the whole society, Australia’s current main policy response to the presence of settlers with diverse backgrounds is multiculturalism. Other society-level policies, however, are as important to the welfare of the present and future ethnic aged as to the population at large, such as healthy ageing. A focus on culturespecific needs can divert attention from more general prerequisites for sustaining individual wellbeing and reducing the social and economic costs of individual and population ageing. For example, practices that can prevent or delay ill health need to be better known, such as where unhealthy aspects of traditional diets place people at heightened risk of disease and early mortality. Thus, in securing the welfare of former migrants, implications for ethnic communities of mainstream national policies warrant equal prominence with culture-specific concerns. While national-level policy-making aims to meet the greatest needs of the greatest numbers, it is at the community level – be it the ethnic community or a spatially defined community such as a town or


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municipality – that the consequences of ageing are most immediate and are necessarily part of everyday concerns for families, local residents, service providers, planners and administrators. The community is the level at which many of the consequences of individual and population ageing become prominent and it is the main level at which national policies are implemented, such as the provision of HACC services and residential care. This being so, there is scope for policies to seek to support communities in order to lessen adverse consequences of ageing and bolster local resources for responding to it. In relation to community resources, there has been rising interest in social capital. Social capital, a concept subject to a wide range of interpretations, is used here in the sense of ‘networks, together with shared norms, values and understandings which facilitate cooperation within or among groups’ (OECD 2001, cited in ABS 2002b: 4). For individuals, social capital consists of ‘the resources that emerge from one’s social ties’ (cited by Astone 2003: 901). The OECD definition is currently influential in the design of data collections on social capital both within Australia and internationally (ABS 2002b: 4). The importance of social capital resides in its recognition of networks and relationships as a resource (Field 2003: 40). Social capital is an explanatory factor in migration itself because social networks provide linkages between origins and destinations and the movement of individuals and families is facilitated through their membership of such networks (Massey 2003: 550). Similarly, participation in ethnic groups and networks in Australia helps some to avoid social isolation, to experience the social and health benefits of social engagement, and to obtain additional and compatible forms of assistance when needed. Conspicuous manifestations of social capital in ethnic communities are initiatives in developing retirement and aged care facilities for compatriots – undertakings requiring not only active participation in a community life but also civic-mindedness to work towards collective goals. Volunteering to visit compatriots and assist in other ways are also manifestations of a community’s social capital. In the social policy field, social capital is seen as having potential to reduce expenditure on social problems, encourage cooperation and trust, and enhance quality of life. It assists in explaining why communities with similar resources may diverge in terms of social


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cohesion, initiative, mutual support and adaptability to change. Although causal links are difficult to confirm, social capital in the form of social and civic engagement and cooperation appears to bestow advantages of wellbeing and resilience on communities, as well as on individuals. Some go so far as to say that ‘social capital is the most fundamental resource a community requires in the creation of economic, social and political wellbeing’ (Winter 2000: 9). For the ethnic aged, it represents a promising avenue for policy development in the future. Recognition of positive, as well as negative, consequences of group membership are important for understanding ethnic minority ageing, discerning lessons relevant to the wider society, and formulating culturally appropriate interventions. As Field stated: … people’s ability to access resources through their social capital can make a considerable difference to their life chances. In so far as the state is expected to intervene in the distribution of resources more generally, in areas such as health or education, social capital represents a tool of policy. In so far as social capital can itself be seen as a public good, it represents a goal of policy. Policies which promote social capital can therefore directly influence the well-being of the wider community. (Field 2003: 121)

Thus, the community is not merely the context in which aged care policies are implemented. It is also a domain in which there is scope for initiatives that can enhance social resources, promote independent and co-dependent living and lessen the need for aged care. As ‘the fundamental group unit of society’ the family is also an important component of people’s social capital; most people belong to a family network, and participation in family life is a major source of life satisfaction. Policies that support family life – including public endorsement of the value of the family to society and the need for employers to recognise the significance of family roles and responsibilities – may support welfare generally, contributing to life-long benefits. Opposite tendencies, however, including never marrying, separation, divorce and childlessness, are eroding the potential of the family to maintain its vital supportive role in later life as well as in younger years (Rowland 2003). For the ethnic aged, the greater prevalence of co-residence of the aged and their relatives (Benham & Gibson 2000: 23) and preferences


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for family care make policies that support family roles more than usually important. In particular, support for the carers of the ethnic aged, and provision of services that support the frail and disabled aged at home, are essential components of the range of policies with impacts at the family level. While the family resources of the ethnic aged are currently relatively favourable because of a greater prevalence of intact marriages (Benham & Gibson 2000: 23), investment in sustaining family life and family stability in younger generations will benefit the family support networks of the present and future ethnic aged. Finally, although the family is a significant form of social capital for the ethnic aged, the extra burdens on family members due to gender inequality and social inequality in some ethnic communities deserve particular attention. The final level at which social policies can impact is the level of the individual. Just as policies enhancing social capital offer practical benefits for communities and families, so too may enhancement of human capital benefit individuals; both have potential to contribute to improving wellbeing and preventing or delaying aged dependency. Social capital and human capital are commonly thought to be complementary and mutually advantageous (Field 2003: 9). Whereas social capital arises from people’s interrelationships with others, in families, groups and networks, human capital arises from characteristics of the individual. During the 1960s, Becker developed the concept of human capital in economics to denote the economic value – to individuals, firms and the general public – of skills, knowledge and good health (Field 2003: 9). In relation to older people, economic value is one aspect of human capital – especially in relation to voluntary work and productive activities – but important also is human capital conducive to independent living. For the aged generally, the latter includes education and health, both of which are associated with higher levels of social engagement and wellbeing. In relation to the ethnic aged, it may be argued that human capital further includes proficiency in English and knowledge of Australian society, since these enhance opportunities for independent living and social participation. For ethnic communities, the fostering of human capital earlier in life, such as through English language classes, has benefits in enhancing autonomy and functioning in later years. Similarly, the


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promotion of healthy lifestyles can be viewed as part of human capital development that benefits individuals.

Conclusion Some directions for future policy development, and the potential for innovation, might be approached through considering four domains in which policies impact. Associated concepts of social capital and human capital suggest a broad view of relevant concerns beyond culture and special needs. Some emphasis on the means of enhancing the resources of communities, families and individuals could lessen the personal, social and economic costs of ageing in the future for ethnic minority populations, as well as for Australia’s population generally. The ethnic aged population has such a varied mix of characteristics that they cannot be regarded as a single group in relation to issues of ageing and aged care. Ethnicity and ageing is a complex field for social policy, entailing support for a diverse and changing ethnic population in addition to all of the issues and concerns in aged care generally. At any point in time, the numbers requiring aged care are but a small proportion of the total ethnic aged population. Whether the numbers receiving ethno-specific care match the numbers requiring it is always uncertain because needs are diverse and difficult to measure. Yet, given the adverse consequences for individuals and families of culturally inappropriate care, from an individual welfare perspective it is better to err on the side of a small oversupply of services and facilities. Otherwise, there will inevitably be harmful shortfalls as demand fluctuates. In forecasting the demand for services and aged care, projections for the total ethnic aged population are but a general starting point. The most useful refinement would be projections of potential client populations in ethnic groups, as may be developed from Censuses and surveys (Rowland 2006). The issues of measuring need and unmet need are difficult to address; a practical approach is to develop indicators of disability levels and vulnerability to having special needs. Unmet need is a problem in aged care generally, partly because of budgetary constraints and partly because planning has to contend with anticipating demand within very many local areas and allowing adequate lead time in building


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accommodation, recruiting and training staff, establishing services and providing information to the public. Progress in understanding and responding to care issues in ethnic ageing has been particularly due to the period of intensive activity in research and policy and program development during the late 1980s and early 1990s. Continuation of this effort is evident in many reports originating from state, territory and Commonwealth government departments (see Department of Health and Aged Care 1999: 27–29) as well as from the Australian Institute of Health and Welfare. Yet, the overall intensity of research activity in this field seems to have diminished, not least because of the decline in funding designated specifically for research on immigration and related issues following the demise of the Bureau of Immigration, Multicultural and Population Research (BIMPR) in 1996. This has raised the prospect of a mounting deficit in knowledge, despite the growing importance of population ageing as a trend affecting Australia’s future, the changing ethnic composition of Australia’s immigration intake, and the need for innovation in approaches to minimising adverse consequences of individual and population ageing. Current policy-related research issues on ethnicity and ageing include: the present and future size and composition of the aged care clientele, the role of the family in aged care, factors increasing or decreasing the need for ethno-specific care, the reasons for the under-representation of the ethnic aged in residential care, the role of social and human capital formation in delaying or preventing dependency, factors conducive to client satisfaction with ethno-specific care, the significance of ethno-specific support in dementia care, and approaches to maintaining efficiency in service provision for diverse and changing local area populations. Australia has entered a time of unprecedented growth in the numbers of its aged from diverse cultural and linguistic backgrounds; it is important that this also be a time of sustained research activity on ethnicity and ageing. References Andrews, K (2002) Culturally Appropriate Care in the New Millennium, Address by the Minister for Ageing to the Summit on the Provision of Culturally Sensitive Aged Care, Australian Multicultural Foundation, Melbourne. Astone, NM (2003) Social Capital. In P Demeny & G McNicoll (eds) Encyclopedia of Population, Macmillan Reference, New York, pp. 901–03.


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Australian Bureau of Statistics (ABS) (2002a) Births, 2001 (Cat. no. 3301.0), Australian Bureau of Statistics, Canberra. —— (ABS) (2002b) Social Capital and Social Wellbeing: Discussion Paper, Australian Bureau of Statistics, Canberra. —— (ABS) (2003) Migration, 2000–01 and 2001–02 (Cat. no. 3412.0), Australian Bureau of Statistics, Canberra. Australian Institute of Health and Welfare (AIHW) (2002) Residential Aged Care Services in Australia 2000–01: A Statistical Overview (AIHW Cat. no. AGE 22; Aged Care Statistics Series no. 11), Australian Institute of Health and Welfare, Canberra. Bengtson, VL (1979) Ethnicity and Ageing: Problems and Issues in Current Social Science Inquiry. In DE Gelfand & AJ Kutzik (eds) Ethnicity and Ageing: Theory, Research and Policy, Springer Publishing Company, New York, pp. 9–31. Benham, C & Gibson, D (2000) Independence in Ageing: The Social and Financial Circumstances of Older Overseas-Born Australians (AIHW Cat. no. AGE 15), Australian Institute of Health and Welfare, Canberra. Borowski, A (1985) Review essay of Ageing in a Multicultural Society: The Situation of Migrants from NonEnglish-Speaking Countries by the Australian Institute of Multicultural Affairs, Australian Journal on Ageing, 4(4): 25–27. —— (2000) Creating a Virtuous Society: Immigration and Australia’s Policies of Multiculturalism, Journal of Social Policy, 29(3): 459–75. Chappell, RL & Havens, B (1980) Old and Female: Testing the Double Jeopardy Hypothesis, Sociological Quarterly, 21(2): 157–71. Coon, R (1986) A Theoretical Examination of Double Jeopardy: Using Theory as Guide to Concept Analysis, Mid-American Review of Sociology, 11(1): 67–90. Deasey, M (1988) Home and Community Care in a Multicultural Society: A Training Package for Direct Care Staff, Supervisors and Planners in HACC Services in Victoria, Ecumenical Migration Centre, Melbourne. Department of Health and Aged Care (1999) Report on the National Stocktake of HACC Policy and Service Provision for People with a Diverse Cultural and Linguistic Background, HACC Outcomes Section, Department of Health and Aged Care, Canberra. Department of Health and Ageing (2005) Partners in Culturally Appropriate Care (PICAC), Department of Health and Ageing, Canberra, . Department of Health and Family Services (1995) The Ethnic Older Persons Strategy: Meeting the Care Needs of Frail Older People from Non-English Speaking Backgrounds, Australian Government Publishing Service, Canberra. Department of Immigration, Multicultural and Indigenous Affairs (DIMIA) (2005) Australia the Country: Facts about Australia, . Ethnic Aged Working Party (1987) Strategies for Change: Report of the Ethnic Aged Working Party, Australian Government Publishing Service, Canberra. Field, J (2003) Social Capital, Routledge, New York. Gelfand, DE (1982) Ageing: The Ethnic Factor, Little, Brown & Company, Boston. Gelfand, DE & Barresi, CM (eds) (1987) Ethnic Dimensions of Aging, Springer Publishing Company, New York. Gibson D, Braun P, Benham C & Mason F (2001) Projections of Older Immigrants: People from Culturally and Linguistically Diverse Backgrounds, Australia 1996–2026 (AIHW Cat. no. AGE 18, Aged Care Series no. 6), Australia Institute of Health and Welfare, Canberra. Gregory, R (chairman) (1991) Aged Care Reform Strategy: Mid-Term Review, 1990–91, Report, Australian Government Publishing Service, Canberra. Holzberg, C (1982) Ethnicity and Ageing: Anthropological Perspectives on More than Just the


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Minority Elderly, The Gerontologist, 22(3): 249–57. Jakubowicz, A (1989) Community Care and the Needs of the Ethnic Aged, Advances in Behavioural Medicine, 6: 435–59. Kendig, HL (1986) Informal Support Networks. In Australian Institute of Multicultural Affairs, Community and Institutional Support for Aged Migrants in Australia: Research Findings, Australian Institute of Multicultural Affairs, Melbourne, pp. 16–52. Lewins, F (1988) Assimilation and Integration. In J Jupp, (ed.) The Australian People: An Encyclopaedia of the Nation, Its People and Their Origins, Angus & Robertson, Sydney, pp. 856–60. Liu, Z (1998) The Probability of Nursing Home Use Over a Lifetime (Australian Institute of Health and Welfare Working Paper no. 16), Australian Institute of Health and Welfare, Canberra. Massey, DS (2003) International Migration. In P Demeny & G McNicoll (eds) Encyclopaedia of Population, Macmillan Reference, New York, pp. 548–53. Meyers, AR (1980) Ethnicity and Aging: Public Policy and Ethnic Differences in Aging and Old Age. In EW Markson & G Batra (eds) Public Policies for an Aging Population, Lexington Books, Toronto, pp. 61–79. Minister for Ageing (2005) Report on the Operation of the Aged Care Act 1997, Department of Health and Ageing, Canberra, . NSW Council of Social Service (NCOSS) (2004) NSW Aged Care Alliance, Federal Election 2004 Issues Kit, NSW Council of Social Service, Sydney. Organisation for Economic Co-operation and Development (OECD) (2001) The Wellbeing of Nations: The Role of Human and Social Capital, Education and Skills, OECD Centre for Educational Research and Innovation, Paris. Palmore, EB & Manton, K (1973) Ageism compared to racism and sexism, Journal of Gerontology, 28(3): 363–69. Partners in Culturally Appropriate Care, Victoria (2004) Cultural Diversity Resource Kit for Aged Care Residential and Community Based Services, Benetas, Melbourne, . Podesta, L (2002) A Government Perspective, Address to the Summit on the Provision of Culturally Sensitive Aged Care, Australian Multicultural Foundation, Melbourne. Productivity Commission (2005) Economic Implications of an Ageing Australia, Productivity Commission, Canberra. Rowland, DT (1991) Pioneers Again: Immigrants and Ageing in Australia, Australian Government Publishing Service, Canberra. —— (1997) Ethnicity and Ageing. In A Borowski, S Encel & E Ozanne (eds) Ageing and Social Policy in Australia, Cambridge University Press, Cambridge, pp. 75–93. —— (1999) The Ethnic Aged and the Likelihood of Special Needs, Australasian Journal on Ageing, 18(3, Supplement), pp. 50–54. —— (2003) An Ageing Population: Emergence of a New Stage of Life? In S Khoo & P McDonald (eds) The Transformation of Australia’s Population 1970–2030, UNSW Press, Sydney, pp. 238–65. —— (2006) Ageing and the Future. In N Peters (ed.), The Dutch: The Move Downunder 1606–2006, Wolters Kluwer, Sydney, pp. 350–63. Senate Community Affairs References Committee (2005) Quality and Equity in Aged Care, Commonwealth of Australia, Canberra, . Torres, S (1999) A Culturally-Relevant Theoretical Framework for the Study of Successful Ageing, Ageing and Society, 19: 33–51. Winter, Ian (ed.) 2000 Social Capital and Public Policy in Australia, Australian Institute of Family Studies, Melbourne.


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6 Age and employment Sol Encel and Rob Ranzijn

Introduction All advanced industrialised countries are confronted with the challenges associated with ageing populations and ageing labour forces. Consequently, the issue of labour force participation by mature-age workers has attracted increasing attention in the past 20–30 years, especially as those born in the peak years of the baby boom are now in their late 50s. Age discrimination, long-term unemployment and enforced early exit from the labour force were major themes in a series of official reports and academic papers from 1990 onwards. Long-term unemployment among men in their 50s remains a matter of concern. Since the late 1990s, there has been increasing emphasis on the need to retain older workers in the labour force, especially given the prospect of declining numbers of school leavers entering the labour market as the result of a low birthrate. In an oft-quoted calculation, the Australian Treasury has estimated that whereas the working population presently grows by approximately 170 000 persons per year, the projected growth for the entire decade 2020–30 will be no more than 125 000 (Bishop 1999). In this chapter, we examine the growth of concern with the importance of retaining older workers in the labour force, reflected in a series of official reports and statements by government ministers. Periodically, this concern


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manifests itself alongside the growth of long-term unemployment among mature-age workers, notably men over 55 years of age. Its effects are examined in the second part of this chapter. A recent report by the Productivity Commission (2005) makes the following points: • Over the next 40 years, aggregate labour force participation rates (LFPR) are projected to fall by around eight percentage points from their current level of 63.5 per cent to 55.4 per cent by 2045. • Average weekly hours worked per employee will drop by 10 per cent, reflecting the rising incidence of part-time work and the increasing labour market share of older workers, who have a greater tendency to work part-time than their younger counterparts. • The negative effects of ageing and average hours worked will outweigh the positive of reduced unemployment. • In the two years from 2004 to 2006, the number of workers is estimated to grow by 320 000, whereas it would take nearly the full 20 years from 2025 to 2045 for the same growth to occur. • In the next 40 years, the pace of effective growth in labour supply will be slower than population growth, unlike the past. • The average age of employees is expected to rise over the next 40 years – by two and a half years for males and three years for females (Productivity Commission 2005: 3.1). In 2005, within the overall participation rate of 63.5 per cent, there were substantial differences between men and women, and between age groups. A report by the OECD illustrates these differences in employment status, using 50 as the benchmark for mature-age workers. The overall employment share of older women was 19.5 per cent of employed women, compared with 22 per cent in the case of men. The OECD report notes that the share of older workers in total employment has increased, from 15 per cent in 1990 to 21 per cent in 2003. For expanding industries, such as property and business services, health, and community services, the LFPR of older workers has risen faster than the average for the workforce. By contrast, for declining industries such as agriculture and manufacturing, there has been a fall in the


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Table 6.1

Employment status by age and gender, 2003 Percentages of Total employment

Age group

Non-casual employees

Casual employees

Self-employed

15–24

51.3

43.4

5.3

25–49

65.7

10.5

23.8

50–54

60.1

7.6

39.0

55–59

52.5

8.3

32.3

60–64

42.6

14.1

39.3

65+

18.9

18.0

63.1

Total

59.8

15.7

24.5

15–24

47.2

51.1

1.7

25–49

64.6

20.9

14.5

50–54

61.3

18.2

20.5

55–59

56.4

18.2

20.5

60–64

47.0

24.9

28.1

65+

31.7

26.4

41.0

Total

59.6

26.3

14.1

Men

Women

SOURCE

OECD 2005: 45

employment shares of older workers. The report concludes that ‘older workers adjust well to changes in labour demand and that older workers are not trapped in declining industries’ (OECD 2005: 48). This seems overly optimistic in the light of high rates of long-term unemployment among older workers (see below).

Cohort effects Cohort effects vary considerably between the sexes. Female participation has risen among younger women as the dip in participation associated with childbearing – the ‘nappy valley’ – has become shallower and narrower. The peak level of LFPR for women is now in the age range 40–44, and


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the Productivity Commission expects this to increase participation rates among women in their 50s. By contrast, male LFPR has dropped sharply with age. Using cohort analysis, the Commission projects participation rates for the period until 2041, as shown in table 6.2.

Educational effects The role of education in improving employment prospects is well known and illustrated in table 6.3. A recent review of research in this area identified a number of factors affecting skill development among matureage persons, including the attitudes and behaviour of employers and the role of indirect influences, such as retirement income policies. The authors emphasise the need for more attention to vocational education and training, the removal of disincentives, and the importance of skill development programs tailored to suit the circumstances of particular groups of mature-age workers (NCVER 2005: 5–7). Table 6.2

Projected participation rates, 2005–41 (%)

Age group

2005

2041

50–54

85

80

55–59

74

72

60–64

50

51

65–69

20

32

6

8

50–54

70

81

55–59

48

72

60–64

30

40

65–69

18

32

2

3

Men

70 +

Women

70 + SOURCE

Productivity Commission 2005: 3.25


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Table 6.3

Participation rates by education, gender and age, 2002 (%)

Age group

Low level

Medium level

High level

25–49

87

95

96

50–64

65

79

85

25–49

62

61

80

50–64

40

66

70

Men

Women

Note: Low level = less than upper secondary education; Medium level = upper secondary education; High level = tertiary education SOURCE

OECD 2005: 49

The unemployment paradox Despite the general decline in unemployment and increased LFPR of mature-age workers, unemployment continues to have a disproportionate impact on older persons, with devastating personal consequences like those described in the latter part of this chapter. The OECD report notes that re-employment chances decline with age. During 2003, for instance, 20 per cent of unemployed men aged 25–44 found jobs, compared with 15 per cent of men aged 60–64. Among women, the corresponding figures were 13 per cent and 9.4 per cent. The majority of women who found employment did so in part-time jobs, whereas the majority of men (apart from the 60–64 age group) found full-time jobs. The OECD report also analyses the high levels of ‘inactivity’ among older men and women. In the age group 25–49, inactivity rates in 2003 were 8.5 per cent for men and 26.4 per cent for women. For men aged 50–54, the rate rose to 13.6 per cent, increasing sharply to 26 per cent in the 55–59 age group, and to 51 per cent among those aged 60–64. For women, the rate was 29.9 per cent in the 50–54 age group, rising steeply to 49.7 per cent among those aged 55–59 and 75 per cent among those in the 60–64 age group (OECD 2005: 55–56). The relations between unemployment, age, education and educational levels are shown in table 6.4. Perhaps the most distressing feature of mature-age unemployment is its duration, which has increased steadily, despite fluctuations, since the


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Table 6.4

147

Unemployment rates by education, gender and age, 2002 Percentages of the labour force

Age group

Low level

Medium level

High level

25–49

9.1

3.9

3.2

50–64

7.1

4.2

3.0

25–49

7.1

3.9

3.2

50–64

3.5

3.5

1.9

Men

Women

SOURCE

OECD 2005: 49

1970s. In 1978, the average duration of unemployment for persons aged 55 and over was 36 weeks; in 1999, 104 weeks; and in 2004, 130 weeks. These rates are approximately double the long-term unemployment rate (LTU) for the population as a whole. The figure for 2004 belongs in the category of very long-term unemployment (VLTU), which is defined as being out of work for two years or more. The OECD report notes that in 2002, 53 per cent of unemployed persons aged 55–59 were LTU or VLTU, compared with 23 per cent of unemployed persons under 50 years of age (OECD 2005: 55). Similar figures were recorded by the Australian Bureau of Statistics in its Labour Force Survey for November 2003, where 23 per cent of all unemployed people were LTU. Among 45–64-year-olds, this proportion rose to 40 per cent, and among those aged 55–64, it was 49 per cent. The ABS report goes on to observe that the severity of LTU among persons aged 45–64 means that they are likely to become discouraged and drop out of the labour force altogether. In September 2005, 53 per cent of those classified as ‘discouraged job seekers’ were aged 45–64 years (ABS 2004a: 117). Realistically, the majority of LTU workers aged 55 and over are unlikely to find continuous employment again, whether full-time or part-time, before they reach pension age.


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Employment, social security and superannuation Changes in the labour force have major consequences for the social security system, in particular the growth of part-time and casual employment. This growth is particularly related to the large-scale entry of women into the paid workforce, which became evident in the 1960s and has accelerated since then. Between 1980 and 2000, women’s LFPR rose from 47 per cent to 61 per cent (ABS 2001). Especially striking has been the rise in the proportion of married women in the paid workforce, which increased from 30 per cent to more than 60 per cent in 2004 (ABS 2004b). Married women account for almost 80 per cent of all parttime workers. This has led to expectations that women will have the ability to provide for themselves through employment, rather than being supported by the state through pensions and benefits if they do not have a husband to support them. This has, in turn, caused a re-examination of the expectations that underpinned the social security system until the 1990s, namely, that eligibility for pensions does not depend on prior labour force participation (Cass 1994). The growth of concern about the increasing proportion of older people in the population was reflected in widespread talk about a ‘pension crisis’. A report by the government’s Economic Planning and Advisory Council echoed the misgivings expressed in a World Bank report of 1994 (Clare & Tulpule 1994; World Bank 1994). Responding to these concerns, the government introduced legislation in 1992 providing for a compulsory national contributory retirement incomes system. The essential provision of the legislation was the introduction of a Superannuation Guarantee Charge (SGC) requiring employers to contribute to a fully vested, portable superannuation scheme for each employee. One of the objectives of the scheme was to establish a clear link between ‘productive work’ (defined as paid employment) and economic wellbeing outside the labour force (Rosenman & Warburton 1997). The policy is examined in detail in chapter 8. This national superannuation scheme was set up as the ‘third pillar’ of a retirement income system whose other components are the non-contributory state pension and privately operated superannuation schemes. The World Bank report


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of 1994 gave Australia a nod of approval for establishing the threepillar structure. At the time it was introduced, there was considerable expectation that it would largely replace the age pension, thus lightening the growing fiscal burden resulting from an ageing and increasingly long-lived population. This expectation now seems unlikely to be realised. Superannuation industry experts generally believe that the SGC will not provide an adequate level of retirement income for most elderly Australians. However, the present government has backed away from any suggestion that it should follow the example of other countries and raise the age of eligibility for the state pension from 65. A shift of emphasis by the government was marked by the Intergenerational Report issued by the Treasurer, Peter Costello, in 2002 as one of the national Budget papers. The predominant theme of the report (discussed in more detail below and in chapter 1) was the need to maintain ‘fiscal sustainability’. In 2004, this theme was taken up in a series of speeches by Mr Costello and the Prime Minister, John Howard, which foreshadowed moves designed to address the ageing of the workforce and the rising costs of pensions and aged care. Mr Costello proposed changes for the national superannuation scheme that would encourage workers to access their superannuation assets while remaining employed, and to invest some of these funds in ‘growth pensions’. Part-time work, combined with a part pension, would keep people working longer. He also foreshadowed a tightening of rules governing the granting of disability pensions, pointing out that 3 per cent of the population was receiving disability benefits, compared with 1 per cent a generation ago. Mr Costello also foresaw the disappearance of full-time retirement, which would be replaced by a combination of part-time work and parttime retirement. He proposed the following changes in the relations between labour force participation and superannuation: • liberalisation of superannuation contributions so that anyone working full-time or part-time should be able to continue contributing until age 65 • liberalisation of restrictions on superannuation contributions for persons continuing in employment between ages 65 and 74


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• a provision that superannuation funds should be required to pay benefits to all persons aged 75 and over, instead of leaving superannuation assets to their estate • reduction of tax exemptions on superannuation contributions for wealthy persons These changes, implemented in 2004–05, were in line with recommendations made by the Human Rights and Equal Opportunity Commission in 2000, following a review of age discrimination (HREOC 2000).

The National Ageing Strategy In 2002, the then Minister for Ageing, Kevin Andrews, launched a ‘National Ageing Strategy’, which was based on a series of discussion papers issued by the government between 1999 and 2001. The document follows closely upon the range of issues identified in a number of reports by the OECD, including a reform of pensions and taxation systems to remove financial incentives to early retirement and financial incentives to later retirement. This would involve the use of a mix of tax/transfer systems, funded systems, private savings and earnings, to achieve a better balance of burden-sharing between generations and greater flexibility in the making of retirement decisions. The report also follows the OECD’s concerns with the employability of older workers and the need for training and retraining. The National Strategy report was soon followed by the Intergenerational Report mentioned above. The report addresses itself to questions of fiscal policy and the impact of demographic change on Australian Government finances. It identifies seven priorities for maintaining ‘fiscal sustainability’, including the development of a social safety net that encourages working-age people to find jobs and remain employed, and the encouragement of mature-age participation in the labour force. The basic assumptions of the Intergenerational Report were criticised in a detailed analysis by two academic economists, who note that the report assumes that the expectation of life will continue to rise, but discreetly avoids the implication that this will involve increasing costs and, therefore, the need for extra revenue. It also avoids any


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discussion of policies that would increase work incentives, as opposed to disincentives for early retirement, or incentives for women to return to the paid workforce after having children. The projections made in the Intergenerational Report assume that the labour force participation rate of women will rise to equal the male rate over the 40-year period covered by the report (2001–41), but ignore the probability that this will require policy measures such as subsidised child care and maternity leave. The same critique also queries the reliance on superannuation income as a solution to the problem of financial security on retirement. The case for superannuation would be much more plausible in circumstances of full employment and job security. As it is, the increase in part-time and casual jobs and the continued use of downsizing to cut labour costs, means that a large section of the labour force is unlikely to accumulate significant retirement income through superannuation contributions, and will join the ranks of age pensioners (Dowrick & McDonald 2002). The National Ageing Strategy and the Intergenerational Report are both concerned with the problems arising because of early exit from the workforce, and stress the need to retain the skills and experience of older workers, especially in the light of the skill shortages that have become increasingly evident in a number of industrial sectors. Although enforced early exit – sometimes described misleadingly as ‘involuntary retirement’ – is the more important factor, voluntary retirement remains a reality. A survey of retirement by the ABS in 1997 reported that the average age at which people left the workforce fell between 1960 and 1995, by four years for men and five years for women. The report also found that in the 1990s, 71 per cent of men retired from paid employment between the ages of 45 and 64, and 53 per cent between 55 and 64. For women, the corresponding figures were 43 per cent between 45 and 64, and 21 per cent between 55 and 64 (ABS 1997). More recent data indicate that the trend to early retirement has slowed, and the LFPR for men aged 60 and over has returned to the levels recorded in the 1980s (ABS 2006). However, these data do not significantly change the relatively low level of LFPR among workers over 55 years of age, as noted by the OECD report in its international comparisons. Pension and superannuation policies, in line with public attitudes, have encouraged people to retire early. Borowski, in a comparison


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between Australia and the United States, noted that many early retirees belong to superannuation schemes that provide a lump-sum retirement benefit. They use the lump-sum benefits to finance the period between retirement and pensionable age, and then take the government’s age pension. In the United States, by comparison, a significant number of ‘retired’ persons continue in gainful employment or return to work after a period of retirement, often in the underground cash economy (Borowski 1988, 1990). A later study also describes the practice of retiring early and using up superannuation assets before pensionable age to enable retirees to pass the age pension’s means test (known as ‘double dipping’) (Ingles 1999). A critical review of this argument points out that double dipping is only available to people with significant assets and accumulated superannuation payments. Nevertheless, the author argues, policies that induce older people to leave the workplace are destructive in the long run. Retirement income policies should be complemented by strategies to encourage prolonged employment, and governments should adopt an integrated approach to rebuild a culture of long working life (Perry 2001).

Employment and social security Since 1990, government policy has moved towards reshaping the employment/retirement/social security nexus. Since it came to office in 1996, the Howard government has been particularly concerned with ‘welfare dependency’. In 2000, the government published the report of a ‘reference group’. Entitled Participation Support for a More Equitable Society, it is generally known as the McClure Report after the chairman of the reference group. The key theme of the report is ‘participation’. The government’s response was given in the Budget for 2001–02, which announced a program with the title Australians Working Together. This contains a section dealing specifically with mature-age persons (50 and over). A number of special benefits are provided, in particular the ‘Transition to Work’ scheme. A statement by the Minister for Employment and Workplace relations, Kevin Andrews (previously Minister for Ageing), outlines the benefits available under this scheme: Transition to Work builds self-esteem and addresses confidence issues of mature-age workers. It improves participants’ prospects of obtaining


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paid employment through assessment, skills training, support and advice on how to get into the jobs market … This strategy over four years will provide additional focused assistance to both mature-age job seekers and those already in work but considering retirement. (Andrews 2004: 3)

The Transition to Work program has three elements, known as Jobwise Outreach, the Mature Age Industry Strategy and the Mature Age Workplace Strategy. Apart from improving the job search skills for the mature-age unemployed, the program aims to increase job opportunities in industries where opportunities for mature-age employment appear to exist, including retail trade, business services, and hospitality. The program also aims to encourage employers to recognise the value of reliable and experienced mature-age workers. Despite the sentiments expressed in launching these projects, the actual funding was modest, amounting to no more than $12.1 million in the budgetary year 2004–05. The government has also endeavoured to raise employers’ consciousness of the value of older workers. Apart from rhetoric, a positive move in this direction was the introduction of the Mature Age Employer Champion Award, conferred for the first time in 2005 on the firm of Coates Hire Ltd, which provides street barriers used to direct traffic during roadworks and building construction. The award noted that 18 per cent of Coates’ staff were aged over 50. The need to change employers’ attitudes is also canvassed in two reports published by the Business Council of Australia in 2003. (The BCA represents the 100 largest corporations in Australia.) The first report, entitled Age Can Work, examines policies in Australia and a number of other countries. It recommends that public attitudes to workforce participation by older persons need to be addressed, and suggests that government should work with employers and their associations to improve retention rates for older employees through family-friendly policies, employer support for retraining, and improved services and support for mature-age persons. A second report, also entitled Age Can Work, argues that ‘cultural change is essential’. It requires the tackling of entrenched attitudes and organisational cultures that undervalue the contribution of mature-age workers. The report stresses the value of diversity in the workforce, and the need for business corporations and


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government to work together (BCA/ACTU 2003). The Age Can Work report was jointly commissioned by the BCA and the Australian Council of Trade Unions (ACTU). The ACTU’s national congress in 2003 adopted, for the first time, a policy regarding older workers, opposing age discrimination and supporting the rights of workers to continue in employment after the ‘normal’ retiring age. Other employer groups have produced similar statements. The Australian Chamber of Commerce and Industry, which represents small and medium-sized enterprises, has suggested that the government pay employers a ‘learning bonus’ to encourage older workers to undertake formal training and improve their skills. The Australian Industry Group, which mainly represents manufacturing industry, has proposed taxbased incentives like the changes to superannuation introduced in 2004 (Burke 2004). Other employment and training incentives have been introduced that are aimed directly or indirectly at improving labour market prospects for older people. They include: a Training Account, designed to assist job seekers to gain work-related skills; the Vocational Education and Training Priority Places Program; the Basic IT Enabling Skills Program; and training credits, available to job seekers who have completed certain minimum requirements. In 2005, the government adopted the tax incentive approach and introduced the Mature Age Worker Tax Offset, available to workers aged over 55 with annual earnings of up to $58 000. Announcing the program, the Prime Minister estimated that it would cost $1 billion over four years and would apply to 750 000 workers. He claimed that it would counter the trend to early retirement, which he has criticised a number of times, calling for an end to the ‘cult of early retirement’. A new portfolio of Minister for Workforce Participation was created to administer the tax offset program. Government policy settings are now clearly directed towards measures designed to maintain or even increase workforce participation among older age groups. Such policies are motivated partly by concern about the state of the labour market, and partly by concern about pressure on the social security budget. However, there are strong counter-pressures. The so-called ‘cult of early retirement’ remains strong. So does employer resistance to the employment of older workers. Effective measures to


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deal with these matters will cost more than governments have so far been willing or able to commit, but the prospect of raising taxes to fund such policies is politically unpalatable. The OECD report quoted above, noting the persistence of early retirement, concludes that Australia can do better. In 2003, 38 per cent of men and 65 per cent of women aged 60 were not in the labour force, figures that are higher than the OECD average, and significantly higher than in Japan, the United States and several of the Nordic countries. In the long run, demographic pressures are likely to constrain governments to do more, but the full force of demographic trends may not be felt until the next decade.

Mature-age unemployment While the Commonwealth Government is increasingly concerned with the retention of older workers in the labour force, much less attention has been paid to the continuing growth of long-term unemployment, most markedly among men aged 55–65. In terms of social policy, this means a waste of human capital and intolerable pressure on families. The ramifications of long-term unemployment extend beyond the individual, since mature-aged people commonly have responsibilities towards their ageing parents as well as their own children, often adults whom they would like to help establish themselves in life. There are numerous financial, psychological and social consequences of being unemployed in middle age. However, many people who have exited the labour market from around age 55 on have no wish to resume employment or, if they do, only on a casual or short-term contract basis. They are not considered to be unemployed for the purposes of this discussion, which focuses on people who need to find employment for financial reasons. Other people classed as ‘retired’ may have exited the workforce involuntarily and, after numerous attempts to become re-employed, given up and left the labour force permanently (Encel & Studencki 1996). This type of ‘retirement’ is referred to as ‘pseudoretirement’ or ‘premature retirement’, and people in this category are also not included in this discussion. On the other hand, many people in casual, part-time or short-term contract positions are underemployed since their level of employment is insufficient to meet either their short-


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term or longer-term needs (Ranzijn et al. 2004), and they are considered as unemployed for the purposes of this discussion. Finally, it is important to note that many of the generalisations made here are about men, who were predominantly the primary wage-earners until the 1970s, while women, apart from those who were not married, generally stayed at home to raise the children. The different implications of unemployment for men and women are discussed where relevant. The consequences of unemployment, detrimental at any age, are particularly devastating for mature-aged people (Ranzijn 2004; Ranzijn, Carson & Winefield 2006). In recent years, a number of important reports have illustrated the range of consequences and suggested ways to reduce discrimination against older job seekers (for example, Access Economics, 2001; Age Limits 2001). A recent study in South Australia produced some vivid illustrations of these detrimental effects (Ranzijn, Carson & Winefield 2006). The following quotes are drawn from this study, comprising 27 mature-age job seekers (over 45 years of age) of both sexes.

Financial impacts The financial impacts are both immediate and long-term. The employment of many mature-age job seekers has been terminated with little, if any, warning and it was a huge financial shock to suddenly have their income reduced to a fifth or less of what it had recently been. Some people are unable to keep up with mortgage repayments and have to sell their homes. They can only afford to go out with friends to movies or restaurants very rarely, if at all, and many are at times unable to afford even the basic requirements for good health and nutrition: You can’t save, you can’t buy clothes when you need to, because you don’t have money to buy them, you can’t go to the movies. (Ranzijn, Carson & Winefield 2006)

The long-term impacts are of possibly greater importance since they threaten people’s ability to manage financially for the rest of their lives (Ranzijn et al. 2004). Many mature-aged people are still paying off mortgages and have not yet accumulated sufficient superannuation or other financial assets:


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I thought I’d last somehow until I invoked my superannuation at 55, we both, my wife and I, thought we’ll make it, not a real problem. As it’s turned out it’s been a problem. Unfortunately, the way superannuation works, when people who get into their 40s and 50s are retrenched, their superannuation stops growing. If you stop work at 45–50 that knock on, multiplying effect [disappears] … there’s nothing new going in and there’s probably stuff coming out to keep you afloat until you are 65. If you’ve only got 15 years of superannuation, that’s not going to go anywhere near it. (Ranzijn, Carson & Winefield 2006)

If forced to sell their homes, they often become reliant upon public housing or the private rental market and, with prolonged unemployment, it becomes difficult to get a loan to buy another house. The financial effects may be compounded by other circumstances, such as divorce and separation, which commonly results in people having to sell their homes. Many mature-aged people are still supporting their children through school or university, and these costs are also expensive. It is becoming increasingly recognised that even people in full employment are unlikely to be financially self-sufficient if they retire at 55, so those who become unemployed in middle life will be almost entirely reliant on the public purse for possibly another 30 or more years (Ranzijn et al. 2004).

Social and psychological impacts Thwarted expectations about the timing of retirement Most of today’s mature-age job seekers would have grown up with the expectation of being able to work until they choose to retire (Ranzijn 2004). Now they are bewildered to find themselves, as they put it, ‘on the scrapheap’ in what they perceive as the prime of their working lives (Ranzijn, Carson & Winefield 2006). The dashing of the normative expectation of being able to control the timing of retirements is compounded by not understanding why it happened to them. They cannot see what they have done wrong, but once labelled as ‘unemployed’ they perceive that former work colleagues think that it was somehow their own fault. Whether through embarrassment or not wanting to be identified with someone who is now in the ‘out-group’, former colleagues tend to avoid them:


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My working friends soon abandoned me when I could not secure employment after a few months … being dumped by family and friends and people I’ve helped when they were down and out, has left me, at 52 years old, deeply hurt, cynical and totally disillusioned. (Ranzijn, Carson & Winefield 2006)

Effect on self-esteem Many mature-age job seekers, particularly men, would have derived their sense of identity and self-worth primarily from their work role (McDaniel 2003). Becoming unemployed also threatens younger people’s self-esteem, but the effect on older people is exaggerated by this lifelong linking of work with identity: If you meet someone socially one of the first questions they are going to ask you is ‘What do you do for a crust?’ That is how you identify yourself. ‘Oh, I’m a teacher.’ I can’t say that any more, I’m not a teacher any more. If you haven’t got that label for yourself, your self worth isn’t as strong as it was when you did have that label to put on yourself. (Ranzijn, Carson & Winefield 2006)

Initially, self-esteem may not be greatly affected, since many are optimistic about finding another job fairly quickly. However, after numerous unsuccessful attempts (as many as 500 in some cases) over a long time, self-esteem goes down substantially. Low self-esteem leads to other undesirable consequences: I have put in hundreds of applications over the last few years without success. During that period I was called up for only one interview. I lost so much confidence and self-esteem as well as enthusiasm and optimism. I became very negative and destructive in my behaviour and attitude. (Ranzijn, Carson & Winefield 2006)

Destructive habits include alcoholism, self-neglect and social isolation (Gallo et al. 2001). Single people or divorcees, especially men, are also at risk of suicide since they cannot see how they could ever get a job, find a partner or obtain the material means for an enjoyable life. Narrowed horizons The long-term plans of mature-age job seekers depended on being able to work until a certain retirement age that they thought was largely of


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their choosing. Many have been looking forward to an extended holiday, renovating their kitchens, or moving house after retirement, expecting to have accumulated enough financial assets in their later working years. For many, unemployment has put an end to these dreams, and horizons have become narrowed as daily life is focused on survival rather than pleasurable projects: We haven’t been to Europe yet, we haven’t redone the kitchen … we can’t really do upgrades, we can survive but we can’t do extra things. There’s not a lot of fat. No fat! You can survive on that [unemployment benefit] until age pensions come in, which [means] we will have a surviving retirement, but it’s a surviving retirement, not a quality retirement. (Ranzijn, Carson & Winefield 2006)

Waste of human capital Most mature-aged unemployed people feel that they have a wealth of valuable skills and many years left to make a productive contribution to society. Research shows that the middle years are often characterised by an innate desire to be generative, to focus less on personal career development and more on leaving a legacy, mentoring younger workers, and using their human capital for the greater good (McAdams, Hart & Maruna 1998; Ranzijn 2002a). Unemployment deprives them of these opportunities and frustrates personal development: Yet I cannot seem to find an outlet in these skills … I feel the need to be a part of a community not just a job seeker. (Ranzijn, Carson & Winefield 2006)

Social impacts The impact of mature-age unemployment goes far beyond the individual. Most are in long-term relationships and most have children – in many cases, children still living with them, sometimes quite young children. It is painful not to be able to afford presents, outings or school fees: Having to say, ‘No we can’t do that’ purely and simply because we don’t have a spare $10, $15 to do it with, when it’s your kids, it really hurts. You hate to put yourself in that position but it’s tough, it’s real tough. (Ranzijn, Carson & Winefield 2006)


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The middle years are characteristically those when one’s own children are starting to make their way in the world, and most parents derive pleasure and satisfaction from helping their adult children in various ways. This is another normative expectation of this time of life that is frustrated by unemployment. Continuing a normal social life with friends is also difficult, as mentioned earlier, and unemployed people tend to quickly lose touch with ex-colleagues. Therefore, their ties with the social job network become loosened, and this loss of social capital makes it more difficult to find work in a similar area. Hence, mature-age unemployment depletes all three forms of capital slowly accumulated through many years of work: economic, human and social. Skill atrophy Skills depreciate even on the job (Arrazola & De Hevia 2004), and they atrophy much more quickly with unemployment (Sheen 1999). Without current state-of-the-art skills in a particular field, unemployed people are unlikely to get rewarding jobs, and mature-aged people tend to be reemployed, if at all, in jobs of lower status than the ones they held down before. At a job interview, an employer tends to look at most recent work experience, not the demanding or complex work undertaken in the past, and hence each successive job is likely to be at a lower level until eventually it becomes impossible to find another job at all. For instance, a former bank manager, after long unemployment, found temporary work as a bank teller. The ‘peg-down’ experience is a debilitating one that results in the unemployed person eventually becoming a ‘discouraged job seeker’.

Gender differences The circumstances of mature-age unemployment can be very different for men and women. Today’s mature-aged men grew up in a time when men were the breadwinners, women stayed at home, and the sense of personal identity was strongly related to these different roles. Hence, being unemployed is often much more shameful for men than for women, and men’s response is commonly to withdraw and become depressed (McDaniel 2003; van Tilburg 2003). On the other hand, many


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female job seekers have much shorter and more fractured work histories, and, often because of divorce or the unemployment of their husbands, are trying to enter the job market late in life from a relatively low skills base, so any jobs they get are likely to be more lowly paid (Calasanti 2002; Encel 1998). Unemployed middle-aged men may have accumulated a reasonable amount of superannuation or other assets that may help them in their remaining years, but middle-aged women may have accumulated very little, so the long-term financial impacts of unemployment are likely to be greater. This is especially likely for women who are divorced. While both men and women are usually set back financially by divorce, men are more likely to repartner and get themselves back on their financial feet. At greatest risk of poverty in later life are middle-aged unemployed women who are single and do not own their own homes (Ranzijn et al. 2004).

The roots of discrimination Age discrimination in employment is endemic. Older job seekers are much less successful than younger ones (Ranzijn, Carson & Winefield 2006). Why is this so? With increasing age come increasing skills and work experience, and because of their purportedly greater work ethic older workers are commonly regarded as more reliable and conscientious, qualities highly valued by employers (Ranzijn 2002b, 2004). However, the virtues of youth are more highly regarded than those of middle age. The contemporary work environment is highly competitive and characterised by constant change and the demands for innovation, creativity and entrepreneurialism. These qualities are more commonly associated with youth. Older workers are very good at their specific taskrelated skills in their specific workplaces, and are highly regarded for these, but these skills have little currency when looking for a new job with a new organisation precisely because they are so specific. Chronological age may be confounded with longevity of employment. A 35-year-old who joined an organisation at 20 may be just as skilled as a 50-year-old who joined at 35. Age in itself is not indicative of work performance, and if younger people are perceived to have more of what it takes in the modern work environment, they are likely to be considered a better investment than an older person (Ranzijn 2004;


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Walker 1999). Since it seems that most employers do not regard a job applicant’s age per se as an advantage, older job seekers need to compete on equal terms with younger people on the basis of their fit with the job, not just previous experience. This will require education and changes of attitude on the part of employers, job seekers themselves, government, and society as a whole. It seems that employers expect that younger people will provide a better return on their investment in recruiting and training than older people (European Foundation for the Improvement of Living and Working Conditions 1997; MacDonald & Weisbach 2004). This conforms with the ‘implicit contract’ under which younger people are prepared to accept lower wages initially on the understanding that promotions and higher wages will come with increasing experience. However, to what extent are these assumptions valid? Recent evidence shows that, especially in high-demand occupations, there is no correlation between age and wages, and in some occupations the correlation is negative, with younger people being paid more (Hu 2003). Secondly, younger people tend to remain with any particular organisation for fewer years than older people, even if the older people are employed at 50 (Spiezia 2002). Since research evidence also shows that older people are just as adaptable, productive, trainable, and able to learn complex new skills as younger people (Ranzijn 2002b), the reality is that older people may represent a better return on investment than younger ones. To increase mature-age re-employment requires educating employers in the facts about the competencies of older workers in the contemporary work environment, not feel-good platitudes about how wonderful older workers are and how employers ‘should’ hire them. Mature-age job seekers may also need to change their attitude if they want to obtain meaningful work. They should not necessarily expect to get a job at the same salary or status level as the one they had before, but need to be prepared to work their way up. They need to realise that their previous work experience may not count for much and be prepared to retrain and up-skill, perhaps in an entirely different occupation. They also need to be proactive and creative in their thinking, to see where new job opportunities may lie and how they could adapt to a different work environment from what they are accustomed to.


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Conclusion

Policy suggestions Direct appeals by government for employers to take on older employees on human rights grounds or in order to reduce a future financial burden are unlikely to succeed. Employers have to safeguard the short-term as well as long-term productivity of their organisations and are at present unconvinced that an older worker will add as much value as a younger one, let alone more. Financial incentives, such as providing short-term subsidies to employers who take on older workers, are also unlikely to succeed because they implicitly give the wrong message: there must be something wrong with older workers, otherwise they would not need subsidies to take them on (Ranzijn 2004). A paradigm shift in policy focus regarding mature-age job seekers is required. Rather than viewing them as a problem, older job seekers could be regarded as an unexploited resource that will be extremely valuable in the fast-approaching era of skills shortages. Since a 50-yearold in Australia today is likely to have another 25 years of good health (Mathers et al. 2001 and chapter 1 of this volume), it may be useful to regard mature-age job seekers in the same category as those in their twenties, as ‘blank slates’ with the full range of occupational options. As mentioned above, the Commonwealth Government has introduced a number of policies since the 1980s aimed at improving the labour market chances of the mature-age unemployed. The most recent statement of policy, entitled Australians Working Together, was published in conjunction with the 2001–02 Federal Budget. It includes measures such as training credits and training accounts; extra payments for persons attending literacy and numeracy courses; changes to the Newstart (unemployment dole) allowance; the appointment of personal advisers; and the provision of training places in information technology (BCA/ ACTU 2003). Although these are moves in the right direction, the budgeted amounts are quite small and the various programs do not add up to a ‘strategy’, a term used regularly in official statements. Although state governments have also introduced labour market programs geared to


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the needs of older people, they are relatively small by comparison with the size of the problem. To make matters worse, the oldest and most successful state program, the NSW Mature Workers Program, established in 1989, was abolished as an economy measure in 2004. The mature-age unemployed are clearly not a priority issue for government, and perhaps not for society as a whole. References Access Economics (2001) Population Ageing and the Economy, Department of Health and Aged Care, Canberra. Age Limits (2001) Age Limits: Age-Related Discrimination in Employment Affecting Workers Over 45, Victorian, South Australian and Western Australian Equal Opportunity Commissions & Australian Employers Convention, Melbourne. Andrews, K (2004) Address by Kevin Andrews, Minister for Employment and Workplace Relations, to the Annual Conference of the Recruitment and Consulting Services Association, 3 August, Canberra. Arrazola, M & De Hevia, J (2004) More on the Estimation of the Human Capital Depreciation Rate, Applied Economics Letters, 11(3) 145–48. Australian Bureau of Statistics (ABS) (1997) Retirement and Retirement Decisions (Cat. no. 6238.0), Australian Bureau of Statistics, Canberra. —— (ABS) (2001) Australian Social Trends 2001 (Cat. no. 4102), Australian Bureau of Statistics, Canberra. —— (ABS) (2004a) Australian Social Trends 2004 (Cat. no. 4102), Australian Bureau of Statistics, Canberra. —— (ABS) (2004b) Labour Force Surveys (Cat. no. 6203.0), Australian Bureau of Statistics, Canberra. —— (ABS) (2006) Retirement and Retirement Intentions (Cat. no. 6238.0), Australian Bureau of Statistics, Canberra. Bishop, B (1999) Employment for Mature Age Workers: Discussion Paper, Minister for Aged Care, Canberra. Borowski, A (1988) Financial Incentives and the Early Retirement Decision: Implications of the American Experience for Australia. In The Decision to Retire, Human Resource Centre, La Trobe University, Melbourne, pp. 61–67. Borowski, A (1990) Older Workers and the Work–Leisure Choice, Australian Social Work, 43(2): 27–36. Burke, K (2004) Welfare State of Mind to Change, Sydney Morning Herald, 28 October, p. 6. Business Council of Australia/Australian Council of Trade Unions (BCA/ACTU) (2003) Age Can Work, Report by S Encel, Business Council of Australia/Australian Council of Trade Unions, Melbourne. Calasanti, T (2002) Work and Retirement in the Twenty-First Century: Integrating Issues of Diversity and Globalisation, Ageing International, 27(3): 3–20. Cass, B (1994) Social Security Policy into the 21st Century. In J Disney & L Briggs (eds) Social Security Policy: Issues and Options, Australian Government Publishing Service, Canberra, p. 10. Clare, R & Tulpule, A (1994) Australia’s Ageing Society, Background Paper 37, Economic Planning and Advisory Council, Australian Government Publishing Service, Canberra. Dowrick, A & McDonald, P (2002) Critique of the Intergenerational Report, Occasional Paper, Centre for Economic Policy Research, Australian National University, Canberra.


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Encel, S (1998) Age Discrimination. In M Patrickson & L Hartmann (eds) Managing an Ageing Workforce, Business and Professional Publishing, 41–52, Warriewood, NSW, pp. 41–52. Encel, S & Studencki, H (1996) Job Search Experiences of Older Workers, NSW Consultative Committee on Ageing, Sydney. European Foundation for the Improvement of Living and Working Conditions (1997) Combating Age Barriers in Employment: Research Summary, European Foundation for the Improvement of Living and Working Conditions, Luxembourg. Gallo, WT, Bradley, EH, Segal, M & Kasl, SV (2001) The Impact of Involuntary Job Loss on Subsequent Alcohol Consumption by Older Workers: Findings from the Health and Retirement Survey, Journey of Gerontology: Social Sciences, 56B(1): S3–S9. Hu, LJ (2003) The Hiring Decisions and Compensation Structures of Large Firms, Industrial and Labor Relations Review, 56(4): 663–81. Human Rights and Equal Opportunity Commission (HREOC) (2000) Age Matters, Human Rights and Equal Opportunity Commission, Sydney. Ingles, D (1999) Structural Ageing, Labour Market Adjustment and the Tax-Transfer System, Conference Paper, Centre for Economic Policy Research, Australian National University, Canberra. McAdams, DP, Hart, HM & Maruna, S (1998) The Anatomy of Generativity. In DP McAdams & E de St Aubin (eds) Generativity and Adult Development: How and Why we Care for the Next Generation, American Psychological Association, Washington DC, pp. 7–43. McDaniel, SA (2003) Hidden in the Household: Now it’s Men in Mid-Life, Ageing International, 28(4): 326–44. MacDonald, G &Weisbach, MS (2004) The Economics of Has-Beens, Journal of Political Economy, 112(1): S289–S310. Mathers, CD, Sadano, R, Salomon, JA, Murray, CJ & Lopez, AD (2001) Healthy Life Expectancy in 191 Countries, 1999, The Lancet, 357, 9269. National Centre for Vocational Education Research (NCVER) (2005) The Mature-Aged and Skill Development Activities: A Systematic Review of Research, National Centre for Vocational Education Research, Adelaide. Organisation for Economic Co-operation and Development (OECD) (2005) Aged and Employment Policies: Australia, Organisation for Economic Co-operation and Development, Paris. Perry, J (2001) Early Retirement: What is the Problem? Occasional Paper, Social Policy Research Centre, University of New South Wales, Sydney. Productivity Commission (2005) Economic Implications of an Ageing Australia, Productivity Commission, Canberra. Ranzijn, R (2002a) The Potential of Older Adults to Enhance Community Quality of Life: Links between Positive Psychology and Productive Ageing, Ageing International, 27(20, 30–55). —— (2002b) Towards a Positive Psychology of Ageing: Potentials and Barriers, Australian Psychologist, 37(2): 79–85. —— (2004) Role Ambiguity: Older Workers in the Demographic Transition, Ageing International, 29(3): 281–308. Ranzijn, R, Patrickson, M, Carson, E & Le Sueur, E (2004) Independence and Self-Provision in Old Age: How Realistic are These Goals? Australasian Journal on Ageing, 23(3): 120–24. Ranzijn, R, Carson, E & Winefield, AH (2006) On the Scrap-Heap at 45: The Human Impact of Mature-Aged Unemployment, Journal of Occupational and Organizational Psychology, 45, in press. Rosenman, L & Warburton, J (1997) Retirement, Retirement Incomes and Women. In A Borowski, S Encel & E Ozanne (eds) Ageing and Social Policy in Australia, Cambridge University Press, Cambridge, pp. 137–56. Sheen, V (1999) The Role of Public Policy Interventions in Reducing Unemployment Amongst Mature-Aged People,


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Paper presented at the Council on the Ageing National Conference, Adelaide. Spiezia, V (2002) The Greying Population: A Wasted Human Capital or Just a Social Liability? International Labour Review, 141(1–2): 71–113. Van Tilburg, T (2003) Consequences of Men’s Retirement for the Continuation of Work-Related Personal Relationships, Ageing International, 28(4): 345–58. Walker, A (1999) Combating Age Discrimination at the Workplace, Experimental Ageing Research, 25(4): 367–77. World Bank (1994) Averting the Old Age Crisis, Oxford University Press, New York.


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7 Health policy for a long-lived society Hal Swerissen and Stephen Duckett

Introduction In Australia, health policy is inextricably tied to the architecture of Federation. The six states and two territories have overlapping and sometimes ill-defined responsibilities for health policy with the Commonwealth Government. In 1946, section 51 (xxiiiA) of the Australian Constitution gave the Commonwealth powers to legislate for: the provision of maternity allowances, widows’ pensions, child endowment, unemployment, pharmaceutical, sickness and hospital benefits, medical and dental services (but not so as to authorise any form of civil conscription), benefits to students and family allowances. (Parliament of Australia)

In combination with the Commonwealth’s section 96 power to make grants to the states on ‘such terms and conditions as the parliament thinks fit’, section 51 (xxiiiA) provides the basis for the modern Australian welfare state, including health services. But the Commonwealth’s powers to make health policy are neither distinct from those of the states, nor are they unfettered. The Commonwealth has dual responsibilities with


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the states for the provision of health services, while at the same time being curiously limited in its power to deal with the medical and dental provision through the civil conscription clause. In practice, until recently, the Commonwealth’s overwhelming fiscal powers made it the dominant player in the development of health policy over the past 60 years. It is not yet clear whether the introduction of the goods and services tax, which provides a significant, untied and growing stream of revenue to the states, will alter this balance of power. The Commonwealth has primary responsibility for medical and pharmaceutical services through the Commonwealth Medical Benefits Scheme and the Pharmaceutical Benefits Scheme. It controls the structure and development of the health workforce through its fiscal management of the university sector. It controls health research and development through the National Health and Medical Research Council and monitoring and reporting through the Australian Institute for Health and Welfare. It also has major responsibility for the surveillance, regulation and monitoring of public health issues and therapeutic goods. While hospitals and home and community care services are jointly funded by the states and the Commonwealth, the Commonwealth sets national policy in these areas through its use of section 96 grants and agreements. It also has significant shared responsibility for Indigenous health. The states and territories are left with residual responsibility for mental health, alcohol and drug services, oral health and a range of maternal and child health, health promotion, counselling and allied health services. During the period of emerging Commonwealth dominance in health policy, there has been an ongoing and shifting debate about the role of the state, the market (private responsibility) and the non-government sector. Most obviously, the policy pendulum has swung to and fro between universal access, financing and provision of public health services through programs like Medicare (and its predecessor Medibank) and reliance on individually determined private financing and provision with a residual public health sector for the poor. The Australian Labor Party has generally supported the former and the Liberal–National coalition the latter.


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More recently, improved technologies, economic growth and changing consumer expectations have seen a significant growth in health expenditure from about 4 per cent of gross domestic product in 1960, to over 9 per cent in 2005. As health care costs have escalated across OECD nations, in Australia as elsewhere, there has also been a significant shift in emphasis away from concerns about access and equity to a greater focus on efficiency. Initially, this saw strategies to more efficiently manage the production of health services (for example, the introduction of performance-based funding systems for health services). Subsequently, policy increasingly became concerned with efficiency in the allocation of available resources to optimise health outcomes and manage demand (for example, requirements for evidence-based practice and cost-effectiveness analyses for new technologies, pharmaceuticals and procedures). In this mix of Commonwealth–state tensions and shifting strategies to address equity and efficiency, the medical profession sought to retain a dominant position in determining policy directions in the funding and organisation of the health system. This has generally manifested itself in continued advocacy for medical autonomy, fee for service payments, private health insurance and regulatory strategies to restrict the role of other professionals in health care practice. Notwithstanding resistance, government demands for greater efficiency have seen the power of bureaucrats, managers and other health professions contest that of medical interests. Changing social patterns and the emergence of general concerns about consumer rights have also seen the emergence of consumer advocacy organisations and strategies, although these remain comparatively less influential than government and the professions. Not surprisingly, this mix has been described as a ‘strife of interests’ (Sax 1984). Until recently, there has been comparatively little interest in the influence that ageing has on health policy. However, this is no longer the case. Clearly, a fierce debate about the likely impact of ageing on the use of health services and consequential costs has broken out (for example, Productivity Commission 2005). Yet to emerge, but quite likely, is the social impact the educated, affluent and politically demanding baby boom cohort will have on health policy as this group reaches old age.


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This chapter first examines the claims that increased life expectancy and demographic ageing will have a significant impact on health policy over the next two decades. It then discusses some of the policy options that are likely to be considered, both in response to a longer-lived society and which take account of other trends that are emerging in parallel.

The changing pattern of health and illness Colin Mathers has reviewed historical trends in the health of older Australians in chapter 2. As for the developed world generally, in Australia dramatic improvements in life expectancy have been associated with very significant changes in the pattern of health and illness. Combined with demographic trends associated with increased fertility in the two decades after 1945, the proportion and absolute number of older people in the Australian population will increase dramatically over the next three decades to 2040. Born between 1946 and 1964, the first of the baby boomers will be 65 in 2011. As a result, the proportion of the population aged over 65 will progressively increase from about 12 per cent today to 25 per cent by 2044 as the baby boomers age. Barring extraordinary events, the number of people aged over 75 is likely to more than double in the next 20 years (Productivity Commission 2005). Today, ageing is closely associated with increasing prevalence and incidence of many chronic diseases (Centers for Disease Control and Prevention 2005). These include cardiovascular disease, cancer, type 2 diabetes, renal disease, musculoskeletal disease, and chronic obstructive pulmonary disease. Depression, which is a significant co-morbidity for these conditions, is also age-related. The majority of these conditions are now included in the health priorities adopted by Australian Health Ministers. By definition, chronic diseases are relatively ongoing. They are often progressive. Many have significant effects on quality of life and a number are life-threatening. They are complex and our understanding of them is limited. As a result, treatment is relatively ineffective, often focusing on slowing progression or palliation rather than cure. In Australia, it is estimated that chronic illnesses are responsible for approximately 80 per cent of the total burden of disease, with an estimated 3 million


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Australians suffering from one or more chronic illnesses (Weeks & Swerissen 2005). The age-related incidence and prevalence of chronic disease varies, depending on the disease. For example, asthma is more prevalent in younger age groups. Diabetes and heart disease become more prevalent in middle age and continue to rise thereafter. Dementia is largely restricted to older age groups. Nevertheless, in general, the incidence and prevalence of chronic disease increases significantly for age groups over 65. About half the total burden of disease occurs in people over the age of 65 (Mathers, chapter 2). This is particularly reflected in the impact of chronic disease on disability and activity limitation. While less than 5 per cent of 15–64year-olds have profound or severe activity limitation, almost 50 per cent of those aged 85 experience these problems (ABS 2004). These trends are of concern to policy-makers because of their potential to increase health care costs. Insofar as the increased proportion, and absolute numbers, of older people in the Australian population is likely to result in a significant increase in the absolute incidence and prevalence of chronic disease and this translates to demand for services, costs will increase. However, the potential impact of ageing on costs is not uncontested.

Ageing and health care costs Australian expenditure on health and aged care in 2002–03 was $72.2 billion, or 9.5 per cent of GDP. The rate of increase in expenditure is currently well above inflation, at about 10 per cent per annum (ABS 2004). Health expenditure is strongly related to ageing. We have seen that older people are sicker and use proportionately higher levels of health care than younger people. On average, those aged over 65 use about four times the resources per person used by those aged less than 65. Per capita usage peaks between 80 and 90 years of age (Productivity Commission 2005), although it falls for very old age groups where intensive and aggressive treatment is seen as less appropriate (Polder & Achterberg 2004). Therefore it seems highly likely that the incidence and prevalence of chronic disease will increase significantly as the population ages


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over the next three decades or so. This will almost certainly lead to a significant increase in aggregate demand for health services (Productivity Commission 2005). However, counter-arguments include: older people are now healthier, so costs will not increase; we will become wealthier and therefore any increased costs will be affordable; technology, not ageing, drives costs; and, we can make policy choices in our response to potential increased demand. We assess these arguments in the next sections.

Compression or expansion of morbidity? Interestingly, despite the dramatic increase in average life expectancy, there has not been an increase in maximum lifespan. Maximum lifespan remains below 120 years. If, at least for the moment, maximum lifespan is relatively fixed, there are at least two possibilities for the future distribution of illness and death in older age. The first is known as the ‘compression of morbidity hypothesis’ (Fries 1980, 1989). It proposes that primary prevention reduces distress and disability caused by chronic disease more than it increases life expectancy. In so doing, distress, disability and disease are compressed around the time we die. Given that maximum lifespan appears to be relatively fixed, if this hypothesis holds, we can therefore increasingly expect to live with less and less illness and disease before we die. Alternatively, we may experience an expansion of morbidity. This is sometimes known as the ‘Medawar hypothesis’ (Olshansky & Ault 1986). Effectively, this hypothesis proposes that systemic failure in old age is inevitable and that the delay in the onset of chronic conditions will be less than the delay in death associated with the prevention and treatment of fatal conditions. Extension of life expectancy can therefore only be achieved at the cost of an increasing experience of illness and disability as the fatal consequences of chronic disease are delayed. Although the data are not yet conclusive, what there is tends to support the compression of morbidity hypothesis (but see Mathers, chapter 2). This suggests that there is significant benefit both to life expectancy and to quality of life in promoting measures to prevent chronic disease, including for those in middle adulthood who are at risk but not yet symptomatic. It is, therefore, plausible to argue that in the future older


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people will be healthier and therefore any increase in their absolute numbers will have less impact on morbidity than would be predicted from current utilisation patterns. However, it is worth noting that there may be limits in the extent to which morbidity can be compressed. Extension of morbidity-free life at very old ages may be more difficult. As average life expectancy increases, the apparent trend towards compression may stabilise or reverse. Up to a certain point, increased years of life lived without disability may not contribute significantly to additional health expenditure (Lubitz et al. 2003). Thereafter, gains may only be obtained at increasing lifetime cost. It is also important to disentangle the effect of prevention on increased life expectancy and the demographic impact of the baby boomers on population ageing. Even if prevention compresses morbidity with increasing life expectancy, as the absolute number of older people increases dramatically over the next three decades there will be an absolute increase in the number of people with chronic disease who need treatment. This will have a significant impact on health care costs. Lubitz studied the impact of demographic ageing on US Medicare expenditure (which covers health care costs for people aged over 65). He found that three-quarters of additional US Medicare expenditure will result from the larger baby boom birth cohort. For the baby boomers, demographic ageing is likely to have a far greater impact on health expenditure than increasing life expectancy. It has also been argued that increased health care costs associated with ageing are largely associated with the costs of dying (Fuchs 1984). If this is true, as life expectancy increases, costs would be deferred. The data indicate that about 30 per cent of US Medicare costs (Lubitz & Riley 1993) – about 10–12 per cent of total US health care costs (Emanuel 1996) – are incurred in the last year of life. Other costs associated with ageing, apart from the final year of life, therefore contribute to increased expenditure. Overall, costs for those aged over 65 appear to remain about the same, despite increased life expectancy. As a result, the absolute increase in the number of older people associated with the baby boom cohort will see a sharp increase in the death rate over the next three decades. Currently, the crude death rate is about seven per 1000. It is expected to increase to around 11 or 12 per thousand (Productivity Commission 2005).


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The data therefore show that even if increased life expectancy as such does not have a particularly significant impact on health expenditure, the increased number of older people resulting from the baby boom cohort will.

The impact of technology Real health expenditure has grown significantly. Historically, technology has made a more significant contribution to increased health expenditure than increased life expectancy. Technological innovation in pharmaceuticals, diagnostics, pathology, communication and specific treatment modalities can lead to more effective and efficient health care, sometimes reducing costs for particular conditions and treatments (for example, by reducing length of hospital stay). It also opens up new assessment and treatment options. Overall, costs increase as more people take up these options. However, the evidence also suggests that there are significant benefits from the introduction of new treatment options in increased life expectancy and reduced morbidity (Cutler & McClennan 2001). Over the past 20 years, ageing has contributed about 0.5 per cent real growth per year, while technology and greater demand has resulted in about two to 3 per cent growth (Productivity Commission 2005). However, ageing and technological innovation interact. Growth in technology-related expenditure is higher for older age groups (Polder & Achterberg 2004). Population ageing over the past two decades has been slow compared to the growth trend over the next three decades. Additionally, as treatment improves, there is a propensity to provide treatment to older age groups for whom it previously would not have been considered appropriate. Consequently, we can expect more rapid real growth in health expenditure in the future. Changes in technology are likely to continue to have a significant impact, but innovation in pharmaceuticals, diagnostics and treatment are hard to predict.

Overall impact on demand Overall, the Productivity Commission report on the economic implications of an ageing population estimates that total government


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expenditure on health as a proportion of GDP will have to increase by 45 per cent in the next two decades to meet projected demand. The impact of population ageing produced by the baby boomers accounts for about a quarter of this change. Over the same period, demand for residential and community aged care places is projected to double (Productivity Commission 2005).

Policy choices Notwithstanding the likely overall increase in demand for health care services associated with population ageing in Australia, ‘demography is not destiny’ (Friedland & Summer 2005). Actual future expenditure will reflect policy choices. Moreover, more expenditure on health care does not mean better health. In 2001, Portugal spent about US$1600 per capita on health, Australia about $2500 and the United States about $4800. Despite the fact that the United States spends three times as much per capita on health care as Portugal and twice as much as Australia, life expectancy in these three countries is about the same (World Health Organisation 2004). For countries like the United States, health expenditure is a ‘luxury good’ with relatively marginal returns on population health for increased expenditure. Despite marginal returns, affluent countries not only spend more per capita on health, they spend more of their national income. Expenditure is a matter of policy (and individual) choice. Crucially, our capacity to afford increased health care will depend on continuing economic growth. In introducing the National Health and Pensions Bill into the Australian Parliament in 1938, Treasurer Casey pointed out that by 1965 the proportion of people aged over 65 would be 6.5 per cent of the population. Consequently, he argued that: In view of the impending inability of the existing pensions scheme, I say quite frankly that, unless something is done to put these schemes on a contributory basis, no government of the future however well intentioned could embark upon any worthwhile extension of our social services without seriously threatening the whole financial fabric of the Commonwealth. (Hansard 1938)


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Casey did not get his Bill through (we had to wait until the 1970s for Medicare and the 1980s for contributory superannuation), but there was a significant expansion in productivity and GDP growth, the proportion of people aged over 65 is now 13 per cent, and we were not ruined! On balance, we can conclude that it is likely that growth of the older population will lead to a 25 per cent increase in demand for health services and a near doubling in demand for aged care services. How we respond will depend on a range of factors but, in particular, on our overall level of economic growth. However, it is important to recognise that how we respond to these emerging demands depends critically on the policy choices today.

The changing context for the health system Earlier in this chapter, we made the point that health policy is contested across jurisdictional, professional and consumer interests. The way these interests have played themselves out on health policy has been affected by a range of social, technical and economic pressures (Swerissen 2002a). Over the past century, family size has declined, women have entered the paid workforce and geographic mobility has expanded dramatically. As a result, the availability of informal care has dramatically declined and will continue to decline as the population ages over the next two decades (Hogan 2004). More recently, there has been a substantial expansion of social rights for people with disabilities. Today, we expect to be able to live in the community if we have a chronic illness or a disability. With some limited exceptions, large-scale residential institutions are a thing of the past. At the same time, as noted above, there has been a dramatic growth in demand and expenditure for hospital services, in part related to population ageing but mainly as a result of new health care technologies. As costs have increased, funders have become increasingly interested in strategies to improve the efficiency of service delivery, particularly through the introduction of new funding systems. Health care providers have responded by decreasing the cost per person or episode of care, primarily by reducing the average length of stay in hospitals (AIHW 2001).


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In response to the declining availability of informal care, decreasing acceptability of residential care and the pressure on length of stay in acute (and sub-acute) care, there has been significant expansion and development of the primary care and community support sector. In disability and mental health services, this has led to community housing, day programs and employment support services. In aged care, there has been a massive expansion of home and community care. Australia now has an extensive range of health and community support for people with disabilities and chronic illness who want to continue to live at home and participate in the community. These services are largely complementary to informal care and support provided by partners and children.

Current and emerging problems As the affluent, better educated and more articulate baby boomers reach old age, it is likely that they will demand more responsive, higherquality and more accessible health care services. Moreover, their sheer numbers will make extension and reform of health services a much more significant policy issue than it has been. It is already clear that there is currently an underinvestment in prevention, the organisation of treatment and intervention is inefficient, and access to services is inequitable. There is a significant underinvestment in primary and secondary prevention for chronic disease. In a large-scale study in New Zealand, Jackson and Tobias ( 2001) estimated that approximately one-third of hospitalisations for people aged less than 75 were potentially avoidable. Of these, approximately two-thirds were potentially avoidable through more effective primary health care services. Effective secondary prevention programs focused on behavioural and physiological risk factors and early stages of chronic disease remain relatively underdeveloped. Although there is considerable evidence that organised self-management programs can significantly improve health outcomes and reduce utilisation, they have not been systematically integrated into primary care in Australia (Walker, Swerissen & Belfrage 2003).


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More broadly, there is considerable evidence that primary prevention strategies to reduce risk factor prevalence and strengthen protective factors are likely to lead to improved health outcomes. We have seen significant population health programs for the prevention and management of risk factors such as smoking, alcohol, nutrition, hypercholesterolemia and hypertension. However, primary health care services remain heavily focused on treatment and secondary prevention. As primary health and community support services have expanded, continuity of care and the integration of services to produce efficient and effective care have become problematic. Over time, there has been a progressive layering of primary health and community care service providers as more functions have been allocated to this sector. This has led to a proliferation of service agencies and funding programs in the community. A study of service coordination conducted in Victoria found enormous variation in the way agencies deal with the management and coordination of care. There were over 350 different processes to document client information, assess needs, make referrals and coordinate services across the 800 agencies that made up the primary care system (Australian Institute for Primary Care 2002). Government funds these agencies through a variety of programs. Each has its own policy, organisational, costing, reporting and accountability arrangements. As a result, transfer of information between agencies is problematic. Eligibility criteria and treatment approaches for the same conditions vary across agencies, leading to inconsistent access and treatment. This may not matter much for simple self-limiting conditions, but it does for those that are complex and require ongoing care and support from a range of providers. Consumers are inconvenienced. Referral processes do not work well and they waste time and incur costs in accessing services across providers. Often, assessments are duplicated and they have to repeat information to different providers. This has the potential to result in errors and avoidable mistakes (Swerissen & Jordan 2005). The existing funding arrangements for primary medical care are not well suited for chronic care. With some limited exceptions, primary medical care is remunerated on a fee-for-service basis, a payment mechanism premised on episodic care. People with chronic conditions


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have higher needs for continuity of care and providers over the course of their condition, suggesting that payment design should have more of a longitudinal basis. We know that a range of people with chronic conditions receive sub-optimal care in the primary care system. Conditions such as hypertension, hypercholesterolemia and type 2 diabetes are often undiagnosed. For those receiving treatment, the evidence suggests that a significant proportion do not have their condition managed according to good practice guidelines (McGlynn et al. 2003). Organisational models for primary and community care based around geographic catchments or enrolled populations are not well developed, despite the strong evidence that these approaches lead to better outcomes. Planning arrangements, clinical data systems, decision support systems, accountability and governance arrangements do not adequately support care planning, service integration and continuity over time and across service boundaries. Inadequate service system organisation is compounded by the current capacity, skills and organisation of the health workforce. The current workforce, which developed around specialisations and interlocking roles suited to hospital and residential care settings, is not well suited to integrated, multidisciplinary service delivery in community settings. While there are now a range of shortages, providing more of the same is unlikely to solve the problems of the future (Duckett 2005). The introduction of Medicare ensured reasonably equitable access to primary medical services, but significant problems have now emerged. Increasingly, a maldistribution of general practitioners has reduced access to primary medical services in rural and metropolitan fringe settings; long waiting times for routine appointments are now being reported in some areas. Recently, the incidence and magnitude of co-payments has increased with the likely effect of disproportionately reducing access to primary medical services for people on lower incomes (Madden 2002; Swerissen, Duckett & Livingstone 2003; Young, Dobson & Byles 2000). The Pharmaceutical Benefits Scheme (PBS) has also ensured reasonably equitable access to a national formulary. However, recent proposed increases to co-payments, in response to concerns about rapidly increasing costs associated with the introduction of new products on the


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PBS, are likely to have an inequitable effect on access for people on lower incomes who are ineligible for concessional access to the scheme if they are introduced (Biggs 2002). Notwithstanding emerging issues, access to general practice and pharmaceuticals is much more equitable than for other primary care services. Access and utilisation for dental, allied health and counselling services vary significantly with location and income. Those with higher incomes who live in metropolitan areas are more likely to use private providers for these services (Spencer 2001). For those on lower incomes, publicly provided services are budget-capped and rationed. In Victoria, for example, it is common for people on low incomes to wait a month or more to get an appointment for publicly funded allied health services and much longer for routine public dental treatment. With the effective abolition of the community health program during the mid-1980s, there has been no national framework to address these issues for nearly two decades (Duckett 2000). As a result, service mix and eligibility criteria vary across jurisdictions. Access to community-based continuing care services varies significantly across people with very similar needs, depending on the historical evolution of programs and eligibility criteria. For example, while the Home and Community Care Program has very dramatically expanded community support for older people with disabilities, comprehensive national programs for other groups with continuing care needs have not developed. As a result, people with mental illness, chronic disease, post-acute care needs, alcohol and drug problems, and younger people with physical and intellectual disabilities, have much more variable access to publicly funded primary health and community care services across jurisdictions.

Directions for the future In response to the rapid ageing of the Australian population, we would argue that the prevention and management of chronic disease is the main challenge for the future as the number of older people in the community grows. While our understanding of the complex and multifactorial causal pathways for chronic diseases remains limited, an emerging population


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health framework for understanding population risks has emerged. A population health approach emphasises the importance of an integrated approach to primary, secondary and tertiary prevention of illness across the lifespan. Health services need to focus on the health of catchments and populations as well as individuals. Services will need to be genuinely teambased and multidisciplinary, adopting a systemic approach to continuity and integration. In particular, there will need to be a much greater emphasis on the primary and community care system for geographically defined populations to prevent and better manage chronic disease.

A health policy for a long-lived society The current health system in Australia is not well structured to deal with the growing numbers of people who will have chronic illness. The primary medical care practitioners are principally remunerated on a feefor-service basis, a system that characterises the interactions between the general practitioner and the patient as being episodic and acute rather than a longitudinal relationship appropriate to people with chronic disease. Primary and secondary care services are also not integrated. This is in part due to the different status and orientation of the two sectors. These differences are exacerbated by different funding arrangements and responsibilities: primary medical care is essentially funded by the Commonwealth Government, with acute in-patient services being funded through state governments for public hospitals or private health insurance, subsidised by the Commonwealth, for private hospital care. These fragmented arrangements mean that no single authority has responsibility for all the care of the person with a chronic illness. A general medical practitioner might, even in the absence of a remuneration incentive, assume responsibility for primary care and care management of a person with chronic illness, but hospitalisations for the patient are the responsibility of other agencies with funding through a different level of government. These funding and organisational arrangements inhibit good care planning and continuity of care. The Commonwealth has attempted to redress some of these weaknesses in its funding of general practice through a number of initiatives loosely referred to as ‘enhanced primary care’. These initiatives include specific items for:


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• health assessments for the elderly • preparation of two-yearly GP chronic disease management plans • coordination of team care for people with chronic illness These fragmented and disorganised arrangements for the general community stand in stark contrast to the arrangements for veterans of the armed forces. The Department of Veterans’ Affairs is the single purchaser for veterans’ services and has a vested interest in ensuring the adequacy of primary medical care, the availability of a broad range of substitute services and community support services for veterans that might reduce utilisation of acute inpatient services or residential aged care services. There are some signs that this ‘integrated purchaser model’ is acting to reduce health expenditure: hospital utilisation for elderly veterans without a disability is 4–5 per cent lower than the rest of the community (AIHW 2002). A health system better designed to address the needs of the chronically ill should provide incentives for prevention, self-management and continuity of care (Wagner 2000; Weingarten et al. 2002). Such a system would require major change to the current approaches. The sine qua non for a new system is a significantly enhanced primary care system, structured and funded to place incentives on primary care providers to manage all aspects of care for the chronically ill. A well-functioning primary care system would incorporate: • a multidisciplinary approach, recognising that no one profession has all the skills necessary to treat people with chronic illness • a team approach to ensure continuity of care • incentives for prevention and self-management • systems to support continuity of care The projected growth of the number of people with chronic illness will put strains on the health workforce. Structures need to be adopted to ensure that the most appropriate health professional is used in every patient interaction. In particular, we need to ensure that where the skills of the doctor are needed they will be available to the patient. In many areas of Australia, this is currently not the case because of a shortage


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of general practitioners. Where the most appropriate provider is from another profession, or where the work of the general practitioner can be delegated, we need to ensure that the relevant profession is available. This flexibility is more likely to be implemented in situations where primary care is provided in a group rather than a solo practice. The fundamental building block for a health system responding to chronic illness is a significantly improved primary care platform that links across professions, and across public and private sectors. A multispecialty primary care practice would be able to ensure that relevant specialists are available (for example, podiatrists, diabetes educators, endocrinologists and other medical specialists) and could provide the skills to facilitate self-management programs and other examples of group education. Even with the best prevention programs, self-management and primary care, people with chronic illness will still require secondary, acute interventions including hospitalisation. Here it is important that there be close integration between the hospital system and primary care. Primary care providers should be able to access the skills of staff in acute environments to assist in their management of patients in the community. For example, local emergency departments might provide a telephone advice service to general practitioners about how a particular patient, experiencing particular symptoms and signs, would be managed if they had attended the emergency department. In this way, the general practitioner may be able to provide this management obviating emergency department visits. It would also be better use of the skills of the general practitioner and provide a more interesting practice environment. In most states, there are no structural incentives for hospitals to link with general practitioners or other primary care services. Funding arrangements are split between the Commonwealth and the state, and the Commonwealth and state bureaucracies have little skill in the issues and funding arrangements of the other level of government. In the longer term, policies that ensure there is one level of government with responsibility for the chronically ill and the aged will probably improve the efficiency of the health system and reduce utilisation by the chronically ill, especially for conditions that could have been managed


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in the community. Duckett (2001) and Labor’s Medicare Gold policy at the 2004 election are examples of policies of this kind. Improved organisation of the care pathways and service agencies is critical if better integrated care is to be delivered. This requires increasing the emphasis on organisations or professionals having responsibility to care for a defined population. One option would be to establish fundholding community health networks, which would be responsible for and coordinate the delivery of services for the populations of one or two local government areas across a range of primary health and community support agencies (Swerissen 1997). In the United Kingdom, arrangements like this have now been implemented as Primary Care Trusts, which hold funds for both community and hospital services for local catchment populations. In New Zealand, this function is conducted by District Health Boards. Another option would be that, rather than having responsibility for a geographic population, health care can be integrated for enrolled or registered populations. This model has been adopted in the United States, where a range of managed care organisations have developed. In terms of general practice, a policy option would be to provide incentives for general practitioners to assume responsibility for the care of a person with chronic illness. Under such a policy, a general practitioner would get ‘a capitation payment’ for assuming significant responsibility for the health care of an enrolled patient. ‘Register-based care’, where patients register with a single general practitioner, has significant advantages over more episodically oriented arrangements, especially for the chronically ill. Register-based care would give general practitioners stronger incentives to ensure that preventive activities are properly undertaken (for example, annual immunisations) and reminder systems could be developed to ensure that appropriate diagnostic tests are undertaken to monitor patients. There would also need to be incentives for patients to enrol and register. At present, there are a few incentives for patients to enrol with a single medical practice. One incentive that could be implemented to facilitate register-based care might be reduced co-payments. This would require some revisiting of the recent initiatives about co-payments and the safety net arrangements. More systematic arrangements for management of patients who are chronically ill should lead to savings in health costs;


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these should be shared between government, providers and patients. The patients’ benefit would accrue through reduced co-payments. Other incentives could also be introduced to encourage patients to enrol with particular providers. New pharmaceuticals could be introduced in a more targeted way; for example, an expensive new anti-hypertension medication could be introduced only through providers who have been appropriately trained in the evidence base for the new medication. And subsidy for the new drug might be limited to patients who have indicated that they will seek care only from a general practitioner who has been appropriately trained. The training arrangements might also include improved skills in health promotion interventions relevant to the disease. A critical feature of these three enrolled population models is that there is an organised or systemic approach to the health of the enrolled population. Funders and agencies have incentives and are accountable for the overall health outcomes of the population for which they are responsible, rather than simply the delivery of specific services. In Australia, virtually all jurisdictions have recognised these issues and are experimenting with innovations to address them, but generalised systemic changes to national policy, funding and organisational arrangements have yet to be agreed to and implemented to consolidate these arrangements. It is arguable that we now need national leadership to address these issues (Swerissen 2002b). Finally, an ageing society will put further pressure on health financing arrangements. The current government has emphasised the key role of private health insurance in funding health care and dramatically increased public subsidies to private insurance. But the industry is already unstable: the average age of those with insurance is increasing, placing pressure on premiums. Ageing of the population will exacerbate these trends, leading to further increases in subsidies or a reassessment of the role of health insurance as a niche product for the wealthy.

Conclusion Health policy in Australia has been characterised by a high level of inertia and, although there has been incremental change to the Medicare Benefit Schedule to recognise some aspects of the burgeoning issues


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associated with the increased number of people with chronic illness, more fundamental reform is now necessary. The baby boomers will have a significant impact on the age profile of the Australian population over the next 20 years. This will lead to a significant increase in demand for health and aged care services. These services are already under significant pressure. While we do not subscribe to a doomsday scenario for the impact of the baby boomers, neither is it credible to do nothing. The focus needs to be on the management of the health system for individuals, and particularly for those with chronic disease, who are the greatest users. This requires us to take a population or health systems perspective focused either on geographic or enrolled (registered) populations. Arrangements need to be put in place to facilitate integrated care for local health systems. This will require new arrangements for funding, clinical information, decision support, clinical governance and professional roles. Ideally, we need national leadership, but in its absence we should not wait. Local trials and innovations should be developed, but these should be focused on catchment populations and local health systems. Finally, it is worth noting that those of us who are baby boomers have a significant stake in the outcome of current reform proposals. We are more affluent, better educated and more demanding than our parents. There are also more of us. It is unlikely we will be satisfied with the current arrangements for the health and aged care system when we become heavy users. It is in our interests to see that change occurs now. References Australian Bureau of Statistics (ABS) (2004) The Health of Older People (Cat. no. 4827.0.55.001), Australian Bureau of Statistics, Canberra. Australian Institute for Health and Welfare (AIHW) (2001) Australian Health Trends, Canberra. —— (AIHW) (2002) Health Care Usage and Costs: A Comparison of Veterans and War Widows and Widowers with the Rest of the Community (Cat. no. PHE 42), Australian Institute for Health and Welfare, Canberra. Australian Institute for Primary Care (2002) PCP Strategy Service Coordination. PCP Initial Needs Identification Care Planning Tools Template Development. Evaluation Report, Australian Institute for Primary Care, La Trobe University, Melbourne. Biggs, A (2002) The Pharmaceutical Benefits Scheme: An Overview, Parliamentary Library, Canberra. Centers for Disease Control and Prevention (2005) Chronic Disease Overview, 2005, < http://www. cdc.gov/nccdphp/overview.htm>.


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Cutler, D & McClennan, M (2001) Is Technological Change in Medicine Worth it? Health Affairs, September/October: 11–29. Duckett, S (2000) The Australian Health Care System, Oxford University Press, Melbourne. —— (2001) Taking Medicare Forward, Blue Book No. 2, Australian Fabian Society Pamphlet Number Fifty Seven, Australian Fabian Society, Melbourne. —— (2005) Health Workforce Design for the 21st Century, Australian Health Review, 29(2): 201– 10. Emanuel, E (1996) Cost Savings at the End of Life: What do the Data Show? Journal of the American Medical Association, 275: 1907–14. Friedland, R & Summer, L (2005) Demography is Not Destiny Revisited, Centre on an Ageing Society, Georgetown University, Washington DC. Fries, JF (1980) Ageing, Natural Death and the Compression of Morbidity, New England Journal of Medicine, 303: 130–35. —— (1989) The Compression of Morbidity: Near or Far? Milbank Memorial Fund Quarterly, 67; 208– 32. Fuchs, V (1984) Though Much is Taken: Reflections on Ageing, Health, and Medical Care (No. 1269), National Bureau of Economic Research, Boston, MA. Hansard (1938) Commonwealth Parliamentary Debates, House of Representatives, 155: 799, Parliament of Australia, Canberra. Hogan, W (2004) Review of Pricing Arrangements in Residential Aged Care, Department of Health and Ageing, Canberra. Jackson, G & Tobias, M (2001) Potentially Avoidable Hospitalisations in New Zealand, 1989–98, Australian and New Zealand Journal of Public Health, 25( 3): 212–19. Lubitz, J, Cai, L, Kramarow, E & Lentzner, H (2003) Health, Life Expectancy and Health Care Spending Among the Elderly, New England Journal of Medicine, 349(11): 1048–55. Lubitz, J & Riley, G (1993) Trends in Medicare Payments in the Last Year of Life, New England Journal of Medicine, 328: 1092–96. Madden, K (2002) Access to Bulk Billing General Practitioners in Tasmania, Australian Journal of Primary Health, 8(1): 87–90. McGlynn, E, Asch, SM, Adams, J, Keesey, J, Hicks, J, DeCristofaro, A, et al. (2003) The Quality of Health Care Delivered to Adults in the United States, New England Journal of Medicine, 348(26): 2635–45. Olshansky, S & Ault, A (1986) The Fourth Stage of the Epidemiologic Transition: The Age of Delayed Degenerative Diseases, Milbank Memorial Fund Quarterly, 64: 355–91. Parliament of Australia, The Australian Constitution, . Polder, J & Achterberg, P (2004) Costs of Illness in the Netherlands, : National Institute for Public Health and the Environment, Bilthoven, The Netherlands. Productivity Commission (2005) Economic Implications of an Ageing Australia, Productivity Commission, Canberra. Sax, S (1984) A Strife of Interests, Allen & Unwin, Sydney. Spencer, AJS (2001) What Options Do We Have for Organising, Providing and Funding Better Public Dental Care? Australian Health Policy Institute, University of Sydney, Sydney. Swerissen, H (1997) How Should We Organise Community Health Services? Australian Journal of Primary Health – Interchange, 3(1): 6–15. —— (2002a) Implications of Hospital Deinstitutionalization for Primary Health and Community Support Services, Australian Journal of Primary Health, 8(1): 9–13. —— (2002b) Toward Greater Integration of the Health System, Australian Health Review, 25(5): 88–93.


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8 Retirement income policy for a long-lived society Allan Borowski and Diana Olsberg

Introduction To obviate the financial losses that would otherwise accompany leaving work in old age, most industrialised countries have developed retirement income systems. These systems employ a limited range of governmental, quasi-governmental and private mechanisms, including social insurance, occupational pensions, individual savings for retirement and meanstested programs. Through institutionalising ‘stable’ sources of income support later in life, these mechanisms seek to protect workers against the financial risk of retirement. Their structure and mix varies from one country to the next (Kingson & Williamson 2001). This chapter describes the evolution of Australia’s retirement income system – the structure and mix of the mechanisms that have been developed and their relationship with one another. Particular emphasis is placed on the period since the early 1980s, during which Australia’s retirement income system has been subject to a process of ongoing reform. The changes during this period, some of which have been described as revolutionary, have been especially important in shaping the architecture of the retirement income system as it exists today. This contemporary focus permits an appraisal of the extent to which the


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objectives of Australia’s retirement income system have been realised (where it is currently ‘at’) and the challenges that still remain. This chapter begins by outlining the main features of Australia’s retirement income system prior to the 1980s. It then outlines the objectives of the reform process that began in the 1980s. The third part of this chapter describes some of the major changes that have been introduced and what they have achieved. In doing so, it shows how and why a number of the objectives remain much further from being realised than was initially expected. The chapter concludes by outlining the challenges that remain for Australia’s retirement income system. The chapter gives particular attention to an especially important distributive issue, namely, that concerned with the economic security of older women.

Australia’s retirement income system prior to the 1980s A descriptor frequently invoked by students of the welfare state is the notion of the ‘pillar’. Pillars examine: … who pays for and who provides the range of social benefits and cash transfers that comprise the non-market income of households at different stages of the life course. Their distinctive ways of packaging income from alternative public and private sources thus provides the key differentia with respect to pillars. (Rein 1999: 2)

The market pillar The role of the market pillar in providing retirement incomes prior to the 1980s was very limited despite the fact that the mechanism of occupational superannuation schemes has a long history in Australia. The first formal scheme was established in 1862 by the Bank of New South Wales, 13 years before the first company private pension plan was established in the United States by the American Express Company. The introduction of federal income taxation under the Income Tax Assessment Act 1915 provided for the tax deductibility of employer contributions made on behalf of employees and the exemption of superannuation fund earnings


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from taxation and thereby encouraged the growth of superannuation schemes. Over the years, this tax treatment of superannuation represented a growing cost to the federal government in terms of foregone tax revenue (or ‘tax expenditures’). Nevertheless, very limited growth in superannuation coverage occurred prior to the Second World War. Covered workers were largely confined to white-collar public servants and employees of financial institutions and large manufacturing firms. These employees were mostly male, as female employees were rarely found among these sectors of the workforce. Female employees were poorly served. Sometimes, females were specifically excluded. Married women, for example, were not entitled to superannuation benefits in many schemes. In some sectors of the public service in Australia up to the 1970s, women were required to resign from permanent employment when they married (Olsberg 1982). Superannuation coverage expanded after the Second World War, but stood at only 32 per cent in 1972. Five years later, coverage had climbed to 42 per cent, but by the early 1980s had reached only 45 per cent (Borowski, Schulz & Whiteford 1987). As far as female coverage is concerned, as recently as 1983 it was only 23 percent, with only 11 percent in the private sector (ABS 1998). The superannuation schemes that covered these workers were overwhelmingly of the defined benefit variety. The limited role played by occupational superannuation in providing a retirement income was not only attributable to the narrow coverage of the workforce. There were two other factors at play. The first of these was that, because of the absence of preservation requirements, superannuation benefits were paid not only at retirement but also at any time a worker changed jobs. This often resulted in the dissipation of benefits during a working lifetime, leaving relatively little for retirement. The second factor was that benefits, unlike employer-sponsored pensions found in most other industrialised countries, were usually paid in lump-sum form and rarely used to purchase an annuity (or private pension). This is because the Income Tax Assessment Act 1915 provided for the full taxation of benefits received in the form of an income stream, but included only 5 per cent of a lump-sum benefit in the individual’s taxable income in the year in which the benefit was paid. Since the top marginal income tax rate was 60 per cent, the maximum tax paid on a lump sum was


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a mere 3 per cent of the total. Thus, what was ostensibly a market mechanism for protecting covered workers against the risk of a loss of income due to retirement actually functioned as something more akin to a concessionally taxed severance pay device.

The public pillar Given this situation, it was the public pillar of the age pension (in contrast to the social insurance schemes favoured in Europe, Canada and the United States) that served as the primary source of income for the elderly. The income- and assets-tested age pension is one of many means-tested programs of an extensive system of income support for people with insufficient income. Its primary role was to provide a minimum subsistence income that was supplementary to any personal savings the elderly may have accumulated themselves (the third pillar). Legislated by Prime Minister Alfred Deakin’s government in 1908 and introduced in 1909, the age pension was available to men at age 65 and women at age 60. This government-provided means-tested and flat rate non-contributory pension served as a system of poverty alleviation for the ‘deserving poor’. Indigenous Australians, aliens and Asians were deemed ineligible and denied the age pension (Dixon 1978/79). The age pension was gradually liberalised over the years. In 1920, 32 per cent of people qualifying on the grounds of age received the age pension. Five decades later, this figure was 70 per cent. By the late 1960s, means were assessed on the basis of income plus a proportion of countable assets aside from the family home, which has always been assets test-exempt. A benefit reduction (or marginal tax) rate of 100 per cent applied to each dollar of income beyond a permissible income threshold. A marked liberalisation process began in 1969 with a decrease in the benefit reduction rate to 50 per cent by the then conservative federal Liberal–Country Party coalition government. Several years later, in 1973, the means test for pensioners 75 years of age and over was abolished by the Whitlam Labor government. The age at which the means test ceased to apply was further reduced to 70 years in 1975. Another major liberalisation took place in 1976, when the Fraser coalition government abolished the assets test component of the means test; that is, age


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pension eligibility was assessed only on the basis of income and took no cognisance of capital. In consequence of these changes, by mid1978 the age pension covered over three-quarters of the population of pensionable age. If one adds service pension recipients (available to veterans of the armed forces five years earlier than the age pension), this ostensibly selective income support provision had effectively become a demogrant scheme covering about 90 per cent of people of eligible age (Department of Social Security 1984; Whiteford & Bond 2000). However, in 1978, future increases in the age pension for those aged 70 or over were made subject to an income test. This change marked the beginning of what would eventually become a fundamental shift in the widely accepted understanding of the role of the age pension. It is of interest to note that Australia has never had a pay-as-yougo social insurance scheme to protect workers against the loss of income due to retirement or other risks, although the idea of doing so has been entertained in the past. For example, legislation (the Health and Pensions Insurance Act) was passed in 1938, but, ostensibly, was never implemented because of the financial implications at a time when war was on the horizon. However, according to Kewley (1977: 161–62), these financial concerns merely allowed ‘latent opposition to the scheme’ – from employers and employees – ‘to become manifest’. Further, the Hancock National Superannuation Committee of Inquiry established by the Whitlam Labor government (1972–75) recommended the introduction of a national superannuation scheme based on a social insurance approach. It reported in 1976, by which time a conservative coalition government led by Malcolm Fraser had been elected to office. Today, the age pension for a single pensioner is equivalent to 25 per cent of average weekly earnings (AWE). Historically, the age pension has fluctuated between 20 and 25 per cent of AWE, but for the last 30 years successive governments have maintained it at around 25 per cent of AWE (Whiteford & Bond 2000). This level was finally prescribed under legislation passed in 1997. It provides among the highest minimum oldage incomes in the industrial world (Sass 2004: 4).


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The objectives of Australia’s ‘new’ retirement income system While the seeds of change as far as the age pension is concerned were sown with the 1978 change, the reshaping of Australia’s retirement income system began in earnest with the election of a Labor government under Prime Minister Bob Hawke in 1983. The prime mover was the Treasurer, Paul Keating, who eventually replaced Hawke as Prime Minister in December 1991. The following objectives for Australia’s retirement income system emerged with the unfolding of the reform process: • to enhance the role played by the market pillar in providing income for retired workers through expanding occupational superannuation coverage • to improve the coverage of the market pillar with a view to enhancing the adequacy of superannuation-provided retirement incomes for future retirees whose retirement income expectations will be higher than those of past retirees • to contain the public subvention of the market pillar through the tax concessions enjoyed by superannuation schemes • to enhance the role played by the market pillar as an income stream throughout the retirement years • to reduce reliance on the public pillar – the age pension – as a source of retirement income through tightening eligibility • to increase household and national savings and, in turn, investment • the equitable provision of superannuation coverage and level of employer-provided benefits for all employees More recently, three further objectives have become evident. These are: • to strengthen personal savings for all Australians, whether in the workforce or not • to strengthen the incentives for delaying retirement • to enhance the consumer sovereignty of workers through providing them freedom of choice regarding the funds into which their superannuation contributions are to be deposited


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The first group of objectives, on the face of it at least, appear to be quite simple, straightforward and non-controversial. However, within the Australian context they generally represented a grand departure from the objectives – to the extent that they were discernible – of the preearly 1980s retirement income system (Borowski 1987; Olsberg 1994, 1995, 1997).

The age pension The age pension, as previously noted, was initially conceived of as a social assistance program for the needy elderly. Over the years, however, the loosening of eligibility had increased coverage to the point that the notion of age pension entitlement as a social right had become progressively entrenched in the public imagination. This social right was seen to rest on the individual’s social contribution as a worker and taxpayer during his/her working years. The 1978 change, the one that made future increases in the age pension for those aged 70 and over subject to an income test, broadly coincided with the somewhat belated public recognition of population ageing and its implications for the long-term costs of the age pension (ed. Howe 1981). This public recognition, together with the immediate budgetary pressures arising from economic recession, led the Labor government in May 1983 to make the base pension for those aged 70 and over subject to an income test. As a result of the 1978 and 1983 changes, by mid-1983 pension coverage had declined by four percentage points relative to the 1978 peak (Department of Social Security 1984). And in 1984 an assets test was reintroduced – just eight years after its abolition. These and subsequent tightenings of age pension eligibility marked a fundamental shift in the social construction of the age pension from a demogrant claimed as a social right to, increasingly, a selective provision based on economic need. In other words, the tightenings of eligibility sought to bring the age pension full circle back to what Deakin’s government had originally intended it to be, namely, a residual social assistance program for the needy elderly.


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Occupational superannuation With regard to occupational superannuation, the objectives for this pillar represented a grand departure in two respects. The first was that the objectives represented a first real attempt to articulate a role for superannuation. Superannuation had played such a minor role in providing a retirement income that Dixon and Foster (1982), for example, wondered why a system of occupational superannuation existed at all! They were also at a loss to explain how policy towards it had evolved. But secondly, and more importantly, the objectives of strengthening the market pillar reflected an acknowledgment by government that it was now legitimate to do what had previously been illegitimate, namely, to intervene with regard to middle- and high-income earners with a view to ensuring higher levels of earnings replacement, even though doing so would contribute to perpetuating into retirement the income inequalities that governments usually try to mitigate (Forward 1983). The pursuit of the first group of reform objectives has been far from resolute. Indeed, Australian governments have pursued these objectives while simultaneously introducing measures that have weakened the possibility of realising some of them. Thus, like many other grand departures in public policy, it has, in important respects, fallen short of what was hoped for in the early stages of the reform process. Further, by virtue of the nature and frequency of changes to Australia’s retirement income system it has become a ‘marvel of complication’ (Sass 2004: 12) requiring considerable expertise to understand and negotiate it. And while the most marked changes have focused on the market and public pillars, recent years have witnessed changes – the second group of reform objectives – that have focused on the role of the third pillar of personal savings and incentives designed to encourage workers to delay retirement.

In pursuit of the objectives

The expansion in superannuation coverage A major objective driving the reforms that began in the 1980s was the expansion in occupational superannuation coverage. According to Myles


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and Pierson (2001: 306), a distinguishing feature of pension reform observed ‘with uncanny regularity’ around the world has been the utilisation of a corporatist social contract involving organised labour and employers’ associations as the political mechanism for redesigning pension policies. In Australia’s case, however, the social contract was formed between the Australian Council of Trade Unions (ACTU) (organised labour’s peak body) and the federal government. Indeed, the single greatest impetus to the expansion of coverage was the election of a Labor government to power in 1983 and the subsequent introduction of the Superannuation Guarantee (SG) that took effect on 1 July 1992. The SG arose out of the 1986 national wage case under Australia’s then centralised wage-fixing system. On the eve of the 1983 federal election, the ACTU, for which improved superannuation had long been an issue, entered into a social contract (the Prices and Incomes Accord) with the Australian Labor Party. Under this contract, the ACTU undertook to restrict future claims for national wage increases to movements in the consumer price index and improvements in national labour productivity in order to help combat inflation and revive the share of national income going to profits. In the wake of the election, the ACTU therefore directed its energies towards improvements in non-wage benefits and working conditions, the so-called ‘social wage’. In the 1986 national wage case before the Arbitration Commission (the central wage-fixing authority at the time), the ACTU, spurred on by the establishment of the Building Unions’ Superannuation Scheme in 1984, claimed, with the support of the government, a 3 per cent wageequivalent (about $12 a week on average) employer-paid superannuation contribution for employees covered under industrial ‘awards’ (national standard labour contracts). This claim was made in lieu of a claim for a wage increase based on productivity improvements. The Arbitration Commission endorsed a process – subsequently affirmed by the High Court (Sass 2004: 7) – of employer–employee negotiations with a view to reaching consent agreements on new or improved superannuation based on ‘award superannuation’ (the 3 per cent wage-equivalent). The ensuing negotiations resulted in coverage increasing to around 70 per cent of all employees by the end of the 1980s (Borowski 1991).


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Legislation passed in the same year, the Occupational Superannuation Standards Act, required that the employer contributions accumulated in individual workers’ accounts be both portable and preserved until age 55. Savings were held in decentralised privately managed superannuation funds, managed and controlled by trustee boards comprising equal numbers of employer and employee member trustee directors. These directors were either nominated by employer associations and trade unions, or elected by employers and employee members of the superannuation funds. The corporate governance of these essentially industry-based multi-employer funds represented a significant departure in the ownership and control of capital in Australia (Olsberg 1994). Award superannuation, however, excluded workers who were not covered by centrally determined industrial awards. Further, many employers either resisted union efforts to initiate negotiations on superannuation or failed to comply with award superannuation where the consent agreements had been approved by the Arbitration Commission. Great difficulty was experienced in policing the payment of contributions, particularly among small employers (Olsberg 1995). In the event, the government announced mandatory superannuation coverage at the 1991 Federal Budget. As there was no economic situation or policy consensus that dictated the mandating of superannuation coverage, various interpretations for this decision have been offered. For example, according to Olsberg (1997), it allowed the government to portray itself as a party of orthodox monetarism and fiscal restraint. For organised labour, the pursuit of mandatory coverage was a response to the perceived difficulty of achieving wider coverage and higher contribution levels through the industrial relations system (Schulz 2005). Under the Superannuation Guarantee (SG) Charge Act 1992, all employers not already doing so were required, as of 1 July in that year, to pay a minimum of 3 per cent of an employee’s salary into a superannuation fund. The level of mandatory employer contributions under the SG has progressively increased since then. It reached 9 per cent in 2002, where it has remained. (Because of a 15 per cent contributions tax (discussed later in this chapter), the mandatory 9 per cent SG contribution is effectively a net contribution of 7.65 per cent.)


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As a result of the SG, today 90 per cent of all workers – almost all full-time workers and three-quarters of part-time workers – have some superannuation coverage (Stanford 2003; ASFA 2004a). Since 1990, the self-employed and uncovered employees have been allowed to make tax-deductible contributions, within age-based limits, to superannuation funds. Those most likely to be uncovered are people with low-incomes, namely, those who are either outside the workforce or in uncovered lowwage employment. (The latter includes employees under 18 years of age who work less than 30 hours a week or employees who earn less than $450 per month from a single employer.) Indeed, the accommodation, cafes and restaurants, and retail trade industries (notable for their high proportions of casual and/or part-time workers – the majority of them female employees) have the lowest superannuation coverage (about 80 per cent). These two industries also have the lowest average earnings (ABS 2005). While most private sector schemes today are of the defined contribution or accumulation variety (see below) and hold sizeable assets, the Commonwealth Government, in contrast, carries substantial unfunded superannuation liabilities in the order of $140 billion. To help meet these liabilities, the Treasurer announced the establishment of the Future Fund in the May 2005 Budget. Contributions to the fund will come from the proceeds of the sale of Telstra and a contribution in the order of $18 billion derived from federal government Budget surpluses (Myer 2006). It is anticipated that a major target of investment by the fund will be infrastructure projects. Coverage expansion and superannuation fund assets The coverage data indicate that Australia has been very successful in enhancing the role of the market pillar in terms of expanded occupational coverage. The expansion in coverage has resulted in a huge growth in the assets of superannuation funds and a new mix of fund types. In 1985, superannuation fund assets stood at $40 billion. Ten years later, this figure was $228 billion. Today, pension assets of $742 billion are held in almost 27 million individual superannuation accounts. Fund assets are increasing by between $50 billion and $60 billion a year. This pool of savings is forecast to surge to $1600 billion by 2015 (Colebatch 2006; Foley 2006).


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A steady process of rationalisation and consolidation of superannuation funds has been in train for a number of years. Today, there are just over 1300 large funds in Australia. Of these, the 226 retail funds (typically managed by life insurance companies and other financial institutions) hold the largest share (one-third) of total superannuation assets. There are a further 84 industry funds that draw members from unrelated employers across a single industry. These account for 15 per cent of total superannuation savings, while almost 973 corporate (single- and multi-employer) funds hold a further 9 per cent. Forty-one public sector funds hold 17 per cent of all superannuation savings. The remaining superannuation assets are held in 312 000 small, self-managed, ‘do-ityourself’ funds with fewer than five members (ASFA 2005). Coverage expansion and the growth in defined contributions plans But the expansion in coverage is just one dimension of enhancing the market pillar. The expansion has been accompanied by other, less sanguine developments, most notably the heightened financial risk borne by members of superannuation funds due to the marked shift from defined benefit to defined contribution or accumulation funds and regulatory shortcomings. As noted above, prior to the major reforms of the superannuation system that began in the 1980s, most superannuation funds provided defined benefits (albeit commonly paid in lump-sum form). However, as superannuation coverage has grown, there has been a large expansion of defined contribution or accumulation type funds. So great has been the shift from defined benefit to defined contribution funds that today only about 10 per cent of all private sector funds provide defined benefits and these funds cover less than 4 per cent of all private sector workers (APRA 2004). Defined benefit funds are more highly represented in the public sector. The factors that have contributed to the dominance of defined contribution funds include: their simplicity under award superannuation and SG arrangements; the fact that both award and SG superannuation arrangements were defined in terms of earnings-related contribution levels rather than benefit levels; and a desire by employers to privatise retirement risk – that is, to shift it onto their employees (APRA 1996).


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The risks borne by the members of the now pervasive accumulation funds are many. For example, under defined contribution schemes, workers must bear both the investment risk (fluctuating investment returns) and the longevity risk (the risk of living longer than you can afford to). Thus, whereas defined benefit plans ‘make clear the outcomes of the system in terms of what the retirement income system is trying to do, [namely] to replace lost earnings’ (Diamond 2001: 77), under defined contribution plans ‘the contribution required to finance a given retirement pension changes whenever wage rates and investment returns change’ (Myles & Pierson 2001: 324). Indeed, between 2001 and 2003 most Australian funds had negligible or negative returns due to the poor performance of the equities (share) market in which about two-thirds of total Australian superannuation assets are invested (Stanford 2003). In 2005, however, the average fund returned 13.7 per cent (Weekes 2006). Interestingly, industry funds, which are non-profit funds and have much lower management and other fees, have consistently produced better investment returns than the retail funds. Other risks borne by workers under defined contribution plans include the erosion of savings through high management fees, superannuation fund fraud and mismanagement, and inflation. A fuller treatment of these risks appears in Schulz and Borowski (2006). Regulation Australian superannuation funds are currently protected against fraud or theft by a compensation scheme, financed by a levy on all funds, that covers up to 90 per cent of the loss (Schulz 2005: 24). In addition, corporate solvency reforms have recently been proposed by the federal government that take into account superannuation entitlements of employees who have lost their jobs through employer bankruptcy (Weekes 2005). Clearly, however, prevention is better than cure and an important means for reducing the risk borne by covered workers is the regulation of superannuation funds. Australia’s superannuation industry was substantially self-regulated prior to the mid-1980s. The public regulatory provisions largely related to the taxation of superannuation under the Income Tax Assessment Act 1915. Fortunately, the expansion of superannuation coverage and the growth


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in defined contribution funds have been accompanied by major reforms in the regulatory framework to protect workers’ superannuation savings. Thus, in 1987 the Insurance and Superannuation Commission was established as a specific industry regulator. Further regulatory legislation was passed in 1993 (the Superannuation Industry (Supervision) Act). And in 1998 the Australian Prudential Regulation Authority was established as a single regulator for the finance industry. But options for still further reform continue to be canvassed (see, for example, SWG 2002). This is because ‘the ability of superannuation regulations to ensure the security and adequacy of retirement incomes is unclear’ (Bateman 2003: 126), despite the marked improvement in the regulatory regime.

Enhancing retirement income adequacy Another goal for Australia’s retirement income system that emerged with the unfolding of the reform process was to enhance the adequacy of superannuation-provided retirement incomes for future retirees, retirees whose retirement income expectations will be higher than those of past retirees. For most of the 20th century, the major source of income in retirement for most Australians was the age pension. Consequently, the issue of what constitutes an adequate retirement income was constructed solely in poverty alleviation terms. As recently as the 1980s, the notion that an adequate retirement income is one that allows retirees to maintain accustomed pre-retirement living standards was an alien one in Australia (Borowski 1984; Borowski, Schulz & Whiteford 1987). However, by the early 1990s, this alternative notion of what constitutes an adequate retirement income was beginning to take hold. Thus, for example, in 1992 the Senate Select Committee on Superannuation observed that future retirees would require a standard of living consistent with that experienced while working (Commonwealth of Australia 1992: 7). Today, there is now a broad consensus that an adequate retirement income is one that, for a person on average earnings, replaces about 60–65 per cent of gross pre-retirement earnings (Commonwealth of Australia 2002a). This adequacy standard was recently endorsed by the then Leader of the Labor Opposition, Mark Latham, who, during the campaign leading up


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to the 2004 federal election, advocated a retirement income goal of ‘65 [per cent] at [age] 65’ for the non-poor. Although the mandatory employer-paid SG contributions have been a retirement savings boon for large numbers of workers, it is quite evident that a contribution of 9 per cent over a working lifetime is almost certain not to yield a retirement income of ‘65 at 65’ for a person on average earnings over a working lifetime. (A Treasury submission to the Senate Select Committee on Superannuation estimated that the SG in conjunction with the age pension would provide a replacement rate for an individual on median earnings of just over 70 per cent after 30 years (Commonwealth of Australia 2002a: 23).) Indeed, at the time that mandatory superannuation was introduced, the government considered that the 9 per cent contribution rate was not necessarily the final figure. The need for a complementary mandatory employee contribution, with an ultimate target of a combined mandatory employer–employee contribution of between 12 per cent and 15 per cent and possibly even 18 per cent, was discussed (Warren 2004: 172). A few years later, in its 1995 Budget, the Labor government proposed to increase superannuation contributions to 15 per cent by 2002 by means of a 3 per cent government co-contribution to match an employee contribution of 3 per cent (Commonwealth of Australia 2002a). Although there is less agreement about the precise level of superannuation contributions required to fill the adequacy gap than there is about what constitutes an adequate retirement income, former Prime Minister Keating (Hughes 2005) and major stakeholders (such as the ACTU and the superannuation industry) continue to advocate raising the SG by a further 6 per cent to 15 per cent through additional employer, employee and/or government contributions. Nevertheless, there is nothing to suggest that the current government has further plans to move beyond the current mandatory employer contribution level of 9 per cent in view of concerns about the impacts of higher employer SG contributions on labour costs and hence employment, and the imposition of an increasing burden of employee contributions on the disposable incomes of low-paid workers. The government, however, has taken some ad hoc measures to enhance retirement income adequacy. For example, with a view to encouraging greater savings for retirement by low-income earners beyond the employer-


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paid 9 per cent SG, the government introduced a non-means-tested cocontribution scheme effective from 1 July 2003. Through the end of June 2004, the government matched on a dollar-for-dollar basis up to $1000 the voluntary superannuation contributions made by people earning up to $27 500. For those with higher earnings, the maximum co-contribution fell by 8 cents for each dollar of additional income until it phased out completely at $40 000 (about 82 per cent of average annual earnings). From July 2004, the government co-contribution is $1.50 for each $1 contributed by a worker up to a maximum of $1500 for people earning up to $28 000. Above this amount, the maximum co-contribution is reduced by 5 cents in each dollar of income, to phase out completely at $58 000. While unquestionably an attractive scheme, it is premised on low-income earners having the financial wherewithal to make the after-tax contribution required to qualify for the government’s co-contribution payment. Indeed, figures released by the Australian Tax Office in September 2005 showed that of the 606 000 people who accessed the scheme, claiming benefits of $327 million (an average of $540 per person), tens of thousands were well-to-do couples (Gordon 2005). Nevertheless, many women have benefited from the new co-contribution policy, with more than 60 per cent of those in receipt of a government co-contribution benefit in 2005 being women (Olsberg 2005).

The tax treatment of superannuation A third objective of the reform process was to contain the public ‘subsidy’ associated with the tax concessions enjoyed by superannuation schemes. Although the inadequacy of projected retirement incomes is due mainly to the low level of contributions, there are other factors at play here too. One of these is the tax treatment of superannuation. Superannuation in Australia is subject to a unique (and complex) tax regime by international standards. This regime has sought both to encourage saving for retirement in the form of superannuation and, at the same time, to contain the public costs associated with these superannuation tax incentives. A major effect of the tax regime has been to very seriously undermine one of the objectives of the reform process began in the 1980s, namely, to enhance the adequacy of the retirement incomes provided by means of superannuation.


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As noted in the discussion above on Australia’s pre-1980s retirement income system, employer superannuation contributions were taxdeductible and lump-sum payments were very lightly taxed. Lump sums received on retirement played a minor role in providing a retirement income. These sums were typically small and were often either dissipated by early retirees prior to reaching age pension eligibility age or invested in ways that did not, due to poor integration between the age pension and superannuation, obviate age pension eligibility. This phenomenon of benefiting from tax-subsidised superannuation and yet still receiving a taxpayer-funded age pension is colloquially known as ‘double dipping’. In 1984, the government introduced increases in the tax on superannuation lump-sum benefits arising from any entitlements accrued after 1 July 1983. These new taxes were: a flat rate of 30 per cent on lump sums taken before age 55; and a rate of 15 per cent on the first $55 000 taken after age 55, with the balance taxed at 30 per cent. Lump sums used to purchase a private pension were totally exempted from taxation, although the private pension’s income stream would be subject to income tax. In 1988, further tax changes were announced. A 15 per cent tax on all contributions and superannuation fund earnings was imposed. With regard to lump-sum benefits linked to post-1983 employment, a tax-free threshold of $60 000 (regularly adjusted upwards since then) for those who preserve their lump sums until at least age 55 was introduced, beyond which a 15 per cent flat rate of tax was applied. And in 1996 a fourth layer of taxation was introduced under which employer superannuation contributions made for high-income earners faced a further ‘surcharge’ of up to 15 per cent. These taxes, intended to recoup/reduce some of the sizeable foregone revenues (the tax expenditures) associated with superannuation tax concessions, have generated enormous revenues – currently $5.8 billion (ASFA 2004b), or 3.3 per cent of all federal government revenue. But they have also resulted in very substantial reductions in the value of the benefits that would otherwise have accrued to retirees from their superannuation savings. Indeed, the cumulative effect of these taxes and their role in eroding the value of retirement benefits, together with the poor investment returns of some superannuation funds, have, for some, substantially diminished the attractiveness of superannuation as an investment.


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In view of the continued growth in superannuation tax revenues on the one hand and the increasing proportion that superannuation tax expenditures represent of all tax expenditures – 56 per cent in 2003–04 (Warren 2004: 177) – on the other, the federal government has been loath to forego this revenue source. Nevertheless, there has been a growing, but somewhat grudging, recognition of the impact of these taxes on the level of superannuation savings that individuals are able to accumulate. In 2004, the government announced a decrease in the superannuation surcharge (the fourth layer of superannuation taxation) from its maximum of 15 per cent, to 12.5 per cent from July 2004 to 10 per cent by mid-2005. Similarly reluctant to forego the superannuation tax ‘bounty’ should it be elected to office in the 2004 federal election, the Labor Opposition had proposed in its electoral campaign to cut the base-level contributions tax by a mere 2 per cent to 13 per cent (Weekes 2004). In the event, the government abolished the surcharge from 1 July 2005. Further, within the context of a public debate about how the government might use the huge Budget surplus projected for the 2005–06 financial year, the Finance Minister, Nick Minchin, in January 2006 briefly floated the idea of abolishing the base-level 15 per cent contributions tax. It was greeted by a chorus of support from business groups, economists, the Labor Party and the Association of Superannuation Funds of Australia, but was derided as unacceptable by Federal Treasurer Peter Costello and, just one day later, Minchin accepted that the proposal was premature (Koutsoukis 2006). In addition to encouraging retirement savings and seeking to recoup or reduce foregone revenue, the superannuation tax regime also seeks, on equity grounds, to limit the amount of money that can be invested in superannuation and be taxed at concessional rates. The government has capped the level of tax-advantaged benefits it considers reasonable for a retiree to receive. On 1 July 1994, it introduced indexed flat-dollar Reasonable Benefit Limits (RBLs). Any amount received above the RBL is taxed at the maximum personal marginal tax rate, which is currently 48.5 per cent. For the 2005–06 financial year, the reasonable benefit limit for a lump sum was $648 946. However, where at least 50 per cent of the total benefit is used to purchase an annuity (private pension), the RBL is twice this amount ($1 297 866).


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From lump sum to income stream? The changes in the tax treatment of superannuation were not only animated by the government’s desire to reduce the public subvention of superannuation. They also sought to redress the situation of the more generous tax treatment of lump sums relative to private pensions and thereby make the latter, which provide an income stream throughout retirement, more attractive. The change in the tax treatment of lump sums, the two-tiered RBL, a 15 per cent pension tax offset available to those aged 55 years and over who draw income from a private pension, and the generous treatment of complying annuities under the age pension’s means test (the exemption under the asset test of 100 per cent of the money invested in these products was recently reduced to 50 per cent), all seek to provide an incentive for the purchase of an income stream. And to the extent that superannuation is preserved until retirement and provides an income stream throughout the retirement years, it would obviate the need for an age pension. Despite the tax and other incentives to take retirement income in pension or income stream form rather than as a lump sum, the government’s efforts to encourage retirees to purchase private pensions with their lump sums has met with little success. Today, more than two decades into the reform process, three-quarters of all retirees opt for lump-sum payments (Commonwealth of Australia 2003). There are several reasons for this. One is that lifetime annuities in particular provide low returns. They also entail a loss of capital to the estate upon the retiree’s death. (Capital guarantees are usually less than life expectancy.) Further, the comparatively small sums of accumulated retirement benefits may be insufficient to purchase a private pension that provides a reasonable income stream. Thus, recent figures indicate that the average superannuation balance of 50–69-year-olds is just $83 000, while average household retirement savings where at least one 50–69year-old is still working are just $170 000. In a number of industry funds (where the majority of Australia’s workers hold accounts), balances for all ages are very much smaller, averaging $10 000 or less, with a number of funds with average balances around the $5000 or $6000 mark (Clare 2004). Given that lump sums are often used, in part at least, to retire debt upon retirement, the balances available to purchase a private


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pension may be still smaller than these figures suggest (AMP Financial Services 2004). And because lump-sum benefits of this order would attract relatively little taxation, the tax disincentive to take a lump-sum payment remains small. Nevertheless, policy-makers continue to support the notion that superannuation lump-sum payments should be used to provide a source of income throughout the retirement years. The Senate Select Committee on Superannuation recommended in 2003 that the government, at some future time, mandate the use of a proportion of superannuation savings for the purchase of either a lifetime or term-certain annuity or pension on retirement (Commonwealth of Australia 2003). Future retirees who will have had a longer period to accumulate superannuation savings can be expected to be better placed financially to purchase a private pension that provides a more adequate income stream. Even so, the sort of compulsion recommended by the Select Committee may be necessary to bring about a meaningful shift from lump sums to income streams.

Reducing reliance on the public pillar A fifth objective of the reform process was to reduce reliance on the public pillar – the age pension – as a source of retirement income through higher incomes provided by superannuation on the one hand and restricting access to the age pension by tightening eligibility on the other. A recent example of the tightening of age pension eligibility was the raising of the eligibility age for women from 60 years to 60.5 years in 1995. It is now 62.5 years and by 2014 will have increased to 65 years, the eligibility age for men. As the Australian economy has been very buoyant for well over a decade, the current state of the economy is not a factor driving efforts to constrain further age pension eligibility. However, the implications of population ageing for heightened levels of future public expenditure continue to weigh heavily on the minds of policy-makers. The current coalition government subscribes to the pessimistic outlook concerning the impact of ageing on public expenditures most recently portrayed in the Intergenerational Report (Commonwealth of Australia 2002b) and Productivity Commission (2005). According to the former


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report, ‘demographic spending’ by the Commonwealth Government is projected to rise from 13.9 per cent of GDP in 2000 to 19.2 per cent by 2041. Despite the considerable doubt that the economic impacts of population ageing on the public purse will be as dire as these figures suggest (see, for example, Dowrick & McDonald 2002 and chapter 1 of this volume), the government remains strongly committed to reducing the take-up rate of the age pension. After two decades of reform, the age pension today remains the major source of retirement income for most Australians. About 80 per cent of the elderly currently receive the age pension or the service pension (Tesfaghiorghis 2002; Department of Family and Community Services 2003). Of those, two-thirds receive a full pension and one-third receives a part pension. This level of take-up should not come as a great surprise, given that the superannuation system still has a long way to go to reach maturity. But projections of the future pattern of age pension entitlement indicate that the take-up rate will be substantially higher than what was expected in the early years of the retirement income reform process. Thus, the Economic Planning and Advisory Council expected that perhaps only 20 or so per cent of the aged population would be eligible for the age pension by the end of the third decade of the 21st century (Tulpule 1992: 32–33), by which time the effects of the SG will have been felt. Yet, it has been recently estimated that over an even longer projection period – by 2050 – the proportion of elderly people receiving the age pension will have fallen by only by five percentage points, to 75 per cent. However, the balance between full- and partpension recipients will have reversed itself, with two-thirds receiving a part-pension and one-third receiving a full pension (Commonwealth of Australia 2002a). It should also be borne in mind that, despite this expected future decline in the take-up rate and the shift in the mix between full- and part-pensions, there will still be a large increase in age pension expenditure because of population ageing and increasing longevity. Clearly, Paul Keating’s objective of replacing the age pension as the standard form of retirement income for future retirees (Olsberg 1994) will only have been partially realised, further underscoring the importance of substantially increased superannuation.


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Increased savings Another objective of the reform process was to increase household savings and, in turn, national investment. The introduction of mandatory superannuation contributions has meant that virtually all Australian workers now hold growing sums in one or more superannuation fund account. The scale of these savings is reflected in the size of superannuation fund assets discussed earlier in this chapter.

Retirement equity The declared objective of introducing greater equity into Australia’s national retirement income system with the introduction of mandated superannuation has had limited success. A key intention of the then Labor government and the trade unions was to seek an equitable provision of superannuation coverage and level of benefits for ordinary wage workers relative to that provided for managerial employees and those in the public sector. This has been marginally successful. Almost all employees in the paid workforce now do have employer-contributed retirement savings in their superannuation accounts. But the level of benefits accrued is largely contingent upon the level of lifetime income in the paid workforce. As a largely occupation-linked benefit, the amount an employee has at retirement reflects lifetime income in the paid workforce, plus or minus investment earnings and fund fees and charges. As a consequence, inequities in retirement income, and so retirement lifestyles, continue to generally reflect economic and social inequities of the paid workforce. Perhaps no more persistent inequity in retirement savings continues to exist than the disadvantages that women face in the almost entirely occupation-linked superannuation system. Women in Australia are still ‘Ms…ing out’ when it comes to retirement savings and having adequate income to sustain a reasonable, let alone comfortable, lifestyle in retirement. In an occupation-linked system of superannuation, women accumulate considerably less retirement savings than do men. A complex array of constraints – broadly summarised as industrial, institutional, legal/political, social/cultural and attitudinal – impact upon women’s retirement savings


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options and opportunities for financially independent and comfortable retirement lifestyles. Such problems are not confined to Australia – many other countries have identified similar problems (Olsberg 2001). Women on average have less than half the retirement savings in superannuation than do men, because on average they have about half the lifetime earnings that men do. The current average superannuation balance for female fund members of $43 000 is just over half the average balance of male fund members at $78 700 (Clare 2004). In the industry superannuation funds, where the majority of women have their savings, the figure is even more dismal. The short duration so far of industry funds, the low levels of contributions and the large numbers of casual workers in those funds (particularly female employees) means that account balances in many industry funds are generally low (Clare 2004). Of note too, is the fact that those women who are unemployed or not in the labour force have very little retirement savings at all. The low accumulations of women’s retirement savings from occupation-linked superannuation and, so, gender inequality in old age are the consequence of women’s lower levels of attachment to the paid workforce, their patterns of broken or fragmented paid work crucially compromised by interruptions to paid employment due to childbearing, childrearing and other family responsibilities, their over-representation in lower paid industries and sectors of the economy, and continuing disparities between men’s and women’s wages (even in industries with similar levels of skill). In Australia, the problem of relatively low superannuation savings is compounded for many women (who have worked in multiple casual or part-time jobs) by their having multiple accounts leading to higher aggregate fees and costs. As the system in Australia develops further, many more women will benefit from having some amount of superannuation savings for their retirement. And recent legislative and policy initiatives have sought to address continuing insufficiencies in the system with regard to women. Changes to Family Law legislation have resulted in greater transparency in the division of superannuation on divorce, and the introduction of Spouse Accounts has certainly increased the numbers of women who have their own superannuation accounts. Of note too, as reported earlier, the introduction of the government co-contribution for personal contributions to superannuation has been hugely beneficial for some women.


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Other policy changes that facilitate greater voluntary contributions will benefit some, but not all women. Most women just do not have enough disposable income to make substantial superannuation contributions on their own, and many use their income from paid work to cover household expenses while their husband or partner (if they have one) contributes into his superannuation (Olsberg 2001). Many women report their savings are so small that there is not really much point financially planning for their retirement, such as paying to see an investment adviser (Olsberg 2001). This has led to claims that women do not plan for retirement, and that women are poor savers and conservative investors (Onyx & Watkins 1996), However, recent research has demonstrated that when women do receive a sufficient income in the paid workforce and reasonable (not even necessarily substantial) retirement savings, women are even more diligent savers than are men, and are canny investors (Olsberg 2001).

Further objectives In 1996, a Liberal–National Party coalition government was elected under Prime Minister John Howard. This government has broadly pursued the objectives described in this chapter. However, it has also sought to strengthen the third pillar of personal savings (but not just for workers), provide incentives for delaying retirement as a further means of containing the cost of the age pension, and enhance consumer sovereignty through allowing workers to choose the fund into which their employer-paid SG superannuation contributions are deposited. Several recent initiatives illustrate the government’s attempts to strengthen the third pillar of personal savings. For example, since July 1999 there has been provision for an 18 per cent tax rebate on superannuation contributions of up to $3000 per year made on behalf of an unemployed or low-income spouse (earns less than $13 800). From July 2004, anyone aged between 18 and 65 – not just the employed – can, within age-based limits, contribute to a superannuation fund and receive an income tax deduction. Indeed, even early retirees who want to top up their superannuation but do not wish to return to the workforce can now continue to make superannuation contributions up until age 65 and claim the first $5000


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and then 75 per cent of the rest up to the age-based limit as a tax deduction. And, most recently, spouses and de facto heterosexual couples can, once a year, split personal or mandatory employer superannuation contributions made after 1 January 2006 once the financial year has finished (after 30 June). This splitting will mostly benefit couples where one is a highincome earner and the partner has low income or no income at all through facilitating access to two RBLs, two-tax-free thresholds and, for those who take their superannuation as income stream, a 15 per cent tax rebate. What is interesting about these initiatives is that they represent a wearing away of the relationship between paid employment and superannuation – a move away from an occupational employer-provided benefit to long-term personal saving for late life within the superannuation system. One of the government’s initiatives to encourage people to delay retirement is the Pension Bonus Scheme. Introduced in 1998, this scheme awards a maximum tax-free lump-sum bonus of $28 363 to people who defer claiming the age pension and go on working for up to five years beyond pension age. They must be eligible for the age pension to receive the bonus. Currently, only 20 per cent of people over age pension age who are still working are registered for the scheme. In 2003–04, the average bonus was $11 324 (Fenech 2004). In February 2004, the Treasurer, Peter Costello, announced changes that, from July 2005, give people access to superannuation at or beyond their preservation age without having to leave the workforce, provided that superannuation is taken as a private pension income stream and not a lump sum. It was promoted as an initiative that would be particularly suited to workers who wish to reduce their working hours and to supplement their earned income with superannuation pension income.

Conclusion A recent study that sought to assess the ‘vulnerability’ of 12 developed countries to rising old-age dependency costs ranked Australia least vulnerable according to an ageing vulnerability index. It was least vulnerable because of, among other measures, its comparatively lower projected age dependency ratio, comparatively low-cost age pension and the fact that superannuation benefits will reach 11 per cent of gross


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domestic product by 2040, far exceeding that of any of the other countries (Jackson & Howe 2003). In light of findings such as these, prominent observers – the World Bank, International Monetary Fund and others (for example, Harris 2004) – have held up Australia’s retirement income strategy of mandating superannuation and rolling back public income support in the form of the age pension as worthy of emulation by others. But even assuming that the assumptions and analyses underpinning the development of such measures as the ageing vulnerably index are correct, this chapter has shown that, after more than two decades of reform, the changes in Australia’s retirement income system either have not or cannot expect to fully realise the objectives that were expected of them. To be sure, the reform process is continuing. A recent example of this is the passage in June 2004 of ‘choice-of-fund’ legislation that allowed, from mid-2005, employees to choose the fund into which their SG defined contributions will be deposited. In the first four months, only about 7 per cent of people switched funds. This low switch rate is largely attributable to the difficulty in making an informed decision (Cameron & Gibbs 2005). This legislation also provided for improvements in disclosure regarding superannuation funds’ fees regimes. But major challenges remain to be tackled. These include, for example, extending superannuation coverage to the small proportion of the workforce that remains uncovered, raising mandatory SG contribution to levels that will produce an adequate retirement income in the future, substantially reducing and simplifying the superannuation ‘tax bite’ that so seriously compromises the realisation of the adequacy objective, guaranteeing the safety of retirement savings held in the now pervasive accumulation-type superannuation funds, ensuring that superannuation is actually used as a means of funding an income stream throughout the retirement years and, as a result of all of these, reducing still further the future take-up rate of the age pension. And there must be full disclosure of fees and charges and controls on the fees charged by investment and financial services providers, particularly retail sector providers. Of note, too, as age-related government spending relative to Australia’s gross domestic product (GDP) is expected to increase, the future fiscal burden for government necessitates greater integration of


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superannuation and social security provisions. And this is so even if the size of the increase in age-related spending is not as great as that projected by the Productivity Commission (2005), as some critics of its report have suggested. One integration strategy is to prevent doubledipping through bringing the superannuation preservation age and the age pension eligibility age into alignment. While the preservation age has been increased to 60 for those born after 1 July 1964, a further increase and alignment with the age pension eligibility age is necessary (Warren 2004). Also, there must be some serious attention paid to the current disadvantages that women face in the largely occupational-dependent system. Women’s fragmented patterns of attachment to the paid workforce will seriously continue to reduce their superannuation entitlements compared to male employees. Women, on average, will continue to retire from the paid workforce with insufficient savings to ensure a comfortable lifestyle in later life. This forecast is particularly threatening for baby boom females (born between the late 1940s and early 1960s) who have enjoyed some degree of financial autonomy. Their expectations for retirement lifestyles are far higher than those of their mothers and grandmothers, who were and are currently almost entirely dependent on the government-provided age pension. There are strategies that can address women’s continuing disadvantages. These include greater equity for women in the paid workforce; more education and incentives for saving, superannuation and investment; assisting women to maximise what superannuation savings they do have; and providing an increasing role for women in the corporate governance of Australia’s superannuation and retirement income system. In sum, if Australia’s retirement income system is to be truly worthy of emulation, then more zealous fidelity to the objectives that emerged in the reform process that began in the 1980s will be necessary.

Postscript Further changes to the retirement income tax regime were announced in the Federal Budget of May 2006. These changes have been almost


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universally welcomed as providing a package of personal tax measures that will give Australians greater opportunities and incentives to save for their retirement. The major features of the Budget changes were radical simplification of superannuation taxes at the point of retirement by abandoning the reasonable benefits limit (RBL), abolishing taxation on retirement benefit payouts for those over 60 years of age, opening co-contributions to the self-employed, easing social security restrictions around the interaction of superannuation and social security payments, dramatic smoothing of age-based contribution limits, and extending the age at which contributions to superannuation can be made up to 75 years. The only initial criticisms of these changes came from welfare organisations and some individual politicians who argued that Budget reforms unfairly benefit the wealthy and high-income earners. The criticisms centre upon the lack of improvements in social security benefits, such as the age pension, and on reductions in personal income tax rates. It was not possible to revise the chapter and canvass the possible implications of these changes before this volume went to press. References AMP Financial Services (2004) Income, Superannuation and Debt Pre and Post Retirement – The Lump Sum: Here Today, Gone Tomorrow, AMP Life Limited and the National Centre for Social and Economic Modelling Income and Wealth Report, Issue 7, March. Association of Superannuation Funds (ASFA) (2004a) How Fair is Super? (Fact Sheet #6), Association of Superannuation Funds of Australia, Sydney. —— (ASFA) (2004b) Taxes on Super (Fact Sheet #4), Association of Superannuation Funds of Australia, Sydney. —— (ASFA) (2005) Superannuation Statistics – October 2005, Association of Superannuation Funds of Australia, Sydney. Australian Bureau of Statistics (ABS) (1998) Employment Benefits Australia 1983 to 1992 (Cat. no. 6334.0), Australian Bureau of Statistics, Canberra. —— (ABS) (2005) (18 March) Year Book Australia: Labour Earnings and Benefits, viewed 30 November 2005, . Australian Prudential Regulation Authority (APRA) (1996) Insurance and Superannuation Bulletin, Australian Prudential Regulation Authority, Canberra, June. —— (APRA) (2004) Superannuation Trends, December Quarter 2003, Australian Prudential Regulation Authority, Canberra, 21 April. Bateman, H (2003) Regulation of Superannuation, The Australian Economic Review, 36(1): 118–27. Borowski, A (1984) Towards Defining an Adequate Retirement Income, Social Security Journal, June:


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1–10. —— (1987) The ‘Revolution’ in Australian Retirement Income Policy, The Gerontologist, 27(4): 478–86. —— (1991) The Economics and Politics of Retirement Incomes Policy in Australia, International Social Security Review, 44(1–2): 27–40. Borowski, A, Schulz JH & Whiteford, P (1987) Providing Adequate Retirement Income: What Role Occupational Superannuation? Australian Journal on Ageing, 6(1): 3–13. Cameron, R & Gibbs, M (2005) Attitudes to Super and Choice in Late 2005, Paper presented at the conference of the Association of Superannuation Funds of Australia (ASFA), 10 November, Melbourne. Clare, R (2004) Why Can’t A Woman Be More Like A Man – Gender Differences in Retirement Savings, Paper presented at the ASFA 2004 National Conference, 10–12 November, Adelaide. Colebatch, T (2006) Super Idea to Return Billions, The Age, 13 January, p. 1. Commonwealth of Australia (1992) Safeguarding Super, Senate Select Committee on Superannuation, Canberra, June. —— (2002a) Superannuation and Standards of Living in Retirement, Senate Select Committee on Superannuation, Canberra, December. —— (2002b) Intergenerational Report 2002–03 (Budget Paper no. 5), Canberra, 14 May. —— (2003) Planning for Retirement, Senate Select Committee on Superannuation, Canberra, July. Department of Social Security (1984) Government Support for Retirement Incomes in Australia (Research Paper no. 24), Policy Review Branch, Development Division, Canberra. Diamond, P (2001) Comments. In R Holzmann & JE Stiglitz (eds) New Ideas About Old Age Security: Towards Sustainable Pension Systems in the 21st Century, The World Bank, Washington DC, pp. 76–79. Dixon, D & Foster, C (1982) Alternative Strategies to Meet the Income Needs of the Age, Social Welfare Policy Secretariat, Canberra. Dixon, J (1978/79) The Evolution of Australia’s Social Security System 1890–1972: The Social Insurance Debate, Social Security Quarterly, 5(2): 1–10. Dowrick, S & McDonald, P (2002) Comments on Intergenerational Report 2002–03, Australian National University, Canberra, 21 June. Fenech, A (2004) Work – It Won’t Kill You, The Weekend Australian: Weekend Wealth, July 31–August 1, p. 38. Foley, K (2006) AXA, Barclays Eye Our Super, Sydney Morning Herald, 16 January, p. 18. Forward, R (1983) Income in Old Age: Is National Superannuation the Answer? (Current Issues Brief no. 4), Department of the Parliamentary Library, Commonwealth of Australia, Canberra. Gordon, J (2005) Wealthy Couples Receive Super Bonus, The Age, 15 September. Harris, DO (2004) Pension Reforms and Ageing Populations: Lessons from Australia and the United Kingdom. Testimony before the US Senate Special Committee on Aging, May 18. Howe, A (ed.) (1981) Towards an Older Australia, The University of Queensland Press, St Lucia. Hughes, D (2005) Keating Urges Plug for $600bn Super Hole, The Age, 10 March, p. 3. Jackson, R & Howe, N (2003) The 2003 Aging Vulnerability Index: An Assessment of the Capacity of Twelve Developed Countries to Meet the Aging Challenge, Center for Strategic and International Studies & Watson Wyatt Worldwide, Washington, DC. Kewley, TH (1977) Social Security in Australia, Sydney University Press, Sydney. Kingson, ER & Williamson, JB (2001) Economic Security Policies. In RH Binstock & LK George (eds) Handbook of Aging and the Social Sciences, 5th edn, Academic Press, New York, pp. 369–86. Koutsoukis, J (2006) Minchin Dilutes Message on Superannuation, The Age, 24 January. Manning, I (2005) Retirement Incomes: National Superannuation, Social Insurance or Something Else? In Transitions in Australian Labour Markets: Initial Perspectives (CEDA Information Paper no. 82), Council for Economic Development of Australia, Melbourne, pp. 29–34.


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Myer, R (2006) Future Fund to Take an Active Stance, The Age: Business, 28 January, p. 20. Myles, J & Pierson, P (2001) The Comparative Political Economy of Pension Reform. In P Pierson (ed.) The New Politics of the Welfare, Oxford University Press, New York, pp. 305–33. Olsberg, D (1982) Superannuation in the 1980s: The Rise of a Social and Industrial Issue, Unpublished Honours thesis, School of Social Science & Policy, University of New South Wales, Sydney. —— (1994) Australia’s Retirement Income Revolution: A New Model for Retirement Savings and Investment Politics, Economic and Industrial Democracy, 15: 283–91. —— (1995) Australia’s Retirement Income Revolution: A Finnish System ‘Down-Under’, Scandinavian Journal of Social Welfare, 4(1): 8–18. —— (1997) Ageing and Money: Australia’s Retirement Revolution, Allen & Unwin, Sydney. —— (2001) Ms…ing Out: Women and Retirement Savings, UNSW Research Centre on Ageing & Retirement Monograph, University of New South Wales, Sydney. —— (2005) Why Women Need More Money in Retirement Than Do Men, Paper presented at the Australian Financial Review National Summit on Ageing, 27 September, Sydney. Onyx, J & Watkins, A (1996) Why Women do Not Plan Their Retirement, ASFA Research Paper, November, Sydney. Productivity Commission (2005) Economic Implications of an Ageing Australia, Productivity Commission, Canberra. Rein, M (1999) Dynamics in the Comparative Analysis of Social Policy Reform. Keynote address presented at the 15th Yokohama 21st Century Forum: Towards an Active Society – Perspectives for Longer Employment and Productive Aging, held in Yokohama, Japan, 21–22 January. Sass, SA (2004) Reforming the Australian Retirement System: Mandating Individual Accounts (Issues in Brief, no. 2), Center for Retirement Research at Boston College, Chestnut Hill, MA. Schulz, JH (2005) Old-Age Income Security: Australia Tries a Different Way, AARP, Washington DC. Schulz, JH & Borowski, A (2006) Economic Security in Retirement: Reshaping the Public-Private Pension Mix. In RH Binstock & LK George, (eds) Handbook of Aging and the Social Sciences, 6th edn, Academic Press, San Diego, pp. 360–79. Stanford, JD (2003) Is Superannuation Safe? The Background and the Issues, The Australian Economic Review, 36(1): 79–88. Superannuation Working Group (SWG) (2002) Report of the Superannuation Working Group on Options for Improving the Safety of Superannuation, Superannuation Working Group, Canberra. Tesfaghiorghis, H (2002) Projections of the Number of Income Support Recipients: 1999–2051, Australian Social Policy 2001–02, Strategic Policy and Knowledge Branch, Department of Family and Community Services, Canberra. Tulpule, A (1992) Can Social and Policy Developments Cope with Demographic Change? Economic and Social Consequences of Australia’s Ageing Population – Preparing for the 21st Century (Background Paper no. 23), Economic Planning Advisory Council, Canberra, pp. 25–38. Warren, N (2004) Tax: Facts, Fiction and Reform, Research Study no. 41, Australian Tax Research Foundation, Sydney. Weekes, P (2004) Dismal Future Awaits Boomers, The Age: Business, 7 August, p. 5. —— (2005) On a Par with Pay, The Age Money Supplement, 26 October, p. 5. —— ( 2006) Stay Alert to Performance of Funds, Says Rating Agency, The Age: Business, 25 January, p. 3. Whiteford, P & Bond, K (2000) Trends in the Income and Living Standards of Older People in Australia, Policy Research Paper no. 4, Department of Family and Community Services, Canberra.


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9 Housing policy for a long-lived society Hal Kendig and Catherine Bridge

Introduction This chapter explores the importance of housing for older people and the ways in which policies can influence their housing over the coming decades. It reviews changes in housing-related policies for older people over the last ten years as a context for understanding change. It then considers housing and policy prospects as the large baby boom cohort enters old age over the next several decades. A wide variety of policies related to housing and accommodation have major consequences for older people’s economic and health resources, social participation, functioning and wellbeing. The first part of the chapter examines ageing and housing policy in terms of individuals’ lifespan development, social and economic change, and relations between generations and successive cohorts. ‘Housing trajectories’ as people grow older reflect legacies of employment and housing markets as well as current and past policies. Stability or change of housing over the life course reflects individuals’ personal and household circumstances as well as emergent opportunities or constraints in the market and policies. With population ageing ahead and uncertain economic prospects, there is increasing concern for generational equity


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between an economically and housing-advantaged baby boom cohort and the Generation X and Y cohorts that will grow old in the future. The second part of the chapter reviews housing-related policies and options that could better prepare individuals and Australia as a whole for an ageing population. The massive decline of national housing policy is having a major impact on the availability of public housing for older people. Living standards and housing options can be affected significantly by alternative policy treatment of older people’s assets in their homes and the availability of rent assistance and other income support. The long-term availability and accessibility of appropriate housing options in the future will depend heavily on ongoing, incremental decisions in terms of building regulations and planning controls. The efficacy and resources for aged care can be increased through improving the home base for community care and the capital base for residential care. This overview chapter is focused on the future and cannot present a comprehensive account of the present housing of older Australia, the diversity among them, and present policy arrangements. The references for the chapter provide much more information on these topics, including some of our own work directed towards different readerships. For an excellent review of the recent policy-related literature on ageing and housing, we particularly recommend Olsberg et al. (2004), Olsberg (2005), Bridge et al. (2003) and other recent reports published or in progress with support from the Australian Housing and Urban Research Institute (AHURI) (see http://www.ahuri.edu.au).

Looking backwards to understand futures Just on 20 years ago, one of the authors looked to the housing futures for Australians who would reach later life in the then distant time of ‘the early 21st century’ (Kendig 1986). He commented that views of the future are inevitably and understandably shaped heavily by the contemporary context in which predictions are made. Most predictions are accompanied by recommendations for actions intended to improve long-term outcomes. In the extreme case, ‘doomsday’ prophesies can set the stage to advocate urgent action to forestall anticipated crises. To


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paraphrase Karl Marx, many practitioners of futurology recognise that a major purpose of studying history can be to change it. Australian housing and the housing of older people have proved to be largely predictable and stable over recent decades. In urban areas, there has been relatively more infill of new housing at higher densities and less intense use of the existing housing stock. The affordability of housing (taking account of wages, interest rates, and prices) follows cycles: the high point for Sydney in 2003–05 was broadly comparable to the affordability pressures during the recession of the early 1980s. This comparative stability – at least to this point in history – has reflected some balance of market forces and governments’ political interests in supporting the attainment of home ownership. The housing of older people today has resulted largely from ‘trajectories’ set by their employment and housing opportunities well before mid-life. More than 80 per cent of older people now are homeowners and home ownership rates in old age have been rising slowly, reflecting increasing real incomes. There have been increasing numbers of older women living alone. Older people have been growing old in postwar suburbs having poor access to public transport. Relatively more have been moving to home units in the ‘empty nest stage’, to homes on the coast after retirement and to retirement homes typically at advanced ages (Olsberg et al. 2004). Financial stress for non-owners on low incomes has been accentuated by continuing declines of low-cost boarding houses and caravan parks. The major unanticipated changes over the last 25 years pertain primarily to government policy. One of the most notable changes has been the massive reduction in provision of public housing – the mainstay of secure and affordable housing for people who cannot afford homes of their own – and the consequent increases of ‘permanent’ rather than ‘transitional’ tenants in the private sector. Each percentage point reduction in public housing levels impacts very significantly on lowincome, disadvantaged people who can never buy homes of their own. Stringent targeting of resources to these highly vulnerable older people – the strategy of the previous Labor government (Kendig & Gardner 1997) – has become less effective given the significant reductions of national resources for public housing.


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A second policy change has been that the proportion of older people in residential care has fallen, especially so for those not having high levels of dependency (see chapter 11). The progressive development of the Home and Community Care Program has increased support at home, which is generally more appropriate for frail older people and preferred by them. In Australia, in 2003, 93 per cent of people with disabilities lived in private households (not cared accommodation) and 91 per cent of people over 60 years of age lived in private accommodation. Community care can work only when people have a secure home base. However, there have been increasing numbers of vulnerable older people who are stressed by high rents, face very long waiting lists for public housing, and who do not have the high dependency required for access to residential care. While government policies to support care at home have progressed, there has been a retraction of corresponding housing programs that sustain a home base for people on low incomes. As discussed elsewhere in this book, the major policy changes in Australia over the last ten years (and earlier) reflect changes in the underlying perceptions of the electorate and ideologies of governments. Fiscal austerity and retraction of public responsibilities have impacted particularly on the housing sector, which is increasingly seen as a private responsibility for all but the most severely disadvantaged people. In recent years, housing assistance has been concentrated relatively more heavily on the politically sensitive first homebuyers. There also has been increasing social and political concern that younger people today may not have the same life-long prospects as have their parents and grandparents’ generations. Through the 1990s, these concerns for intergenerational equity combined with concern to limit urban sprawl and the costs of urban infrastructure. One consequence has been various policy attempts to ‘free up’ housing ‘under-occupied’ by older owners in large homes, so it could be used by younger families having trouble entering the market (Kendig & Gardner 1997). These policy efforts have proven to be remarkably unsuccessful except insofar as older people have been provided with opportunities to move to more desirable housing alternatives in their local areas. This brief look to the recent past reminds us of the deeply-seated Australian value placed on housing and home ownership, the slow


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change of the overall housing stock, and the importance of earlier life opportunities on housing outcomes in old age. While housing resources on entry to old age have been increasing for most Australians, those with the least resources have been particularly affected by reduced availability of public housing and residential care. These changes have limited housing options for the relatively small but very vulnerable group of lower-income older Australians who do not have housing or other forms of wealth.

Envisioning the future The context in which ageing and policy are envisaged is changing rapidly in Australia. Government policy, as reflected by the Treasurer’s 2002 Intergenerational Report, has placed population ageing at centre stage in formulating long-term policy directions. The broader concern for ‘intergenerational equity’ is that the next cohorts of Australians – particularly those who are young adults today – may face less favourable life-long economic prospects than their parents’ or grandparent’s cohorts. For example, the housing of younger and middle-aged Australians today suggests that the security and advantages of home ownership may be less available to older people in the future (Beer, Faulkner & Gabriel 2006). The importance and value of housing and related investments make it far more significant for ‘age policy’ than is frequently realised. A study for the Australian Housing and Urban Research Institute (Bridge et al. 2001) surveyed policy-makers, advocates, and service providers about their views of accommodation and care trends for younger and older people with disabilities. They observed five main trends for these vulnerable groups over the middle to longer term: deinstitutionalisation (especially for younger people); ageing in place (and the inappropriateness of present housing, land use and transport policy); increasing expectations of carers; the trend towards increased ‘consumer rights’; and a trend towards ‘user pays’. These trends combine with increasing expectations from older people themselves, continuing fiscal austerity, and the increasing costs to government of an ageing population. Drawing on this and related reports, Kendig and Duckett (2001) have argued for policy approaches that deliver an affordable, choice-based aged care system for 2020.


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Home ownership rates in old age are expected to rise as the baby boom cohort moves into their retirement years over the coming decades (Kendig & Duckett 2001). This should increase self-provision capacities and limit needs for government assistance paid for by taxpayers in the workforce. However, with falling home ownership rates at younger ages, future cohorts are expected to have fewer of the financial benefits of home ownership to offset income reductions after retirement from the paid labour force. Overall, in terms of housing wealth as well as lifetime incomes, it can no longer be assumed that older people will necessarily be disadvantaged relative to younger people by their cohort of birth. The impact of the older population on the overall housing market will increase considerably along with the baby boom cohort’s entry into old age over the next 10–20 years. As more couples in middle age move into the ‘empty nest’ stage of life – and more people at all ages live alone – older adults without children at home have become the single largest component of household decision-makers. The trend towards smaller households is already holding up levels of housing demand, notwithstanding slow population growth, and increasing demand for medium-density housing in accessible locations. The housing choices of older people are already evincing major changes. The traditional pattern in Australian housing has been ‘ageing in place’, where people remain in the long-term family home for up to a decade or so until death or the last few years of life. Although Australians are likely to be working longer in the future, the trend towards increasing life expectancy means that older people (especially women) can increasingly expect to live three or more decades after departure from the paid labour force. Housing increasingly needs to be responsive to the emergence of the ‘Third Age’ in which people have left work but remain healthy for many years before a typically shorter period in the ‘Fourth Age’ of frailty and dependency. The move towards ‘lifestyle’ housing is already being seen in a number of ways. Once freed from the geographical constraints of the workplace, more people are moving to retirement on the coast or in small inland towns (the seascape and treescape) or living in age-concentrated ‘lifestyle’ communities with people who share similar interests and leisure activities (as well as the ‘pooled’ capacity to pay for them) (ed.


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Stimson 2002; Gardner, Browning & Kendig 2005). A broader pattern of moves to home units (often large new residences with small courtyards) can provide a more easily maintained home that is better located in terms of amenities, shops and transport. The increasing pace of these moves will see much of the housing opportunities for younger families emerging from the sales by older people in established urban areas. The most significant of the predictable housing changes is that the baby boomers will be bringing very different life experiences and expectations to their housing choices in later life. In 2006, the first of the postwar baby boomers are turning age 60 years, and they will be increasingly replacing the cohort of older people who had formative childhoods in the interwar years. The most notable effect of this ‘cohort succession’ will be the passing on of a generation noted for its stoicism and modest expectations notwithstanding the financial means from the postwar economic boom. By contrast, the baby boom cohort is better positioned with life-long economic opportunities and they have higher expectations and more skills for negotiating their way with markets and governments. The baby boomers are likely to rapidly accelerate the trends towards diversity and new forms of housing and communities in later life. In contrast to their parents, most have grown up in the postwar suburbs designed for single-family homes and cars, and many are accustomed to diverse housing arrangements having moved into flats and shared accommodation in their young adult years. They have spent long periods travelling overseas or having holidays in Australia, and periodically upgraded their homes or moved to better homes as their incomes increased. These life-long experiences give them a wide repertoire of possibilities and capacities in the housing market. They are likely to drive major market changes. There also are major influences ahead limiting housing and lifestyle choices of baby boomers in later life (Kendig et al. 2004). Modelling by NATSEM projects major shortfalls in baby boomers’ post-retirement incomes from superannuation or pensions after they leave their earnings from employment (see chapter 8). Baby boomers are likely to face difficulties if they have to adjust their expectations downwards in their housing or other aspects of their lifestyles. There appears to be little


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scope for more public sector support for the mainstream of older people given the economic pressures on younger taxpayers and prevailing political ideologies underlying the fiscal restraint of governments. Current population projections indicate that around 25 per cent of Australians will be aged 65 years or over by 2051. Nearly half of all persons aged 60-plus years need at least some assistance to manage everyday activities, but this increases to over four out of five for those aged over 85 years (ABS 2004). Further, roughly two-thirds or more of the increase in life expectancy over the decade 1988–98 was estimated to have been with some disabilities (NATSEM 2004). While advancing age is not always related to needs for care, the growing numbers of very old people will increase the numbers of Australians with disabilities. This sketch of the future provides a background to the housing policies considered in this chapter. It suggests that new policy approaches are needed to more effectively provide housing choices and maintain quality of life and care under uncertain economic pressures ahead. Mixes of private and public responsibilities are likely to change. Perhaps the greatest challenge is to ensure that marginally housed older people – who experience multiple economic and social deprivation (Morris, Judd & Kavanagh 2005) – are not lost from policy attention.

Housing and economic resources Australia has one of the highest rates of home ownership among older people in advanced industrial countries. Among individuals and couples aged 65 years and over in private households, nearly 80 per cent are outright homeowners in Australia. Home ownership is the major financial divide among the majority of older people who rely primarily on the age pension for their income. Those who own their own homes outright can have a modest but adequate standard of living, while those who pay rent typically face housing costs that drive them into poverty and put them at risk of social exclusion. Nearly all older owners (93 per cent) pay less than a quarter of their income on housing (AIHW 2002). The home also is a substantial asset that can be used to buy into aged care facilities and/or left as inheritances. While owners face the direct costs of property taxes and


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maintenance, they are financially advantaged by the tax-free position of owner-occupied housing in terms of use value, property appreciation, and eventual inheritance (Kendig 2000). Older owners typically are ‘asset-rich but income-poor’. Owner occupancy is essential for enabling many older Australians to have an adequate standard of living while relying on a relatively small government pension. The Australian Institute of Health and Welfare (2002) reports that approximately 7 per cent of older individuals and couples are private tenants, 6 per cent public tenants and another 5 per cent live rent-free or with some form of shared equity. While older owners generally have incomes well above those of tenants, the housing costs for older couples are much lower for outright owners ($38 per week) than for those who are renting ($103 per week). Few tenants at any age have very much in the way of housing or other assets. Among Australian households aged 65 years and over in 2002–03, 102 000 of those on low incomes were paying housing costs above 30 per cent of income; 44 000 of them were paying more than 50 per cent of their income on housing (Yates & Gabriel 2006). A number of reports continue to demonstrate the efficacy and efficiency of public housing in providing a secure and affordable home base for life-long tenants. The proportions of older tenants who pay more than a quarter of their income on rents are 80 per cent for private tenants and only 20 per cent for public tenants (AIHW 2002). However, notwithstanding the economic growth of the last 15 years, changing political ideologies have led to less public housing investment. Unless there are major changes in political attitudes, public housing for older people is likely to continue to decline particularly fast with the passing on of those who entered public housing during the growth periods in earlier decades. Older tenants rely heavily on the means-tested rent assistance, which pays (as of early 2006) up to $99 per week subject to a stringent income and assets means test. While this assistance does not confer the security or other benefits of home ownership or public housing, it is highly targeted on those in most financial need and it is available to nearly all who meet the eligibility requirements. Rent assistance fits well the dominant belief that income support is a primary responsibility of the


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Commonwealth Government, and that the private market is a better way to provide housing as well as other goods and services. It also accords well with the rising voice of consumer sovereignty. A comprehensive AHURI study by Olsberg (2004, 2005) has reviewed the existing evidence showing that owner-occupied housing is the major source of wealth among older Australians. The massive house price appreciation in Australia over recent decades (attributable mainly to the historic reductions in base interest rates) has substantially increased the wealth of sitting homeowners. The baby boom cohort has invested heavily in their own homes (and investment rental property) assisted by the tax advantages of housing investment. While the tax advantages of alternative savings in superannuation have been increased (see chapter 8), the value of baby boomers’ housing is unlikely to fall in real terms. The land of existing suburban housing has locational advantages over new dwellings on the urban fringe; and single-family housing can be updated, modified or redeveloped profitably. Increases in the value of housing have directed increasing attention to ways in which older owners could draw on the assets in their homes. The equity value in owner-occupied housing has always been accessible by trading down to less expensive housing, albeit with substantial capital reductions due to transaction costs. Housing wealth is increasingly used to buy into integrated accommodation and care retirement villages, and to pay substantial capital contributions for entry to low-level residential care (hostels). However, for older owners the equity in their homes has largely been ‘locked-up’ because they do not wish to sell and leave their homes. Home equity conversion (HEC) provides a financial mechanism by which older people can draw down small capital sums or income streams from their mortgages (Reed 2004). These reverse annuity mortgages increase by the amounts of mortgage ‘draw-downs’ plus the accumulating interest; repayment is not required until the home is eventually sold. The potential cash-in-hand is likely to be sufficient only for one-off expenditure (such as a holiday or new consumer good) or else an improvement that can increase the capital value of the home. The Commonwealth Government facilitates HEC programs by providing modest concessions on the drawdown sums in the means test for the age pension.


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Results from Olsberg’s major national survey of people aged 50 years and over indicate little interest in various forms of home equity conversion, notwithstanding its apparent rationality. Older people (and their children) are understandably reluctant to take the real risks of encumbering their homes under uncertain regulatory protections. The risks of financial loss, or even losing one’s home, increase with larger draw-down sums, higher interest rates, longer periods of loans, and slow housing price increases. Improved financial mechanisms and regulations might be able to facilitate the safe and more widespread take-up of these products (Tilse et al. 2005). The most provocative aspect of Olsberg’s study is her evidence that the baby boom cohort may be much more inclined than their predecessors to spend their assets rather than leave them as inheritances to their children, who could use the resources as they move towards later life. She reports that a third of baby boomers, as contrasted with a quarter of those who are very old today, expect to exhaust their wealth before they die. The practical problem is that nobody knows how long one is going to live, and it is very expensive to pay for life-long annuities. More use of one’s own assets in later life may enable ageing baby boomers to maintain higher standards of living, notwithstanding income shortfalls through long periods of retirement. There is some evidence that intergenerational transfers may be shifting more towards helping children with education (for example, ‘up front’ HECS payments) and housing (deposits on homes) earlier in life rather than leaving it as inheritances. However, there has never been much evidence that many adult children provide ageing parents with informal care in exchange for eventual inheritances. Taxation of inheritances – which could provide public resources for equitably providing substantial housing and care on the basis of need – is not a political possibility for the foreseeable future (Kendig 2000). The importance of housing wealth for the adequacy of aged care was underscored by the Hogan inquiry into long-term care costs (Hogan 2004). Hogan recommended that governments could meanstest accommodation bonds for high-level care (nursing homes) in order to meet high capital costs – as is the case in low-level care (hostels). The political sensitivity of this recommendation led the government


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to virtually rule out such a change in the short term. However, there are notable policy advantages in ‘unbundling’ payments for aged care into a financially means-tested accommodation component and a needs-based care component (Kendig & Duckett 2001). This would provide more accommodation choice and quality for people with more resources and free scarce public resources for meeting the capital costs of accommodation for vulnerable older people who do not have housing or other forms of wealth.

Government housing The Commonwealth Government and state/territory governments share responsibility for providing public and community accommodation and other housing assistance programs for low-income tenants of all ages under the Commonwealth State Housing Agreement (CSHA). In addition, the Supported Accommodation Assistance Program (SAAP) provides transitional support and accommodation to homeless people and those at risk of homelessness to help them achieve self-reliance. While older people make up a large proportion of public tenants, they typically face many years on a waiting list before securing a public tenancy whatever their age at the time of application. The majority of Commonwealth funding under the CSHA is in the form of capital grants, mainly for the provision of public housing. The amount of funds provided for public housing is broadly equivalent to its expenditure on rent assistance for low-income private tenants as outlined above. As compared to rent assistance, the direct provision of public housing involves higher initial outlays per person, but potentially can provide security of tenure and access to high-quality supportive accommodation in favourable locations. This potentially can contribute an essential home base that can limit pressures for inappropriate and costly entry to residential care. The main impact of public housing for older people is seen through the opportunities provided to people of modest means for secure, affordable and sound housing over their adult lifespan. For example, public housing now has many older people who entered the sector 30 or more years earlier when home ownership was beyond their financial


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capacities. However, notwithstanding expectations for rising real costs of housing in the future, recent trends in CSHA funding indicate a growing and massive shortfall in public housing in the decades ahead. Public housing is likely to be much less available in the future for the many low-income tenants who will be reaching retirement age and then moving into advanced old age, where they are also rendered vulnerable by physical frailty. The capacity to provide a secure home base for vulnerable older people in the future depends heavily on the fate of the Commonwealth State Housing Agreement and the funding it provides, particularly for public housing. However, with the CSHA Agreement apparently under threat, it appears that governments are winding back on this major investment in life-long or old-age housing for people of modest means. Even if a decision were to be taken now to increase public housing expenditure, it would be years before there would be an appreciable effect on available supply relative to need in the population. A massive investment over decades would be required to meet the anticipated escalation in the need for public housing for the swelling numbers of vulnerable older people.

Accommodation and home-based care Having a secure home base underpins community care that can be complementary to residential care and it is an increasing component of aged care (see chapter 11). Over the last decade, the increases of Community Aged Care Packages (CACPs) – and, more recently, the Extended Aged Care at Home (EACH) packages – have added still higher levels of care in the community, but they do not fund the accommodation that must come with it. If disadvantaged older people cannot find affordable accommodation, they cannot access community care as an alternative to residential care. The Assistance with Aged Care and Housing for the Aged program, for those in marginal housing, provides for only 6000 people nationally (Morris, Judd & Kavanagh 2005). Community care also requires service providers – a majority of which are from the ‘not-for-profit’ sector. Population projections to 2031 show an increasing shortfall of carers relative to the growth of frail older people (NATSEM 2004).


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The supportiveness of accommodation for carers as well as for frail older people can be critical to the adequacy of community care. As a place of work, the home also must meet occupational health and safety requirements for those providing services to and within the home. While housing is important for everyone, it impacts with particular force on the health, social support, quality of life, wellbeing and community participation of people rendered vulnerable by poor health or limited financial resources (Bridge et al. 2003). The future of community care will depend heavily on government’s capacities to resource an adequate accommodation base for frail older people who do not have housing or other assets. Further, for frail older people who do have adequate housing, there is strong demand for providing care in their own home base that is already paid for privately; few wish to move to residential care in order to have high levels of care. As discussed above, policies that ‘unbundle’ accommodation and care costs could increase choice for those who have financial resources and free public resources to better accommodate those who do not have housing or other forms of wealth (Kendig & Duckett 2001).

Housing adjustments and modifications Adjusting housing can be an important response to declining capacities as people grow older. The Myer Foundation’s vision for aged care, which brought together leading experts to recommend policy directions and innovations, highlighted the lack of clear policy designed to enable older owners to adjust their housing to better fit their changing needs (AHURI 2004). Moves to retirement accommodation can confer social, financial and care benefits for those who choose this housing alternative (Gardner, Browning & Kendig 2005). Ageing in place, however, is preferred by the overwhelming majority of older people. For them, home maintenance can be essential for their independence, comfort and care, including carer safety and comfort. Home maintenance includes minor repairs and painting that would normally be carried out by the older people themselves (if they were fit and healthy) or paid for privately (if they had the means).


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Housing that can accommodate changes in people’s capacities over the lifespan can enable them to live and remain in their homes as long as possible. Moreover, maintenance and modification interventions have been shown to be effective in decreasing accidents and injury with a reported seven-fold reduction in reported morbidity (Ambrose 2001). Housing design features that can be required by older persons and people with disabilities, such as ramps and handrails, can facilitate independence in daily living. Ageing with a functional impairment generally results in much more time being spent within the home. Traditional Australian housing has been largely that of the ‘great Australian dream’, comprising 2–4 bedrooms and a bathroom on a quarter-acre block in the suburbs. These homes are typically built on one level, which facilitates internal mobility, but the large dwellings and gardens can be difficult to maintain. Further, most new housing in major cities is in unit and high-rise developments. While those with more than three storeys typically have lifts, access to the units themselves and their associated common areas remains problematic. ‘Universal design principles’ can cater for the range of physical dimensions and capacities as people move through the life course. However, residential housing design in Australia typically assumes average adult dimensions and reach ranges for healthy and fit individuals. As a consequence, inaccessibility in the form of stairs, narrow entry/ exit, corridors, bathroom problems, and so on, render remaining in the community without substantial and costly modifications difficult. Strong building regulations are needed to require ‘age-friendly’ housing design because developers and home buyers resist even modest cost increases that can greatly improve the adaptability of housing. Overall, design innovations for older persons in residential housing environments have been given little attention. Particular design features such as stairs or inaccessible building features place people with disabilities and their carers at risk of further injury (Public Health Association of Australia 1993). Home injuries in Australia, as in other countries, are a common occurrence. Australian and international evidence shows that moves to more appropriate housing or housing adaptations can significantly reduce falls for older people and delay functional loss and dependency (Bridge et al. 2003).


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Neither our traditional nor current building practices are sufficiently inclusive or diverse to adequately accommodate older and disabled people without significant and costly modifications. There have been recent Commonwealth moves to introduce greater eco-friendly building practices, but no regulatory guides or tax-free incentives are evident to promote greater adaptability of our total housing stock. It is critical that the accessible and sustainable agendas in housing are developed in harmony to ensure that ‘green’ housing is usable by the whole population and is accessible for those on low incomes. Australia could better provide for future housing needs through comprehensive, national building regulations. For example, the UK Visitable Housing Law aims to ensure that all buildings are accessible for people who have disabilities that limit their mobility. However, even if such progressive legislation were to be introduced in the very near future, it would take decades to improve the majority of Australian housing. Only a few per cent of the total housing stock is built each year and comparable numbers of dwellings are renovated each year. The HACC program funds home modification services that improve the independence of frail older people (Bridge & Gopalan 2005). However, the provision of this support varies greatly between the states; for example, the numbers are particularly low relative to need in Victoria and much higher in New South Wales. These results highlight the implications of state-based versus national funding structures for access and equity to home adaptation programs.

Mapping housing policy drivers on to older individuals’ housing options The delivery of housing programs is most effective when tailored to each individual’s diverse circumstances and preferences. The four examples in box 9.1 illustrate how the environment, care and personal situations influence peoples’ differing accommodation and care needs as they become vulnerable in later life. We will now consider the appropriateness of different housing and care options for each of these individuals. In the case of Pat in scenario 1, her difficulties with mobility and reliance on a wheelchair make it difficult for her to stay in her existing


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Box 9.1 Scenario 1 Pat is 65 years old and lives in the outer suburbs of a city in a rental unit. She has multiple sclerosis, and has recently been prescribed a wheelchair. She has the support of her healthy husband, John, who is able to assist her with most activities of daily living, including showering, toileting and dressing. Scenario 2 Bob is 70 years old and lives alone in a public housing unit. His rheumatoid arthritis limits his capacity in daily activities such as toileting and showering. Scenario 3 Betty has just turned 75. She is fairly fit and healthy. She lives with her husband in their owner-occupied home of 40 years situated in a country town. Betty wishes to remain in her home for as long as possible. Scenario 4 Reg is 80 years old and until recently has lived in a caravan on the coastal fringe with his dog. He has recently been diagnosed with prostate cancer. While in hospital for treatment, he failed to pay his rent on time and was served with an eviction notice. rental property. To use the wheelchair in her home requires level access, without steps, and it would be costly to install a lift or a ramp. The space next to the bed and the arrangements and choice of fixtures in the bathroom will also be critical. It is difficult for her and her husband to pay for rising rents and she does not have the housing assets that could pay for more appropriate accommodation. Any home adaptations for Pat will require written consent of the unit owner and she will have to organise and pay for removing any adaptations should she have to move. Additional services will help her husband to maintain


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her care and the housing cannot place carers at risk of injury, such as when transferring Pat from bed to chair and in and out of the bath. Relocation may be an option, but public housing waiting lists are long and the private rental market contains very few affordable and accessible properties. In scenario 2, Bob’s public housing unit provides secure, affordable accommodation. The unit can be adapted to support increasing needs and it is designed so that care can be provided safely. He also could relocate to a more appropriate public housing unit accommodation within the existing stock depending on available vacancies. In scenario 3, Betty owns her own home so she can put in preventative home adaptations, but in her rural area it could be difficult to access care and modification services, including skilled tradesmen. Limited access to allied health professionals may limit the quality of advice available to her as to how to prevent injury around her home. In scenario 4, Reg’s lack of a secure home base and his serious health condition make the transition to residential care a likely possibility. Given his urgent need, alternative and or emergency accommodation might be arranged under either the SAAP or CHSA programs. His accommodation would need to be near public medical, transport and care services for him to continue to age with minimal support within the community.

Conclusion Far-sighted policies can contribute significantly in preparing Australia for the housing opportunities and challenges of an ageing population. The adequacy of housing for individuals in old age is heavily influenced by their capacities to achieve either home ownership or a public tenancy before they reach mid-life. The stock of housing in which people grow older is determined by the initial investment and cumulative increments over many subsequent decades. For these reasons, it is essential to take ageing and housing fully into account in a wide range of policies influencing the built environment, incomes, housing, and care. Overall, the baby boom cohort is well positioned for their housing in old age over the decades ahead. Favourable employment and housing markets earlier in their lives have enabled the vast majority to achieve the financial security and independence of home ownership. Subject to basic market protections and supportive services, homeowners on


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a reasonable income can have substantial choice of housing options. However, there will continue to be minorities who have not secured either a home or a public tenancy, and health difficulties can challenge the adequacy of accommodation, even for people having financial resources. There are worrisome indications that Generations X and Y may not have the housing opportunities experienced by their parents and grandparents. Australia’s capacity to implement constructive policies addressing ageing and housing into the future depends on sufficient collective will. This requires recognition of the value of public investment and planning in achieving good outcomes efficiently and equitably. Many of the most important and persistent impacts of the built environment reflect design, investment and regulation decisions by both the public and private sectors many decades earlier. A lifespan perspective is also essential, given that housing resources and vulnerabilities in later life reflect the cumulative effects of advantage or disadvantage over many years. Increasing longevity underscores the importance of housing responsive to the diverse resources and preferences of people over what typically could be 30 or more years of life beyond 60 years of age. In summary, a central theme of this chapter is that policy at all levels of government needs to take careful account of the all-embracing impact of housing on the quality of life, living standards, and convenience and support for people at all ages. An affordable and supportive home provides a foundation for older people. As Australia faces unprecedented population ageing, housing needs to be recognised as having a pivotal part in the flow of resources and provision of support between the generations in a changing Australia. References Ambrose, PJ (2001) Living Conditions and Health Promotion Strategies, The Journal of the Royal Society for the Promotion of Health, 121(1): 9–15. Australian Bureau of Statistics (ABS) (2004) Disability, Ageing and Carers, Australia: Summary of Findings, 2003 (Cat. no. 4430.0), Australian Bureau of Statistics, Canberra, 15 September. Australian Housing and Urban Research Institute (AHURI) (2004) Housing Futures in an Ageing Australia (Policy Bulletin no. 43), Melbourne. Australian Institute of Health and Welfare (AIHW) (2002) Older Australians at a Glance (No. AGE 25), Canberra. Beer, A, Faulkner, D & Gabriel, M (2006) 21st Century Housing Careers and Australia’s Housing Future: Literature Review, AHURI, Melbourne.


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Bridge, C & Gopalan, P (2005) Retrofitting: A Response to Lack of Diversity: An Analysis of the Home Modification and Maintenance Services Funded under the Home and Community Care Program, Paper prepared for the National Housing Conference 26–27 October 2005, Perth. Bridge, C, Flatau, P, Whelan, S, Wood, G & Yates, J (2003) Housing Assistance and Non-Shelter Outcomes, Final Report, Melbourne: Australian Housing and Urban Research Institute, Western Australian AHURI Research Centre & Sydney AHURI Research Centre. Available online: . Bridge, C, Kendig, H, Quine, S & Parsons, A (2001) Housing and Care for Younger and Older Adults with Disabilities, Final Report, Sydney: Australian Housing and Urban Research Institute (AHURI), The University of Sydney Research Centre. Available online: . Gardner, I, Browning, C & Kendig, H (2005) Accommodation Options in Later Life: Retirement Village or Community Living? Australasian Journal on Ageing, 24(4): 188–95. Hogan, WP (2004) Review of Pricing Arrangements in Residential Aged Care, Publications Production Unit, Australian Government Department of Health and Ageing, Canberra. Kendig, H (1986) Housing Futures for Older Australians. In R Thorne (ed.) The Housing and Living Environment for Retired People in Australia, Hale & Iremonger, Sydney, pp. 322–33. —— (2000) Ageing and the Built Environment. In P Troy (ed.) Equity, Environment, Efficiency: Ethics and Economics in Urban Australia, Melbourne University Press, Melbourne, pp. 97–109. Kendig, H & Duckett, S (2001) Australian Directions in Aged Care: The Generation of Policies for Generations of Older People, Australian Health Policy Institute at the University of Sydney, Sydney. Kendig, H & Gardner, IL (1997) Unravelling Housing Policy for Older People. In A Borowski, S Encel & E Ozanne (eds) Ageing and Social Policy in Australia, Cambridge University Press, Cambridge, pp. 174–93. Kendig, H, Gibson, D, Harding, A, Hugo, G, Richardson, S, Saunders, P & Telford, B (2004) The Ageing of Australian Society: Economic, Fiscal, and Societal Implications, Future Summit 2004, Report of the First Annual Future Summit, 6–8 May, 2004, Sydney, pp. 18–24. Morris, A, Judd, B & Kavanagh, K (2005) Marginality Amidst Plenty: Pathways into Homelessness for Older Australians, Australian Journal of Social Issues, 40(2): 241–51. National Centre for Social and Economic Modelling (NATSEM) (2004) Who’s Going to Care? Informal Care and an Ageing Population, National Centre for Social and Economic Modelling, University of Canberra, Canberra. Available online: . Olsberg, D (October, 2005) Ageing-in-Place: Intergenerational and Intra-familial Housing Transfers and Shifts in Later Life, Final Report, Australian Housing and Urban Research Institute, UNSW-UWS Research Centre. Available online: . Olsberg, D, Perry, J, Encel, S & Adorjany, L (January, 2004) Ageing-in-Place? Intergenerational and Intrafamilial Housing Transfers and Shifts in Later Life, Australian Housing and Urban Research Institute (AHURI), UNSW-UWS Research Centre. Available online: . Public Health Association of Australia (1993) Health and Housing, viewed 30 November 2000. Available online: . Reed, RG (2004) Reverse Mortgages, John Wiley & Sons, Brisbane. Stimson, R (ed.) (2002) The Retirement Village in Australia: Evolution, Prospects, Challenges, University of Queensland Press, Brisbane. Tilse, C, Wilson, J, Setterlund, D & Rosenman, L (2005) Older People’s Assets: A Contested Site, Australasian Journal on Ageing, 24 (s1): S51–S56. Yates, J & Gabriel, M (2006) Housing Affordability in Australia, Australian Housing and Urban Research Institute, Melbourne.


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10 Ageing in space: Transport, access and urban form Mike Berry

Introduction It is now commonplace to note that societies like Australia are riding a demographic wave. By 2030, one in every four people in the OECD member countries will be over 65 years of age. This is the date when the last of the baby boomers will reach the conventional retirement age, though when and how they retire is an increasingly vexed question (see chapters 1, 6 and 8). In the first half of the 21st century, the population aged over 80 will treble in these countries, creating a range of new issues and challenges for governments, the non-profit welfare sector and families. Foremost among them will be concerns over the mobility prospects of the aged, especially of the increasing number of those living alone, in particular single women over 80 years of age. ‘Providing for the ongoing safe mobility of ageing baby boomers will require active planning and a rethinking of strategies, policies and provision of services in order to support their continued health and well-being into and beyond retirement’ (OECD 2001: 3).


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A person’s mobility needs and travel behaviour change significantly over the life course. Early dependence on parents, guardians, older siblings or other significant adults gives way to increasingly independent behaviour and a widening choice of the mode, timing, destination and duration of travel. Towards the end of life, many of these needs and capacities change, for some ushering in a renewed period of growing dependence and vulnerability. Transport services, both public and private, offer access to a range of desired activities at a cost in terms of money and time. Being able to match travel needs with available and affordable transport services at various stages in the life course has a big impact on an individual’s life chances, particularly with respect to finding and keeping a job, accessing needed health and education services, enjoying a range of cultural and leisure pursuits and interacting or visiting family members and friends. When an older person (or a younger disabled or impoverished one) is not able to travel to conduct desired or needed activities, his or her world effectively ‘closes in’, unless (and to the extent that) compensating actions and policies by government, community organisations or family members effectively intervene. This chapter outlines and discusses these issues and impacts. The next section addresses the linked but different concepts of ‘mobility’ and ‘accessibility’. A consideration of these concepts allows a fuller understanding of the relationships between transport needs and services, on the one hand, and the health, employment and retirement issues surrounding ageing. It also raises important questions about the significance of continuing technological changes in areas like communications and transport. The section following discusses recent cross-national research on the travel behaviour of older people. In particular, it seems clear that the baby boomers and their successors will remain much more dependent on private transport, notably the motor car, than earlier generations. ‘Automobility’ of the aged raises special issues and problems around safety and health that communities and their governments will need to deal with. The chapter then moves on to consider the ‘drivers’ of the patterns and trends in travel demand and behaviour identified – the economic and social factors that appear to be responsible for these outcomes.


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Clearly, factors like the distribution of wealth and lifestyle choices have a large part to play here. Then follows a discussion of the likely impacts of the emerging patterns of travel and other behaviours on the quality of life of older people and on the broader environment and economy. This leads, finally, to a consideration of the main policy implications for government in the transport and related fields.

Mobility and accessibility There are many activities, services and experiences that are only available at specific points in space – within large metropolitan regions or in smaller towns or remote pristine locations. For the vast majority of the population in advanced industrial countries, permanently residing at other points in space, enjoyment of these location-specific ‘events’ requires physical movement, sometimes over long distances. Some trips to consume or experience these events fall into regular routines – the daily commute to work being an obvious example. Others are more sporadic or one-off in nature, such as a post-retirement caravan tour around the country. This raises another dimension, namely, many of the trips taken have multiple destinations and purposes. Research has shown that women have a greater tendency than men to ‘trip chain’; that is, to group activities in sequence and travel between them – for example, from home to shops, to dropping off children at school, to visiting an ill relative, and back to school at pick-up time (Morris, Wang & Berry 2002). This pattern of travel, or ‘mobility career’, clearly relates to the differentiated gender roles prevalent in our society and is significant in any discussion of ageing, since women, overwhelmingly, are carers for the elderly, particularly the frail aged. Travel to single or multiple destinations is, in this sense, conceived to be a means to an end – enjoyment of some event or activity. However, not everyone has the same effective opportunity to travel. Mobility resources are limited and unevenly distributed across the population and over the life course. Natural ageing and aged-related illness can reduce the capacity to travel by some modes, as do disabilities at any age. Whether or not a person has access to an automobile, either as driver or passenger, is a powerful determinant of mobility in countries like


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Australia. Car access is related, in part, to a person’s wealth. Wealthier people can afford to own and drive cars and to hire taxis. Regardless of wealth levels, however, readiness and willingness to travel is likely to change over an individual’s life. Retired people, for example, may have more effective choice over when and how they travel and for what purposes than younger people in the fulltime workforce. A critical factor in determining a person’s mobility capacity is where they live, especially in relation to where transport infrastructure (roads, railways, bus routes, and so on) has historically been provided. Residential location is, therefore, important in determining effective access to many location-specific events. In Australia’s capital cities, the fact that the middle suburbs, settled after both world wars, have large remnant populations of older people has (unintentionally) protected their accessibility to many key services, simply because those suburbs have inherited dense local and major road networks and significant public transport coverage. This, allied to non-transport-related factors, such as psychological attachment to the family home and neighbourhood, is probably partly responsible for the pronounced tendency of people to ‘age in place’, to hang on in the family home until compelled by illness or other circumstances to move. Long-distance moves, say to a retirement village, which, by their land-intensive nature, tend to be located in outer suburban areas of large cities, can radically reduce an elderly person’s mobility capacity, though the impacts may be partly offset by on-site provision of services. The importance of infrastructure provision is underscored when new facilities or services are provided. The opening of a new bridge or freeway or the introduction of new bus routes or timetables can have a large impact on effective access to some or all desired destinations, both for those residents directly affected and others; for example, people living in previously congested streets that now have traffic funnelled onto the new roads. Of course, the impacts can be positive and negative, even for a single household. Thus, a new freeway at the bottom of the street may reduce the time and cost of commuting for people near the access ramp, while increasing neighbourhood noise and air pollution. Likewise, any closure or reduction of facilities will have positive and negative effects of varying intensity. In fact, any major land use change in


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a large urban region will have complex impacts on relative accessibility across the population, forming what urban geographer David Harvey (1973) termed overlapping ‘externality fields’. The discussion so far suggests that mobility and accessibility are two sides of the same coin. In fact, there are important differences. In the first place, some travel may be an end rather than a means to accessing a location-specific event. The journey itself can be part of a consumer’s utility function; more informally, ‘getting there is half the fun’. For older people, especially those living alone, regular travel, with or without particular destinations and activities in mind, may have both physical and psychological health benefits (Metz 2000; Kennie, Dinan & Young 1998). Voluntary travel as an end in itself – as a generator of ‘destination-independent benefits’ – is here seen as a ‘good’ rather than a ‘bad’ or ‘necessary evil’ that uses up scarce money and time to overcome the friction or ‘tyranny of distance’. Conversely, effective accessibility to a service or experience may change without any travel-related implications. The introduction of home-based services aimed at the elderly, such as meals on wheels, home shopping delivery and health care visiting, can substantially improve accessibility without requiring greater mobility. Likewise, recent innovations in information and communications technologies and business practices, such as interactive television and Internet banking, can also enhance what might be called ‘stationary access’. By reducing the need for or the number of trips, such innovations can have significant benefits for older people, particularly the mobility-impaired. Effectively operating social networks can also substitute for physical mobility. Shopping for housebound older people by family members, neighbours, local government, community groups or commercial services is a case in point. Living in communities with strong networks and accumulated social capital can materially enhance the quality of life of people as they age in space (Levine & Garb 2002). As Alsnih and Hensher comment: With many seniors using delivery services (which includes relatives shopping for them), their trip rates (defined as travel from an origin to a destination to undertake activities or a set of activities) are observed to decrease. This might then be judged to be a loss of mobility when in fact it is a benefit. What has occurred in this case is that freight trips have


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replaced passenger trips. Accessibility defined as the ease of reaching destinations … per se has actually increased, whereas mobility defined as ease of movement has decreased. (Alsnih & Hensher 2003: 905)

Metz (2000: 3–4) suggests that an adequate conception of ‘mobility’ should therefore comprise five key elements: travel to achieve access to desired people and places; the psychological benefits of ‘getting out and about’; the exercise benefits of movement; involvement in local community activities; potential travel (that is, knowing that a trip could be made if necessary or desired). On the other hand, an adequate conception of accessibility would need to encompass both the need and resources to travel to relevant destinations and the capacity of people to enjoy the same or similar experiences without travelling; for example, at home. Most of the remainder of this chapter deals with the mobility, and especially travel, needs and behaviour of the elderly and ageing population.

Travel behaviour of older people When people travel, they choose how to travel (mode), where to travel (destination or destinations), when to travel (timing) and for what purposes. These decisions are, as noted above, constrained to more or less extent, across the population and across the life course. Much of the research into travel behaviour in the advanced industrial nations has focused on the split between different transport modes. In a cross-national study, Rosenbloom (2001) found that older people were increasingly likely to maintain or increase their reliance on cars and walking. Walking becomes more important for the over-75-yearolds, reflecting perhaps the shorter average distances travelled and full withdrawal from the workforce. In countries like the United States, Britain and Australia, older people in the recent past have been particularly wedded to their cars (see the following section); for example, in the mid-1990s, 92 per cent of trips taken by Americans over 65 years of age were by car, either as driver or passenger (Rosenbloom 2001: 380). The rate of car dependence is almost as high for the over-85-year-old cohort. Travel patterns in other advanced countries follow broadly similar trends, though with interesting


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variations. Thus, in the Netherlands, ‘only’ half the total trips made by 65–74-year-olds were by car and 6 per cent by public transport, while 22 per cent were made by walking and 23 per cent by cycling (Tacken 1998). The situation was similar for the Dutch population over 75 years of age, with relatively high rates of walking and cycling. Nevertheless, when looking at travel other than for short distances, the dominance of private over public transport is clear (see table 10.1). Focusing on mechanical transport modes, by the mid-1990s more than 80 per cent of trips were made by cars and taxis, compared to rail, buses and coaches, in a range of western European nations. Moreover, in all bar three countries (Norway, Switzerland and the Netherlands), the rate of car dependence increased over the 1984–94 decade. In the case of Britain, car dependence falls progressively with age for the over-65-year-olds, for both men and women, but 60 per cent of all trips over 1.6 kilometres (including walking and cycling) taken by men over 80 years of age are by car; the comparable figure is 58 per cent for women (Rosenbloom 2001: 382). However, gender differences emerge Table 10.1 Country

Trips by mode, selected countries, 1984–94 Cars and taxis

Buses and coaches

Rail

1984

1994

1984

1994

1984

1994

Belgium

81.2

88.3

11.1

5.2

7.8

6.5

Denmark

75.5

80.4

16.1

12.9

8.4

6.7

Finland

76.2

81.8

17.2

13.2

6.6

5.0

France

83.0

86.6

6.8

5.6

10.2

7.8

Germany

76.7

84.6

13.4

8.1

9.9

7.3

Great Britain

84.1

88.9

9.9

6.7

6.0

4.5

Netherlands

85.7

83.8

7.6

7.9

6.7

8.2

Norway

84.9

85.0

9.5

9.6

5.6

5.5

Portugal

78.5

81.1

13.1

13.5

8.5

5.6

Spain

71.0

79.1

18.4

14.7

10.5

6.2

Sweden

82.0

82.6

10.3

11.3

7.7

6.0

Switzerland

82.6

80.8

5.4

6.1

12.0

13.6

SOURCE

Australian Government 2004: 10.10


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here. British women over 65 are much more likely than men in this cohort to be passengers rather than drivers. Older women also take a much higher proportion of trips on public transport than older men and all people under 65 years of age. That is, women over 80 use public transport for almost 30 per cent of trips, compared to 21 per cent of trips by men over 80 and 8 per cent for under-65s (Rosenbloom 2001: 382). In general, in Britain and the United States, use of public transport rises with age. In part, this has reflected the lower average incomes of the aged (by comparison with the under-65-year-old population) and the limitations on mobility imposed by illness or age-related disabilities. Increasing urban public transport use seems, at least in these two countries, to be positively correlated with both income and location. Thus, people living in higher-density areas have relatively high public transport usage. This is perhaps not surprising given that such areas provide bigger market areas for bus operators and tend to be closer in to the city centres, which act as hubs for fixed rail systems. Conversely, low public transport usage is positively related to the number of drivers in the household and the prevalence of fully detached housing, the latter figuring predominantly in outer suburbs of the large metropolitan regions (Evans 1999). However, the recent Productivity Commission (2005) report, The Economic Implications of an Ageing Australia, found that the use of public transport was inversely related to age. Older urban Australians, in particular, were the least dependent on bus and rail transport, by comparison to younger cohorts (see figure 10.1).

The case of Melbourne During the 1990s, researchers at RMIT University carried out the Victorian Activity and Travel Survey (VATS) for the Victorian Department of Infrastructure. This annual survey of 7500 Melbourne households sought information on all travel activities of each member of the household over the full day of the survey. The results, analysed for the year 1994 by Morris and Rosenbloom (1997), are summarised below. They focus on travel for non-work reasons and provide a snapshot of travel behaviour by age and gender in the mid-1990s, though to what extent this picture is changing and/or will change in the new century is uncertain (a point returned to later in this chapter).


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ageing in space

Figure 10.1

247

Public transport use by age, Australia

Age (years)

15–24

24–44

Rail (regional) Bus (regional) Rail (urban) Bus (urban) Population

45–64

65+

0

10

20

30

40

50

% SOURCE

Australian Government 2004

Number of trips The average number of trips taken per day rises from young adulthood, peaks and levels off in the forties at around five, and then declines quite rapidly, falling below two trips per day for both men and women over 80 years. The rate of tripping changes more radically for women over the life course. Women on average take more trips than men up until the age of 40, but fewer over the remaining decades of life. This pattern is not unexpected, given the gender division of labour prevalent in the cohorts in question and the multiple roles assumed by women in the paid and unpaid workforce. Middle-aged women are more likely than men, at least in the recent past, to make a larger number of shorter trips (often linking several destinations and purposes) related to both (paid) work and non-work activities, the latter particularly associated with care for young and elderly dependants (Morris, Wang & Berry 2002).

Modal split As in the British case, noted above (and in apparent contradiction of the Productivity Commission finding), car dependence falls with age but


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still remains high. Reliance on both public transport and walking rises when considering non-work-related trips. Women over 85 years of age are more than three times more likely to have taken public transport than both men and women under 60. Women over 65 were also much more likely than men to be car passengers rather than drivers, as opposed to little difference in this respect for people under 60. Whereas 44 per cent of men 85 and over drove on the day of the survey, only 4 per cent of women in this age group did. These and other gender-based differences in travel patterns have important implications for transport and related policy, a point returned to below. Walking also assumes an extremely important element of the time-geographies of older people, particularly for the over-80s. Even though relative use of a car declines with age, car travel was still the single most important mode of travel for Melbourne’s elderly in the mid-1990s. The VATS study found that for all people over 65, except women 85 and over, the average number of daily trips taken (whether by car or not) was higher for those who held a current driver’s licence, suggesting that the potential to travel conferred by a licence may encourage greater actual travel. This finding reinforces Metz’s point made above that travel capacity is a critical part of a full understanding of mobility patterns and travel behaviour.

Staying put The number of people who do not travel at all (that is, who made no trips outside the home on the day of the survey) also varied considerably with age, rising progressively from around 15 per cent for 20-year-olds to around 40 per cent for those over 85. Again, the age profile of female travel is more pronounced than for men. Young women are less likely to be stuck in the home but, from 40 onwards, more likely to be so. For women 75 years and over, around 50 per cent did not travel at all on the day of the survey (Morris & Rosenbloom 1997: 11). The main reason given for not travelling is that the respondent had ‘no need to’. Up until the age of 70, between 10 and 20 per cent of respondents said that they did not travel because of illness. This percentage climbs to around 30 per cent for those over 70 years of age (Morris & Rosenbloom 1997: 4).


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Location Car use for non-work trips varies positively with distance from the centre of the city. Outer suburban and fringe living is heavily organised around the motor car, not surprisingly given that these areas support relatively large concentrations of younger families with children, generating complex multi-trip and cross-town travel in regions poorly served by public transport. Conversely, the inner and middle suburbs have, on average, older resident populations and better access to public transport and other urban facilities. However, although there are clear differences in car dependence between inner and outer locations and a corresponding declining dependence with age, it is still the case that, in the outer and fringe areas, more than 60 per cent of trips are made by car by every age cohort, even the very old (those over 84 years of age). The picture for public transport use is a mirror of that just described. In the central and inner suburbs, public transport accounts for between 13 and 24 per cent of trips for the over-70s. In the middle suburbs, over-84s also use public transport 15 per cent of the time. For other age cohorts in the middle suburbs and especially those further out, public transport assumes an increasingly marginal role in their travel lives.

Timing Older Melburnians display a distinct preference for travelling in the morning. The peak travel time for over-65s is 8 am, compared to a peak of 10 am for the under-65s. The former tend to travel less than the latter both in the afternoon and the evening. This may have something to do with tendency of the elderly to tire more quickly than younger people or general concerns about avoiding afternoon peak travel and feelings of lack of safety and security when travelling at night. Disaggregating by reason for travel, Rosenbloom and Morris find that this pronounced morning peaking by the elderly holds particularly for trips to the shops and for medical services. Interestingly, the morning travel peak is characterised by relatively high levels of walking among older cohorts. As the day progresses, their car dependence increases. It is not clear why this is the case, but it may be related to factors like length of trip; that is, the tendency for people to


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make shorter trips on foot in the morning, leaving longer, multipurpose trips to later in the day. Travel survey data for Adelaide and Sydney show broadly similar outcomes to the Melbourne case (Alsnih & Hensher 2003). Table 10.2 indicates the average trip rates by transport mode at the beginning and end of the 1990s for different age groups. Car trip rates increased for all age groups during the decade, including the over-75s. Conversely, train and bus trips fell for all groups except the 65–75 age group in the case of train travel. Alsnih and Hensher conclude that: The evidence … for Sydney and Adelaide suggests that more people are driving or being driven whilst less people are utilising public transport (bus and train). This highlights the urgency for research specifically targeted to understanding the elderly population’s travel behaviour and likely ways in which they will seek out coping strategies as they age. Conventional (fixed-route) public transport is unlikely to be a notable contributor to the mobility agenda of seniors in an ageing population. (Alsnih & Hensher 2003: 14)

The authors note that current travel survey data produced by the Australian Bureau of Statistics focuses on the journey to work and therefore misses the activities and needs of the growing ageing population. Appropriate policy responses to the latter’s travel needs will require change in the future direction of data gathering and research.

Table 10.2 Age

Sydney person trip rates by selected mode by age

2000

1991

2000

1991

2000

Train trips 1991

18–64

3.241

3.172

0.160

0.191

0.205

0.215

65–75

1.940

1.780

0.228

0.255

0.136

0.105

75+

1.237

0.999

0.244

0.262

0.073

0.123

SOURCE

Car trips Car trips Bus trips Bus trips

Train trips 2000

Rosenbloom 2001: 383


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Automobility The discussion in the preceding section stressed the high rate of car usage by older age groups in Australia in the recent past. The key question is to what extent this trend is likely to intensify or even gather pace. Alsnih and Hensher (2003: 14) assert that the rate of licensed drivers among the 60–79 age group will double in Australia by 2020. Rosenbloom (2001: 376) broadens that claim to argue that: ‘In the next two decades almost 100% of older men and between 60–90% of older women in the developed countries will enter their retirement years as car drivers’ (italics in original). She offers evidence from a number of the advanced industrial nations to demonstrate that, in spite of wide differences in taxes, planning regimes, land use patterns and urban form, older people are taking more car trips for longer distances and for a wider range of purposes than in the past, a pattern termed ‘automobility’. The first indication of a likely intensification of car dependence comes from a consideration of the proportion of older people who hold current driving licences. Between 1992 and 1997, licensing rates grew for all age groups in the United States. The sharpest growth in that five-year period was among women over 70 years of age – up from 50 to 65 per cent. Ninety per cent of American men aged over 70 held licences by 1997. Licensing rates are somewhat lower in countries like Norway, but even here Rosenbloom finds that rates climbed through the 1980s and into the 1990s. The rate for older men increased sharply to approach the very high rates evident in the United States. However, again, the most rapid increase related to women, who doubled their licence rates in the 64–77 age group, admittedly from relatively low rates (Rosenbloom 2001: 380). The proportion of the population holding a current driver’s licence is a powerful indicator of future car dependence. In the first place, it provides more older people with the potential to make a wide range of personal travel trips and (as noted above) the potential to travel is a critical empowering element in enhancing mobility horizons. Second, the flexibility of car travel – with respect to when, where, for what purposes – tends to lead to both more trips and longer trips. Between 1983 and 1995, per capita car trips by over-65s increased by 77 per cent in the United States. Moreover, vehicle miles per driver doubled,


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average trip length increased by 13 per cent and the average time per trip increased by 39 per cent (Rosenbloom 2001: 384). Third, in the case of ageing couples, the non-driver also has access to car travel as a passenger. Finally, evidence suggests that once in possession of a licence, older people are loath to give them up until compelled to do so by infirmity or regulation. This reflects a tendency for the aged to give up or reduce walking and public transport before they reduce trips by car (OECD 2001). The reverse side of the coin to increasing car dependence is the prospective decline in the use of public transport, at least in its conventional forms. This trend is evident in the data for Sydney and Melbourne quoted above. Rosenbloom (2001: 388–90) presents similar data for the United States, Norway, Germany and New Zealand. She concludes: ‘Overall, it does appear that, around the world, as older people switch from work to non-work travel and trips grow too far to walk, elderly travellers are relying less on public transit and other alternatives and more on the car’ (Rosenbloom 2001: 390). The conventional wisdom that people favour public transport as they move into retirement and switch from work to non-work travel, is clearly not borne out by the evidence. The inflexibility of fixed route public transport and perceived safety concerns, particularly at night, seem to be factors in this pattern. In the Melbourne study reported above, the average length of non-work trips was 7.3 kilometres, far too long for walking and, based on respondents’ actual experience, trips of this length took more than twice as long by public transport compared to car travel.

The ‘drivers’ of future trends There are a number of reasons why ‘automobility’ of the aged is likely to increase over the next 20–30 years.

Aspirations The increasing longevity of the baby boomers and their active planning for retirement and beyond, coupled with rising quality of life aspirations, lies behind the increasing variety and length of trips taken by this group as it ages. Put simply, more people will be around longer, looking to access more activities, many of which will require on-demand mobility.


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Breakdown in the division between work and other activities To the extent that ageing baby boomers manage their transition to full retirement through stages and over a prolonged period, many will negotiate and manage changing combinations of work and non-work activities. This is likely to produce rising numbers of multipurpose trips, in some cases related to seasonal changes in job opportunities. Such individualised patterns of activity will put a premium on flexible means of mobility under the control of the older individual and enhance dependence on the motor car, unless and to the extent that new transport technologies and management or systems of service delivery improve the accessibility opportunities associated with conventional alternatives to automobiles. Engagement in the formal workforce for longer periods, in turn, will underpin affordable access to a range of non-work activities for which car travel, either as a driver or passenger, is required.

Health The increased investment – public and private – in the health and wellbeing of older people will tend to maintain the capacity to drive a car well into advanced age. By extending the period of access to a large range of activities, a healthier ageing population will need to retain high levels of mobility for which automobiles are the preferred mode of travel. Again, these factors may be self-reinforcing, to the extent that active and mobile ageing improves health. On the other side of the coin, older people whose health outlook is poor face further (and, perhaps, selfreinforcing) disadvantages imposed by impaired transport immobility. These disadvantages may disproportionately face elderly people, in particular ethnic groups and among our Indigenous populations (see chapters 2, 3 and 4).

Wealth High aspirations for the quality of life during the latter stages of the life course are partly related to the level of resources, personal, symbolic and material, that people can and expect to accumulate. As a group, the baby boomers grew to adulthood in the third quarter of the 20th century, the first period of mass consumerism during what is usually


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referred to as ‘the long boom’. By the end of the century, the boomers, while representing around a fifth of the population, owned two-fifths of the wealth (NATSEM 1999; Kelly 2001). If past patterns of inheritance persist – and this is highly uncertain – this wealth share is likely to increase further. Greater average wealth will tend to be reflected in high automobile use, both because more older people will be able to afford to own and maintain a car and because they will wish to in order to access the larger range of activities now affordable. ‘With the growth in the numbers of the elderly in the population, together with their increased health and wealth, it would suggest that they now form a growing (perhaps even the fastest growing section) proportion of the expected increase in the demand for travel over the next 10–20 years’ (Banister & Bowling 2004: 108).

Increasing inequality However, along with rising average wealth, we may also witness increasing inequality in the distribution of wealth among the elderly, marked especially by the division between those who have purchased and paid off a house and/or accumulated significant superannuation savings during their working lives, on the one hand, and the remainder who have not (see chapter 8). The existence of this latter marginalised group raises the spectre of what has been called ‘the transport poor’.

Inherited urban form The second half of the 20th century also witnessed a massive suburban boom in a number of Western countries, including Australia (Walker 1981; Berry 1984; Harvey 1989, chapter 1). The spread of automobile ownership and massive investment in road infrastructure underpinned rapid suburbanisation during the long boom – the age of what Harvey terms ‘the Keynesian city’. By encouraging outward urban development at low densities, the automobile reinforced its grip on urban populations. ‘It meant the mobilisation of effective demand through the total restructuring of space so as to make the consumption of the products of the auto, oil, rubber and construction industries a necessity rather than a luxury’ (Harvey 1989: 39). At the same time that sprawling cities locked


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suburban populations into car ownership, low residential densities undercut the market viability of alternative public transport services, an outcome reinforced by the increasingly lop-sided pattern of public infrastructure investment in roads. The emergence over the past 25 years of what Harvey dubbed ‘the post-Keynesian city’ has changed much about the urban landscape (for example, the issues around which urban politics swirl), but has done nothing to undermine the dependence of urban populations of all ages on the automobile. Gentrification and increasing dwelling densities in the inner areas of the capital cities in Australia has, if anything, intensified car dependence. Cities like Melbourne are clearly bifurcating into an inner ring of affluent suburbs housing well-educated, highly paid ‘knowledge workers’ (and transient minorities like students), while the remainder of the metropolitan region supports lower paid, larger and less highly educated households (O’Connor & Healy 2002; Wood et al. 2004). The inner urban dwellers have high rates of car ownership, a tendency reinforced by town planning requirements for one and sometimes two car parking spaces for each unit in new medium- and high-density residential developments. This situation is further reinforced by the flexibility car use provides to people working long and irregular hours, in multiple locations and who may also travel to and from a second house outside the metropolitan region. Poor provision for ‘park-and-drive’ at public transport nodes and inadequate timetabling, especially at night, are further incentives for urban dwellers to rely on the motor car. Postwar patterns of infrastructure investment – and what might be called, ‘road politics’ – continue to vastly favour private over public transport. This holds as much, if not more, in many non-metropolitan and rural communities where population thresholds for viable public transport coverage are not met and where rationalisation of rail services, in particular, associated with moves towards privatisation and corporatisation in the public sector, have left communities totally dependent on road transport for both freight and passenger movement. For all the reasons listed above, car ownership and use is what economists term a ‘normal good’; that is, the demand for it increases with a person’s income. In spite of pronounced inequalities among older people with respect to income and wealth, health status and family or


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community support networks, one common feature of life has prevailed and, under current policy settings, is likely to continue to prevail, namely, automobility.

The impacts of transport needs and behaviour of the elderly The likelihood that people will seek to maintain high levels of mobility well into old age, particularly through access to and use of the motor car, has important implications, both for the elderly themselves and for the broader society. It has been argued above that mobility is one key determinant of the quality of life enjoyed by people at all stages of the life course. Constrained mobility can severely limit the ability to access valued location-specific services and adversely affect an individual’s physical and mental health. For example, in an influential longitudinal study, Marottoli et al. (1997) concluded that the cessation of driving is a strong predictor of the onset of depressive symptoms in older people. Banister and Bowling (2004) report on the key findings of a national survey on mobility and quality of life among people 65 years and older carried out in Britain in late 2000. A total of 1299 eligible respondents were approached for interview and 999 agreed, a response rate of 77 per cent. A series of both open-ended and closed questions were asked. Respondents were also asked to rate their quality of life on an ascending seven-point Likert scale from ‘as bad as can be’ to ‘as good as can be’. Some of the main findings were as follows: • Older people with access to a car or van were much more likely than those without to rate their quality of life as ‘as good as can be’ or ‘very good’. Those with car access also tended to engage in more social activities. • Although the vast majority of respondents were able to walk at least 400 yards and only 6 per cent claimed never to go outside the house during daytime, 42 per cent never went out at night. This difference seems to reflect concerns over safety, security, recognition of visual incapacity and perceptions of crime.


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• A majority of respondents saw the speed and volume of traffic as a big or fairly big problem. This rated much higher than crime as a detractor from quality of life. • Respondents who had good access to social and leisure activities, shops and safe walking during the day were much more likely than others to rank their quality of life ‘as good as can be’. The overall picture presented is complex with the many different aspects of travel and QofL [quality of life] issues all influencing the views of elderly people. It is important to take the wider view than conventionally used in transport analysis to identify the key concerns of the elderly, not just in terms of what they choose to do (active involvement – the transport elements), but also in terms of their integration in their local community and neighbourhood (passive involvement – the non-transport elements). It is only when both the active and passive elements are brought together that we can begin to understand the role that transport plays in the QofL for the elderly. (Banister & Bowling 2004: 114)

However, the increasing reliance of the elderly on car travel raises important matters of safety. Older people are vulnerable to serious injury and death, both on the road as drivers or passengers and as pedestrians. Eventually, failing physical or mental faculties raise the probability of having an accident. The mobility aspirations and habits of an ageing population in a world characterised by technological stagnation and underinvestment in alternatives has effectively locked older people into a pattern of mobility that relies on a form of transport that may pose greater safety risks than, for example, crime. The OECD (2001) has identified support for older people to continue driving safely and the provision of safer vehicles for the elderly as two of the eight major policy priorities for governments in the advanced economies (see below). The increasing automobility of the elderly also poses important questions for the long-lived society. Foremost among them is the impact on the environmental sustainability of large urban centres. In particular, older drivers add to the already serious problems of traffic congestion and air pollution. On the one hand, elderly drivers who are not in the workforce may have greater choice as to when they drive and may, therefore, avoid peak travel, lessening the adverse environmental


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impacts of their travel. However, as already noted, with the blurring of the distinction between work and retirement, this factor may be losing its bite. Moreover, other aspects of driver behaviour will work in the other direction. Rosenbloom (2001: 391–93) presents evidence that elderly drivers are more likely than other drivers to engage in ‘wasted trips’; that is, ‘scouting out’ the route beforehand, becoming lost or ‘going the long way round’ in order to use familiar landmarks. Duplicating trips adds to the environmental load created. Furthermore, as people move into very old age or suffer serious disabilities, younger family members, especially daughters and daughters-in-law, engage in chauffeuring and other support activities, which add to the total number of car trips and distances travelled; the greater the distances between family members, the greater the impact (Velkoff & Lawson 1998).

Policy implications There are three major policy imperatives raised by the emerging pattern of mobility aspirations and behaviour of the elderly in the long-lived society. The first relates to the need to ensure the safety of older people as they travel; the second focuses on the problem of meeting the mobility needs of people when they stop driving; the third switches to the broader concerns of dealing with the negative environmental consequences of increasing automobility. The OECD study quoted earlier identified the following eight policy priorities aimed at addressing some of these concerns.

Support and funding to enable lifelong mobility This would require a greater level of awareness and degree of integration of government services than is currently the case in most countries. It would also depend on a reshuffling of government budget priorities, which would, in turn, depend on the political power of the aged and their supporters (see chapter 13).


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Support for older people to continue to drive safely Better diagnosis of and support for people with physical impairment would reduce the risk of road accidents. The introduction of mandatory age-based licence testing is in place in some countries and jurisdictions. However, a more discriminating policy that tests only those drivers at risk may be more effective, less costly and politically more palatable. In Australia, there are marked variations across the states and territories (see table 10.3). The OECD report stresses the need for better driver assessment and rehabilitation for older people with functional impairment.

Provision of suitable transport options to the private car Developing flexible, user-friendly transport services as a viable alternative to both the car and conventional public transport is clearly a massive task. Policies like road pricing may encourage drivers to switch from peak to non-peak travel but, in the absence of viable alternatives, will not significantly reduce the reliance on automobiles. The introduction of new technologies like ‘dial a mini-bus’ or taxi-cards, use of smart Table 10.3

Driving licence requirements for older drivers, by state and territory

Jurisdiction Victoria New South Wales Queensland South Australia Western Australia Australian Capital Territory

Licensing requirements No requirements for elderly drivers. Victorian Older Drivers’ Handbook available. Mandatory medical examination at 80 years. Annual medicals after 85 plus yearly driving test. Medical certificate of fitness required for over 74-year-olds to be carried while driving. Licence restrictions advised by medical practitioner and noted on licence. Annual medical certificates of fitness required for all drivers aged over 69 years. On reaching the ages of 75, 80 and 85, drivers are required to complete a seniors’ declaration form prior to renewal of licence. On turning 85, drivers must take a driving test and medical examination. Drivers over the age of 75 must have a standard medical form completed by their doctors. ACT Older Drivers Handbook available.

Northern Territory

No specific requirements. Drivers of all ages require a standard eye test every five years.

Tasmania

Drivers over the age of 75 require an annual medical examination. Tasmanian Older Drivers Handbook available.

SOURCE

Alsnih and Hensher 2003: 915


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cards and navigation aids (to make multi-modal travel seamless), better signage, more visible security arrangements and improved design of buses and other public transport vehicles would improve access to these alternative mobility options (Coughlin 2003). However, most of these developments require significant infrastructure and recurrent resourcing and extensive management support, both on introduction – overcoming cultural resistances – and operation. The fact that women over 80 are relatively heavy users of public transport in many countries underscores the need to improve the physical access to and safety of such services.

Safer vehicles for older people New transport technologies, like adaptive speed controls (electronic sensing devices that respond quickly to changes in traffic speeds, making up for slowing reaction times among older drivers) and night vision enhancement devices may substantially reduce accident rates among the elderly (Coughlin 2003). Government regulation of vehicle manufacturers may be required to ensure greater safety of use by the elderly. This is likely to raise the cost of car ownership, marginalising some poorer older people and run up against political opposition from car manufacturers, suppliers and peak groups.

Development of safer roads and infrastructure Emphasis here would be on keeping abreast of and applying improvements in designs and standards with respect to roads and public infrastructure. Budget priorities would determine the extent to which and how quickly such improvements are introduced.

Appropriate land use practices Planning for new housing facilities for the aged needs to be integrated with a range of support services, including transport. Safe urban design with respect to footpaths, road crossings and the like will also contribute to improved mobility for the elderly. Wheelchair access to public spaces and routes could be mandated as a required condition for planning approval.


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More flexible housing design also has a contribution to make, particularly around facilitating mutual support arrangements between household members and neighbours and catering for changing housing needs as residents age in place (see Murray et al. 2004 for innovative approaches along these lines).

Involvement of older people in policy development Baby boomers are likely to be more politically vocal about their needs into old age than earlier generations. This may encourage their greater involvement in the policy process. This would challenge existing political structures but, if accommodated, may improve the receptivity to policy reforms.

Educational campaigns to promote maximum mobility and safety for older people Raising awareness of the mobility needs of the elderly will need to extend well beyond the group itself in order to convince voters and sensitise governments and community organisations to the policy measures needed to achieve the outcomes noted above. These OECD recommendations extend the policy horizon well beyond the normal transport-related considerations of ageing currently dealt with in the political system. In a recent inquiry by Australia’s Productivity Commission, attention was narrowly focused on the likely impacts of ageing on government expenditure on transport services. The Draft report concluded: The impact of ageing on total transport spending is likely to be limited. The majority of expenditure is for transport infrastructure, and ageing will not fundamentally affect the requirements for road and rail networks, or their configuration. (Australian Government 2004: 10.10)

Clearly, the Productivity Commission, the major economic advisory arm to the Australian Government, has a much narrower policy view than the OECD. This suggests that policy reforms in this country aimed at improving mobility for the elderly in the age of automobility have large hurdles to surmount.


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More generally, although the policy debate opened up by the OECD report and recommendations introduces many important issues, it ignores others. In particular, the broader concerns over environmental sustainability noted earlier do not figure in this discussion. Nor has the issue of transport poverty, the marginalisation or exclusion of lower income or otherwise disadvantaged older people from existing and proposed transport services, really been addressed. In order to come to grips with these mobility issues, it would be necessary to carefully prioritise the many possible policy interventions canvassed in the OECD report. In the end, these are essentially political matters forcing attention on how particular policy approaches mobilise support and opposition in a world of competing ends.

Conclusion It has been argued in this chapter that where people live and how they move around materially affects their effective life experiences as they age. It is also the case that access to services and ‘desired events’ can be enhanced through measures other than mobility; that is, by providing them in or close to home. Ageing in and through space will be an increasingly important part of the lives of today’s baby boomers. Their aspirations are likely to be very high and will run up against an inherited urban form and infrastructure system that puts maximum emphasis on the continuing ability to drive or be driven on the roads. This pattern of car dependence, in turn, is placing a heavy environmental load on society. Major improvements to urban form and infrastructure, designed to address the negative consequences of automobility, will require very significant expenditure by government and will depend, in large part, on the successful mobilisation of political influence by or on behalf of older people. References Alsnih, R & Hensher, D (2003) The Mobility and Accessibility Expectations of Seniors in an Ageing Population, Transport Research Part A: Policy and Practice, 37(10): 903–16. Australian Government (2004) Economic Implications of an Ageing Australia, Draft Research Report, Productivity Commission, Melbourne. Banister, D & Bowling, A (2004) Quality of Life for the Elderly: The Transport Dimension, Transport


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Policy, 11(2): 105–15. Berry, M (1984) The Political Economy of Australian Urbanisation, Progress in Planning, 22(1): 5– 80. Coughlin, J (2003) New Transport Technology for Older People, OECD-MIT International Symposium, Cambridge MA, September. Evans, E (1999) Influences on Mobility among Non-driving Older Americans, Transport Research Board Conference, Personal Travel: The Long and the Short of It, Transport Research Board, Washington DC. Harvey, D (1973) Social Justice and the City, Edward Arnold, London. —— (1989) The Urban Experience, Blackwell, Oxford. Kelly, S (2001) Wealth on Retirement: Latest Estimates for Australia, Paper presented to 9th Annual Colloquium of Superannuation Researchers, University of New South Wales, Sydney. Kennie, D, Dinan, S & Young, A (1998) Health Promotion and Physical Activity. In R Tallis, H Fillit & J Brocklehurst (eds) Brocklehurst’s Textbook of Geriatric Medicine and Gerontology, 5th edn, Churchill Livingstone, Edinburgh, pp. 1461–72. Levine, J & Garb, Y (2002) Congestion Pricing’s Conditional Promise: Promotion of Accessibility or Mobility, Transport Policy, 9(3): 179–88. Marottoli, R, Mendes de leon, C, Glass, T, Williams, C, Cooney Jr R, Berkman, L & Tinetti, M (1997) Driving Cessation and Increased Depressive Symptoms: Prospective Evidence from the New Haven Established Populations for Epidemiological Studies of the Elderly, Journal of the American Geriatrics Society, 45, 2: 202–06. Metz, D (2000) Mobility of Older People and their Quality of Life, Transport Policy, 7(2): 149–52. Morris, J & Rosenbloom, S (1997) Transportation of the Elderly in Melbourne, Driving off into the Sunset: Some Myths about Ageing, Transport Research Centre, RMIT University, Melbourne. Morris, J, Wang, F & Berry, M (2002) Challenges of a Changing Metropolitan Melbourne for Transport Planning, Paper presented to Australasian Transport Research Forum Transport Policy Colloquium, October, Brisbane. Murray, S, Berry, M, Downton, P & Wright, L (2004) The Ageing of Aquarius: Designing New Housing Solutions for Australia’s Baby Boomers, Paper presented to Australian Association of Gerontology Annual Conference, November, Melbourne. National Centre for Social and Economic Modelling (NATSEM) (1999) Income Distribution Report: Assets of the Baby Boomers, National Centre for Social and Economic Modelling, University of Canberra. O’Connor, K & Healy, E (2002) Labour Market, Housing Market Interdependencies within Metropolitan Australia: A Case Study of Melbourne, Final Report, Australian Housing and Urban Research Institute, Melbourne. Organisation for Economic Co-operation and Development (OECD) (2001) Ageing and Transport: Mobility Needs and Safety Issues, Organisation for Economic Co-operation and Development, Paris. Productivity Commission (2005) Economic Implications of an Ageing Australia, Productivity Commission, Canberra. Rosenbloom, S (2001) Sustainability and Automobility Among the Elderly: An International Assessment, Transportation, 28: 375–408. Tacken, M (1998) Mobility of the Elderly in Time and Space in the Netherlands: An Analysis of the Dutch National Travel Survey, Transportation, 25: 379–93. Velkoff, V & Lawson, V (1998) Gender and Ageing: Caregiving (US Bureau of Statistics IB/98-3), Washington DC. Walker, R (1981) A Theory of Suburbanisation. In M Dear & A Scott (eds) Urbanisation and Planning in Capitalist Society, Methuen, London and New York, pp. 383–430.


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Wood, G, Berry, M, Dalton, T, Pettit, C, Allan, I, Leong, K & Stoakes, A (2004) Analysis and Development of Indicators and Datasets for the Housing Affordability for Low Income Victorians Project, Stage Three, Victorian Department of Premier and Cabinet, Melbourne.


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11 Uncertain prospects: Aged care policy for a long-lived society Michael Fine

Introduction In the first half of the 20th century, no one spoke of ‘aged care’ services in Australia. Nor was aged care recognised in policy. The physical care and support of older people received little, if any, public attention, as it was considered a private matter for which responsibility was left to the family. When there was no family, the elderly person unable to care for himself or herself was forced to turn to charity. In the early years of the century, this often meant the system of ‘indoor-relief’ – large, workhouse-like institutions such as the Lidcombe Homes for Old Men and Old Women in Sydney that developed in the late 19th century (Dickey 1980). By the Second World War, those without family who were old and chronically ill could also be found kept in the public and charitable hospitals, which developed as centres for medical treatment of chronic conditions, often serving as long-stay facilities for those who could not be cured (Fine & Stevens 1998). Only in the 1950s did a specialised system of services and facilities funded by the Commonwealth Government


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begin to emerge. This was based on the development of residential (or institutionally based) facilities. Where the need for care exceeded the capacity of the family to provide support, access was provided to a distinct set of provisions that came to be known as ‘aged care’ services. The term, given legal expression in the Aged Care Act 1997, refers to services officially designated as residential care facilities (high and low care) that are probably still best known by their more established titles of ‘nursing homes’ and ‘hostels’, the latter also referred to as ‘homes for the aged’. Care in a long-lived society, however, poses a very different challenge. As life expectancy increases and the epidemiological profile of ageing has changed, older people are ceasing to be a marginalised minority. Many of the assumptions that underlay earlier models of aged care thus need to be rethought. Some of the potential lines of development are already evident in the mix of care emerging in the early 21st century. Informal care provided by spouses, partners and other family members remains by far the most prevalent form of support in the early 21st century (ABS 1999), despite popular perceptions of the decline of the family. Care at home is now also increasingly supplemented by care provided by community services (Fine 1994; AIHW 2005). Older people also use significant amounts of health care and are by far the greatest users of acute health care services. In 2002, for example, those aged 65 and older constituted approximately 13 per cent of the total Australian population, but accounted for 38 per cent of all health expenditure, 34 per cent of all people admitted to public and private hospitals and 47.6 per cent of all bed days in public and private hospitals (author’s calculations based on figures provided in AIHW 2004). With further ageing of the population, the use of acute care by older people is likely to exceed half of all bed days and close to that proportion of total health expenditure within the next few years and may increase well beyond this at a later date. As the health system is forced to adapt, becoming even more oriented towards the support of an older population, the notion of a distinct field of ‘aged care’ becomes increasingly less plausible. What will there be in its place? A search for new constellations of care that link acute care hospitals more closely to ongoing residential aged care and care provided at home has been apparent in the Australian system since Aged Care Assessment Teams (ACATs) were introduced


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across the country in the 1980s, charged with the responsibility for matching applicants to appropriate residential or community services. To improve the efficiency of the system of referrals and transfers between elements of the larger health and care system within which aged care services operate, ever closer linkages with more expensive, institutionally based and professionalised medical services are now being sought (ed. Glendinning 1998; Fine 1999). These attempts to produce what is now commonly described as ‘continuity of care’ by linking informal care, community care, primary health care, acute hospital and specialist care and long-term residential aged care into a seamless and integrated system reflect pressures to reduce costs and enhance effectiveness. The line of development that care services for older people takes in a long-lived society is not a simple matter of gradual expansion of the existing system in response to demographic pressures. Nor should policy discussion be confined to ways of lowering the projected cost to government by transferring responsibility to service users. Demographic change provides the context for the development of service provision policies, but constitutional constraints and political and economic forces have a more direct and immediate impact. The economic restructuring that has accompanied globalisation and population ageing in Australia over recent decades has been marked by political interventions. Since the election of the Howard government in 1996, these have been explicitly intended to facilitate the expansion of the market as a way of both providing and funding services. Aged care services are increasingly being encouraged to adopt the principles of user pays at the same time as they face pressures from business to become more open to corporate development than is already the case. Other groups and movements – including the carers’ movement seeking greater recognition of the importance of informal care and various consumer and grey power groups representing pensioners, superannuants and self-funded retirees – have also fought to have their voices heard. In the process, aged care has come to be an important ground for contesting the future character of Australia as a long-lived society. These pressures raise some fundamental questions. Is there a need for a distinct set of ‘aged care’ services in a long-lived society? If care is required, what forms might this support take and how might it be


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financed in Australia in the 21st century? This chapter addresses these questions, examining the ways that policy debates about the projected cost of aged care and the shifting balance between different forms of provision frame the responses. Following a brief overview of current aged care programs, the arguments and evidence are organised, into two parts – a brief sketch of the emergence of aged care in the recent past, and a review of projected future developments. With the socioeconomic and epidemiological changes that underlie the shift towards a long-lived society, evidence of a new constellation of care is emerging. The changing balance between formal and informal care, community and residential care services, primary health care and acute hospital provisions that is reshaping care options for the 21st century will need to confront the increasing dominance of the market and the potential withdrawal of state intervention if there is to be a system of care that is more than just a market for the aged care industry.

Current provisions Services receiving public subsidies to provide aged care in Australia are funded through a series of programs on the basis of daily bed subsidies for residential care facilities and service contracts for community services. Increasingly, tied funds are also being used to enable direct purchase of services by case managers, consumers or by existing service provision authorities. An overview of recurrent funding received through these programs in 2004, based on documentation provided by the Australian Institute of Health and Welfare (AIHW), is presented in table 11.1. This identifies a range of forms of provision considered aged care, extending from long-term residential and community care to assessment and payments for informal or family carers. Medical care, funded through other programs, is not included, although the total cost of its provision for older people exceeds that of aged care services. By far the most significant form of provision, in terms of the amount of public funding received, is the residential care program funded by the Commonwealth Government. Service users are also required to make substantial payments for services received, but their contributions are not recorded in the available figures. Residential care services include


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aged care

Table 11.1

Recurrent government expenditure on aged care services, 2000– 01 and 2003–04 (a) ($m current prices)

Program

2000–01

2003–04

3 987.0

5 336.0

8.7

20.4

725.1

917.1

Veterans’ Home Care and in-home respite(d)

23.3

91.1

Community Aged Care Packages (CACP)(d)

194.6

307.9

8.4

15.5

National Respite for Carers(d)

68.6

101.5

Assessment (ACAP)(d)

39.2

48.4

Day Therapy Centres(d)

28.5

31.6

Multipurpose and flexible services(d)

34.0

60.7

Commonwealth Carelink Centres(d)

12.1

13.9

–

17.6

Accreditation(d)

10.4

6.5

Other

20.3

26.6

179.6

326.9

5 339.7

7 321.7

Residential aged care – subsidies(b) Residential aged care – resident and provider support(b) Home and Community Care (HACC)(c)

Extended Aged Care at Home (EACH)(d)

Flexible care pilot projects(d)

Carer allowance (d) Total (a) Commonwealth and state government direct funding of services.

(b) Mainly funded by Commonwealth Government; figures include state and territory funding of approximately $50 million p.a. for high-level residential aged care subsidies. (c) Funding by Commonwealth, state and territory governments. (d) Funding by Commonwealth Government only. SOURCE

AIHW 2005, table A47: 424.

both ‘high care’ places (formerly known as nursing home beds) and ‘low care’ places (hostel beds). High care facilities provide round-theclock nursing supervision and personal care, while low care facilities cater for a lower level of need. Residents typically have their own self-


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contained accommodation, while facilities are more home-like with less intensive staffing levels. Under the ‘ageing in place’ approach adopted by the Commonwealth Government from 1996, it is now possible for residents of low care facilities that need high care to remain in their existing place while receiving the higher level of benefit (Gray 2001). The next largest funding program is the Home and Community Care (HACC) program , jointly funded by Commonwealth and state governments. The HACC program can be further broken down into a funding for a series of specialised services, including home nursing, domestic assistance (this includes home cleaning, showering, dressing), other personal care services, home maintenance and modification services, community transport, day care, neighbour aid, and counselling services. HACC services are frequently (although not necessarily) taskspecific and are commonly small, locally based organisations. The Veterans Home Care program, which includes in-home respite, is a program of community care services for eligible veterans of the armed forces and their family members that is broadly comparable in level of support available to the HACC program. The complexity of such a variety of community-based provisions, however, has long been a cause of concern. The Way Forward (DHA 2004), a program of reform that is primarily administrative in character, has been recently commenced with the stated aim of addressing overlaps and gaps in service delivery to enable easier access to services, introduce greater standardisation in service management, to streamline the funded programs administered by the Australian Government, and to improve partnerships between the Australian and state governments and service providers. The Community Aged Care Packages (CACPs) and Extended Aged Care in the Home (EACH) programs share some of the attributes of both community care and residential care. The ‘packaged’ form of home-delivered care, which typically involves a level of case-managed care of a set of support activities provided at home by a single agency, provides a more integrated approach to servicing individual clients than is provided through the HACC program. Care packages cater for older people who require a level of care that is comparable to that of residential care services. Developed from, and funded through, the residential care program, the distribution and adequacy of care packages are measured as part of the residential care benchmark, now extended with the inclusion


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of the CACP and EACH program to 108 beds per 1000 people aged 70 and over (AIHW 2003a). A range of other programs are also funded by the Commonwealth Government as aged care. Some, such as the National Respite for Carers Program, fund direct service delivery – in this case, by financing shortterm respite admissions to residential care facilities in order to give family carers a short break. Day Therapy Centres are funded by the Commonwealth to provide outpatient-style medical and paramedical care to older people who may otherwise require inpatient care in acute hospitals. Multi-Purpose and Flexible Service funding is made available to services in remote and rural regions where there is insufficient population density to warrant both hospital and aged care services. Multi-Purpose Services (MPS) provide a mix of acute and long-term care services, the precise mix varying with local circumstances. Flexible Service funding, of which there is only a small amount annually, is used for funding aged care services in Indigenous communities. Some funds are also earmarked for pilot projects and other innovations (AIHW 2005). Some of the most significant programs are not concerned with direct service provision, but with access to services through assessment of individual need or information provided to older people and their families. The Aged Care Assessment Program (ACAP), far more important than the modest funding might suggest, is concerned with determining eligibility for entry to residential care, for referrals to community care, and with undertaking assessments to determine the level of funding for which individuals in residential care are entitled. The multidisciplinary Aged Care Assessment Team (ACAT) services, available in every region of the country, provide impartial, professional advice to all older people in need of personal support. Funding is also made available for accreditation, which is closely linked to the current system of standards enforcement in residential care services. Carer allowances, based on the payment of cash benefits rather than the provision of services, represent a very different kind of financial support for aged care. Payments are made to family carers who live with the person who needs to receive care. Payments to family members of care recipients aged 65 or older increased markedly between 2001 and 2004, but much of this increase was due to a one-off payment of


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$600, made to all eligible recipients in 2004. While these payments are intended to defray the costs of providing care for the care recipient, they are not means-tested (AIHW 2005). Carer payments, formerly known as carer pensions, in contrast, are a means-tested income support program available only to family carers who are unable to be employed substantially as a result of their caring responsibilities and who would not otherwise have a family income. Carer payments, interestingly, are not listed by the AIHW as part of the aged care expenditure.

A care use perspective Focusing on the use of care services presents a very different picture to that of the finance and provision of specialised services. The figures in table 11.2 illustrate the range of support that is used by older people in Australia. These figures, like those presented earlier in table 11.1, exclude health care expenditure, which is presented in table 11.3. The data, nevertheless, present a picture of aged care that contrasts markedly with the government expenditure data presented earlier. While residential care is the most expensive aged care program in terms of government expenditure, use of care provided in the home is far more extensive. Similarly, it is clear from table 11.3 that, while older people are major users of health care with the intensity of their usage increasing markedly with age, coverage of other service types, such as CACPs and EACH, is relatively minor in comparison. Yet the rapid rise in the provision of care packages and their attractiveness to consumers, service providers and governments suggest that, with the appropriate policy settings, this form of community care could well become the dominant model. Just as the cost of health care for aged people far exceeds that in specialised aged care services, so too is the coverage of care provided within families and households more extensive than that provided by the residential aged care facilities. With the epidemiological, social and economic changes that underlie the shift towards a long-lived society, the shifting balance between formal and informal care, community and residential care services, primary health care and acute hospital provisions is reshaping care options and suggests that the development of a new constellation of care is already strongly in evidence.


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aged care

Table 11.2

273

Long-term care arrangements for older people (aged 65+), Australia, 2003–04 Number

Per cent (a)

Need for care (b)

Residential Aged Care Services (High Care)(c)

89 922

3.45

4–6

Residential Aged Care Services (Low Care)(c)

47 785

1.83

3–4

646

0.02

4–6

25 722

0.99

3–4

At Home with HACC or VHC(c)

598 737

22.99

2–4

Living at home with unpaid care only

345 500

13.26

1–4

560 900

21.53

1–4

Total needing some assistance

1 164 600

44.71

1–6

All people aged 65+

2 604 900

100.00

0–6

Care arrangement

EACH(c) CACPs(c)

Level of disability Severe or Profound Activity Limitation

(a) Per cent of total population aged 65+. (b) Indicative rating of frequency of assistance required on scale 0–6: 0 = no assistance needed; 1 = occasional assistance; 2 = some assistance; 3 = regular assistance; 4 = daily assistance; 5 = constant day-time care; 6 = 24-hour care. (c) Service use figures report existing and new clients for each agency, and may count the same individual more than once. SOURCE

Adapted from AIHW 2005: 155, figure 4.2; 176, table 4.18

Aged care as alternative provisions Aged care, in the relatively narrow sense of specialised long-term care services for older people, is surprisingly recent in Australia (Cullen 2003). It emerged as a distinct program only when a series of privately owned residential and nursing services that became known as convalescent or nursing homes were established in a fairly haphazard manner in the 1950s and 1960s (Fine & Stevens 1998). Their purpose was to provide care to the large numbers of chronically ill older people discharged from, or refused admission to, the newly emerging acute care hospitals of the


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Table 11.3

Estimated resident population and allocatable health expenditure, 2000–01

Per cent of population (2000)

Per cent of health expenditure (2000–01) (a)

0–64

87.5

62.0

65–74

6.8

14.7

75–84

4.3

15.0

85 and over

1.3

8.2

65 and over

12.5

38.0

Age group

(a) Allocatable health expenditures exclude expenditure on aged care services. SOURCE

ABS 2004; AIHW 2004: 378, table 8.25

postwar period. The Commonwealth Government instituted the Hospital Benefits Act 1952 and a national system of voluntary health insurance in 1953 (Kewley 1973; Sax 1985; Hogan 2003). This led to the exclusion of many aged and disabled people from the hospitals on which they had previously relied for ongoing care and accommodation. A series of makeshift facilities – some provided on a charitable basis by churchbased providers and others by entrepreneurs who saw a new business opportunity – emerged in the following years to provide for those who could not return home. Their ineligibility for Commonwealth hospital benefits eventually led to the introduction of Commonwealth-funded ‘nursing home benefits’ in 1963 (Sax 1985). As private entrepreneurs realised the opportunity provided by a government-guaranteed income and church-based and other charitable groups struggled to expand services to meet demand, the number of nursing home beds grew rapidly, their rate of growth far exceeding that of the aged population in general (Saunders & Fine 1992). Nursing homes soon became the dominant form of provision, with a separate funding system that ensured its autonomy and separation from the health care system (Senate 1985; DCS 1986; Parker 1987; Saunders & Fine 1992; Hogan 2003). This first period of aged care development, which commenced under the Menzies Liberal government and lasted through the Whitlam and Fraser governments until 1983, was characterised by the emergence of a


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275

Commonwealth-financed non-government nursing home industry and a series of non-profit hostels or homes for the aged. Aged care, in this era, was effectively equated with residential care. By the late 1970s, the outcome of the program was what came to be seen as ‘institutional domination’, an imbalance in the system of provision, with Australia having far more nursing home beds, proportional to the number of older people, than other comparable countries (Hogan 2003). The growth in nursing homes was, in part, an outcome of policies designed to reward providers who were able to keep the daily costs per bed as low as possible. Not surprisingly, problems were evident in the quality of care provided in a number of homes, as periodic scandals arising over the treatment of people in nursing homes demonstrated (McLeay 1982; SWAG 1982; Senate 1985). An unintended consequence of the rapid expansion of the nursing home industry was the low level of growth of hostel care. As a series of public inquiries documented, both public pressure and sound economic and planning principles pointed to the need to develop an alternative that would provide older people and their families with options of receiving support in their own home or of moving to a hostel (McLeay 1982; DCS 1986; Howe 1990). A second developmental period, involving a systemic transformation that came to be known as the Aged Care Reform Strategy, commenced in the early 1980s, ensuring that aged care became a site of significant innovation (Howe 1997). Reforms introduced into the aged care system in the mid-1980s by the new Labor government were intended to constrain nursing home costs by diverting those who did not need such care into alternative, home and community-based provisions. A series of new measures – which included the introduction of what was called the aged care ‘benchmark’ of 100 residential care beds per 1000 people aged 70 years or older; restrictions on access to nursing homes, including the establishment of the tightened entry criteria and standardised assessment procedures; the introduction of a form of casemix funding that linked payments received by nursing home proprietors to the level of dependency of residents; and the development of specialised multidisciplinary Aged Care Assessment Teams (ACATs) – helped develop a more differentiated and complex system of aged care. Importantly, emphasis was placed on the expansion of community care


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with the introduction and development of the Home and Community Care (HACC) program and the introduction, a few years later, of case management programs such as the Community Options (COPS) program and Community Aged Care Packages (CACPs). The Aged Care Reform Strategy thus provided for an expanded range of services to people who required support to remain living independently in their own homes. This involved yet another approach to funding, based on a system of block payments to locally based non-profit agencies, the cost of which was shared by the Commonwealth and state governments (DHHCS 1991; Howe 1997; Gibson 1998). The new measures saw a marked shift in Australian policy towards community support and an increasing emphasis on assessment and targeting as a means of ensuring that individuals receive appropriate services while tight budgetary constraints were maintained. The economic logic behind the policies adopted was based on the need to develop an affordable system of support for an ageing population, substituting cheaper alternatives for inappropriate placements in nursing homes. There was also a strong concern for equity and social justice evident in the policies and funding measures developed. A sophisticated user rights strategy was developed that built on the acknowledgment of the extent of elder abuse in residential care as well as in the community (Kurrle, Sadler & Cameron 1991; Kurrle 1993). The new regulatory approach included a focus on outcomes monitoring in residential care as well as the appointment of community visitors as part of a more systematic program of quality regulation than had previously operated (Ronalds 1989; Braithwaite et al. 1993; Gibson 1998). Alongside a range of alternative forms of community care services, ‘carers’ were also identified in the HACC legislation, and unpaid family members and other informal caregivers began to be deemed eligible for support from services, for carer pensions, and other forms of direct payment. Where there had once been a sharp divide between formal and informal care, new forms of partnership began to become evident, with family carers, almost three in every four of whom are women, increasingly supported by formal services and/or direct carer payments (Howe & Schofield 1996; Shaver & Fine 1996). These developments in Australia paralleled and, in the case of ACATs, led those taking place elsewhere in the world. Under


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277

pressures from both demographic ageing and economic restructuring, the field was transformed from a system of backward-looking ‘Cinderella services’ to become what some researchers have described as the ‘cutting edge of change’ (Baldock & Evers 1992). Most planning and efficiency measures adopted by the Commonwealth in the field of aged care during the period of the Labor government (1983–96) focused on supply-side interventions that were intended to redirect service users from unnecessary use of relatively expensive, institutional care facilities (nursing homes) towards less expensive forms of home- and community-based care, so that it would be possible to meet increases in demand for care associated with demographic ageing while enhancing the equity of the system, all within existing projected and affordable budgetary limits (DHHCS 1991; Howe 1997). Changes were also introduced into service fee and subsidy measures during this time with the aim of achieving more equitable access for all older people to the available services. This second period of aged care development, like the first, continued to see aged care as an alternative set of provisions. Links between aged and acute care services began to receive attention, but the aged care system remained largely set apart. The intention was to provide those who needed help with a choice to remain in their own home, supported by formal community services as well as by informal care. As most services were highly specialised (home nursing, meals on wheels, home care or housekeeping, day care, and so on) the division of labour generally required coordination between specialised organisations and, in the home, between the assistance provided by formal organisations and that of informal caregivers. Problems of coordination were thus built into the new designs for aged care (Fine 1999). A third period of transformation is now under way, marked by two major developments: commercialisation and restructuring. Each of these developments emphasises demand rather than supply-side planning, representing a significant break in the way that aged care policy was shaped in the previous period of reform. Commercialisation arises largely as the result of attempts by the Howard Liberal–National government since 1996 to reduce and restructure the extent of the Commonwealth’s financial commitment to aged care. In the Aged Care Act 1997 (AIHW 1997), the most important recent initiative of the Australian Government, a


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series of financial and regulatory changes were made to the operation of residential care services that were intended to limit government commitment to financing aged care and increase the requirements for service users to pay for their own services (Fine & Chalmers 2000). Initial plans requiring most users to contribute entry payments for high-level residential care services that were equivalent to the cost of their family home (comparable to the ‘accommodation bonds’ that had been charged long-term residents of low-level residential care) led to a public outcry on their introduction in October 1997. Guidelines were subsequently changed to enable new residents to pay an increased daily fee rather than a single large entry payment, maintaining the principle of consumer funding of services, although reducing the financial benefit to nursing home owners. Similar approaches have been applied to other areas of aged care. HACC services, for example, also received directives that led to an increase in fees for service users. Changes were made to legislation to allow the entry of for-profit community care providers. In a move that many regard as encouraging the development of a publicly supported market, contracts for the provision of HACC services are increasingly being put to competitive tender from 2004 (AIHW 2005; Productivity Commission 2006). There have also been proposals for a more radical transformation of all aged care services to conform to the models of a commercial market, as discussed in the next section of this chapter. The restructuring of aged care is closely linked to attempts by the Council of Australian Governments (COAG) to deal with state and Commonwealth government conflicts over financial and administrative responsibility for health services, concerns and initiatives to develop a more integrated system that better links dedicated aged care services and general health care services. As the costs of acute health care services have risen, policy-makers and health economists have advocated solutions that seek to make better use of long-term care services as cheaper substitutes through the creation of an ‘integrated’ system of coordinated care (COAG 1995; Duckett 1995). With the implementation of the Coordinated Care Trials and a series of other large and smaller integration initiatives, the separate character of aged care services and the problems experienced with coordination have been challenged (Fine 1999, 2001). As Bates and Lapsley (1985) have argued, the health systems of most advanced


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279

economies experience ongoing pressures as a result of the continual inventiveness and expansion of health services. These pressures are felt most strongly in the acute care setting of the hospital, where life-saving and life-changing interventions, such as open-heart surgery, that only a few years ago were regarded as medical miracles, are now available on a routine basis. Medical advances and the associated professional differentiation and specialisation that flow from them are continually expanding the capabilities of the system to intervene, requiring ongoing adjustments and restructuring in the acute care sector if the system is to continue to operate within limited public resources. Despite the general move to restructuring, a number of the policy initiatives of the previous Australian governments have been maintained and, in some cases, extended. The role of ACATs in assessing need and matching clients to services, for example, has been extended. Another important example has been the expansion of the program of Community Aged Care Packages (CACPs), first developed in the early 1990s as a way of enabling residential care providers to deliver hostel-level support services to older people who continue to live in their own home. The success of the CACP program has also led to the development of Extended Aged Care in the Home (EACH), a program of more intensive services suitable for those whose level of needs for support may otherwise require admission to a nursing home. The rapid expansion of these forms of packaged care delivered to those who live at home has had the effect of shifting the balance of community care away from the HACC program, with its myriad of specialised locally based providers, towards the larger-scale providers of residential care, who dominate among the providers of aged care packages (AIHW 2005). Alongside these developments, the regulatory framework for user rights in residential facilities has been reversed. In its place is a system of service accreditation that emphasises policy, procedures and paper work systems in place of service outcomes and ongoing monitoring by community visitors (Gray 2001; ACSAA 2006). Once again, public scandals arising from the disclosure of poor-quality residential care have become apparent. Finding a system of regulation that can ensure reliable and quality care to those who rely on it remains a significant challenge to policy in the 21st century.


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Directions in aged care in 21st-century Australia One of the most striking features of the development of aged care in Australia to date is the driving dynamic of ongoing systemic change. Incrementally, but seemingly inevitably, the scope and character of the system has been developing for over 50 years. Much of this development derives from historical patterns of direct governmental intervention and steering, as shown above. Each major government since the 1960s has sought to shape the system in accordance with its broad political philosophy, while acknowledging the longer-term trend of population ageing and the need to ensure that an adequate and affordable system of care would not be a burden to the generations of their children and grandchildren. The division of responsibilities between state and federal governments under the Australian Constitution has also shaped the forms of intervention that were possible. The states, with constitutional responsibility for providing health care services, have faced sharp fiscal limitations with their capacity to raise finance through tax severely constrained. The Commonwealth, with its superior taxing capabilities and powers, has had the responsibility and opportunity of responding with a national program. Since the 1960s, the Commonwealth has got around the limitations on its capacity to provide direct services by focusing on the finance and administration of formal aged care services. Increasing attention has also been paid in recent years to the issues concerning the labour force – both the paid workforce and the availability, support and promotion of informal care – which is no longer seen as an entirely private matter. New forms of ‘shared care’, in which formal services work hand in hand with family carers, suggest the distinction between public and private responsibilities is increasingly blurred. While the forms of service promoted by government policy have shifted significantly over the past 50 years, the fact that the Australian Government has taken responsibility for interventions over this time is arguably the most significant of all features. Public administration and financial support has been necessary because without it most frail older people could not be assured of access to ongoing care when it is most needed. Aged care thus represents a field in which there is strong evidence of market failure over a long period of time. With considerable


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281

proportions of the older population lacking the means to afford care over the longer term, government financial assistance was required to ensure equitable access to support. If this support is removed, it would be likely to lead to the withdrawal of vital services for a significant but unknown proportion of older people who would not be able to afford the ongoing costs of care. The Howard government has focused on demand-side reforms to aged care, seeking to develop a system based on market principles, reducing reliance on public financing, planning and intervention. The National Commission of Audit (NCA 1996), established by the Howard coalition government shortly after its election in March 1996, identified the costs of the ageing population as a potential financial catastrophe for the nation and recommended the introduction of demand-side measures in the field of aged care that would introduce a form of user-pays funding for most nursing home care. This approach, which informed many of the financial reforms introduced in the Aged Care Act 1997, was aimed not so much at reducing the utilisation of nursing home services (although it may well have had this effect) as increasing the funding by users, moving towards a more market-based approach to their utilisation, and shifting responsibility for funding capital investment in aged care infrastructure away from government (Fine & Chalmers 2000). This approach was elaborated in the Intergenerational Report, issued by the Australian Treasurer (Costello 2002), in which it was argued that the costs of an ageing population in the 21st century were unsustainable for government. Here, Treasury’s official calculations were disclosed: As the number of very old people increases, spending on aged care is also projected to increase from 0.7 per cent of GDP in 2001–02 to 1.8 per cent of GDP in 2041–42. Aged care is the most demographically sensitive area of government spending and the number of very old people is expected to increase significantly. (Costello 2002: 9)

Turning to the market for aged care, it was argued, offered the only sustainable long-term prospects for government. The recommendations for aged care, therefore, focused on the issue of user-pays funding for residential care to ensure ‘an affordable and effective residential aged care system that can accommodate the expected high growth in the number of very old people (people aged 85 or over)’ (Costello 2002: 2).


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Building on this approach, the most important blueprint for future aged care policy as envisaged by the current government has been that provided in the final report of an inquiry that focused on the pricing of residential aged care. Chaired by the economist Professor Warren Hogan, its central concern was with the ‘intergenerational inequities’ that were projected in the Intergenerational Report if the care of older people continued to be funded on the existing basis of general taxation revenue and user payments (Hogan 2004). To overcome the problems of aged care financing, a longer-term shift towards a market-based system of aged care was proposed. The financial calculations on which the review’s longer-term recommendations were based are set out in table 11.4. Based on existing contributions from government and payments by private consumers, the figures show a less pessimistic result than that projected earlier in the Intergenerational Report. The total cost of aged care was forecast to rise from $8.3 billion in 2002–03 to $107.9 billion in 2042–43. Expressed in terms of GDP, these figures increase from 1.13 per cent to 2.33 per cent over the same period. The relative contributions by private consumers were projected to rise from 0.29 per cent to 0.81 per cent of GDP, if existing policies were maintained. In contrast, the contribution by the Commonwealth Government under current indexation arrangements would rise only marginally, from 0.77 per cent to 0.79 per cent of GDP. In addition, a funding shortfall of 0.67 per cent of GDP was projected by 2042–43 that would need to be covered either by private consumers or by government (Hogan 2004: 109). The differences in the figures projected in the two reports illustrate the perils of such long-term projections. Small differences arising from the program definitions, the assumptions behind future projections of needs and utilisation rates, or from population projections are magnified as figures are aggregated and projected over decades. As a reflection on the past 50 years of changing provisions in the field of aged care demonstrates, the assumption that needs and provisions will remain the same over such a long period is also flawed, contravening much of the evidence presented elsewhere in the report. Yet, while it is tempting to dismiss the results altogether, there is much that can be learnt from a close study of such projections.


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283

According to the Hogan Report’s projections, residential care will continue to be the major contributor to the cost increases expected in the first four decades of the 21st century. This suggests that the development of future provisions would need to adjust, either by ensuring that the projected financial shortfall could be covered, or better, by shifting the balance of service use and reducing the extent of reliance on residential care services. The conclusions drawn by the Hogan Review are predicated on maintaining the existing mix of services and ignore the latter option entirely. In place of longer-term structural reform, they therefore emphasise the need to increase consumer contributions to the funding mix of residential care. This is linked to a strategic process of business and market development. Hogan’s vision is that, instead of an ‘immature’ industry dependent on government, aged care should become a ‘mature and independent industry’ operating primarily as a market-based system of provisions for aged consumers (Hogan 2004: 273–301). Where a social democratic policy perspective would give priority to maintaining coverage while restricting overall costs, the market approach advocated by Hogan sees in the ageing population an economic opportunity and seeks to promote the expansion of the aged care industry along corporate lines. To assess the capacity of government to cover the additional costs projected by 2042–43, the Hogan review considers the prospects for the Australian economy, concluding that: … the Australian Government will not be able to maintain its share of responsibility for the funding of aged care services for older people … without running up significant deficits. (Hogan 2004: 116)

Older people, however, are reported to be about to enjoy an increased potential to contribute to funding their own care. Hogan suggests that there is also a strong case to tighten means testing of incomes and to make a number of other changes that would effectively increase the total contribution of most service users and open it up to make it a much more deregulated market in which a number of corporate players compete. Government would continue to have a role, but its responsibility for funding would be reduced to providing a welfare safety net for a small


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Table 11.4

Financing aged care, government and consumer contributions, 2002–03 to 2042–43 (Hogan Report) 2002–03 2012–13 2022–23 ($ billion) ($ billion) ($ billion)

Nominal GDP

735.768

1225.882

1941.341

2032–33 2042–43 ($ billion) ($ billion) 3013.584

4630.327

Cost of provision (assuming current practices) Residential care

6.654

12.638

26.019

52.007

93.993

CACPs and EACH

0.337

0.447

0.717

1.220

1.836

HACC

0.863

1.624

3.133

6.182

10.901

Other programs

0.434

0.552

0.699

0.887

1.128

Total cost

8.288

15.261

30.568

60.296

107.858

Australian Government (current arrangements) Residential care

4.312

6.540

10.771

17.379

24.825

CACPs and EACH

0.288

0.359

0.540

0.857

1.205

HACC

0.637

1.253

2.465

4.849

9.538

Other programs

0.434

0.552

0.699

0.887

1.128

Total ($ billion)

5.670

8.703

14.475

23.972

36.696

Total (% GDP)

0.77

0.71

0.75

0.80

0.79

Residential care

2.077

3.835

8.545

18.741

36.389

CACPs and EACH

0.050

0.078

0.147

0.297

0.531

HACC

0.043

0.081

0.157

0.309

0.545

Total ($ billion)

2.170

3.994

8.849

19.348

37.465

Total (% GDP)

0.29

0.33

0.46

0.64

0.81

Private

State government Residential care

0.264

0.440

0.697

1.083

1.663

HACC

0.183

0.290

0.512

1.024

0.817

Total ($ billion)

0.447

0.730

1.209

2.107

2.480

Total (% GDP)

0.06

0.06

0.06

0.07

0.05


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aged care

285

Total status quo funding Residential care

6.654

10.815

20.013

37.203

62.877

CACPs and EACH

0.337

0.436

0.687

1.155

1.736

HACC

0.863

1.624

3.133

6.182

10.901

Other programs

0.434

0.552

0.699

0.887

1.128

Total ($ billion)

8.288

13.428

24.533

45.426

76.641

Total (% GDP)

1.13

1.10

1.26

1.51

1.66

Shortfall (additional funding required from Australian Government or elsewhere) Residential care

0.000

1.823

6.006

14.805

31.116

CACPs and EACH

0.000

0.010

0.030

0.065

0.100

HACC

0.000

0.000

0.000

0.000

0.000

Other programs

0.000

0.000

0.000

0.000

0.000

Total shortfall ($ billion) Total shortfall (% GDP)

0.000

1.833

6.036

14.870

31.216

0.00

0.15

0.31

0.49

0.67

SOURCE

Hogan 2004: 108–09, tables 6.1 and 6.2

number of older people without assets, income or any personal capacity to pay (Hogan 2004: 117–29).

The market and its alternatives It is often argued that the necessity for government intervention arises because the market has failed as an effective means of ensuring that those who need care can have access to it when it is required. Markets depend on consumers being able to make free and informed choices between competing providers sensitive to prices and demand. As the Hogan Review acknowledges, a number of problems are likely to be encountered in the development of a true market for aged care (Hogan 2004: 79–83, 247–50). The key problems identified by the review were:


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• Market failure. Aged care is subject to market failure, in part because ‘the key service suppliers have a huge knowledge advantage that consumers cannot easily bridge’. Further, once locked into receiving care, it is difficult if not impossible for consumers to change providers (Hogan 2004: 79–80). The effects of refusing care when it is needed, too, can be significant for members of the community other than the older person who needs care. • The side effects of regulatory intervention limit competition. Hogan gives the example of the effects of professional regulation, preventing providers from switching from existing staff mixes to less costly (and presumably less qualified) staff (Hogan 2004: 80). Other limits on competition are equally if not more serious. The high occupancy rate of residential care services, for example, means that it is seldom possible for applicants to choose between competing services they could use. Vacancies that might suggest excess capacity are quickly filled so that, instead of encouraging competition, overservicing is promoted. Regional market effects are well known, as there is little incentive for providers to service areas of low population density. • Ensuring access for the disadvantaged. There is a need to ensure access to aged care for those who could not otherwise afford to pay for necessary services. Financial subsidies and regulation of services, however, distorts the market, giving inappropriate financial signals to providers (Hogan 2004: 80). Hogan argues, however, that once allowance is made for the regulation of quality, price incentives presented by market mechanisms present the most viable option for the longer term that can improve industry productivity and ensure the financial sustainability of services. This is a strong endorsement of the approach adopted by the Howard government. Yet current experience and the history of aged care suggest that it cannot be treated as a discretionary consumer good and that market failure must be regarded as an inevitable feature of the field rather than an incidental one. Aged care is not like most consumer goods in which the buyer is free to choose or to refuse to use a particular product, not just because consumers are not able to freely assess the merits of a range of competing providers at


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the time they need help, or because the high cost of ongoing care means that most are unable to afford its use over a long period. Failure to use care services when they are needed can have significant negative consequences for others (Fine & Chalmers 2000). As a consequence, a different approach to planning, funding and regulation is required. If the argument that it is necessary to ensure sustainable funding for aged care is accepted, it is necessary to consider the question of the various options that might be used to encourage potential users to contribute more to the costs of their own care. A short synopsis of the most widely encountered options is presented in table 11.5 (Fine & Chalmers 1998). Direct payment of costs by consumers has not proven to be viable for long-term care, largely because there are too many older people who need care who cannot afford it, placing others at risk as a result. The catastrophic costs involved clearly aggravate the cost barrier. For this reason, some form of public intervention operates in every advanced country, usually on the basis of a public subsidy of care costs, requiring Table 11.5

Funding options for aged care

Type of funding

Payment

Coverage

Example

User-pays, with market pricing

Payment by consumers at point of consumption. May require use of savings and asset run down.

Selective. Requires back-up means-tested public assistance type programs for those unable to pay.

United States (but backed up by Medicare and Medicaid provisions for those unable to pay).

Public subsidy of user fees, with co-payment

Payment of fixed fees Usually means-tested. that cover all or part of cost of provision. Funded through general taxation revenue or by identified taxation revenues, such as death duties.

Most west European countries, Canada, Australia 1963 onwards.

Private LTC insurance

Voluntary individual Selective contributions over many years.

United States; Proposed for United Kingdom 1996, Australia, 1998, but not successful.

Social LTC insurance

Compulsory Universal contributions over working life, or from set age (e.g. 45 years)

Netherlands, Germany, Austria, Israel, Japan

SOURCE

Fine & Chalmers 1998


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a co-payment of some form on behalf of the user. In practice, there are two forms of insurance that can be identified: private insurance and social insurance. Private Long-Term Care (LTC) insurance is an option for financing aged care that, although much discussed, has not proven to be popular or successful. The most extensive experience with this form of payment is in the United States, where it has been marketed by insurance companies for a number of years and deliberately encouraged in a number of states through the provision of incentives of various kinds. Despite this, the take-up rate for such insurance has been low, in part because it is necessary for insurers to limit the extent of benefits available through private insurance to maintain the costs of contributions at anything like a reasonable level. National LTC Insurance, a social insurance approach, appears to have a number of advantages over private schemes. There are no problems of adverse selection because such schemes are universal. Each citizen contributes and is entitled to benefits if they later have a need for care. Because contributions are means-tested and proportional to income, those with the lowest incomes pay either nothing or a very small amount of their income. Importantly, because there is a single ‘payer’, significant administrative efficiencies can be achieved. Such a system also makes it possible to help contain final costs of provision because a single payer has greater capacity to restrain service provision costs than multiple, competing purchasers (Osberg 1995). Finally, there appears to be a political legitimacy and acceptance of the schemes in those countries in which they exist that makes them very popular with voters, as is evident in Australia with the Medicare scheme. National Long-Term-Care Insurance represents an important funding mechanism for long-term care in a number of countries, most notably the Netherlands, Germany, Japan, Israel and Austria (Borowski 1997; OECD 1998; Fine & Chalmers 2000; Casey 2003). Reflecting the success of such schemes, there have been a number of prominent advocates of some form of long-term care insurance in Australia (Walsh & De Ravin 1995; Borowski 1997; Howe & Sarjeant 1999; Howe 1999; McCallum 1999; Somogyi et al. 1999). Plans have also been advanced for a system of casemix-like payments that would serve to more closely link acute health care, primary care and extended care services for older people


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(Kendig & Duckett 2001). Because any discrete program of LTC funding creates incentives to shift costs from the acute health system, it is also necessary for clear program boundaries to be established. An argument can therefore be made for the insurance to be provided through the same funding mechanism as the general health care system. Interestingly, to date, proponents of social insurance have been drawn from academic and professional ranks rather than the political system. Until political interest is shown in an alternative approach to funding aged care, it is safe to say that these alternative funding schemes are essentially of academic interest only, their main purpose being to demonstrate that there are viable alternatives to the market and that the choice of the market is a political decision rather than an unavoidable financial necessity.

Human resource constraints The emphasis in developing and maintaining a national program of services, to date, has been almost exclusively on the finance of aged care. Demographic evidence is beginning to emerge, however, that suggests that concern for ensuring the availability of caregivers – the human resources required to provide the care – will become increasingly pressing in the 21st century. The Hogan Review, for example, outlines a series of existing problems in staffing in residential aged care, concluding: There is no prospect of a falling off in the demand for staff. The expansion of education and training of aged care staff in general must be expanded to a level well beyond anything contemplated in recent years. The expansion will not be a temporary commitment. (Hogan 2004: 235)

Leading the Hogan Review to go beyond the market to recommend a significantly increased public commitment to education and training were figures on the aged care workforce. These show that the number of employees in the residential care sector declined between 1995–96 and 1999–2000, while the number of people receiving care increased. There has also been a considerable adjustment within the direct care workforce, as the numbers of registered and enrolled nurses in residential care facilities have declined, while the use of personal care assistants increased. These changes reflect both the growing shortage of nursing


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staff and the development of workforce structures that rely more on lower paid and less qualified staff. The Hogan Review is not alone in giving staffing of aged care detailed attention. Other recent reviews of staffing include studies by the National Institute of Labour Studies (Richardson & Martin 2003), the Australian Institute of Health and Welfare (AIHW 2005: 380–93) and the Productivity Commission (Productivity Commission 2005), alongside the publication of the National Aged Care Workforce Strategy (DHA 2005). Each of these reports emphasises the importance of fostering education and training while working to improve the pay and conditions of employment in order to attract sufficient qualified staff. Although existing problems experienced with the aged care workforce have prompted much of this attention, the longer-term implications of demographic change are the greatest concern. Population ageing is associated with a reduction in the numbers of those of workforce age at the very time that numbers of older people are increasing most dramatically, so that attracting and maintaining a well-qualified workforce is as much an issue as is the financing of care. Planning the workforce must be closely linked to financial planning, as the costs of aged care will continue to be largely determined by the cost of the workforce. Given that existing data on care for older persons shows that far greater proportions rely on informal than formal care (AIHW 2003b), the availability of informal caregivers should be of even greater importance from the perspective of human resources. Detailed projections of patterns of informal caregiving have also been provided by recent studies based on modelling of demographic data on caregiving in Australia (Jenkins et al. 2003; Percival & Kelly 2004). The results of projections from current data suggest that the availability of informal carers will decrease in coming decades. This is in marked contrast to a recent and otherwise directly comparable study of projections of informal care in England over the same period (Pickard et al. 2000). The different results of the Australian and English studies are indicative of the importance of the assumptions and trends introduced in such modelling exercises. In addition to small national differences in the prevalence of disability and the availability of carers, there are


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significant variances in the definitions of disability used in the British and Australian data. More important are the different assumptions about marital status and household formation in each of the studies. While Pickard and her British colleagues present figures that show an increasing trend for older people to form intimate partnerships, the statistical data from the mid-1990s used in the Australian studies assume that older people will be increasingly separated, divorced or widowed. It is also assumed that increasing numbers of older people in Australia will live alone, while the British researchers draw on data that point to increasing rates of repartnering and co-habitation that will translate into increased rates of partner carers over the first four decades of the 21st century. Forecasts of the future adequacy of the aged care workforce and unpaid caregivers, like the forecasts of the future costs of aged care, are based on projections of the data available at the time the study is undertaken. There is an assumption built into the modelling that the existing system somehow sets the benchmark that future provisions must meet. But how adequate is the current system? The unspoken hope of experts and the general public alike is that it will develop and improve in the future, rather than remain the same. There is already no direct correspondence between the numbers of primary carers and those requiring assistance as a result of disability evident in the existing demographic data. In 1998, for example, the number of people needing care as a result of disability exceeded the numbers of available primary carers, as assessed by the ABS, by a ratio of 2.3:1 (ABS 1999; Jenkins et al. 2003). It is thus clear that not all older people with a severe or profound disability rely on caregivers at present. Their pattern of management, instead, is one that relies, for a large part, on self-care, one component of which involves accessing and managing assistance from other sources when it is required. Future medical advances and improved access to existing preventative techniques are likely to lead to a further reduction in the prevalence of disabling conditions. Similarly, improved access to existing and future technological and social developments are also likely to enable those with relatively high levels of physical disability to live a relatively independent life.


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Conclusion Aged care must be regarded as a work in progress. Its future development in Australia will clearly involve responding to the issue of demographic, economic and political changes that the long-lived society entails. But it is erroneous to claim that the demography of ageing makes it inevitable that public responsibility cease and that the future development of aged care be left to the market. As policy responses to population ageing have moved the issue of aged care to centre stage of the policy debates, it is increasingly clear that there is a struggle to define and claim the territory of aged care. Residential care providers to date have been successful in sustaining the public perception that aged care requires their services, but they no longer can claim the responsibility is theirs alone. The carers movement has also laid strong claims to the field, while it is apparent that community support and health care services are also essential. The history of the current, rather complex and diverse system of provisions indicates that the tensions besetting the existing system will have a profound effect on the way that services develop over the coming decades. References Aged Care Standards and Accreditation Agency (ACSAA) (2006) Accreditation Standards (Homes), The Aged Care Standards and Accreditation Agency Ltd., accessed February 2006. Australian Bureau of Statistics (ABS) (1999) Disability, Ageing and Carers: Summary of findings Australia, 1998 (Cat. no. 4430.0), Australian Bureau of Statistics, Canberra. —— (ABS) (2004) Australian Demographic Statistics (Cat. no. 3101.0), Australian Bureau of Statistics, Canberra. Australian Institute of Health and Welfare (AIHW) (1997) Australia’s Welfare 1997: Services and Assistance, Australian Government Publishing Service, Canberra. —— (AIHW) (2003a) Community Aged Care Packages in Australia 2001–02: A Statistical Overview (AIHW Cat. no. AGE 30, Aged Care Statistics Series no. 14), Australian Institute of Health and Welfare, Canberra. —— (AIHW) (2003b) Informal Care. In Australia’s Welfare 2003, Australian Institute of Health and Welfare, AusInfo, Canberra, pp. 65–120. —— (AIHW) (2004) Australia’s Health 2004 (AIHW Cat. no. AUS 44), Australian Institute of Health and Welfare, Canberra. —— (AIHW) (2005) Australia’s Welfare 2005, Australian Institute of Health and Welfare, AusInfo, Canberra. Bates, E & Lapsley, H (1985) The Health Machine: The Impact of Medical Technology, Penguin, Melbourne. Borowski, A (1997) Financing Long-Term Care for the Aged: Israel’s Long-Term Care Insurance Law, Social Security Journal, September: 56–72. Braithwaite, J, Makkai, T, Braithwaite, V & Gibson, D (1993) Raising the Standard: Resident Centred Nursing


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Home Regulation in Australia, Australian Government Publishing Service, Canberra. Casey, BH (2003) How Will We Provide and Pay for Long-Term Care? Journal of European Social Security, 5(1): 67–89. Costello, PT (2002) Intergenerational Report, 2002–03 (Budget Paper no. 5), Department of Treasury and Finance, Canberra. Council of Australian Governments (COAG) (1995) Health and Community Services: Meeting People’s Needs Better, A Discussion Paper, Council of Australian Governments, Commonwealth Department of Human Services and Health, Canberra. Cullen, D (2003) Historical Perspectives: The Evolution of the Australian Government’s Involvement in Supporting the Needs of Older People, Review of Pricing Arrangements in Residential Aged Care (Background Paper no. 4) (Warren Hogan, Chair of Enquiry Task Force), Department of Health and Ageing, Canberra. Department of Community Services (DCS) (1986) Nursing Homes and Hostels Review, Australian Government Publishing Service, Canberra. Department of Health and Ageing (DHA) (2004) The Way Forward: A New Strategy for Community Care, Canberra. —— (DHA) (2005) National Aged Care Workforce Strategy, Aged Care Workforce Committee, Canberra. Department of Health, Housing and Community Services (DHHCS) (1991) Aged Care Reform Strategy Mid Term Review 1990–91, Department of Health, Housing and Community Services, Australian Government Publishing Service, Canberra. Dickey, B (1980) No Charity There: A Short History of Social Welfare in Australia, Thomas Nelson, Melbourne. Duckett, S (1995) Medicare: Where to Now? Australian Health Review, 18(1): 117–25. Fine, M (1994) Supporting, Exploiting or Displacing the Family? Community Support for Disabled and Frail Older People. In J Inglis & L Rogan (eds) Flexible Families: New Directions for Australian Communities, Pluto Press, Sydney, pp. 73–92. —— (1999) Coordinating Health, Extended Care and Community Support Services: Reforming Aged Care in Australia, Journal of Aging and Social Policy, 11(1): 67–90. —— (2001) The Australian Coordinated Care Trials: A Review of the Diagnosis, Prescription and Treatment Regimes. In M Fine, D Perkins, A Owen & M Warner (eds) Coordinated Care on Trial: Background to the Emergence of the National Coordination Agenda in Health Care (Australian Studies in Health Service Administration no. 90), School of Health Services Management, University of New South Wales, Sydney, pp. 1–16. Fine, M & Chalmers, J (1998) The Application of User Pays Principles to Government Programs for Older Australians: The Case of Aged Care, NSW Committee on Ageing, Ageing and Disability Department, Sydney. —— (2000) User Pays and Other Approaches to the Funding of Long-Term Care for Older People in Australia, Ageing and Society, 20(1): 5–32. Fine, M & Stevens, J (1998) From Inmates to Consumers: Developments in Australian Aged Care Since White Settlement. In B Jeawoddy & C Saw (eds) Successful Aging: Perspectives on Health and Social Construction, Mosby, Sydney, pp. 39–92. Gibson, DM (1998) Aged Care: Old Policies, New Solutions, Cambridge University Press, Cambridge. Glendinning, C (ed.) (1998) Rights and Realities: Comparing New Developments in Long-Term Care for Older People, The Policy Press, Bristol. Gray, L (2001) Two Year Review of Aged Care Reforms, Department of Health and Aged Care, Ausinfo, Canberra. Hogan, W (2003) Historical Perspectives: The Evolution of the Australian Government’s Involvement in Supporting the Needs of Older People, Review of Pricing Arrangements in Residential Aged Care (Background Paper no. 4) (David Cullen Chief Author of report, Warren Hogan, Chair of Enquiry Task


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Force), Department of Health and Ageing, Canberra. —— (2004) Review of Pricing Arrangements in Residential Aged Care, (Warren Hogan, Chair of Enquiry Task Force), Department of Health and Ageing, Canberra. Howe, A (1990) Nursing Home Policy in Australia: From Laissez-faire to Restructuring. In HL Kendig & J McCallum (eds) Grey Policy: Australian Policies for an Ageing Society, Allen & Unwin, Sydney, pp. 150–69. —— (1997) The Aged Care Reform Strategy: A Decade of Changing Momentum and Margins for Reform. In A Borowski, S Encel & E Ozanne (eds) Ageing and Social Policy in Australia, Cambridge University Press, Cambridge, pp. 301–26. Howe, A & Sarjeant, H (1999) Strengthening the Financing of Aged Care in Australia. In Policy Implications of the Ageing of Australia’s Population: Conference Proceedings Melbourne, 18–19 March, 1999, Productivity Commission & Melbourne Institute of Applied Economic and Social Research, Melbourne, pp. 357–88. Howe, A & Schofield, H (1996) Will You Need One, or Will You Be One, In the Year 2004? Trends in Carer Roles and Social Policy in Australia Over the Last and Next 20 years. In Towards a National Agenda for Carers: Workshop Papers (Aged and Community Care Service Development and Evaluation Report, no. 22), Australian Government Publishing Service, Canberra, pp. 3–18. Howe, AL (1999) Extending the Pillars of Social Policy Financing to Aged Care, Social Policy and Administration, 33(5): 534–51. Jenkins, A, Rowland, F, Angus, P & Hales, C (2003) The Future Supply of Informal Care, 2003 to 2013: Alternative Scenarios (AIHW Cat. no. AGE 32) Australian Institute of Health and Welfare, Canberra. Kendig, HL & Duckett, S (2001) Australian Directions in Aged Care: The Generation of Policies for Generations of Older People, Australian Health Policies Institute, Commissioned Paper Series 2001/05, University of Sydney, Sydney. Kewley, TH (1973) Social Security in Australia, 1900–1972, 2nd edn, Sydney University Press, Sydney. Kurrle, S (1993) Responding to Elder Abuse: A Follow up Study of Interventions and Outcomes, Australian Journal on Ageing, 12(4): 5–9. Kurrle, S, Sadler, PM & Cameron, LD (1991 ) Elder Abuse: An Australian Case Series, Medical Journal of Australia, 155(3 ): 150–53. McCallum, J (1999) Financing Aged Care Services: 1999 and Beyond, Australasian Journal of Ageing, 18(2): 54–55. McLeay, L (1982) In a Home or At Home: Accommodation and Home Care for the Aged, Report of the House of Representatives Standing Committee on Expenditure (Chaired by L. McLeay), Australian Government Publishing Service, Canberra. National Commission of Audit (NCA) (1996) National Commission of Audit Report to the Commonwealth Government, Australian Government Publishing Service, Canberra. Organisation for Economic Co-operation and Development (OECD) (1998) Ageing and Care for Frail Elderly Persons: An Overview of International Perspectives (DEELSA/ELSA/WP1(98)10), Organisation for Economic Co-operation and Development, Paris. Osberg, L (1995) The Equity, Efficiency and Symbolism of National Standards in an Era of Provincialism, Paper presented at the 8th Annual Canadian Health Policy Conference, Toronto. Parker, RA (1987) The Elderly and Residential Care: Australian Lessons for Britain, Gower, Aldershot. Percival, R & Kelly, S (2004) Who’s Going to Care? Informal Care and an Ageing Population, Report prepared for Carers Australia by the National Centre for Social and Economic Modelling, Canberra, viewed 28 July 2004, . Pickard, L, Wittenberg, R, Comas-Herrera, A, Davies, B & Darton, R (2000) Relying on Informal Care in the New Century? Informal Care for Elderly People in England to 2031, Ageing & Society,


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20(6): 745–72. Productivity Commission (2005) Australia’s Health Workforce: Research Report, Productivity Commission, Canberra. —— (2006) Report on Government Services 2006. Part F Community Services, Productivity Commission, Melbourne, viewed February 2006, . Richardson, S & Martin, B (2003) The Care of Older Australians: A Picture of the Residential Aged Care Workforce, National Institute of Labour Studies, Flinders University, Adelaide. Ronalds, C (1989) ‘I’m Still an Individual’: A Blueprint for the Rights of Residents in Nursing Homes and Hostels, Issues Paper, Department of Community Services and Health, Canberra. Saunders, P & Fine, M (1992) The Mixed Economy of Support for the Aged in Australia: Lessons for Privatisation, The Economic and Labour Relations Review, 3(2): 18–42. Sax, S (1985) A Strife of Interests: Politics and Policies in Australian Health Services, George Allen & Unwin, Sydney. Senate (1985) Private Nursing Homes in Australia: Their Conduct, Administration and Ownership, Senate Select Committee on Private Hospitals and Nursing Homes, Australian Government Publishing Service, Canberra. Shaver, S & Fine, M (1996) Social Policy and Personal Life: Changes in State, Family and Community in the Support of Informal Care. In Towards a National Agenda for Carers: Workshop Papers (Aged and Community Care Service Development and Evaluation Report, no. 22), Department of Human Services and Health, Australian Government Publishing Service, Canberra, pp. 19–36. Social Welfare Action Group (SWAG) (1982) Abuse of the Elderly: A Report on the Results of a Phone-in study of Elder Abuse, Social Welfare Action Group, c/- Department of Social Work, University of Sydney, Sydney. Somogyi, S, Gale, AP, Helenius, CO, Knox, DM, Sarjeant, HB & Stevens, RJ (1999) Financing the Ageing: Now is the Time to Act. A Discussion paper. Institute of Actuaries of Australia, viewed February 2006, . Walsh, JE & De Ravin, JW (1995) Long Term Care: Disability and Ageing, Institute of Actuaries of Australia, Sydney.


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12 The politics of ageing Sol Encel and Elizabeth Ozanne

Introduction The emergence of the ‘ageing enterprise’ in Australia since the mid1980s has paralleled increasing international and government initiatives in response to population ageing and the need to mediate rising cost and social pressures by active government intervention. Classified as a neo-liberal welfare state with some corporatist leanings, Australia has responded to population ageing with a specific set of policy interventions designed to regulate and recalibrate its economy in the light of these shifting economic and social demands (Productivity Commission 2005). As a federated parliamentary system with considerable concentration of power at the federal level, the major challenges of population ageing have been central to prime ministerial and electoral politics in recent decades and have, as well, been actively driven and mediated by key public agencies that have tended, along with their political masters, to have had primary agenda-setting power. The process of policy elaboration that has occurred over several decades has had a major effect in mobilising institutional interest groups, voters and citizens around the issues of an ageing society. It is argued here that the politics of an ageing society have been essentially government and policy led rather than being a direct response to mobilisation of aged individuals, interest groups or the aged vote. This chapter explores the nature and sources of power in


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an ageing society and some of the reasons why a ‘grey power’ thesis is difficult to substantiate (Skocpol 2003).

Neo-liberalism and social policy Since the 1980s, Australian Government policies have been deeply influenced by neo-liberal approaches to social welfare. Like other neoliberal states, this has entailed a mix of policy levers – decommodification, recalibration and cost containment (Healy 2002; Castles & Uhr 2005). According to Esping-Andersen, neo-liberal policies include the deregulation of wages, flexible employment conditions, and open markets, with the aim of achieving higher rates of employment at the cost of wage erosion (Esping-Andersen et al. 2002). Taxation levels and government outlays remain relatively low, public sector employment is constrained, transfer payments tend to be income-tested, private sector activity in pensions and social services (such as health and child care) is extensive and, in many cases, public expenditure is used to subsidise private provision for the middle classes (Pierson 2001). In addition, political mobilisation by unions and other interest groups is not strong enough to challenge the broad consensus that supports these policies. The effects of such policies are clearly evident in government actions related to the ageing of the population. The Howard coalition government has successfully managed the centrist ‘consensus’ during its lifetime. Reviewing the government’s record over a period of eight years, Julian Disney remarks that the coalition was relatively generous towards older people. He ascribes this to the electoral importance of older age groups, something that we examine later in this chapter. He suggests that payments to older people will not be stigmatised as ‘welfare’. Accordingly, pension policy was made more generous and concessions were extended to self-funded retirees. The number of residential aged care places increased considerably, as did assistance for elderly people to remain in their own homes as long as possible. However, the level of assistance remained severely inadequate, especially when affordability and adequacy of service were taken into account. In addition, the government’s attempts to increase contributions from service users did not provide sufficient protection for poorer people (Disney 2004).


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Policy and politics The politics of ageing are played out at several levels. They can be observed in the structures of governance at international, national and state government levels, in the operations of national and state government bureaucracies, in the influence of key interest groups, and in the role of older persons through organised groups and as voters, consumers, citizens and contributors to economic and social capital (Binstock & Quadagno 2001). The general thesis of this chapter is that ‘policy leads politics’ (Campbell 2003). Since the mid-1980s, policy development has taken the form of an ‘ageing enterprise’ (Estes 1979), which is at the core of the politics of ageing. The interaction between policy and politics is evident in the shifting approaches of government over a period of 25 years.

The evolution of policy Until the 1980s, Commonwealth Government policy related to ageing was mainly concerned with two areas – old-age pensions and subsidies for nursing homes. With the advent of the Labor government (1983–96), a much more comprehensive approach was developed. The main vehicle of activity was the Aged Care Reform Strategy, inaugurated in 1985. The Reform Strategy had four aspects: • improvement of access to services, and greater equity in resource allocation • improvement in the quality of care • interventions related to individual clients and agencies delivering services • program areas of residential care or home and community care The outcomes of the Reform Strategy have been described in detail by Howe (1997). She notes that the reform impulse had stalled after ten years, so that no legislative framework had been created by the time the Labor government lost office in 1996, although a report by the Australian Law Reform Commission was released in 1995. Under the Labor government, the role of the Commonwealth in aged care had become the dominant force in the planning and financing


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of residential and community care. One immediate result of the election of the Howard coalition government was an attempt to realign Commonwealth and state responsibilities. Three previous attempts to achieve this realignment by shifting responsibilities to the states had failed. In 1977, the Premiers’ Conference agreed to such a review, which was not actually completed until 1983. In the meantime, the House of Representatives Standing Committee on Expenditure produced a report in 1982 that advocated radical changes. Its report proposed that responsibility for residential accommodation and home care programs should be transferred to the states over a five-year period (Howe 1997). The issue was canvassed again at a special Premiers’ Conference in 1990. The State Premiers’ Conference attempted to provide a forum for the national discussion of federal–state relations and to tease out the linkages between aged care and other governmental responsibilities, both state and federal. Agreement was not reached and the subject was later transferred to the agenda of the Council of Australian Governments (COAG), created in 1993 at the initiative of the Labor Prime Minister, Paul Keating (Green & Pfeffer 1997). The matter was still on the agenda of COAG when the Labor government lost office in 1996. The first COAG meeting under the new government took place in June 1996. At the time, the majority of state governments were controlled by the coalition parties, and the Commonwealth Government had little trouble in persuading the states that responsibility for managing aged care should devolve upon them. It was envisaged that the Commonwealth would retain responsibilities for national policy, information and systems of payment. The states would manage and coordinate provision of services. A national aged care strategy would be developed to cover all areas of agreement. These proposals were influenced by the report of an inquiry by the National Commission of Audit (National Commission of Audit 1996), an ad hoc body set up by the Prime Minister, John Howard, shortly after his accession to office. The Audit Commission examined aspects of the management and financial activities of the Commonwealth, and recommended a number of changes in fiscal and accounting practices. The report relied heavily on the concept of the ‘age dependency ratio’, which the report defines as the ratio of people aged 65 and over to those


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between 18 and 64. (Note that the World Bank defines this ratio as the number of people over 60 years of age divided by the number of persons aged 20–59. Common practice among demographers is to define this ratio in terms of persons aged 65 and over divided by the number of those aged between 15 and 64. The arbitrary character of the age levels chosen underlines the caution that should be attached to arguments that rely on this ratio. See also chapter 1.) Using the age dependency ratio as the basis of its analysis, the Audit Commission report stressed the importance of self-reliance in old age, to reduce the burden on government. It was important to ‘moderate’ public expectations. Otherwise, they would weaken action by individuals to provide for their own retirement. The ‘private saving culture’ should be strengthened so that government involvement was limited. Four specific proposals were made to achieve these ends: • means testing for nursing home benefits • recovery of the cost of nursing home benefits from the estates of former residents with significant assets • greater incentives for private saving towards the cost of retirement • administration, funding and service delivery of aged care and health franchise services to be devolved from the Commonwealth to the states (eds Borowski, Encel & Ozanne 1997) Although the government did not accept all the recommendations of the Audit Commission report, the general philosophy of the report has continued to influence government policy. In the event, however, the states backed away from their initial acceptance of devolution of responsibility for aged care once the financial implications of such a transfer became clear. Bilateral agreements, which were due to be signed during 1997, simply did not take place. If anything, the responsibilities of the Commonwealth have increased in the period since 1996. This is reflected in the expansion of Commonwealth Government bureaucracies related to ageing and health. A national Office of Ageing was created in 1986, and a number of program areas have followed, related to social security, health, housing and employment. The report of the National Commission of Audit was followed by a series of other reports setting out the neo-liberal policy direction of the Howard government. They include:


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The Intergenerational Report, 2002 The National Strategy for an Ageing Australia, 2002 The Way Forward, 2004 Investing in Australia’s Aged Care, 2004 The Challenge of an Ageing Population, 2004 Economic Implications of an Ageing Australia (Productivity Commission 2005)

The Intergenerational Report addressed itself to questions of fiscal policy and the impact of demographic change on government finances. It stressed the need for ‘fiscal sustainability’ and identified several priorities to this end, including a retirement incomes policy that encouraged private saving for retirement. The report also emphasised the need to contain the growth of the Pharmaceutical Benefits Scheme and to stimulate widespread participation in private health insurance. There was no recognition of the likelihood that extra revenue would be required to meet increases in aged care costs; instead, the report endorsed the need for user-pays policies and for reliance on superannuation to reduce pressure on the age pension. The National Ageing Strategy, released in 2002, may be seen as a pendant to the Intergenerational Report. Despite its title, it does not provide any strategic directions. Rather, it is a moderately useful review of the issues covered in much greater detail in the series of discussion documents issued by the then Minister for Ageing, Bronwyn Bishop, between 1999 and 2001. The Strategy report committed the government to nothing in particular and avoided questions relating to government expenditure and fiscal policy. A genuinely strategic approach has yet to emerge. State governments have also been key players in the elaboration of aged policy (Pfeffer & Green 1997). Offices of Ageing were created in most states and territories in Australia in the mid-1980s in response to the burgeoning of an aged services infrastructure. Though some of these offices have since been subsumed into larger Health/Disability/Primary Care Departments, they have seen considerable expansion in their budgets and the community service infrastructure they support – from Aged Care Assessment Services to Aged and Extended Care Centres and local government Home and Community Care Services. Some policy areas


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have more state involvement than others. For instance, whereas hospital funding is largely a federal responsibility, Home and Community Care is a jointly administered federal–state program. State governments have also set up advisory committees to tap into community concerns; for example, the Ministerial Advisory Committee of Senior Victorians and the Ministerial Advisory Committee on Ageing in NSW. At the national level, there is the National Aged Care Advisory Committee. These bodies are not representative, and act primarily as buffers in the mediation of new policy initiatives.

Grey power? Alan Walker, in a recent review of the relationship between ageing and politics, notes that it is a largely neglected topic that constitutes a ‘gaping hole’ in gerontological research. He argues that this has allowed two related myths to flourish: the myth that the increased number of older people is an intolerable burden on society, and that ‘grey power’ has an excessive impact on government. Grey power, he suggests, is ‘more hype than substance’, but it is regularly reproduced and amplified in support of neo-liberal economic and social policies (Walker 2006). A powerful stimulus to these myths was given by the report of a commission appointed by former US president Jimmy Carter in the 1970s (White House Conference on Aging, 1981). The American daily press, the business press and a number of neo-liberal economists used Carter’s commission as a hook on which to hang their arguments. An example from the business press was an article in Forbes magazine which declared that ‘the myth is that they’re sunk in poverty. The reality is that they’re living well. The trouble is there are too many of them – God bless ’em’ (Flint 1980). Commenting on such views, Binstock argues that the aged were being used as a scapegoat for failures in public policy. Carter’s commission identified a looming crisis in the social security system that had stoked concern that the cost of pensions and aged care would impose an intolerable burden on American society. Whereas the earlier stereotype of older persons treated them as the deserving poor, this had been replaced by a much more repressive stereotype that presents the


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aged as relatively well off because of welfare programs, and exercising too much political influence. Increased longevity will make the problem worse (Binstock 1985). Binstock has also described this as the transition from ‘deserving poor’ to ‘greedy geezers’ (Binstock 2005). The fictitious character of the social security crisis has been dissected by a number of writers. In a comparative study of the economics of ageing, Schulz, Borowski and Crown criticised reliance on the age dependency ratio as ‘voodoo demographics’ (an allusion to the criticism levelled at Ronald Reagan during the 1980 American presidential campaign for his reliance on ‘voodoo economics’). The spectre of an intolerable economic burden and a rise in intergenerational conflict was a phantom used to disguise real issues about the level of taxation and the role of government in the economy (Schulz, Borowski & Crown 1991). The language of crisis also appears in two significant reports published in 1994 – one by the World Bank, appropriately titled Averting the Old Age Crisis, and one in Australia, entitled Australia’s Ageing Society. The Australian report, written by two economists as a paper for the Economic Planning and Advisory Council, avoids the term ‘crisis’ but uses the standard arguments based on age dependency to paint a gloomy picture of a growing burden on existing systems of income support, aged care and health care. An ageing population was likely to have negative effects on international competitiveness, domestic demand, and the availability of a skilled labour force, while health expenditure would rise by almost 3 per cent of GDP within 50 years (Clare & Tulpule 1994). Despite the generally pessimistic tone of this report, the authors concluded that increased costs could be met by modest rises in taxation, especially as GDP per head was expected to double in real terms by their projected year of 2051. However, reactions to the report in the newspapers could only be described as hysterical, exemplified by the following instances: • ‘Pickpocket Pensioners’, headline, The Australian, 16 February 1994. The article went on to claim that most of the savings of the young would go into consumption expenditure by their grandparents. • ‘Baby Boomers Won’t Just Fade Away’, headline, Sydney Morning Herald, 7 February 1994. The following editorial maintained that the baby


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boomers would become an intolerable burden on society as they grow older, threatening ‘a general sclerosis of Australian attitudes and culture’. • ‘Health Cost a Life and Death Issue’, headline, Sydney Daily Telegraph, 31 January 1994. More temperate than the two preceding articles, this editorial foresaw the danger that the elderly might come to be regarded as an unfair burden on the health dollar (Encel 1995). The language of ‘crisis’ and ‘burdens’ has since abated somewhat, and is notably absent from official documents such as the 2002 Intergenerational Report. In the following section, we note how political parties have preferred to court the ‘grey’ vote rather than stress the problems of an ageing population.

Older people as voters ‘Grey power’ and the ‘grey vote’ are regularly invoked by conservative commentators to warn against the excessive influence of older people on public policy. Peter Peterson, at one time Secretary for Commerce in the administration of US president Richard Nixon, wrote an apocalyptic book in which he conjured up the vision of a ‘nation of Floridas’, with hordes of grey-haired baby boomers laying waste to the savings of younger generations (Peterson 1996). Peterson is a leading member of the Concord Coalition, an influential pressure group whose major concern is to promote the case for tax cuts. In a later book, Peterson invokes the images of a looming iceberg or a steep precipice confronting society (Peterson 1999). As against this, Binstock argues that age, as such, has little influence on electoral decisions in the United States. He notes that older Americans tend to distribute their votes among candidates in much the same way as other age groups. ‘The votes of older persons divide along the same partisan, economic, social, gender and other lines as those of the electorate at large’ (Binstock 2005). Similarly, there is no evidence that older voters as a single interest group have swayed election outcomes in Australia. Though more older than younger people vote, they tend to do so along specific interest rather


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than age lines. The aged vote has, however, been wooed by government in successive budgets/elections and the government is careful not to offend the aged voter. Paradoxically, despite these rumblings on the political Right, older voters have traditionally supported conservative parties. Public opinion polls in Australia consistently find that, among voters aged 55 and over, more than 60 per cent choose the coalition parties in two-party preferred terms. This preference is more marked among women than men. Opinion polling also indicates that older electors are less likely than younger voters to change their votes. Studies of voting behaviour at the 2001 and 2004 federal elections in Australia are broadly consistent with opinion poll data. Support for the Australian Labor party (ALP) declined progressively with the age of the voters. In the House of Representatives election of 2001, the ALP gained 46 per cent of votes cast by voters under 25, 40 per cent of votes cast by voters aged 25–44, and 34 per cent among voters aged 45–64. Thereafter, the proportion stabilised at 34 per cent. For the Liberal– National coalition, the results were almost a mirror image: 33 per cent among the under-25s, 41 per cent among the 25–44 age group, 51 per cent among the 45–64 age group and 56 per cent among the over-65s (Warhurst 2002). Three years later, there was an interesting shift, although the Liberal–National coalition retained its advantage among the over-65s. Among the under-25s, support for Labor dropped to 32.3 per cent as compared with the 2001 figure of 46 per cent. The coalition parties were the principal beneficiaries, rising to 42.5 per cent from their 2001 figure of 33 per cent. There was also a significant rise in the proportion of younger voters choosing ‘Other’ parties or independent candidates, whose share rose from 21 per cent in 2001 to 25.2 per cent in 2004. The Labor vote among the over-65s was almost unchanged at 35 per cent. Likewise, the coalition vote among the over-65s was very similar at 54.9 per cent (Australian Electoral Commission 2005). Commenting on these results, Borowski and McCormack (2005) note that both parties made substantial efforts to woo the ‘grey’ vote in 2004. Thus, the coalition offered an increase in the rebate for private health insurance, a tax credit for mature-age workers and a ‘utilities supplement’ to subsidise the cost of services such as gas and electricity,


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available to both pensioners and self-funded retirees. The ALP undertook to introduce a ‘Medicare Gold’ scheme that would cover the cost of hospital treatment for people over 75 years of age, a more generous system of pension indexation, and an allowance for grandparents acting as primary carers for their grandchildren. (The latter undertaking was evidently prompted by the results of a 2004 survey of families by the Australian Bureau of Statistics which found that there were 22 500 families in which grandparents were acting as primary carers in the absence of parents). Borowski and McCormack argue that this concern with older people is somewhat perplexing in view of the fact that people over 65 years of age make up only 13 per cent of the Australian population. A possible solution to this paradox is their observation that older voters are disproportionately located in marginal seats. Conventional political wisdom maintains that elections are won or lost on the basis of results in marginal seats. They estimate that Labor held 23 marginal seats before the 2004 election, in four of which there was a disproportionately high level of people over 65. In the case of the coalition, there were ten such seats out of a total of 26 marginal seats. They conclude that ‘in a system where the outcomes of elections are determined by swinging voters in marginal electorates, prudent politics would demand strenuous efforts to woo the votes of any elderly swinging voters in these marginal electorates’ and this, it would appear, has been the strategy of the federal government. The stability of the ‘grey’ vote forms an interesting contrast with the situation in Britain. At the 1997 British general election, which returned a Labour government, the regular British Election Survey focused on older voters and found that people aged 55 and over were less likely to change their vote as compared with younger voters and, if they did change, it was more likely that they would move towards the Conservatives rather than Labour. These tendencies were even more marked among voters aged 65 and over (Vincent, Patterson & Wale 2001). Reflecting these electoral preferences, the British Labour party’s electoral strategy at the 1997 election focused on younger age groups. In office, however, the Blair government paid considerable attention to the issues arising from an ageing population and the effect of its policies was evident at the 2001 general election. A majority of women voted


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Labour – the first time since women were enfranchised in 1918. This was clearly due to a shift among older women. Labour also scored well among the baby boom generation, where one estimate suggests that only 25 per cent of them voted for the Conservatives at the 2001 election (Age Concern 2002). Walker (2006) has spelt out what might be some of the main barriers to political participation and influence of older people. Contrary to popular opinion, older people do not necessarily share a common interest by virtue of their age alone that transcends all their other interests. Secondly, the majority of older people remain relatively powerless politically, being outside employment and the opportunity for collective action through unions. Thirdly, they lack the formal channels for protest through political parties and other formal groups. They confront significant physical, psychological, economic and gender barriers to their participation in political campaigns. Lastly, they tend to be conservative in their orientation and loyal to the party they have always voted for.

Pressure groups Political systems such as Australia’s are sometimes described as ‘pressure group democracies’. Concomitantly with the growth of the older age groups in the population and the development of the ‘ageing enterprise’, there has been a steady growth and expansion of older persons’ pressure groups, of which there is now a wide range reflecting many diverse interests. Like pressure groups in other policy areas, they exist alongside the party system and the electoral process, focusing their activities more directly on the organs of government and administration. A number of the more influential and well-established groups are examined below.

Retired persons’ associations Pensioners’ groups have perhaps the longest history. A number of small groups already existed in the 1920s. In 1931, the state pension was cut, in line with wage cuts imposed by the Commonwealth Arbitration Court (as it then was) to meet the economic crisis of the 1930s. In New South Wales, pensioner groups reacted by forming the Combined Pensioners’


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Association in 1931 (now the Combined Pensioners and Superannuants Association). The CPSA was able to have the pension cuts restored in 1933. Since then, it has lobbied for a number of benefits, including: excursion (reduced fare) tickets on public transport; concessional rates for telephone, electricity, water and gas services; local council rate (that is, property tax) rebates; and improved rights for residents of nursing homes and hostels. Pensioners’ groups have been less effective in other states. As a result, their national organisation, the Australian Pensioners and Superannuants Federation (APSF), has lacked influence, especially in comparison with the NSW state body. Its activities were further curtailed in 1997, when the Commonwealth Government withdrew the funding that it provides for welfare groups through the Community Sector Support Fund. This followed a dispute between the APSF and the coalition parties during the 1993 federal election campaign. Federalism has also played a part in the history of the Council on the Ageing (COTA), which grew out of a variety of state-based groups. In Victoria, the Older People’s Welfare Council was established in 1951, at the initiative of the National Council of Women. New South Wales followed suit in 1956. A national body was created in 1961, using the title of the Australian Council on the Ageing, with its head office in Melbourne, but its activities were marginal until the 1970s. COTA’s real strength was at the state level, where their structure varies considerably. Perhaps the strongest state body is in South Australia, where it seeks a mass membership. Others have preferred to act as umbrella bodies for affiliates including seniors’ clubs, service providers and other groups. In the 1980s, COTA-Australia attempted to strengthen its base through a merger with a state-based organisation, Later Years of Queensland. These moves were unsuccessful. Instead, Later Years merged in 1991 with two other state-based bodies, Mature Australia in NSW and SelfFunded Retirees of Western Australia, to become the National Seniors Association (NSA). NSA is now the largest organisation of older persons, claiming a membership of 280 000. Unlike the pensioners’ groups, the majority of its members are ‘self-funded’ retirees and its lobbying activities are less important than its service activities, which include insurance, travel and financial services. Unlike COTA, it has a centralised


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structure comprising ‘zones’ and ‘branches’, although the zones generally fall within state boundaries. New South Wales, for instance, has five zones encompassing 43 branches. A further attempt at a merger was made in 2002 in the shape of the COTA-National Seniors Partnership. The inspiration for this partnership was the American Association of Retired Persons, now known simply as AARP (Ozanne & Keogh 2003). AARP, with a membership of more than 36 million, is the largest organisation of older people in the world and maintains an active lobby in Washington. By consolidating the public policy secretariat and the insurance activities of COTA with the much larger membership of NSA, it was hoped to forge a new and powerful lobby group. The graft, however, did not take and the merger unravelled in 2004. Apart from the internal stresses that frequently attend such mergers, there was a basic incompatibility between the public policy commitment of COTA and the more individualist ideology of the NSA, with its membership drawn predominantly from self-funded retirees. This is reflected in the official statement by the NSA that the merger broke down because of ‘insurmountable problems … related to governance of the partnership, management principles, and the strategy and philosophy of service to various seniors’ groups’. Subsequently, the NSA dismantled the structure of Policy Councils set up under the merger and dismissed staff in three states (New South Wales, Victoria and Western Australia) (Simmons 2006). Following the breakdown of the merger, four of the state COTAs – New South Wales, Victoria, Western Australia and Tasmania – joined forces with the Association of Retired Persons Australia (ARPA) to form a new confederal organisation, the COTA-over 50s Alliance, which incorporates the existing insurance services of ARPA. The Alliance was formally launched in October 2005 by the then Minister for Ageing, Julie Bishop. The parallel existence of these two organisations poses awkward choices for the Commonwealth Government in making allocations from the Community Sector Support Fund. Side by side with COTA and NSA is the Association of Independent Retirees (AIR), which also grew from a state base into a national organisation. It was originally established in Queensland in 1990 and now operates in all states and the Australian Capital Territory. Its membership


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prospectus declares that ‘those who have retired without calling on the public purse find themselves disadvantaged and discriminated against by Federal, State and Local governments … the Association was established to right these wrongs and seek justice with a fairer treatment of self-funded retirees’. The prospectus goes on to note that lobbying is a major activity and that AIR is represented on government committees and is active in making submissions to government. AIR is sponsored by two major money market operators, Deutsche Morgan Grenfell and Bain Financial Planning, who provide advice on investment strategies. AIR’s lobbying is aimed mainly to induce government to extend benefits and concessions similar to those available to state pensioners. It was influential in persuading the Commonwealth Government, in 2001, to introduce a Seniors Health Card, which provides some of the benefits available through the Pensioners Health Card.

Aged care Aged care is provided by a wide range of organisations whose relationships have undergone considerable change and consolidation since the 1980s. Residential care has long been a part of the welfare activities of church bodies, notably the Catholic and Anglican churches, Uniting Care Australia, Baptist Care and the Lutheran Church. The activities of these organisations are likely to be affected by government responses to the Hogan Report on residential care pricing, described in chapter 11. Apart from the church-based providers, which generally undertake their own lobbying, the aged care provider sector is organised nationally through a number of peak associations. These include the National Aged Care Alliance, Aged and Community Services Australia and the Australian Nursing Home and Extended Care Association (ANHECA). Many of these groups are themselves members of broader health/ welfare alliances like the Australian Council of Social Service (ACOSS) and the Australian Council of Disability (ACROD). A state counterpart is to be found in New South Wales in the form of the Aged Care Alliance, established in 1996, which operates under the aegis of the NSW Council of Social Service (NCOSS). Change and consolidation in the sector have come about partly as a result of the expansion of government activity in relation to ageing,


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which is described in several chapters in this volume. They have also occurred because governments prefer to deal with a small number of coordinated groups rather than a large number of small ones. This is reflected in the growth of church-based bodies, such as Anglicare and Mission Australia, which have absorbed a number of smaller church groups dating back to the 19th century. This has led, inter alia, to the professionalisation, bureaucratisation and commercialisation of activities that have traditionally depended on volunteers and not-for-profit institutions such as religious orders and congregations. An interesting example of consolidation in the aged care sector is that of Aged and Community Services Australia, which began primarily as a national association of church and charitable non-government residential aged care providers in the mid-1950s. It was re-badged in the 1980s as Aged Care Australia and in 1991 as Aged and Community Services Association to represent both residential and community care providers as well as beginning to open its membership to private sector providers. In the most recent period, this organisation has been actively partnering with both universities and research centres and other area-specific agencies to advance its various project areas on workforce planning, housing, residential and community care. A further merger has been negotiated in Victoria between the largely charitable provider-based organisation Victorian Association of Health and Extended Care (VAHEC) and the Aged Care Association of Victoria (ACAV), which predominantly represents private aged care providers. This brings about major consolidation between nursing home industry providers in Victoria and parallels earlier similar mergers of public and private providers in the one organisation in other states. Two interest groups related to ageing that have burgeoned in the most recent period have been Carers Australia and Alzheimer’s Australia. Their rapid development and growth have been related to both substantial government subsidy and their centrality to contemporary debates about population ageing as the baby boomers move into retirement. Carers Australia was founded in 1993 by professionals and carers concerned to more effectively represent the interests of carers to government. Since the mid-1980s, carers have been recognised as both


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co-clients and co-providers in Australian aged policy (Howe & Schofield 2001) and, with the expansion of community care programs in the recent period, there has been a massive expansion of government subsidies for carer resource centres, respite programs and carer allowances and payments. There are now Carer Associations in all states and territories and a National Association that sponsors an annual conference. The evolution of this organisation has been recently reviewed by Creelman (2002). Alzheimers Australia, focused on dementia and dementia care, was founded in 1990. The organisation was assisted in establishing a high profile by its chief executive officer, who had been a senior official of the Commonwealth Health Department. He was successful in having Alzheimer’s disease made a national research priority as well as getting substantial government resources directed to education and care services. There are Alzheimers Associations in each state and territory, established over the 1980s, which have both a service and an education role. The Association maintains a website and holds an annual conference for families, practitioners and researchers. The Association also mounts a Dementia Awareness Week annually as well as undertaking and contracting research into the causes, cure and care of people with dementia. The issue of aged care was also taken up in a private philanthropic venture by the Sidney Myer Fund in response to criticism by lobby groups such as ACSA and COTA that government was being slow to respond to the social and economic implications of population ageing. Eleven reports were commissioned from a range of experts dealing with trends in health and disease, workplace planning, home and community care, new service models, and the financial implications of care. The final report was released in 2002, entitled 2020: A Vision for Aged Care in Australia (http://www.myerfoundation.org.au) (Myer Foundation 2002). The then Minister for Ageing, Kevin Andrews, acknowledged the value of the report and undertook to take its findings on board in the formulation of government policy.


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Conclusion Aged persons’ pressure groups undoubtedly exercise some influence on government policy and decisions in particular areas, but their importance is clearly less than that of industry lobbies, farmers’ associations and professional bodies. This is true in other countries as well. Binstock has made several analyses of the political role of the American Association of Retired Persons (AARP). In spite of its size and resources, he argues that AARP has not been particularly successful as a lobbying organisation (Binstock 2005). Older persons’ pressure groups in Australia cannot compare with AARP or its British counterpart, Age Concern. However, there is ample room for research on the ‘grey vote’ and the influence of pressure groups. There have been few studies of the significance of advocacy by key interest groups, nor are there many investigations into the contribution of the older population to Australia’s ‘social capital’. The importance of such inquiries is emphasised by Alan Walker, who calls for an examination of what he calls the ‘Transatlantic consensus’ on policies related to ageing. This consensus, he maintains, is based on a neo-liberal agenda dominated by privatisation and the retreat by the state to minimal welfare functions, a situation that is not conducive to political engagement and influence by pressure groups (Walker 2006). The expansion of research is, however, taking place as the result of decisions in 2005 by the Australian Research Council and the National Health and Medical Research Council to support the establishment of a national gerontology research network from which a national research agenda is expected to emerge. We should learn much more about the politics of ageing as research evidence accumulates. References Age Concern (2002) Politics and Old Age, Paper delivered by Ian McCartney and others to the conference of the International Federation on Ageing, October, Perth. Australian Electoral Commission (2005) Electoral Newsfile (No. 121), February, Australian Electoral Commission, Canberra. Binstock, H & Quadagno, J (2001) Aging and Politics. In RH Binstock & LK George (eds) Handbook of Aging and the Social Sciences, 5th edn, Academic Press, San Diego, CA, pp. 333–51. Binstock, RH (1985) The Aged as Scapegoat. In B Hess & EW Markson (eds) Growing Old in America, Transaction Books, New Brunswick, NJ, pp. 489–506. —— (2005) The Contemporary Politics of Old-Age Policies. In RB Hudson (ed.) The New Politics of Old Age Policy, Johns Hopkins University Press, Baltimore, pp. 12–25.


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Borowski, A, Encel, S & Ozanne, E (eds) (1997) Ageing and Social Policy in Australia, Cambridge University Press, Cambridge, Introduction, pp. 12–14. Borowski, A & McCormack, J (2005) The Contemporary Politics of Ageing: The 2004 Federal Election. Paper presented at the annual conference of the Australian Association of Gerontology, Surfers Paradise, November. Campbell, AL (2003) How Policies Make Citizens: Senior Political Activism and the American Welfare State, Princeton University Press, Princeton NJ. Castles, F & Uhr, J (2005) Australia: Federal Constraints and Institutional Innovations. In H Obinger, S Leibfried & FG Castles (eds) Federalism and the Welfare State: New World and European Experiences, Cambridge University Press, Cambridge, pp. 51–88. Clare, R & Tulpule, A (1994) Australia’s Ageing Society (EPAC Background Paper 37), Office of the Economic Planning and Advisory Council, Canberra. Creelman, A (2002) Carer Policy in Aged Care: A Structural Interests Perspective. In H Gardner & S Barraclough (eds) Health Policy in Australia, 2nd edition, Oxford University Press, Melbourne, pp. 275–93. Disney, J (2004) Social Policy. In R Manne (ed.) The Howard Years, Black Ink Agenda, Melbourne, pp. 208–10. Encel, S (1995) Age Dependency: Myths and Realities. In S Graham (ed.) Dependency, the Life Course and Social Policy (Reports and Proceedings no. 118), Social Policy Research Centre, Sydney, pp. 71–84. Esping-Andersen, G, Gallie, D, Hemerijk, A & Myles, J (2002) Why We Need A New Welfare State, Oxford University Press, Oxford. Estes, CL (1979) The Ageing Enterprise: A Critical Examination of Social Policies and Services for the Aged, JosseyBass, San Francisco. Flint, J (1980) The Old Folks, Forbes, 12 February, pp. 51–56. Green, D & Pfeffer, M (1997) The Making of Policies for the Aged. In A Borowski, S Encel & E Ozanne (eds) Ageing and Social Policy in Australia, Cambridge University Press, Cambridge, pp. 283–85. Healy, J (2002) The Care of Older People: Australia and the United Kingdom, Social Policy and Administration, 36(1): 1–19. Howe, AL (1997) The Aged Care Reform Strategy. In A Borowski, S Encel & E Ozanne (eds) Ageing and Social Policy in Australia, Cambridge University Press, Cambridge, pp. 301–26. Howe, AL & Schofield, H (2001) Family Care for Frail Elders and Norms of Caregiver Well-being at the Turn of the 21st Century. In DC Thomasma, S Gauthier & DN Weisstub (eds) Aging and Caring for Our Elders, Kluwer Academic Publishers, The Netherlands, pp. 29–47. Myer Foundation (2002) 2020: A Vision for Aged Care in Australia, The Myer Foundation, Melbourne. National Commission of Audit (1996) Report to the Commonwealth Government, Australian Government Publishing Service, Canberra. Ozanne, E & Keogh, B (2003) Interlinking Theory and Method in an Analysis of an Aged Advocacy Group, Australia and New Zealand Third Sector Review, 8(3), 107–20. Peterson, PG (1996) Will America Grow Up Before it Grows Old? Random House, New York. —— (1999) Gray Dawn, Three Rivers Press, New York. Pfeffer, M & Green, D (1997) The Making of Policies for the Aged. In A Borowski, S Encel & E Ozanne (eds) Ageing and Social Policy in Australia, Cambridge University Press, Cambridge, pp. 276–300. Pierson, P (2001) The New Politics of the Welfare State, Oxford University Press, New York. Productivity Commission (2005) Economic Implications of an Ageing Australia, Productivity Commission, Canberra. Schulz, JH, Borowski, A & Crown, WH (1991) Economics of Population Aging, Auburn House, New York, pp. 86–87.


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Simmons, D (2006) De-Merger Hits Hard, National Senior, 6 February. Skocpol, T (2003) Diminished Democracy: From Membership to Management in American Civic Life, University of Oklahoma Press, Norman, Oklahoma. Vincent, JA, Patterson, G & Wale, K (2001) Politics and Old Age, Ashgate, Aldershot. Walker, A (2006) Ageing and Politics: An International Perspective. In RH Binstock & LK George (eds) Handbook of Aging and the Social Sciences, 6th edn, Elsvier, Burlington MA, pp. 339–59. Warhurst, J (2002) International versus Domestic Issues: The Elections for the House of Representatives and the Senate. In J Warhurst & M Simms (eds) 2001: the Centenary Election, University of Queensland Press, St Lucia, pp. 9–17.


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13 Lifelong education and lifelong learning Sheila Rimmer

Introduction As the lifespan of Australians lengthens, so the period after retirement from full-time work also extends. There may be 20–30 years of life to live after retirement. Much depends on health and income, but Australians are now healthier, better educated and more financially secure than previous generations. Government policy will encourage longer years in the workforce. Whatever their number of remaining years, seniors need to consider how to spend those years. Retirement means change, perhaps self-assessment, and there may be a new career (Ageing International 1998). The main focus of this chapter is the provision, use and appreciation of life-long learning programs in Australia, and what older people themselves feel about participating in such programs and informal avenues of learning. Most people appear to enjoy retirement, but the attitudes of the wider society tend to denigrate the elderly. So, affirmative attitudes to ageing, a recognition of seniors as volunteers, carers for young and old – acknowledging them as a positive asset to society – should start to progressively emerge as the number of elderly people increase.


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For many, retirement will include volunteer work, helping the family and taking up new educational activities. There are many courses, ranging from university extension courses at the top of the market, to the Workers Education Association (WEA), or the University of the Third Age (U3A) with lower fees, or a local book club offered for free. Most older people recognise the need to be active and to keep the mind alert. Mental stimulation adds to the quality of life. Meeting like-minded people in classes can lead to new friendships. Opportunities such as this may be difficult for people in regional and remote areas, but distance learning and the use of the Internet are reducing the isolation. Older people are turning to new technologies. Barriers to taking educational courses may be the cost of the course, or difficult access because of poor public transport. Frailty or an unhappy schooling experience may also prevent people from participating.

Definitions of lifelong education and learning The term ‘lifelong learning’ was officially endorsed in UNESCO’s adoption of the term ‘lifelong education’ in 1965. The idea was taken up, endorsed and developed in a number of countries. The Faure Report of 1972, Learning to Be, saw this as an important landmark in education. Lifelong learning rejected the idea that learning finished after leaving school or university, but would continue throughout life. In 1979, the UNESCO Institute of Education published a discussion paper, ‘Lifelong Learning – Life Transitions and the Older Learner’, which gave the following definition of lifelong learning: • lasts the whole of life of each individual • leads to systemic acquisitions, renewal, upgrading and completion of knowledge, skills and attitudes made necessary by the constantly changing conditions in which people now live • has as its ultimate goal promotion of the self-fulfilment of each individual • is dependent for its successful implementation on people’s increasing ability and motivation to engage in self-directed learning activities


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• acknowledges the contribution of all available educational influences, including formal, non-formal and informal The Faure Report 1972 developed UNESCO’s endorsement of lifelong learning as ‘the master concept of education policies in the years to come in both developed and developing countries’ (Faure Report 1972: 160). Discussion centred on the social benefits of lifelong learning. In human terms, lifelong learning was seen as an important part of the individual’s development, empowering citizens and contributing to the good of society. Descriptions such as quality of life and development of the human potential and self-realisation abounded and it was argued that democratic society was strengthened by education that was open to all and continued through life. These early definitions and reports of the late 1960s and early 1970s were based on a humanistic tradition that saw continuous education as giving individuals greater opportunity and personal fulfilment. In Australia, the establishment of lifelong learning networks and the creation of university units on lifelong learning encouraged research and the concept became increasingly recognised by government. The Australian Association of Adult Education (now Adult Learning Australia) was established in the 1980s and has become a national body funded by the Commonwealth Government. In New South Wales, the Board of Adult and Community Education was established by legislation in 1990.

Australian Government policies The OECD looked at structural adjustment and economic performance in 1987, followed by the 1994 White Paper, ‘Growth, Economic Competitiveness and Employment’. This viewed education and training as the key means of ensuring social transformation. The first Global Conference on Lifelong Learning was held in Rome in late 1994. Further White Papers followed and the 1996 paper, ‘Teaching and Learning, Towards the Learning Society’, linked lifelong learning with economic security. European countries, the paper argued, should make a greater investment in the knowledge base (OECD 1987).


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These ideas were picked up and developed in Australia, so that by 1990 the House of Representatives Standing Committee on Community Affairs produced a report on retirement entitled ‘Is Retirement Working?’ (House of Representatives Standing Committee on Community Affairs 1990). It suggested that retirement should be rethought, asking what it meant for older people. This report emphasised the importance of learning opportunities to increase satisfaction in retirement. It also saw the need for training for both volunteer work and paid work. A year later, the Senate Standing Committee on Employment, Education and Training report, ‘Come in Cinderella’, described adult and community education as a fourth education sector after schools, universities and technical and further education (TAFE). It emphasised the need to train not only young people but the older generation who had experience and expertise. It recommended the benefits of learning for older people as a government responsibility. Exploring the issues further in ‘Expectations of Life: Increasing the Options for the 21st Century’, the House of Representatives Committee for Long Term Strategies, reported in 1992 that people’s potential was being lost and wasted if they took early retirement and spent the next 20–30 years doing little or nothing (House of Representatives Committee for Long Term Strategies 1992). This report advocated educational opportunities for older people and the need for retirement preparation courses. Unfortunately, advocating and implementing such policies are different issues and outcomes are often slow to eventuate. The Australian Association of Adult and Community Education (AAACE) (now Adult Learning Australia) reported on lifelong learning in its publication The Third Age in 1995. It looked at the benefits of lifelong learning and the barriers that prevented older people from updating skills and taking part in adult education. It also commented that while learning may slow down it does not stop. The Senate Standing Committee on Employment, Education and Training (1997) updated the Cinderella report in ‘Beyond Cinderella – Towards a Learning Society’, surveying change over a six-year period. It identified the benefits to health from continuing education and called for more research and more support for adult education.


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The recommendations of these committee reports have not been implemented. Talk of a learning society and a clever country appear to be empty words that fail to address the needs of future generations. The National Board of Employment, Education and Training (NBEET) followed up earlier reports in 1996 with a report, ‘Lifelong Learning – Key Issues’. This argued the need for a skilled and flexible workforce, but also with enabling people to realise more of their individual potential and in raising awareness and possible involvement in various critical issues in public policy (NBEET 1996: 43–46). In 1998, the Australian National Training Authority looked at vocational education and training and identified it as a means to ‘ensure that the skills of the Australian labour force are sufficient to support internationally competitive commerce and industry and to provide individuals with the opportunities to optimise their potential’ (ANTA 2000: 3). This illustrates the shift in attitude to lifelong learning. The emphasis is now on training and retraining in the workforce and less on satisfying lifestyle preferences in later years. The Department of Education, Science and Training media release on lifelong learning in Australia (EIP03/13, section 2.1) states that: … the lifelong learning policy agenda is built on assumptions about the importance of skills in the New Economy. Almost all industrial sectors are increasingly knowledge-based and economic returns are obtained from a range of intangible inputs, one of which is workers’ skills. Participation in education and training is increasing and economic rewards are flowing to people with high skills. (Department of Education, Science and Training 2003: 14–15)

It goes on to speak of the ‘knowledge-based economy’ that features workrelated training. This lifelong learning should be universal, is often selfmotivated and is increasingly self-funded. Some tax rebates are allowed by the Australian Tax Office for work-related training sessions and conferences to encourage continuous updating of skills. However, this emphasis on workplace education and increasing productivity is in danger of ignoring the larger dimensions of stimulating and cultural education courses that encourage older people to continue to utilise their abilities and skills in retirement. Involvement in such courses gives a feeling of independence


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and self-responsibility so important for retired people. The value of lifelong learning in its various forms is neglected by government and fails the growing market and the need for adequate provision. While our focus is on learning by older people and their participation, and different models of provision are described below, it should be recognised that the vocational emphasis and the drive to self-funding will seriously affect older people if the balance is not redressed. The threat was demonstrated by the New South Wales Government budget, which cut funding in 2005. Metropolitan community colleges and adult education centres were told only vocational courses would be funded and not the so-called ‘leisure’ courses. This means concessions on fees paid by older people undertaking such courses will be reduced because budgets have to be balanced. The distinction between leisure and vocational courses can be very artificial. A woman taking a flower arrangement course, seen as a leisure course, may go on to get a job in a flower shop. A man taking a bricklaying course, a vocational course, may only be interested in building a barbecue in his backyard, which should surely count as a leisure pursuit. So, there are some grey areas. The more expensive leisure courses offered by universities’ extension services are still available, but this simply emphasises the divide between those people who have limited incomes and those who are self-funded retirees on a comfortable income. High costs are a complete barrier to older retired people who are in receipt of an age pension and who would benefit from participation. The cost of conferences on ageing issues and health issues is out of reach. The high conference fees, which employers gladly pay for their staff to attend, put them out of reach for older people. Only if a few subsidised enrolments are offered can some older people take part. Reporting on the New South Wales budget cuts (averaging 30 per cent to most of Sydney’s metropolitan colleges) the education reporter in the Sydney Morning Herald wrote: So-called cappuccino courses have been targeted by the State Government. The Minister for Education said that the days of taxpayers subsidising lessons in home brewing, feng shui, spirit channelling and shopping for Peking duck ingredients in China town were over. Only those colleges offering courses in job skills will get the money. (Burke 2004: 6)


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A statement on behalf of community colleges accused the government of reneging on the commitment to lifelong learning. It was pointed out that there was a high level of participation by people over the age of 55. The Sydney Worker’s Education Association suffered a 35 per cent cut in funding. In 2004, it offered fees subsidies worth $118 000 a year to seniors who make up 30 per cent of the WEA student body. The Executive Officer, Richard Pinder, pointed out that pensioners were not as interested in vocational courses, but ‘more interested in keeping the grey matter ticking over’. The Minister’s reply was to the effect that the colleges could still run leisure courses, but that it was proper for taxpayers’ money to be spent on practical courses that will help people to get training to find a job. Unfortunately, the needs and aspirations of older people have been overlooked (Pinder 2005: 1).

Older people’s perception of lifelong education and learning Surveys on the participation of older people in lifelong learning done in the United States (AARP 2000) and in the UK series, Growing Older, published by the University of Sheffield (2003), both found that older people want to keep up with the world around them and enjoy learning something new. Continued learning in later years gives physical and mental benefits and memory training shows positive results. Dementia can strike anyone and rates increase with age. Iris Murdoch, the famous English philosopher and novelist, whose experience of dementia was documented in book and film, is an example of the changes involved for someone suffering this disease. Studies do indicate, however, that there are higher rates of dementia among the less well educated. Informal learning, such as reading newspapers, listening to the radio and watching television, rates highly among older people. They also support cultural activities, the theatre, musical concerts and libraries (Economic and Social Research Council 2003). Book clubs are another form of informal learning. They are extremely popular, their numbers growing in recent years. In the United Kingdom, a men’s reading group dates back to 1799 and continues today. In Sydney,


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a North Shore group dates back to the 1930s, but there may be longer established groups elsewhere. In a survey undertaken in the United Kingdom (Hartley 2001), the majority of groups had 6–10 members, met monthly and most of their members were women. A few groups were mixed, while a few were for men only. Women often form a group in the early years of marriage, when they are caring for small children, and 30 years later they still meet. Some clubs are serviced by councils of adult education, the Workers’ Education Association (WEA) and some bookshops. The most dramatic example of a book club in Australia is found at Cape Tribulation in far north Queensland, where a group-sponsored scheme arranges the books to be air-dropped in sets of ten with reading notes, for this small isolated community in a rainforest area. In the United States, there has been a rapid growth of clubs. About 500 000 clubs exist today, a number that has doubled since 1994. Oprah Winfrey’s book club on her television show has undoubtedly contributed to this growth. The show went off the screen in 2002. When it resumed in 2003, classics were chosen rather than new fiction. In 2005, a letter from 158 authors stated book clubs had stopped buying new fiction and pleaded for a return of new books to help book sales! The largest survey took place in the United States and was commissioned by the American Association of Retired Persons (now officially named AARP). This survey of 1019 Americans 50 years of age and over was conducted in 1999 and the findings released in 2000. The research looked at typical learning methods, motivations, learning interests and the life event context in which learning takes place. It found that older adults are interested in learning to keep up with what is going on in the world around them, for their own personal and spiritual growth and/or for the simple joy of learning something new. AARP discovered that older adults are interested in a wide variety of subjects, subjects that would improve their quality of life often building on an existing ability and skill, and great interest was shown in learning about health so that older people could take better care of their health. Information on diet and nutrition, measuring personal health status and managing stress were issues of great interest to older learners.


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A later British survey (Withnall & Thompson 2003: 1–2) recorded many benefits that older people felt resulted from lifelong learning activities. Older people appeared to benefit from learning in terms of general health and wellbeing and wider social and community involvement. New friendships were often formed and participation in a course could lead to volunteer work that required a specific training program; for example, as an art gallery or museum guide.

TAFE and community colleges The opportunity for lifelong learning in Australia was first developed by the Mechanics Institutes and Working Men’s Colleges, sometimes called the School of Arts. These institutes were established in the United Kingdom in the early 1820s and the first in Australia was opened in 1827 by a group of master tradesmen in Hobart. Sydney followed in 1833, opening a Mechanics Institute and School of Arts. Melbourne’s Mechanics Institute began in 1839. The Sydney Institute offered general education courses and, despite perpetual funding problems, within two years was recognised as an important and prestigious organisation. By the 1840s, Schools of Art had been established in Newcastle, Brisbane and Adelaide. In 1875, there were 75 Schools of Arts in New South Wales supported by a government grant of £3102. Evening courses were both technical and general, with some afternoon classes for ladies in elocution and French. By 1883, government spending was reviewed and the government now directly funded Sydney Technical College and took control. The importance of these colleges was that they gave adults the opportunity of a secondary education and also the chance to attend liberal arts classes. Community colleges were an offshoot of Sydney Technical College. Courses were held at night in schools under the umbrella of what became the Department of Technical Education. In 1990, legislation established the Board of Adult and Community Education, financed by both state and federal government (Cobb 2000). Funds are provided for adult courses. The Board decides priorities and, recently, these have targeted migrants and disadvantaged groups. Vocational courses were the priority aimed at retrenched mature-age workers. Between 2002 and 2004, 433 courses


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were run at 218 different locations, attracting 5429 students in New South Wales. Mature-age students (the 45–65 age group) on unemployment benefits and supporting parent pensioners comprise the student body. Forty per cent of these students have found paid work within six months of attending courses, 30 per cent find voluntary work and others embark on further study. Courses on health and first aid are related to growth areas of employment. Many take up two or three part-time or casual jobs. Mature workers often take 2–5 years to adjust to retrenchment and upskill, so it is a slow but very beneficial process (Drabsch 2004). In Melbourne, a generous donation matched by public funding, established the Working Men’s College in 1839. Struggling over the years to remain independent led to disputes with the State Education Board. Links with the University of Melbourne were broken and the Education Board took over the control of courses, examinations and reduced staff salaries in the mid-1890s. The emphasis was on vocational courses. Arts courses only continued if fully funded by fees. In 1911, the Melbourne College successfully voted to become independent of the Education Department. The name changed from Working Men’s College to the Melbourne Technical College and later became the Institute of Technology. From 1981, it was named the Royal Melbourne Institute of Technology (RMIT). The Royal title was self-imposed with no relation to the monarchy. In the late 1980s, it became RMIT University (MurraySmith & Dare 1987). The TAFE system itself is under challenge as the result of Commonwealth Government proposals to set up technical colleges under direct federal control, in an attempt to relieve a chronic shortage of skilled tradespeople. This runs against the traditional role of TAFE in providing so-called leisure courses for older people.

Other providers There are many non-government organisations offering opportunities for learning courses that are aimed at mature and older people. Community organisations, Probus, seniors clubs, church groups and, in particular, the Worker’s Education Association (WEA) and the University of the Third Age (U3A), provide good examples of such provision.


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The WEA is an excellent example of a voluntary adult education organisation, an independent and not-for-profit provider that over time has attracted a government subsidy to pursue its goals. First started in Sydney in 1913, ten years after the English WEA was established, WEA celebrated its 90th birthday in 2003. The history of WEA was recently published and entitled A Special and Distinctive Role in Adult Education: WEA Sydney 1953–2000 (Dymock 2001: 187–92). The annual report states the WEA believes that its activities are of value to individuals and enhances their role as citizens in a democratic society (Workers Education Association 2001–04). The mission statement expresses a resolve to maintain excellence, encourage students to participate in their own education and facilitate access to all who seek to take part in WEA activities. In 2003, 90 947 Sydney students were enrolled in 1471 educational activities over four terms, with an emphasis on liberal arts, science and health courses. There can be as many as 350 courses offered in Sydney in one term alone. Over 32 per cent of the enrolments (6374) were adults over 60 years of age, the highest over-60 enrolment of adult and community education in New South Wales. Richard Pinder, Executive Officer appointed in 2002, noted in his annual report that ‘in addition to this proud history of liberal education, WEA was responding to the world emphasis on vocational training and responding by providing more courses in business studies, computer and workplace skills’ (Pinder 2005: 5). Online courses are now offered in the vocational subjects, business studies, workplace training and computer training. These particular courses are all nationally recognised training courses, so that people living in remote areas with computer access can continue their learning. WEA has also joined with the University of New England to enable students to gain direct admission to the university as distance education undergraduates. Richard Pinder commented that state policy has been reversed from a policy of learning for all endorsed in the 1990s to one that now makes it more difficult for older learners to maintain a healthy interest in society as active and involved lifelong learners. He believes that costs will probably have to increase and one can only hope that the pendulum will swing back to a wider interpretation of an education for life, acknowledging the many benefits of lifelong learning.


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The other state that has a flourishing WEA is South Australia. Established there in 1913, WEA is now the largest independent provider of adult education and training. Adults from all ages and a diversity of background attend WEA courses. Most courses are offered in Adelaide and a close working relationship with U3A means courses and tutors can be shared. Older people make up some 36 per cent of the management board. Computer courses are very popular with older students (Sachsegm, Campbell & Phan 1999). Australian states vary in the provision of adult education and South Australia has 60 per cent of service provided by government agencies. In other states, community-based organisations provide the liberal studies courses that are no longer funded by government. In Victoria, the WEA planned its own demise in 1948, and transferred its assets to the newly formed Adult Education Association of Victoria. A voluntary association, it fosters adult education and covers rural and suburban areas. In addition to many courses, it offers residential schools, day seminars, lunches with speakers and theatre parties. Victoria shows solid support for lifelong learning, as it also established by statute the Council of Adult Education in 1947. The Council has historic connections to the University of Melbourne Extension Board. The 21 council members represent Melbourne and Monash Universities, the Australian Broadcasting Corporation (ABC), and the Education Department. There are also four co-opted members.

University of the Third Age U3A is a particularly good example of senior self-help groups providing educational opportunities for all who wish to take part in such activities. U3A is based on the premise that during the Third Age of life people are in a post-retirement stage when they have time to pursue other interests. U3A is a worldwide educational movement and U3A in Australia is part of that movement. The idea of U3A was started in Toulouse, France, in 1973 in association with a local university. In this relationship, it was envisaged as a sort of university extension organisation providing education opportunities for retired people, with university staff providing lectures. The idea spread to the United Kingdom in 1981,


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first established in partnership with Cambridge University. There, U3A took on a different form, with the formation of independent U3As based on courses conducted on a volunteer basis by members. Australia has followed this pattern. The first U3A in Australia was established in Melbourne in 1984 and in 1986 U3As were inaugurated in Adelaide, Perth and the Australian Capital Territory, with Brisbane coming on board in 1987. Sydney was a latecomer and the inaugural U3A meeting was held in the Great Hall of Sydney University in March 1988. The movement flourished and one management committee could not cover courses over the whole metropolitan area of Sydney. So, eventually, seven regions were established, with other U3As in different parts of the state. Management and administration is in the hands of elected members, all of whom volunteer their services (University of the Third Age 2004). Each region has its own committee and establishes its own courses, seminars and social activities and reports to the central committee through its elected representatives. Anyone can join U3A, which recognises learning and the pursuit of knowledge as an end in itself. U3A is implementing the medieval idea of a community of scholars. In 2004, U3A Sydney had over 5000 members who met in more than 52 class venues and another 19 venues were located in private homes. The venues ranged from schools, church halls, RSL clubs and retirement villages, offering a total of some 246 courses. The variety of courses ranges from anthropology and archaeology to economics, gardening, history, foreign languages, music, philosophy, politics, drama, science and writing (University of the Third Age 2005). A further expansion of U3A activities began at the end of 1999, when U3A Online (U3AOL) started as an idea that was established in the International Year of Older People (IYOP) (Brayton, Swindell & Mackinlay 2005). It allows people to study at home or through community-based venues via the Internet. It has a directory of U3As, news items, useful information and forums for discussion. U3AOL was particularly concerned with people who were socially or geographically isolated. It is linked with U3A in New Zealand and with the Third Age Trust in the United Kingdom. The program receives some government grants and is also supported by Griffith University in Brisbane.


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The digital divide and computing skills

Use of computers and the Internet by seniors Many older people have learnt to embrace the new technologies. Recent retirees are already computer-literate. Older retirees want to keep up to date, to try something new and to be able to communicate by email with their families. Many give their reason as ‘keeping up with the grandchildren’. Barriers to the use of computers may be a dislike of new technology, a fear of learning new skills and cost that effectively excludes many retired people on limited incomes. Providing computers in local libraries, computer centres and senior citizens clubs can overcome the cost factor. Aware of the increasing use of the Internet as the main way of accessing information has led to the term ‘a digital divide’, a divide between those who have ready access to computers and the Internet and those who do not. The latter group is increasingly disadvantaged as the amount of information online and transactions online builds up. The barriers, however, are coming down and the number of seniors using computers is growing steadily. Access to computer skills is being made possible by non-government organisations that offer training at a reasonable cost. The WEA in Sydney offers five different seniors computer courses, with seven additional sessions each term. They are usually taught by an older person in a relaxed and supportive environment. Groups are kept small and over 100 students enrol each year. Councils on the Ageing (COTA) have also pioneered classes for seniors using peer educators. Various partnerships have developed. Queensland COTA worked with the State Department of Social Security Community Information Network and later obtained Rotary support. In South Australia, COTA Clubs partner with the Flinders University program Seniors Online. Ninety-eight per cent of participants have completed this course. COTA Victoria provides training sessions for older people in public libraries. Western Australia COTA offered ‘computer courses for the mortally terrified’, again using peer educators, and it has gained accreditation for its computer courses. Computer clubs are popular. In Tasmania, the Older Persons Electronic Network (OPEN) caters for older people and the disabled (McKean 2003). In Sydney, clubs have been available since the 1970s and


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the Australian Seniors Computer Club Association (ASCCA) was formed to bring clubs together in 1998. Among Australians over 75 years of age, only 5 per cent reported using a computer at home and 3 per cent used the Internet. However, numbers of seniors online are growing. In 2005, the Federal Minister for Education and Training, Brendan Nelson, and the Minister for Ageing, Julie Bishop, launched a video and DVD project entitled Connecting with Computers. Perhaps the most interesting development is the use of computers by people living in residential care. In Victoria, government funds were offered to ten nursing homes in the year 2000 to encourage this change. Such programs add to the quality of life for residents. One 84-year-old who visits her friends in a home declared, ‘I don’t worry about having to be in a nursing home one day. I just look for where I will plug in my computer’ (Scott 1999: 28).

The Fourth Age A study undertaken by the Department for Education and Employment in the United Kingdom entitled The Fourth Age Learning Report (Soulsby 2000: 27–29) used questionnaires and a number of visits to test the hypothesis that investing in more and better learning opportunities for older people could reduce health and social welfare costs by encouraging independence for a longer period of time. This hypothesis has been advanced for the Third Age, so research was next focused on the Fourth Age. The concept of the ‘Fourth Age’ is largely due to the late Peter Laslett, who characterised it as the period of gradual decline following an active Third Age (Laslett 1991). Those engaged in care settings accepted the idea that learning and other activities could enhance the quality of life in aged care facilities. However, the research has found that personal development for the frail and dependent was largely ignored. Over time, it seems that some private providers have become aware that such activities reduce dependency and, therefore, lead to a reduced cost. Keeping a person active rather than bedbound by putting on a program of activities to break the boredom of a long day benefits not only patients but staff. Some exceptional nursing homes were identified and these were all committed to the idea of a meaningful engagement for the benefit of the client. One organisation welcomes


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frail older people and, on arrival, each resident is given a copy of the ‘Book of Life’. In this book, they record their past, the present and, most importantly, the future in terms of dreams and aspirations and perhaps unfulfilled ambitions. The book has additional pages that can be used to include photographs of family and friends and pages to record recent achievements. If the older person is unable to write, a family carer or volunteer can help to fill in those blank pages. This Fourth Age of learning is still in its infancy, but, given increased life expectancies for both men and women, this is an obvious area of activity for development. Some limited work is being carried out on the use of computers in the nursing home setting. It has proved successful in hostels and retirement villages, so this seems to be a possible extension, depending on the health and receptivity of residents. If a Fourth Age of learning is pursued, it will in fact be learning for the whole dimension of life (Department of Education and Employment 2000).

Conclusion

Future directions Increased longevity has stimulated a range of developments in lifelong learning. The Carnegie Report on Learning, Education, Training and Information in the Third Age (Carnegie Report 1992; Schuller & Boyston 1992) stressed the need to develop a methodology based on an improved understanding of the learning processes of the older adult, in both practical and theoretical areas. The report includes case studies, such as the program at Strathclyde University (entitled Learning in Later Life), which had 1000 students per year enrolled in more than 40 courses. A few enlightened corporations have introduced pre-retirement schemes designed to encourage older employees to develop the learning habit before they retire. An outstanding example is that of Pitney-Bowes, a leading American manufacturer of office products, which enables workers aged 50 and over to claim educational expenses for a period lasting two years into retirement. One government that has acted to promote later-life learning is that of South Korea, a country with a rapidly ageing population. A scheme


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based in the capital, Seoul, caters for the metropolitan population of more than 10 million. ‘Cultural spaces’ for the ageing will be provided through a network of colleges established specifically for the elderly. The colleges are planned to provide around 70 classes in foreign languages, philosophy and a range of other subjects. In a society faced with an ageing population, in which dementia, Alzheimer’s disease and Parkinson’s disease are bound to become more common, the maintenance of mental function becomes increasingly important. Education may be critical in training people to ‘recruit’ the alternative mental networks that enable them to compensate for damage or disease. There is a growing body of evidence that intellectual activity enables individuals to develop a ‘cognitive reserve’ that protects them against mental and physical deterioration (Melton 2005: 32–35). Investment in lifelong education can be a major contribution to making ‘positive ageing’ a reality (Fitzgerald 1997). References Ageing International (1998) Global Perspectives on Life Long Learning, Rutgers University Press, New Brunswick. American Association of Retired Persons (AARP) (2000) Survey on Life Long Learning, Washington DC. Australian National Training Authority (ANTA) (2000) Flexible Learning for the Information Economy. Brayton, D, Swindell, R & Mackinlay, E (2005) A Voice Worth Listening To, Griffith University, Brisbane. Burke, K (2004) Cuts in leisure courses, Sydney Morning Herald, 6 November 2004, p. 6. Carnegie Report (1992) Learning, Information and Training in the Third Age, Carnegie UK Trust, Fife, Scotland. Cobb, J (2000) Sweet Road to Progress, NSW Department of Technical Education, Sydney. Department of Education and Employment (2000) The Fourth Age Learning Report, Sudbury, UK. Department of Education, Science and Training (2003) EIPO3, 13, Canberra. Drabsch, T (2004) Briefing Report, No. 12, NSW Parliamentary Library, Sydney. Dymock, D (2001) A Special and Active Role, Allen & Unwin, Sydney. Economic and Social Research Council (2003) Older People and Life Long Learning, University of Sheffield Press, Sheffield. Faure Report (1972) Learning To Be: The World of Education Today and Tomorrow, UNESCO, Paris. Fitzgerald, I (1997) Never Too Late to Learn, Ministerial Committee on Ageing, Sydney. Hartley, J (2001) Reading Groups, Oxford University Press, Oxford. House of Representatives Committee for Long Term Strategies (1992) Expectations of Life, Australian Government Publishing Service, Canberra. House of Representatives Standing Committee on Community Affairs (1990) Is Retirement Working? Australian Government Publishing Service, Canberra. Laslett, P (1991) A Fresh Map of Life, The Emergence of The Third Age, Harvard University Press, Cambridge, MA.


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McKean, R (2003) All You Need is a Door: Access to Third Age Learning in Tasmania, Australian Journal of Adult Learning, 4(3): 11–20. Melton, L (2005) Use It – Don’t Lose It, New Scientist, 17 December: 32–35. Murray-Smith, S & Dare, J (1987) The Tech: Centenary History of the RMIT, Hyland House Publishing, Melbourne. National Board of Employment, Education and Training (NBEET) (1996) Lifelong Learning – Key Issues. Organisation for Economic Co-operation and Development (OECD) (1987) Structural Adjustment and Economic Performance, Paris. Pinder, R (2005) Workers Education Association, Annual Report, pp. 1, 5. Sachsegm, M, Campbell, A & Phan, O (1999) Life Long Learning and Older People, Office for Ageing, South Australia. Schuller, T & Boyston, AM (1992) Learning, Information and Training in The Third Age, Carnegie UK Trust, Fife, Scotland. Scott, H (1999) Seniors in Cyberspace: Older People and Information, Council on the Ageing, Melbourne. Senate Standing Committee on Employment, Education and Training (1997) Come in Cinderella. Soulsby, Jim (2000) Learning in the Fourth Age, National Institute of Adult Continuing Education, Leicester, UK. University of the Third Age (2004) Constitution, Sydney. —— (2005) Course List, Sydney. Withnall, A & Thompson, V (2003) Older People and Life Long Learning: Choices and Experiences, University of Sheffield Press, Sheffield. Workers Education Association (2001–04) Annual Reports, PMP Print, Sydney. —— (2005) Course List, PMP Print, Sydney.


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14 Family and intergenerational relationships in the long-lived society Elizabeth Ozanne

Introduction Population ageing has had a profound impact on family structure and family life over the last 20 years, the ramifications of which are continuing to play themselves out in intergenerational relationships. This chapter examines the combined impacts of falling fertility and mortality on family form and family structure in contemporary Australia. It draws on national and comparative research evidence to explore some of the key dimensions of the changes that are occurring and their implications for support of the elderly, both now and towards 2050. It is argued that contemporary demographic shifts, in a rapidly globalising postmodern world, are transforming both structures and values in relation to the family of late life, and present both new opportunities and increased risks for individuals and societies seeking to negotiate new intergenerational territory.


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Judah Matras (1990) suggested that population ageing would mean not only that more people would live longer, and that there would be more elderly persons in the population, it would also signal a new framework for organisation of the individual life course, and for family and community interdependency and relationships. He further commented that under the shifting demographic, socioeconomic and political contingencies of individual and population ageing, new agerelated patterns of ‘dependency’, family and social ‘obligations’, and ‘entitlements’ and claims on family and community would emerge. Similarly, Bengtson (1993) suggested that the ‘contract’ between generations was changing as a result of the major expansion and survival of the older population relative to younger and middle-aged cohorts and was bringing about marked alteration in generational support and socialisation patterns, which had both potential for greater conflict and solidarity. More recently, some European sociologists of the family have suggested that quite radical cultural shifts are taking place in the nature of family obligations framed by the very different circumstances of the marriage patterns and timing of fertility of the first (1860–1960) and second (1960+) demographic transitions. Based on extensive values surveying in Europe, Lesthaeghe and Surkyn (2004), for instance, suggest that contemporary Western societies are in transition between two contrasting value constellations in relation to societal and family life, framed by the very different social and economic circumstances of the first and second demographic transitions. In their analysis, the first demographic transition occurred at a time in which economic growth fostered material aspirations and improvements in material living conditions. The preoccupations of the 1860–1960 era were mainly concerned with increasing household real incomes, improving working and housing conditions, raising standards of health, improving human capital through mass education, and providing a safety net for all via the gradual construction of the social security system. In most countries, these goals were shared and promoted by all major democratic political parties and social institutions. In this endeavour, solidarity was a central concept and all political or religious institutions had their views on the desirable evolution of the family. For religious organisations, these views were based on the sanctity of matrimony in


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the first place, but their defence of the closely knit conjugal family also stemmed from fears that urbanisation and industrialisation would lead to immorality and atheism. Secular institutions and political parties equally saw the family as the cornerstone of society. Both moral and material wellbeing would be served best by a sharp gender-based division within the family: husbands assuming their roles as devoted breadwinners and women as guardians of all quality-related issues (for example, health, education). In other words, all religious and political forces contributed to the ‘embourgeoisement’ of the family. The second demographic transition, they argue, was founded on the rise of higher-order needs. Once the basic material preoccupations are satisfied, further income growth and educational expansion jointly lead to the articulation of more existential and expressive needs. These are centred on a triad: self-actualisation in formulating goals, individual autonomy in choosing means, and claiming recognition for their realisation. These issues emerge in a variety of domains, and lead to significant ideational and cultural shifts. According to Lesthaeghe and Surkyn (2004), the second demographic transition occurs in tandem with the growth of ‘postmaterialism’ (Inglehart 1990) and political or religious ‘deinstitutionalization’ (Lesthaeghe & Moors 1996), the disengagement from civic, professional or community-oriented associations, a critical stand vis-à-vis all forms of authority, the stress on expressive values in socialisation and in work, and a quest for far more egalitarian gender relations. At the individual level, the choice of new types of households (premarital single living, cohabitation and parenthood within cohabitation) are linked to such individualistic and nonconformist value orientations across a great variety of spheres. Lesthaeghe and Surkyn (2004) found these associations between household types and value orientations to hold not only for northern and western Europe, but more recently for southern, central and eastern Europe. The implications of these shifts for the family are that instead of convergence towards the nuclear and conjugal model composed of a married couple and their offspring, a multitude of living arrangements other than marriage become more the norm. The disconnection between marriage and procreation becomes more apparent, and reliance on


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replacement migration leads to increased cultural diversity, less stability of households, and higher levels of poverty and exclusion for certain highrisk household types (for example, single-parent households). Table 14.1 (adapted from Lesthaeghe & Surkyn 2004) highlights the demographic, societal and cultural shifts of the first and second demographic transitions as they relate to the family. There is considerable debate about the extent of these value shifts in different regions of Europe and in countries and ethnic subgroups with different religious/cultural heritages (Coleman 2003; Van de Kaa 2003; Thornton, Axinn & Jayakody 1992). However, the combination of an ageing world demography, in the context of rapid globalisation and modernisation, appears to confirm a changing values landscape (Giddens 1999; Inglehart 1990). Value-shift surveying has been much more recent in Australia (eds Wilson et al. 2005), and though some (Western & Tranter 2005) have, in fact, questioned the degree to which Australian families might have moved in the postmaterialist direction indicated in the United States and Europe, there is evidence in contemporary research of changing attitudes and practices in families (Olsberg & Winters 2005) and between generational groups (NATSEM 2003). In a recent Demos/Age Concern Report on the ‘new old’ from the United Kingdom, Huber and Skidmore (2003) find that quite distinct value orientations are beginning to be evident there between what they call the Senior Generation (born between 1930 and 1945), the Baby Boomers (born between 1945 and 1960), Generation X (born between 1960 and 1975) and Millennial Children (born between 1980 and 2000).

The first and second demographic transitions in Australia Australia has not been exempt from these demographic trends, with fertility falling below replacement (McDonald 2003 and chapter 1), with marriage being increasingly delayed (DeVaus 2004), with rates of cohabitation rising (Rowland 2003) and an increasing diversity of family forms becoming evident from many years of a replacement migration policy (Weston, Qu & Soriano 2003).


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Table 14.1

Overview of demographic and societal characteristics related to the first and second demographic transitions in western Europe

First demographic transition 1860–1960

Second demographic transition 1960+

Marriage • Rise in proportions marrying

• Fall in proportions married

• Declining age at first marriage

• Rise in age at first marriage

• Low or reduced cohabitation

• Rise in cohabitation (pre- and postmarriage)

• Low divorce

• Rise in divorce; earlier divorce

• High remarriage

• Decline of remarriage following both divorce and widowhood

Fertility • Decline in marital fertility via reductions at older ages; lowering mean ages at first parenthood

• Further decline in fertility via postponement; increasing mean age at first parenthood; structural sub-replacement fertility

• Deficient contraception; parity failures

• Efficient contraception (exceptions in specific social groups)

• Declining illegitimate fertility

• Rising extramarital fertility; parenthood within cohabitation

• Low definitive childlessness among married couples

• Rising definitive childlessness in unions

Societal background • Preoccupation with basic material needs: income, work conditions, housing, health, schooling, social security; solidarity prime value

• Rise of ‘higher-order’ needs: individual autonomy, self-actualisation, expressive work and socialisation values, grassroots democracy, recognition; tolerance prime value

• Rising memberships of political, civic and community oriented networks; strengthening of social cohesion

• Disengagement from civic and community oriented networks; social capital shifts to expressive and affective types; weakening of social cohesion

• Retreat of the state; second secularisation • Strong normative regulation by state and Churches; first secularisation wave; political wave; sexual revolution; resistance to and social ‘centralisation’ authority; political ‘decentring’ • Segregated gender roles; familistic policies; embourgeoisement

• Rising symmetry in gender roles; female economic autonomy

• Ordered life course transitions; prudent marriage; dominance of one family model

• Flexible life course organisation; multiple lifestyles; open future

SOURCE

Adapted from Lesthaeghe & Surkyn 2004


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In Australia, average mortality rates have been declining strongly over the last century (Productivity Commission 2005). The crude death rate (number of deaths per 1000 people) almost halved last century, from 12.2 in 1901 to 6.6 in 2001. This occurred despite a rising concentration of older people. Much of this improvement stems from a decline in infant mortality. Also, the likelihood of dying at a specific age has fallen substantially for all but the oldest age groups. There have also been substantial reductions in the likelihood of death at most ages. Over the 30-year period from 1971 to 2000, there has been at least a 50 per cent reduction in the probability of death for middle-aged people. Australia, like many other developed countries, experienced a health transition from infectious to chronic diseases in the 1930s. During this transition, some falls in the incidence of infectious diseases, especially for older age groups, were offset by the rising incidence of chronic diseases; for example, coronary heart disease, stroke and cancer death rates increased from the 1920s and 1930s (AIHW 2000). As a consequence of falling mortality rates, life expectancy in Australia has increased by around 30 years since the 1880s (Productivity Commission 2005). By 2050, projected life expectancy for females is 92.2 and for males 88 years (ABS medium projections of 87.7 for females and 84.2 for males). Most demographers expect further gains in life expectancy in the future. Australian women have on average 1.7 children. The total fertility rate for Australian women has halved in the last 50 years. However, more than a quarter of men and women have fewer children than they would ideally like to have, according to the ABS (DeVaus 2004). The Australian fertility experience has fluctuated widely over the long term (Productivity Commission 2005). After the First World War, the total fertility rate declined from about 3.1 in 1921 to reach a trough of 2.1 when the Depression was at its worst, before building up again in the post-Second World War years to reach a peak of 3.6 in 1961. There were sharp falls in fertility rates from the early 1960s to the late 1970s. This reduction in fertility reflected increased access to family planning methods, advances in medical technology and changes to the interpretation of abortion law that made it safer and easier to terminate unintended pregnancies, and increases in labour force (and education)


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participation by women in the late 1960s and 1970s, as well as other socioeconomic changes that motivated smaller family size. Since the late 1970s, total fertility rates have continued to fall, but at a gradual rate, reaching a TFR of around 1.7 in the 2000s. This is roughly half that of the peak of 1961, however. It is predicted in various projections that the rate could fall as low as 1.4 in the future. As Barnes (2001) and Jackson (2001) note, key pressures on family formation and fertility include: rising employment entrance costs; high housing costs; high cost of children; converging workforce aspirations of men and women; enduring gender roles; workplace culture; greater instability and insecurity in relationships; and potential higher future taxation levels (CDFCS 2003). In relation to nuptual trends, fewer Australians are entering a registered marriage and those who do are marrying at an older age (AIHW 2005). In 2003, the highest registered marriage rates were in the 25–29-year age group. Between 1997 and 2003, there was a 28 per cent decline in marriage rates for those aged 24 years and under. Over the same period, there was an increase in marriage rates among older age groups, particularly in the 30–34 age group (with an increase of almost 14 per cent). Reflecting these trends, the median age at first marriage increased during this period from 27.8 to 29.2 years for males and from 25.9 to 27.3 years for females. On average, males are about two years older than females when they first marry. The Australian population has changed dramatically in terms of cultural background since the Second World War, from an almost exclusively Anglo-Celtic background to one of the most ethnically diverse countries in the world (Weston, Qu & Soriano 2003). As reported by Rowland in chapter 5, in 2001 Australia had seven overseas-born groups from non-English-speaking countries whose numbers aged 65 and over exceeded 20 000 (ABS 2003: 112–13). The largest groups were from Italy, Poland, Germany, former Yugoslavia, Greece, the Netherlands and China. By 2026, population projections indicate that there will be 16 such groups, six of which will be from Asian countries (Vietnam, China, the Philippines, India, Malaysia and Sri Lanka) (Gibson et al. 2001). A particular feature of Australia’s immigrant population, however, is the representation of around 200 different birthplaces and languages


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(DIMIA 2005), which creates diversity far beyond that implied in any count of the largest groups. Accordingly, recognition of ethnic diversity and adaptability to varied changes will be important prerequisites for effective responses to the ongoing procession of former immigrants into older age groups. As Lesthaeghe & Surkyn (2004) and Van de Kaa (2003) suggest, Australia’s migration policies have led to the increased cultural diversity of Australian families, and the ‘creation’ of a truly multicultural society. The ageing of Indigenous peoples is also a significant characteristic of the Australian population (see chapter 3), though, by and large, Indigenous people have not participated in the demographic transition to the same degree as the rest of the population. In the 2001 Census, 2.2 per cent of the population were identified as Indigenous – more than three times that in the 1971 Census (Weston, Qu & Soriano 2003). This increase derives not only from natural increase, but also from such factors as an increased propensity to acknowledge this status and improvements in Census enumeration procedures. Because of the high levels of mortality prevalent in the Indigenous population in the past, there are very few survivors to older ages. Twenty per cent of the total Australian population (4 million) are over 60 years of age, but less than 5 per cent of Indigenous people (25 000) are over 60, and only 4000 are above age 75, so it appears to be past mortality that is holding the Indigenous population age structure down. In Lesthaeghe and Surkyn’s (2004) terms, the Indigenous population might still be said to be in the early phases of the first demographic transition, with its high birth rate but also high death rate because of still high infant mortality and continuing failure to show real gains in morbidity and mortality at later ages.

Specific implications for the family Writing in 1990 in the Handbook of Ageing and the Social Sciences, Bengtson, Rosenthan & Burton asserted that: … today’s elderly are participants in a quiet revolution in the demography of intergenerational family life in which individuals are growing older in intergenerational families that are quantitatively and


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qualitatively different from those of their great grandparents in terms both of the structure and the duration of family roles and relationships. Unlike the two and three generation families of their predecessors, there is a greater probability that today’s elderly will be part of a fouror even five generation family with fewer members per generation. Moreover, the number of years that aging individuals spend in family roles has increased dramatically – today’s aging parents may be part of their children’s lives for over a half a century. As grandparents, their ties to adult grandchildren and great grandchildren may extend beyond 20 years. (Bengtson, Rosenthan & Burton 1990: 263–64)

They identified two major trends in the past 50 years that have changed traditional expectations about families: • The first and most familiar is the widespread demographic transitions involving increased longevity, decreased fertility, and attenuated family structures across several generations referred to above. • The second is an increased diversity in family forms, norms, and behaviours – particularly evident among subgroups in Western societies – resulting in significant heterogeneity in the situations of elderly individuals within their family relationships. From their Californian longitudinal study, Bengtson, Rosenthan and Burton (1990) have noted the increased survival of four and five generations in families, leading to intergenerational extension at the same time as there has been intragenerational contraction in terms of the reduced number of family members in each generation. This ‘verticalisation’ has many implications for the complexity and potential pool of intergenerational relationships as well as for multigenerational living arrangements. First, in the decades to come, individuals will grow older having more vertical than horizontal linkages in the family. Second, within generations, horizontally ageing individuals will have fewer brothers and sisters. And third, family members will have fewer cousins, aunts, uncles, nieces and nephews. There has been very little research on the extent and impact of multigenerational survival within families in Australia, though life tables indicate continuing improvement in survival of successive cohorts (Rowland 2003). Having fewer children and living longer has lengthened the time spent in intergenerational family role statuses. Because of sex differences,


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however, the length of time spent in family roles is different for women and men. This poses dilemmas for care of dependent elders and has implications for the length of time that women spend as widows. It also, however, may lead to the development of positive ‘crescive bonds’ across the life course between partners and family networks and provide a greater opportunity to invest heavily across a group of kin that is more manageable in size than in previous generations. The demographic revolution has also produced a number of variable patterns in intergenerational family structures and roles related to: • • • •

variations in the timing of fertility (both early and delayed) increased childlessness increases in single-parenthood increases in divorce and reconstituted families

Early-childbearing or age-condensed patterns appear to be more of a specific trend in the United States and some parts of the developing world than in Australia, though this trend is apparent in some Indigenous and ethnic communities. In Australia, teenage fertility is currently the lowest it has been since 1921 (De Vaus 2004). Whether this will be maintained is yet to be seen. As Bengtson, Rosenthan and Burton (1990) suggest, teenage pregnancy has three impacts on family structure and relationships: • It creates an age-condensed family in which age distance between generations can be just l5 years. • The small distance between generations can blur intergenerational boundaries. • It can spark early transition to new family roles, such as grandmotherhood, that are often premature and experienced as a burden. A recently commissioned ABS survey of grandparents as carers (ABS 2005) showed that the majority were still in the usually ‘expected’ age range. Australian women are having children later (DeVaus 2004). The median age at which women had their first baby in 2001 was 30 years (CDFCS 2003). The ABS commissioned a special study of delayed childbearing in Australia in 2001 (ABS 2001), which indicated that women from


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professional white-collar occupations have fewer children than those from lower-level white-collar and blue-collar occupations. It is also apparent that the earlier women leave school, the more children they tend to have. This trend towards later childbearing is ‘stretching’ out each generation, and is resulting in fewer children overall. There is evidence to suggest that some women may be having fewer children than they would like. Among the group of 14 000 women aged 18–23 years in the Australian Longitudinal Study on Women’s Health (Women’s Health Australia 1997), 92 per cent indicated that they would like to have children by the age of 35. When women postpone birth until their mid- to late-thirties (as is now the case in the United States), a family structure with large age gaps is created with the following implications: • Parents and grandparents who enter roles later in life may not experience their status long. • The greater age distance between generations may create strains in development of bonds across the life course, particularly since it may result in women simultaneously experiencing childrearing problems with their adolescent and caregiving demands from their ageing parents. • The later in life that one has a child, the fewer children one has and the potential caregiver pool for ageing parents is reduced. The proportion of Australian women who were childless at the end of their reproductive life has changed over time, from between an estimated 20 per cent in the 1996 Census to 30 per cent of women born at the beginning of the century, to 11 per cent of women born at the beginning of the 1950s (Rowland 1998; ABS 2002). For women born more recently, childlessness appears to be on the rise and at current rates is expected to reach 28 per cent. Current assessments (ABS 2000) indicate that between 20 per cent and 24 per cent of women will remain childless. Childlessness of women may be influenced by factors such as cultural background, educational level and labour force participation. It would seem that childlessness of women may be contributing to current low fertility levels in Australia and is becoming more entrenched because of changed lifestyle factors.


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Childlessness may be influenced by both cultural and social factors, such as country of birth, Indigenous origin, religious affiliation and educational attainment. While childlessness among Australian-born women aged 45 years at the 1996 Census was 11 per cent, it was higher for women born in Japan (28 per cent), Thailand (27 per cent) and the United States (25 per cent), and lower for women born in Portugal (3 per cent) and Turkey, Greece, Taiwan and Croatia (4 per cent each). Childlessness was three percentage points lower (8 per cent) for Indigenous women than for their non-Indigenous counterparts. Women recorded as having no religious affiliation showed the highest level of childlessness (16 per cent), women of Islamic faith had the lowest (5 per cent). Women attaining an undergraduate degree or higher-level qualification were most likely to be childless (20 per cent). For women who had no tertiary qualifications, the proportion was 9 per cent. As Bengtson, Rosenthan and Burton (1990) suggest, childlessness creates the shortest and slimmest lineage structure. Establishing intergenerational bonds and the options for receiving care within the family become quite limited for older childless adults. Often, the childless elderly establish bonds with extended or fictive kin. Building such connections may become more difficult, however, as the frequency of kin concomitantly declines with fertility. US data suggest that about one in five older people do not have children. In general, childlessness is not associated with differences in psychological wellbeing, happiness, morale, loneliness or life satisfaction. Research on childlessness in later life has tended to confirm the principle of substitution. Childless women are more likely to report siblings as confidants than are women who have children. Johnson and Catalano (1981), however, found that with impairment, the social networks of the married childless become constricted as they withdraw from other ties into an intensified marital relationship, a pattern of social regression. Unmarried childless elderly are at higher risks of institutionalisation than the married or parental elderly. The principle of substitution seems to apply most to childless older adults in good health who construct social support networks that are different but equally satisfying compared to elderly with children, but these networks become less viable with the onset of impairment and the need for increasing instrumental assistance.


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The rise of out-of-wedlock childbearing suggests yet another form of intergenerational family structure. Single-parent families, including those with dependent children, are becoming more common in Australia, rising from 7.1 per cent in 1969 to 22.3 per cent in 2003 of families with dependent children (De Vaus 2004). Almost 27 per cent of children spend some time up to the age of 18 living in a single-parent family. The main route to single-parenting is relationship breakdown. Older family members are called upon, most often by their daughters, to serve as the ‘other parent’ for their grandchildren. Older women are also more likely to share a household with their daughters and grandchildren to assist with childrearing and economic pressures of single-parenthood (ABS 2005). Divorce rates in Australia increased only marginally over the 1997– 2003 period, from 12.5 to 13.1 per 1000 married people (AIHW 2003b). In 1991, the rate was 11.6 per 1000 married males and 11.5 per 1000 married females (ABS 2004). The proportion of marriages that are de facto has slowly increased and the 2001 Census showed that 12 per cent of people living in couples were in a de facto relationship (including same-sex couples), up from 7 per cent in 1991. Similarly, more recent data from the ABS Family Characteristics Survey showed that 12 per cent of all couples with children aged 0–17 years were in a de facto marriage in 2003 (ABS 2004). The ABS categorises Australian families into two broad groups: couple families, which include intact, step and blended families: and one-parent families. In 2003, couples in both step (56 per cent) and blended families (39 per cent) were more likely than those in intact families (8 per cent) to be in a de facto marriage (ABS 2004). In the United States, there is a record high rate of divorce among the young adult and middle-aged. When the children of the elderly divorce, it has a marked effect on intergenerational family life in that grandparents may not have opportunities to be actively involved and confront restrictions in relations with former daughters-in-law or sonsin-law. If divorce is followed by remarriage, elderly parents are faced with a complex reconstitution of the intergenerational family and the further complexity of integrating stepchildren into their kinship structure. A recent study by the New South Wales Committee on Ageing (1997) has


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explored the rights of grandparents and grandchildren in situations of relationship breakdown.

The mediating role of public policy Different welfare state regimes (Esping-Andersen 1997) have a somewhat different orientation as to how the state should intervene in relation to the family across the life course. Neo-liberal states, with their pronatalist and familialist policies, tend to focus on shoring up falling fertility rates by provision of incentives to keep younger mothers at home and encouraging further births. They also support the extension of family care policies in late life by carer subsidies, respite programs and provision of intensive home-support packages that encourage carers not to return to work but to maintain their elderly relative at home. Democratic regimes alternately foster greater participation of women in the workforce, while at the same time encouraging good-quality child care and better work/life balance policies by firms to assist both males and females with child-care and parent-care demands across the life course. Social democratic governments also more often provide ‘transfer payments’ and different forms of guaranteed income to manage new types of life course transitions (Matras 1990). As Lesthaeghe and Surkyn (2004) suggest, ageing societies confront a number of demographic circumstances in relation to the family of late life, namely, the movement away from the nuclear and conjugal family composed of a marital couple and their offspring towards a multitude of living arrangements other than marriage and an increasing disconnection between marriage and procreation. This can lead to less stability in households and high levels of poverty and exclusion in certain household types (for example, single-person/single-parent households). At the same time, high replacement migration (in below replacement societies) leads to increased cultural diversity, which must also be responded to. The policy ‘levers’ that governments have at their disposal to mediate population ageing and its effects on the family tend to be specifically directed at attempting to change patterns of fertility (McDonald 2003), mortality and migration in the first instance, and then to support families through identified life-course transitions.


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Australian policy in relation to the family of late life is perhaps best articulated by the recent report of the Productivity Commission, Economic Implications of an Ageing Australia (2005), and the Commonwealth Department of Family and Community Services’ (2003) submission to the Inquiry into Long-Term Strategies to Address the Ageing of the Australian Population in the Next 40 Years. The Productivity Commission (2005) report concluded that there was limited scope to moderate population ageing purely through demographic policies directed at increasing fertility and migration levels, though it did not rule out that some change was possible in both these areas. The report primarily targeted strategies to decrease mortality, by health promotion and lifestyle interventions, and to also change employer and worker attitudes to increase the labour force participation rates of older workers. Its primary recommendation, however, was the maintenance of a growth rate of 2 per cent of GDP for these other recommendations to be satisfactorily implemented. The 2003 Commonwealth Department of Family and Community Services submission acknowledged that Australia’s ageing demography carried risks and opportunities for family formation, fertility and social participation. It proposed a broad agenda that concurred to some degree with the later Productivity Commission report but also made some specific recommendations in relation to the family across the life course, namely: • promoting higher labour market participation and reducing premature retirement to counteract the reduction in the growth of the population of working age and to safeguard retirement incomes • preserving Australia’s internationally moderate rate of population ageing by assisting families to realise their goals for employment and fertility • supporting social participation, particularly among the elderly • preventing long-term deterioration of the Commonwealth budget due to slower economic growth and increased age-related spending In relation particularly to supporting family formation and resilience, the submission comments that the international evidence suggests that higher labour force participation need not be incompatible with high fertility, providing the right mix of policies are in place to support parents’


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work and family choices. Supporting family resilience through capacitybuilding investments in early childhood development and youth was seen to be the basis for greater independence in adulthood and a more productive future workforce. Promoting family stability will continue to be important as relationship breakdown can increase the incidence of income support reliance and children growing up in jobless families, and reduce retirement savings. Population ageing will also change patterns of care. Delays in family formation may lead to simultaneous care for children and older people becoming more common. The increasing prevalence of disability with age, and the growth of older-age cohorts, could increase the demand for care for people with disabilities and their carers. Both NATSEM (2004) and AIHW (2003a) have recently explored the future expected ratio of older people to potential carers in Australia to 2050. The type of policies that are seen to have a positive impact on work and family reconciliation include: • family-friendly workplaces in terms of smoother transitions, flexible hours and parental leave • assistance with costs of children across the life course from childbirth to child care • relationship support with the establishment and continuation of relationships • social support in relation to secure housing and higher education Australia has put in place specific policies under each of these headings and is in general seen to provide a good safety net for families, particularly in the family formation stage. To support families to care for their aged members at home, expenditure on the Home and Community Care Program has quadrupled over recent decades (Bishop 2004) with the expansion of both basic and intensive home support programs (for example, EACH, Aged Care Packages) and expansion of rehabilitation and transition arrangements to return older people home following a period of acute care. The Commonwealth Department of Family and Community Services (2003) recommended that future support to families would seek to further ensure that:


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• the decision to have children does not lead to marginalisation from the labour force • transitions between paid work and childbearing are smoother • families are able to create an environment conducive to child development/wellbeing • pressures of balancing work and family do not impact on relationship stability • the needs of people with multiple caring responsibilities are addressed • the total fertility rate is not further significantly reduced

Research on factors that contribute to ageing well in late life There is now extensive international research on some of the key factors that contribute to ageing well in late life and, concomitantly, what factors put individuals and families at risk. This section briefly highlights some of the directions of this research.

Effects of good marital or close interpersonal relationships There is considerable evidence of the protective effects of a good marital or close interpersonal relationship for health and wellbeing in late life. Data from many sources support the conclusion that, compared to unmarried elderly, married elderly have higher levels of morale, life satisfaction, mental and physical health, economic resources, social integration and social support, and lower rates of institutionalisation (Bengtson, Rosenthan & Burton 1990; Hughes & Waite 2004). Some of the protective health impacts of marriage are related to two facts: • Married people are less likely than persons of other marital status to engage in high-risk health behaviours. • In times of poor health, a spouse provides invaluable care. DeVaus (2004) estimates that 43 per cent of care providers are spouses.


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In addition, older married women are less likely to be poor than are their unmarried peers and more likely to live in their own households. The majority of older people also rate their marriages as happy or very happy. The easy availability of divorce suggests that marriages that persist into maturity will be especially strong. There is some dispute in the literature, however, as to whether this high level of satisfaction relates purely to marital status alone or has more to do with family composition and household type. Hughes and Waite (2004) find older adults living in married-couple households (with or without their own children) show higher levels of functioning across physical, emotional and cognitive dimensions compared with adults in married-couple households that also include other persons. Adults in any type of married-couple household tend, however, to show higher levels of functioning across all of these dimensions than single adults living alone, single adults living with their own children or single adults living with others. Household types tend to array themselves by average levels of functioning across physical, emotional and cognitive measures, so that older adults in married-couple households (with or without their own children) show the highest levels of functioning, followed by marriedcouple households with others, then by single adults alone, then by single adults with their own children, with single adults living with others consistently showing the lowest levels of functioning.

Importance of satisfying personal relationships Evidence suggests the increasing importance of satisfying personal relationships across the life course and in late life and that individuals will increasingly select those relationships which are satisfying and reject those which are not. Bengtson, Rosenthan and Burton (1990) remind us that the developmental literature on love suggests that relationships are transformed with time, so that the very basis of bonds of affection changes. In this perspective, physical attraction, passion and self-disclosure are viewed as facilitating the formation of the relationships, but relations are sustained over the long term by familiarity, loyalty and a mutual investment in the relationship.


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According to Carstensen’s (1991) socioemotional selectivity theory, individuals as they age choose deliberately to narrow their social networks to devote more emotional resources to fewer relationships with close friends and family. Such selective engagement is not the same as disengagement or withdrawal from a wide range of social relationships. Instead, older adults may prefer to derive emotional comfort and meaning from familiar or intimate social interactions rather than expending the effort required to create and maintain a wide network of acquaintances that may provide less meaning to their lives. Numerous studies of friendship in late life have tended to reinforce this perspective. Giddens, in his Reith Lectures on the Family in the Postmodern World (1999), emphasises the increasing importance of productive/constructive relationships across the life course with a premium on gender equity, good communication and mutual satisfaction. Marriage, he suggests, is now less a legal contract, and a good relationship is increasingly defined as one of equals where each partner has equal rights and obligations. Lesthaeghe and Surkyn (2004) suggest that a new calculus of greater utilitarianism in personal relationships is evident in the second demographic transition, with a shift from basic survival to higher-order needs for individual autonomy, self-actualisation, expressive work and socialisation values, grassroots democracy and recognition. Tolerance is a prime value of such relationships. This shift to expressive and affective values, as compared to more community oriented values, they maintain, leads to greater secularisation, more flexible life course organisation, multiple lifestyles and choice of more open relationship options.

Emergence of new forms of social support in late life Antonucci and Akiyama (1995) and Kahn and Antonucci (1980) have argued that individuals form ‘convoys of social support’ across their life course responsive to their shifting life circumstance. As with personal relationships, careful selection of social network members is viewed as adaptive since it determines the degree to which individuals have access to social resources that can satisfy their socioemotional needs. In fact, older adults who have kin may nevertheless turn first to friends and neighbours for assistance, partially because friendship involves more voluntary and reciprocal exchanges between equals, consistent with


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social exchange theory. Whether family, friends or neighbours become involved appears to vary with the type of task to be performed, as well as the helpers’ characteristics, such as proximity, extent of long-term commitment and degree of interaction. Friends and neighbours are well suited to provide emotional support and to assist occasionally, such as providing transportation and running errands, while families are best equipped for long-term personal care (Hooyman & Kiyak 2005). The literature on alternative family forms and non-traditional relationships suggests that there is active substitution and adaptation in the formation of ‘surrogate and friendship families’ or ‘families of choice’ (Calasanti & Slevin 2001; Dorfman, Walters & Burke 1995). Similarly, studies of the family of late life talk about ‘crescive’ (Bengtson 1993), ‘latent’ and ‘fictive kin’ (Riley & Riley 1994) relationships as significant in the support networks of single-living persons and widows. Among couples partnering in late life, ‘living apart together’ (LAT) relationships are becoming more common in the United Kingdom and Europe, enabling each partner to maintain some degree of autonomy and independence while still sharing intimacy (Borell & Karlsson 2003). Phillipson (2003) has argued that we are likely to see the emergence of new types of ‘personal communities’ in later life that are supportive and inclusive of a broad range of older persons, both in traditional and nontraditional family roles. Naturally-occurring retirement communities (NORCS) may be one form of this arrangement in the United States.

Evidence of rethinking of traditional family roles Social roles are the foundation of the family. However, much research suggests that these are changing through the redefinition and creation of new roles, via adaptation, substitution and transformation. For example, as Hughes & Waite (2004) point out, motherhood has been redefined by increases in women’s work and increases in non-marital childbearing. The role of father has also changed as men adapt to more shared childrearing. Other family roles, such as the never-married mother, step-parent, ex-spouse, partner and stepchild, may be initially ill-defined, but families will gradually renegotiate new expectations and obligations as transitions arise.


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The way these roles evolve can have important positive and negative implications for individual health and welfare. For example, shifts in the gendered division of household labour may mean that co-resident adult children will demand less of their mother’s time and that roles in the family will become more equally shared between genders. Childlessness, similarly, may leave people more time to develop friendships and other voluntary associations – which are beneficial to health. The possibility of such adaptation to family ‘losses’ is an important corrective to the view that the lack of family is inevitably harmful.

Increased conflict and ambivalence or increased solidarity? Several authors suggest that the new diversity in family forms is in fact undermining filial obligation (Lesthaeghe & Surkyn 2004) and radically shifting the nature of the social contract between generations. Others, however, have suggested that in future there will be a richer resource of vertical family relations on which to draw (Bengtson 1993), supplemented by new and more diverse ‘convoy’ involvements of a more voluntaristic and strategic nature. Whether the complexity of new family relationships, particularly in reconstituted families, will put a major strain on the solidarity of future family relationships is yet to be seen. Pillemer and Luscher (2003) suggest that new intergenerational family relations may engender greater ambivalence in commitment and obligation between family members and that value difference in four- and five-generation families may also prove difficult to bridge (Hughes & Waite 2004). In countries undergoing rapid social development, such as the old Soviet states of Europe or the newly developing regions of Africa, generational tensions between ‘oldregime’ parents and ‘new-regime’ children can often be very stark. In a globalising world, Phillipson (2003) advocates the importance of research on how contemporary ‘international families’ are managing their far-flung ‘network capital’ in relation to family care tasks across the life course.


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The extent of a post-materialist value shift in families As Huber and Skidmore (2003) have pointed out, for the United Kingdom, the baby boom generation is defined by two distinct – and sometimes conflicting – attitudes: social activism and individualism. The defining character of the ‘new old’ will depend on whether their individualism or social activism wins out. The authors suggest that baby boomers could turn into the ‘selfish generation’ (Thomson 1991) or ‘civic defenders’ who push for wider social change. As Laslett queried a decade or so ago in A Fresh Map of Life (1991), what will be the contribution of the aged to the longer-lived society is still an open question that merits much more public debate than it has so far warranted in Australia. Persons who are currently aged 65 and over were born into families of origin and formed families of procreation before the main shifts in family behaviour. Their children and grandchildren did participate in these shifts, which in part shapes the older generation’s experience of ageing. In contrast, the baby boom cohort will reach age 65 having experienced families of procreation that follow contemporary patterns. Members of Generation X will presumably have both grown up in newstyle families and formed new-style families. Members of the baby boom cohort were in the vanguard of family change and are now beginning to reach their 60th birthdays. Their numerical strength will accelerate the long-term ageing of the population, raising critical questions regarding their wellbeing in maturity and the subsequent consequences for society. It is likely that baby boomers will reach maturity with a more diverse set of family structures relative to members of preceding generations. They will be less likely to be currently married, more likely to be living alone, and perhaps more likely to be living in a complex household. Their family histories will certainly be more variable. The incidence of cohabitation, multiple marriages, non-marital childbearing and childlessness will all be greater in these cohorts. Baby boomers will have spent less of their life in married-couple households and more living alone, in singleparent or in complex households. In that the distribution of family types is shifting towards those that previous research has shown to be linked to poorer health outcomes, future cohorts may be at a greater health disadvantage than earlier ones.


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The shift in marital status is particularly important in this regard. Baby boomers’ relatively diverse families will correspond therefore to both greater diversity in health outcomes and perhaps an overall lower level of health. As Hughes and Waite (2004) suggest, however, while this rather pessimistic scenario may be accurate at a high level of generality, it offers limited insight into the heterogeneous processes that will underlie this gross pattern. Understanding these processes is likely to be critical for both research and policy in the coming years. The actual implications of the contemporary family for health will depend heavily on how family roles and relationships continue to evolve.

State of research into the ageing family International experience suggests that research on the family of late life has been fairly traditional, micro, and focused on the marital dyad and normative transitions, rather than exploring the way in which the family is transforming under current demographic and globalising forces. There have been several calls within the US, UK, European and Australian contexts for this situation to be rectified (Bengtson et al. 2003; Giddens 1999; DeVaus 2004). The first major research study of Ageing and the Family in Australia was carried out by Hal Kendig in 1986, with a focus on family-care issues (ed. Kendig 1986). Though there was a seven-year follow-up to this study in 1991 by John McCallum (NCEPH 1991), there has not been a further large-scale study looking at ageing and the family. The Australian Institute of Family Studies (AIFS) was set up in the mid-1970s with a mandate to look at family issues across the life course. Though it has given some intermittent attention to ageing, and its founding director, Don Edgar, was an ardent advocate of exploring the impact of population ageing on families (Edgar 1991, 1989), AIFS currently appears largely preoccupied with the family of early life. Unlike a decade or so ago, however, there are now an increasing number of data sources available from the Australian Bureau of Statistics, Australian Institute of Health and Welfare and the National Australian Centre for Social and Economic Modelling that can be mined in relation to the family of late life.


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David DeVaus (2004) has done the most systematic mapping of available data sources on the family across the life course. In his audit of the major Australian surveys relevant to the study of families across the life course, he listed the following key agencies as providing relevant survey data: the Australian Bureau of Statistics, the Australian Institute of Family Studies, the Research School of Social Sciences at the Australian National University, the Melbourne Institute of Applied Economic and Social Research, the Australian Government Department of Family and Community Services, the Commonwealth Department of Health and Aged Care, the National Health and Medical Research Council, the Australian Council of Educational Research, the Productivity Commission, the International Social Science Survey, the World Values Survey and individual researchers. Some government departments, such as the Commonwealth Department of Family and Community Services, have also taken the lead in elaborating a research and policy agenda in relation to the impact of population ageing on the family and proposing how public policy might most appropriately intervene (CDFCS 2003). With the Melbourne Institute of Applied Economic and Social Research at Melbourne University, in 2001 the Commonwealth Department of Family and Community Services initiated the Household, Income and Labour Dynamics in Australia Panel Study (HILDA), which is currently moving into its fourth wave of data collection and analysis of the Australian household. HILDA has enormous potential for answering numerous questions about changing family attitudes in middle and late life. Though none of these efforts alone have built up a systematic picture of the family of late life, they have served to contribute to a reliable database for secondary analysis by governments and individual researchers. It is notable, however, that the relatively newly created ARC/NHMRC Research Network on Ageing Well (2005), whose mandate is to increase research capacity in the sector, has not targeted the ageing family as one of the five arms of its current research activity (which are Productivity and Economic Security, Independent Living and Social Participation, Health Ageing, Population Research Strategies, Aged Care Services), though family issues may indirectly cross-cut all of these areas.


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On the international scene, the US Andrus Gerontological Centre Longitudinal Study of the Aging Family, headed by Vern Bengtson, has been the major pioneer in furthering both methodological and theoretical research on the ageing family via surveys of successive generations in California, but this project remains unique in its scale and scope. In 2002, a major European international comparative study of the ageing family, OASIS (Old Age and Autonomy: The Role of Service Systems and Intergenerational Family Solidarity), was launched. OASIS is an international research project, funded within the 5th Framework Program of the European Community, with the goal to deepen the understanding of the interplay between family culture, intergenerational relations, and service systems and their impact on elders’ autonomy and quality of life. This research project is built upon a partnership between institutions and researchers from Germany, Israel, Norway, Spain and the United Kingdom, coordinated by the Center for Research and Study of Ageing at the University of Haifa, Israel. A book on the project’s outcomes was published by Bengtson and Lowenstein in 2003 under the title Global Aging and the Challenges to Families (eds Bengtson & Lowenstein 2003). The project maintains a website and has generated a useful comparative literature on the family of late life. Within the Australian context, it is perhaps timely to undertake a more systematic audit of the various research efforts going on in relation to the ageing family, examining the strengths and weaknesses of our present research base and how we might proceed in the future. This could most usefully be undertaken by the Commonwealth Department of Family and Community Services, the ARC/NHMRC Healthy Ageing Research Network or the BARC Research Group (Building Ageing Research Capacity), which was initiated by a consortium of several key Australian Government agencies and the Australian Institute of Health and Welfare in 2003. Alternatively, the federal government, through the Minister of Family and Community Services, could commission the development of a national research agenda on the ageing family, much as the Healthy Ageing Research Agenda was generated several years ago (Kendig 2001). Some of the key questions that could be addressed by a more systematic research agenda might include:


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• What are the key types of emergent family forms now evident in Australia that are beginning to impact on late life? • What do we know about the relationships of these different family forms to health and mental health outcomes in late life? • How are traditional family roles of mother, father, child, grandparent, sibling, and so on, being renegotiated in contemporary families and impacting on late life? • Has there been a shift in the nature of the social contract between different generations in terms of the perceived obligations to provide care? • What do we know about current intra- and intergenerational transfers and inheritance patterns in contemporary families? • Are there some contemporary family forms that continue to remain invisible and unexamined (for example, gay and lesbian relationships, new types of late life communities)? • How are globalisation and shifting migration patterns contributing to family form and family diversity in late life?

Conclusion This chapter has argued that shifts in fertility and mortality are having a profound impact on family structure and family life in contemporary Australia and are accompanied by evidence of cultural and attitudinal shifts that present both new opportunities and increased risks for individuals and families in a longer-lived society. References Antonucci TC & Akiyama, H (1995) Convoys of Social Relations: Family and Friendships within a Life Span Context. In R Blieszner & V Hilkevitch Bedford (eds) Handbook of Aging and the Family, Greenwood Press, Westport, Connecticut, pp. 355–71. Australian Bureau of Statistics (ABS) (2000) Births Australia, 1999 (Cat. no. 3301), Australian Bureau of Statistics, Canberra. —— (ABS) (2001) Older Mothers – Family-Family Formation, Australian Social Trends 2001, accessed from . —— (ABS) (2002) Lifetime Childlessness (Cat. no. 3101.0), Australian Demographic Statistics, Canberra. —— (ABS) (2003) Migration, 2000–01 and 2001–02 (Cat. no. 3412.0), Australian Bureau of Statistics,


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Canberra. —— (ABS) (2004) Household and Family Projections 2001–2026 (Cat. no. 3236.0), Australian Bureau of Statistics, Canberra. —— (ABS) (2005) Grandparents Raising their Grandchildren, Australian Social Trends, Canberra, accessed from . Australian Institute of Health and Welfare (AIHW) (2000) Australia’s Health 2000, . —— (AIHW) (2003a) The Future Supply of Informal Care 2003 to 2013: Alternative Scenarios, A Report jointly funded by the Australian Government Department of Health and Ageing and the Australian Institute of Health and Welfare (AIHW Cat. no. AGE 32), Canberra. —— (AIHW) (2003b) Australia’s Welfare 2003 (Cat. no. AUS 4I), Australian Bureau of Statistics, Canberra. —— (AIHW) (2005) Australia’s Welfare 2005, Canberra. Barnes, A (2001) Low Fertility: A Discussion Paper, Commonwealth Department of Family and Community Services (Occasional Paper no. 2), February, Canberra. Bengtson, VL. (1993) Is the Contract Across Generations Changing? Effects of Population Aging on Obligations and Expectations Across Age Groups. In VL Bengtson & WA Achenbaum (eds), The Changing Contract Across Generations, Aldine De Gruyter, New York, pp. 3–44. Bengtson, VL & Lowenstein, A (eds) (2003) Global Aging and Challenges to Families, Hawthorne, Aldine De Gruyter, New York. Bengtson, VL, Lowenstein, A, Putney, NM & Gans, D (2003) Global Aging and the Challenge to Families. In VL Bengtson & A Lowenstein (eds) Global Aging and Challenges to Families Hawthorne, Aldine De Gruyter, New York, pp. 1–24. Bengtson, V, Rosenthan, C & Burton L (1990) Families and Aging: Diversity and Heterogeneity. In RH Binstock & LK George (eds) Handbook of Ageing and the Social Sciences, 3rd edn, Academic Press, New York, pp. 263–87. Bishop, J Hon. (2004) The Way Forward: A New Strategy for Community Care, Commonwealth of Australia, Department of Health and Ageing, Canberra. Borell K & Karlsson, SG (2003) Reconceptualizing Intimacy and Ageing: Living Apart Together, In S Arber, K Davidson & J Ginn (eds), Gender and Ageing: Changing Roles and Relationships: Open University Press, Maidenhead, pp. 47–62. Calasanti, T & Slevin, K (2001) Gender, Social Inequalities and Aging, Altima Publishers Walnut Creek, CA. Carstensen, LL (1991) Social and Emotional Patterns in Adulthood: Support for Socio-Emotional Selectivity Theory, Psychology and Aging, 7: 3331–38. Coleman, D (2003) Why we Don’t have to Believe without Doubting in the Second Demographic Transition, Paper presented at European Population Conference, Warsaw, August. Commonwealth Department of Family and Community Services (2003) Inquiry into Long-Term Strategies to Address the Ageing of the Australian Population over the next 40 years, Commonwealth Department of Family and Community Services submission to the 2003 House of Representatives Standing Committee on Ageing (Occasional Paper no. 8), Commonwealth of Australia, Canberra. Department of Immigration, Multicultural and Indigenous Affairs (DIMIA) (2005) Australia the Country Facts about Australia. Website: . DeVaus, D (2004) Diversity and Change in Australian Families: Statistical Profiles, Australian Institute of Family Studies, Melbourne. Dorfman, RA, Walters, K & Burke, P (1995) Old Sad and Alone: The Myth of the Ageing Homosexual, Journal of Gerontological Social Work, 24: 29–44. Edgar, D (1989) Children, Youth, Elders: Re-linking the Generations, Family Matters, 25: 2–7.


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—— (1991) Ageing: Everybody’s Future, Family Matters, 30: 15–19. Esping-Andersen, G (1997) Welfare States at the End of the Century in Family, Market and Community (OECD Social Policies Studies no. 21), Paris. Gibson, D, Braun, P, Benham C & Mason F (2001) Projections of Older Immigrants: People from Culturally and Linguistically Diverse Backgrounds, 1996–2026, Australian Institute of Health and Welfare (AIHW Cat. no. AGE 18, Aged Care Series no. 6), Canberra. Giddens, A (1999) Family, The Reith Lectures, BBC on line . Hooyman NR & Kiyak HA (2005) The Importance of Social Supports: Family, Friends, Neighbors and Communities. In NR Hooyman & HA Kiyak, (eds) Social Gerontology: A Multidisciplinary Perspective, Pearson, Boston, pp. 305–48. Huber, J & Skidmore, P (2003) The New Old: Why the Baby Boomers Won’t be Pensioned Off, Demos/Age Concern, London. Hughes, ME & Waite, LJ (2004) The American Family as a Context for Healthy Ageing. In S Harper (ed.) Families in Ageing Societies: A Multi-Disciplinary Approach, Oxford University Press, New York, pp. 176–89. Inglehart, R (1990) Culture Shift in Advanced Industrial Society, Princeton University Press, Princeton, NJ. Jackson, N (2001) The Policy-maker’s Guide to Population Ageing: Key Concepts and Issues (Commonwealth Department of Family and Community Services, Policy Research Paper no. 13, June), Canberra. Johnson, CL & Catalano, DH (1981) Childless Elderly and their Family Supports, The Gerontologist, 21(6): 610–18. Kahn, RL & Antonucci, TC (1980) Convoys over the Life Course: Attachment, Roles, and Social Support. In PB Baltes & O Brim (eds), Life-Span Development and Behavior (Vol. 3), Academic Press, New York, pp. 253–86. Kendig, H (ed.) (1986) Ageing and Families: A Social Networks Perspective, Allen & Unwin, Sydney. Kendig, H (2001) The Review of Healthy Ageing Research in Australia Undertaken by the Community Services Ministers Advisory Council, Canberra . Laslett, P (1991) A Fresh Map of Life: The Emergence of the Third Age, Harvard University Press, Cambridge, MA. Lesthaeghe, R & Moors, G (1996) Living Arrangements, Socio-Economic Position and Values Among Young Adults. In D Coleman (ed.) Europe’s Population in the 1990’s, Oxford University Press, Oxford, pp. 163–221. Lesthaeghe, R & Surkyn J (2004) Value Orientations and Second Demographic Transition (SDT) in Northern, Western and Southern Europe: An Update, Demographic Research, Max Planck Institute of Demographic Research, April 17th, Special Collection 3, no. 3, Rostock, pp. 45–86. McDonald, P (2003) Australia’s Future Population: Population Policy in a Low-Fertility Society. In S Khoo & P McDonald (eds) The Transformation of Australia’s Population 1970–2030, UNSW Press, Sydney, pp. 266–79. Matras, J (1990) Dependency, Obligations and Entitlements: A New Sociology of Aging, the Life Course and the Elderly, Prentice-Hall, Englewood Cliffs, NJ. National Centre for Epidemiology and Population Health (NCEPH) (1991) Ageing and Families 7 Years After: Data from a Seven Year Follow-up of Older Australians, Australian National University, National Centre for Epidemiology and Population Health, & Lincoln Gerontology Centre, Canberra. National Centre for Social and Economic Modelling (NATSEM) (2003) Generation Xcluded: AMPNATSEM Income and Wealth Report Issue 6, November, NATSEM, Canberra. —— (NATSEM) (2004) Who’s Going to Care? Informal Care and an Ageing Population, Report prepared for Carers Australia and funded by the Myer Foundation and Brotherhood of St Laurence, Canberra.


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New South Wales Committee on Ageing (1997) When Families Break Down: Rights of Grandparents and Grandchildren, NSW Committee on Ageing, Council on the Ageing (NSW), Sydney. Olsberg, D & Winters, M (2005) Ageing in Place: Intergenerational and Intrafamilial Housing Transfers and Shifts in Later Life, Final Report for Australian Housing and Urban Research Institute, October. Phillipson, C (2003) From Family Groups to Personal Communities: Social Capital and Social Change in the Family Life of Older Adults. In VL Bengtson & A Lowenstein (eds), Global Aging and Challenges to Families, Addine De Gruyter, New York, pp. 54–74. Pillemer, K & Luscher, K (2003) Intergenerational Ambivalences, 4, New Perspectives on Parent–Child Relations in Later Life, Elsevier Publishing, Oxford. Productivity Commission (2005) Economic Implications of an Ageing Australia, Final Report, Productivity Commission, Canberra. Riley, MW & Riley, J (1994) Structural Lag: Past and future. In MW Riley, RL Kahn & A Foner (eds), Age and Structural Lag: Society’s Failure to Provide Meaningful Opportunities in Work, Family and Leisure, John Wiley & Sons, New York, pp. 15–36. Rowland, D (1998) Cross-national Trends in Childlessness (Working Papers in Demography, no. 73), Research School of Social Sciences, Australian National University, Canberra. —— (2003) An Ageing Population: Emergence of a New Stage of Life. In S Khoo & P McDonald (eds) The Transformation of Australia’s Population 1970–2030, UNSW Press, Sydney, pp. 238–65. Thomson, D (1991) Selfish Generations? The Ageing of New Zealand’s Welfare State, Bridget Williams Books, Wellington. Thornton A, Axinn W & Jayakody (1992) Reciprocal Effects of Religiosity, Cohabitation and Marriage, American Journal of Sociology, 98(3): 628–51. Van de Kaa DJ (2003) Second Demographic Transition. In P Demeny & G McNicoll (eds) Encyclopedia of Population, Macmillan Reference USA, Thomson-Gale, New York, vol. 2, pp. 872–75. Western, M & Tranter, B (2005) Are Postmaterialists Engaged Citizens? In S Wilson, G Meagher, R Gibson, D Denemark & M Western (eds) Australian Social Attitudes, UNSW Press, Sydney, pp. 82–100. Weston, R, Qu, L & Soriano, G (2003) Australia’s Ageing Yet Diverse Population, Family Matters, 66 (Spring/Summer): 6–13. Wilson, S, Meagher, G, Gibson, R, Denemark, D, Western, M (eds) (2005) Australian Social Attitudes: The First Report, UNSW Press, Sydney. Women’s Health Australia (1997) Databook for the Baseline Survey of the Australian Longitudinal Study on Women’s Health, Research Institute for Gender and Health, Newcastle, .


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15 Ageing and the law Terry Carney

Introduction Ageing has risen in political importance in Australia. In 2001, the federal government released a national strategy on ageing, encouraging participation, reviewed the economic implications of ageing in the 2002– 03 Budget, and announced various polices in February 2004 (AIHW 2003: 282, 275; Australia Treasury 2004b). Law reflects society and its values (Thane 2001; Whitton 2001), such as the balance between respect for individual autonomy (privileged along with private markets in the United States) and values such as protection or communal decisionmaking (Polivka & Moody 2001; Doron 2003: 252). So laws take different forms, such as protective (for example, adult guardianship), supportive (for example, social security), preventive (for example, enduring powers of attorney), or empowering (for example, civic participation in management issues) (Doron 2003). Despite the false impression created by documents such as the Productivity Commission report in 2005 (Productivity Commission 2005) that an ageing demographic profile necessarily dictates greater state privatisation (Castles 2001; Carney & Sceats 2005), it is argued that law in the long-lived society should, instead, serve citizenship by expanding supportive, empowering or participatory functions in order to dampen adverse effects of neo-liberal economic and welfare reforms (Hancock 2002).


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Even by 2050, Australia will rank 53rd of 193 countries in terms of high age ratios (Productivity Commission 2005: 11), spending just another 3.3 per cent of GDP by 2030, against around 10 per cent in western Europe (Castles 2004: 120–21). As explained fully elsewhere (Carney 2006), we should be sceptical of supposed path-breaking influences of globalisation or a new risk society, though diversification of forms of work/social participation and the blurring of work and civic participation are fuelling demands for more ‘customised’ welfare, like private superannuation. Older Australians do encounter some difficulties, such as dealing with professionals or accessing transport, housing, work and residential aged care services (Minichiello, Browne & Kendig 2000; NSW Law and Justice Foundation 2005), but generally ageing is now unproblematic, as captured by the 2002 WHO goal of active ageing (AIHW 2003: 275). Many needs are met by family and friends rather than the law or the state, though the mix of responsibilities changes (Howe & Schofield 2001). The NSW Law and Justice Foundation identified half a dozen main areas where substantive law or practice issues arose for older people when dealing with or seeking to access the law (NSW Law and Justice Foundation 2005), noting the diversity of types of issues in these various settings. These included age-specific issues in housing (retirement villages or aged care); life cycle-associated needs (such as for substitute decisionmaking or health); problems in financial planning or access to justice and consumer issues, where stoic reluctance to ‘make waves’ means that law is lightly used; and issues of vulnerability, such as work and service discrimination or elder abuse (NSW Law and Justice Foundation 2005: 360–61). In addition to well-known issues, such as end-of-life decisionmaking, they also drew attention to new friction points around the implications of divorce law for grandparents wanting to preserve contact with (or care for) their grandchildren. Justice cannot be done to all of these areas in this chapter. So we therefore concentrate on core legal areas of retirement income security and protection of labour market and social access, before briefly turning to ‘personal rights’ (recognition of the dignity and richness of expectation of the aged regarding choice of retirement) and aged participation (the enjoyment of equality of access to the full range of citizenship rights).


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‘Security’ and Australia’s retirement incomes policy evolution

History and context As explained elsewhere, models of the welfare state differ from place to place (Esping-Andersen 1990; Ozanne 1997). Australia’s model of ‘working class labourism’ (Castles 1985; Taylor-Gooby 1991: 96–97) now faces pressure from neo-liberal market reforms (Carney 2006). Elsewhere in Asia, primary reliance is on the family and the firm (Goodman & Peng 1996: 195; Takahashi 2004: 288) but, despite Japan’s long-term-care insurance reforms in 2000 (Lai 2001; Talcott 2002; Takahashi 2004), relatives are often overburdened (Ramesh 2004: 325). The history of Australia’s pioneering federal age pension reforms early in the 20th century (behind Germany, Denmark and New Zealand) has been told elsewhere (Carney 2006: chapters 2 and 6). The public age pension was long the sole protection against aged poverty, and it remains the principal bulwark. By the 1950s, coverage had widened from one-third to three-quarters of the aged population (McCallum 1990: 60). It delivered comparative security and basic adequacy of benefits, based on low pension rates and strict income tests focused on the most needy. High home ownership levels partly offset the impoverishing effects of austere levels of payments. The 1985 re-introduction of an assets test (not including the family home) unsettled groups such as farmers, but the system has remained fairly stable, even if means tests imperfectly measure social need since ownership (the key under the law) and enjoyment of property (the socially relevant issue) do not always coincide (Carney 2006). Policy outcomes can be unpredictable, though. Abolition of death duties was welcomed by farmers keen to pass farms to descendants, but abolition may have postponed the age of transfer, giving greater ‘job satisfaction’ for male farmers while delaying formation of town networks by their partners. Gifting rules catching assets disposed of in the last five years, and ‘farmer’ exceptions, replicate that issue (Voyce 1993, 1999). The age pension legacy is substantial. It still provided the principal retirement incomes for three-quarters of all income units with an aged member during the 1999–2000 year (AIHW 2003: 283–84). Private savings


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mainly serve as bridging income for those voluntary (and increasingly involuntary) pre-retirees experiencing constriction and structural change in the labour market (as jobs are redistributed away from older workers). Occupational superannuation long enjoyed generous taxation concessions, but compulsory superannuation was introduced, the subsidy accrued mainly to a small, privileged group of workers.

Age pensions, private savings and superannuation Australia’s retirement income policy is now built on three pillars of a needs-tested pension, compulsory superannuation and voluntary private contributions and savings (Australia Treasury 2004b: 1), as called for by the World Bank’s three pillars of savings, redistribution and insurance (World Bank 1994: 10). But because pension means tests favour poverty alleviation over earnings replacement, continuation of previously enjoyed standards of living relies on adequacy of private savings or superannuation. Superannuation is deferred private provision. It is bought with present income to provide future benefits mirroring wage relativities. It boosts, and ultimately replaces, age pension incomes if contributions are sufficiently high over a full working life – around 12 per cent of salary. While 90 per cent of all employees are now covered, Australian superannuation is too recent, and contributions are set too low for it to become the principal source of Australian retirement income; currently only 8 per cent of aged income units reach that point (AIHW 2003: 283–84). Successive government plans for a contributory age pension prior to the Second World War failed to materialise (Carney 2006: chapter 2). Economists Downing and Gates advocated national superannuation schemes in the 1960s and early 1970s, with general revenue-funded ‘floor’ entitlements for the poor and some contributory elements. A 1974 Senate report endorsed the idea, but government support evaporated. In 1985, the mandatory 3 per cent superannuation levy (raised to 9 per cent by 2002) introduced the European mainstay – life cycle preservation of income relativities. Prior to its defeat, Labor’s 1995 Budget aimed to lift the levy to 15 per cent by 2002, raising another 3 per cent from employees, matched by government. The new coalition government abandoned the target, so superannuation incomes remain inadequate.


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Even if replacement of spending (not former income) is the test, 30 years’ full contributions yields only 76 per cent replacement levels (Australia Treasury 2004b: 5), or just 52 per cent of final salary ($18 000 p.a.) for a person earning $35 000. This is a major public policy flaw from a public savings standpoint. Tax concessions for private superannuation contributions have a longer history, costing around $11 billion (against age pension outlays of $19 billion) in 2004. Until July 1983, the taxation of retirement benefits was perverse. Lump-sum payments were taxed at just 5 per cent, as were pensions or annuities, removing any incentive to prefer pensions over lump-sum payouts. Superannuation funds were often set up by employers as a ‘tax sink’ or a source of business operating capital: undistributed fund earnings were untaxed, while employer contributions were tax-deductible. For their part, employee benefits were neither vested (owned) nor preserved (locked in) for retirement. Women, lowincome and part-time workers fared least well, losing a portion of their work-income only to see it later offset against the age pension, unable to make contributions during spells of unemployment or child rearing and seeing nest eggs eroded by inefficiencies of managing multiple small entitlements in different funds. Taxation settings changed slowly, and then only for future contributions (to avoid upsetting prior plans). The tax on lump sums increased in 1983 if the amount was not rolled over into a pension or annuity. New accumulations in genuine retirement schemes were taxed at payout at 15 per cent on the first $55 000 and 30 per cent for the balance or 30 per cent for the whole sum if drawn down before age 55. Then, in 1988, a dual-stream collection arrangement was introduced. Fund earnings were now taxed (at 15 per cent p.a., against a corporate rate of 33 per cent), and a 15 per cent p.a. advance collection was levied on funds as an up-front contributions tax (paid on behalf of contributors, based on contributions made in the tax period), offset by a rebate of that amount on payout. This altered the taxation of the contributor’s share from an original stepped 15 or 30 per cent rate at payout, advancing taxes previously paid only on retirement many years later. Finally, Reasonable Benefit Limits (RBLs), introduced in the 1960s to serve a tax-avoidance goal, were expanded to promote greater equity. A


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1985 tax ruling capping lump-sum payments qualifying for deductions at seven times the person’s final average salary, irrespective of affluence, was altered in 1988 to minimise discrimination against low-income earners. A sliding scale of (diminishing) benefits was phased in over five years for incomes over $35 000 (indexed) together with a differential (and more generous) treatment of annuities (allowing a ratio of 11.5 times the base for these contributions, provided at least 50 per cent was taken as a pension). Private superannuation savings continue to be encouraged in various ways, including currently by matching, up to a cap of $1000, contributions by lower and middle income earners, and by allowing payments of voluntary superannuation contributions up to age 75 (Australia Treasury 2004b: 14). The February 2004 reforms also eased the ability to make tax concession-qualifying superannuation contributions between the ages of 18 and 65, irrespective of having a work history in the previous two years – removing the former ‘work test’ precondition (Australia Treasury 2004b) – and it provided new contributions and cash-out rules for those aged 65–74. And the 2006–07 Budget, among other changes, foreshadows removing from July 2007 the 15 per cent tax on payouts, as well as abolishing RBLs.

Superannuation or just a form of tax planning? Maintenance of system integrity has been a challenge since the 1983 changes, because the reforms hinged on identifying genuine retirement schemes and excluding manipulative tax planning. To encourage pensions and annuities over lump sums, these investments were treated separately to, and more favourably than, the complex and changing social security investment income rules. A ‘purpose test’ from superannuation regulation law was written into the social security law and the more generous treatment offered to superannuation than to ordinary income was quarantined to yields from compulsorily preserved benefits (see now s. 8(8)(b)). Monies drawn out before retirement age reverted to ordinary investment income unless reinvested in roll-over funds providing annuities at retirement age. Retirement integrity was challenged by the High Court ruling in Read’s case (1988) (78 ALR 655), finding that some very dubious retirement


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investment product returns were not income for social security purposes, but capital. Parliament overcame this loophole by counting capital as income, apportioned over 12 months. To avoid penalising genuine retirement investments, favourable treatment was needed for two groups of investments, namely, so-called accruing return investments and their more speculative, but less-predictable market-linked investments (see further Carney 2006: chapter 6). Deemed income returns were attributed to some such investments to stop avoidance of the income test. However, the classes of investment proved hard to distinguish, the complex rules were open to manipulation by vendors of retirement products, and saving vehicles like shares were separately dealt with, leaving different rules and incentives for different schemes. In 1993, a single basket of investments was proposed to overcome this problem, with losses on one investment offset against gains on other qualifying investments. Difficulties such as not counting capital losses in the first 12 months, or trouble in dissecting out capital growth components were addressed in the 1994 Barber Report, recommending that shares and managed investments attract deemed income rules, at stipulated rates, rather than assessment by complicated rate of return methods, while pensions and annuities would continue being assessed as real income flows. All investments would be asset-tested, and capital-inaccessible products valued on current account balances. The 1995–96 Budget implemented that scheme, but only for non-income-stream products. In 1998, a fresh start was made. Classification of investment products was abandoned in favour of the characteristics of the resulting income streams. Differential incentives apply, depending on the durability of the income streams. They distinguish between genuine retirement products (which lock-up capital to generate long-term incomes) and ‘allocated’ schemes that are more flexible and permit capital to be accessed. Lifetime income investments are rewarded by exemption from asset testing and deduction of the amortised value of the costs of acquisition (s. 1098). Those lasting for five years (but less than life) are asset-tested but can amortise the purchase price. Anything lasting less than five years is both asset-tested and attributed a deemed income. This regime encourages genuine retirement planning through an assets test exemption (where capital is truly inaccessible) and deduction of purchase costs, as well as


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by offering higher reasonable benefit limits (RBLs) (rewarding people with a slightly higher cap on the lump-sum component of any genuine retirement savings). From September 2004, this clarity was muddied by allowing certain market-rate products to comply if they offer reasonable durability of what are necessarily fluctuating incomes (Australia Treasury 2004b: 9). Moreover, the previous 100 per cent asset test exemption for products locking up capital (defeating avoidance objectives) was diluted to 50 per cent for new products, since full exemption proved too tempting a way for very high-wealth individuals to ‘park’ substantial capital assets in products that they would never need to draw down for retirement (Australia Treasury 2004b: 10). Once again, extraneous tax avoidance motives partly derailed retirement planning policies. It can be seen that income security following loss of access to labour market rewards in Australia still rests principally with a taxfunded but austerely means-tested pension. Due to policy-failures to insist on a sufficiently substantial level of contributions, superannuation remains inadequate to guarantee current young working-age cohorts the protection of a wage-related standard of living in their retirement and is still prone to exploitation by tax planners. Despite measures to foster working beyond retirement, and other incentives to save, the retirement settings offer inadequate security.

Softening transitions between work and retirement Australia’s current labour force participation rate is comparatively low, ranking 12th of 30 in the OECD, influenced by early retirement patterns (Australia Treasury 2004a: 2). Over recent years, the government has therefore offered incentives for people over age pension age to remain in the workforce, paralleling European Union Council moves to raise workforce participation of older workers, pre- and post-retirement age, at meetings in 2000 (Lisbon) and 2002 (Barcelona) (von Nordheim 2004).


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Fostering working beyond standard retirement age Measures include the July 2000 expansion of the tax off-set for people continuing to work beyond 65 (eliminating tax for a single person on incomes up to $20 500, with reduced rates up to $38 340: Australia Treasury 2004b: 13) and the reduction in the severity of the claw-back of the age pension by liberalising the income test taper (from 50 to 40 per cent) when the goods and services tax was introduced. The 1998 lumpsum bonus for people who defer claiming the age pension once becoming eligible, of 9.4 per cent of base pension entitlement for each year of full employment of at least 960 hours a year (King, Baekgaard & Harding 2001: 52; Australia Treasury 2004b: 13), was another. Likewise, the 1997 dispensation allowing employer superannuation guarantee contributions to be made between age 65 and 70 (Encel 2001; Australia Treasury 2004b: 14). The 2004 federal election added the mature-age worker tax-offset (of $500 p.a. for workers over 55 years of age earning up to $48 000 p.a.) at an estimated cost of $1 billion over four years. For self-funded retirees, a once-a-year $200 lump-sum ‘utilities payment’ was introduced ($100 for pensioners), costing $900 million over four years. Policy impacts can have unintended outcomes, however, as shown by the February 2004 liberalisation of the ban on accessing superannuation by people between the preservation age (55 for people born before July 1960 and 60 for those born after July 1964) and the age of retirement, when they had not yet permanently left the workforce. Originally designed to clamp down on premature accessing of superannuation, its unintended consequence was to push some people into premature retirement solely to access needed savings. From July 2005, superannuation in the form of an annuity can therefore now be combined with work income once a person reaches the preservation age (Australia Treasury 2004b: 10; Costello 2004) thus softening the overly sharp dichotomy between work and retirement. The government balanced this by tightening rules allowing withdrawal without penalty of redundancy payouts rolled over (at a concessional tax rate) into superannuation. Withdrawal flouts the objective of the tax carrot to encourage supplementation of retirement income provision, but this reform could yet make matters worse, should people decide not to roll over a redundancy in the first place.


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Previously, policy capped the ability to take advantage of work/ retirement combination concessions once a person turned 75. Exceptions were made where an industrial award dealt with superannuation above that age, or where the person worked more than 30 hours a week. As had happened many times previously, most notoriously with the former ‘type of retirement product’ rules, the tax avoidance industry took advantage of this exception to lock monies up in such contributions for estate-planning purposes. To address this, from July 2004, it became mandatory for funds to begin to disgorge entitlements either as a pension or lump sum, once a person reaches 75 (Australia Treasury 2004b: 8). To date, policy has not taken the next logical step of equating retirement with the ‘mutual obligation’ (or contractual) agreements that, for people of workforce age such as the unemployed, sole parents with a child over eight years of age, and many former disability pensioners, require some workforce or community participation in return for receipt of welfare payments (Carney 2006). But, as elsewhere (van Oorschot & Boos 2000), the ‘buffer group’ of recipients of a disability support pension payable for permanent loss of work capacity, were first exposed to ‘activation’ strategies (Carney 2003; Australia Treasury 2004a: 8), and the 2005 Budget announced that from July 2006, new applicants will not qualify for the pension if they are able to work 15 hours (previously 30 hours) a week, and will instead be placed on activity-tested payments (Carney 2006: chapter 8).

Retirement and age discrimination Statutory ages of retirement and qualification for the age pension (formerly 65 for men and 60 for women; between 1994 and 2004 progressively rising to 65 for women) historically recognised the moral claims of aged people whose labour founded current prosperity. Such measures are now seen as too blunt and as a denial of human rights. They have been replaced by legislative inclusion of age as a prohibited ground of discrimination and/or bans on compulsory retirement. Age was made a prohibited ground of discrimination by South Australia (1990), Queensland (1991), New South Wales, Victoria and the Australian Capital Territory (1994), Western Australia and the Northern Territory (1995), and Tasmania (1998). (Anti-Discrimination Act 1977


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(NSW) Part 4G; Equal Opportunity Act 1984 (SA) s. 85A; Equal Opportunity Act 1984 (WA) Part IVB; Discrimination Act 1991 (ACT) s. 7(1)(ib); Equal Opportunity Act 1995 (Vic) s. 6(a); Anti-Discrimination Act 1998 (Tas) s. 16(b); Anti-Discrimination Act 1991 (QLD) s. 7(1)(f); Anti-Discrimination Act 1992 (NT) s. 19(1)(d).) Commonwealth action was slowest, with full equal opportunity legislation delayed until June 2004 (Encel 2004: 6–7). Such legislation makes it unlawful to discriminate (directly or indirectly) on the basis of age in areas such as work, access to places and vehicles, education, provision of goods and services, accommodation, and registered clubs. There are many exceptions, however. Thus, apart from the unproblematic dispensations for positive discrimination, the NSW legislation exempts provision of superannuation, insurance and credit grounded on statistical data or other reasonable bases (ss. 49ZYS– 49ZYU), along with driver safety (s. 49ZYV), and participation in sport (s. 49ZYW). This is a wider range than for other heads of discrimination, as pointedly observed by the NSW Law Reform Commission in its 1999 review of the legislation (Encel 2004: 4). In 2004, the federal Age Discrimination Act made it unlawful to discriminate either directly or indirectly on the basis of age, including within the workplace. The Industrial Relations Reform Act 1993 had previously made age a basis for a much narrower protection against unfair termination of employment, and had required the Commission to renovate awards to remove any provisions that ‘discriminate against an employee because of, or for reasons including … age’ (s. 150A(2)(b); later, the Workplace Relations Act 1996, s. 170CK(2)(f) (Encel 2004: 4)). The 2004 legislation also includes exemptions covering positive discrimination and population targeting by charities, voluntary or religious bodies, and legitimating distinctions made in provision of superannuation, insurance or credit if grounded in data or reasonable bases (HREOC 2005: chapter 2.5), as well as evidence-based decisions about the provision of health and medical services (such as flu shots for the aged, or lack of access to certain treatments), and any distinctions found in social security or taxation laws (HREOC 2005: paras 2.5.5–2.5.6). The reasonableness or otherwise of indirect discrimination has been left to the courts, without further guidance (unlike disability), compounding an uncertainty that has elsewhere generated much litigation (HREOC 2005: para. 2.2.3).


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HREOC has also rightly criticised the insistence on showing that age is the dominant rather than just ‘a’ factor as is the case with cognate laws on discrimination (para. 2.2.4). Compared to other forms of discrimination, most notably discrimination on the basis of either sex or race, a focus on age discrimination is a recent phenomenon (Encel 2004: 1), as the infancy of these legislative schemes demonstrates. As a consequence, age discrimination case law is still in an early developmental state across Australian jurisdictions. The most significant case before the Australian courts involved a Qantas pilot dismissed at age 60 as a result of international aviation rules permitting states to exclude pilots aged 60 and above from entering their air space. The High Court (Kirby dissenting) accepted Qantas’ argument that because pilots aged 60 and above were excluded from the majority of its flight paths, the company’s requirement that pilots be aged below 60 was ‘inherent’ to the position and thus permissible under the relevant federal legislation (Qantas Airways v Christie (1988) 152 ALR 365). California outlawed compulsory retirement in the 1950s and another two dozen states followed before Congress legislated in 1967 and in 1975 precluded discrimination in federally funded projects (Encel 1993: 125). Australia’s 1975 Poverty Inquiry examined the issue (Encel 1993: 124), but progress was slow and patchy. A 1980 NSW Anti-Discrimination Board report supported age as a ground, but opposed banning retirement ages. However, as in the United States, banning mandatory retirement came first. New South Wales and Western Australia foreshadowed a ban in 1989, and South Australia set up an inquiry. New South Wales phased in a ban on retirement ages (except in industrial awards) by 1993 and South Australia passed legislation the same year. In 1990, the Victorian Law Reform Commission proposed banning retirement ages two years after making age a ground of discrimination, but ultimately both were achieved in 1995 amendments (with only a limited 12-month moratorium for some retirement ages). Western Australia followed the dual model in 1995 and the Australian Capital Territory enacted the Discrimination (Amendment) Act in 1994. Other jurisdictions mainly followed the dual model summarised above. While the combination of equal opportunity and a ‘ban’ on


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retirement ages is not problematic, the federal division of power, necessitating both federal and state/territory laws and administrative institutions, does add to public confusion about what level of government is responsible, and where one goes to complain, though there are constitutional barriers that the federal law has sought to minimise by permitting choice between the laws and bodies wherever possible (s. 12(5). HREOC 2005: para. 2.1.3). Concern has also been expressed about the wide range of exemptions, especially to the equal opportunity provisions (Encel 2004: 4), and about the unfortunate consequences of extensive use of conciliation (which disempowers a generation more inclined to stoically accept their lot in life rather than aggressively pursue their rights), and which serves to privatise (and hide) any favourable rulings in settlements that otherwise might have resulted in normative rulings by the courts (NSW Law & Justice Foundation 2005: chapter 7). This is not a small point. The final observation made by the Foundation after its extensive research and review was that: The most commonly recurring theme throughout this project was that older people were reluctant to complain about issues affecting them … [an attitude which may constitute] the most significant and challenging barrier [confronted] in accessing legal assistance, initiating complaints … and accessing non-legal advocacy and support services. (NSW Law & Justice Foundation 2005: 367)

Can law trump culture? Laws do not always fully achieve their objectives, even in the most auspicious of circumstances. Australia had much higher rates of early retirement by workers aged 55–64 in the period 1974–81 than did Japan or the United States (declining 15 per cent compared with 2 per cent and 6 per cent respectively). The reasons included the greater financial security conferred by the postwar boom, liberalisation of the age and war service pensions, and declining opportunities for older workers due to recessions and structural changes (Carney 2006: chapter 7). Mature workers face significant barriers to accessing the labour market (Encel 2000), or in using the new Job-network to assist in a job search (Age Counts 2000). Research confirms that age discrimination is both subtle and complex, varying with age and gender of workers and employers.


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Age clearly has differential influence over the work prospects of the pre-retirement group, with women being less at risk than older unskilled males, for instance (Carney 2006: chapter 7). Symbolic legislative affirmation of equal opportunities to work may not greatly assist the aged, with the research showing rather mixed or weak impacts (Encel 2004: 8–10, 12). Studies suggest that a variety of factors, including social and structural (rather than legal) barriers are at the root of these problems (Ginn & Arber 1996). Unintended effects may arise when retirement income rules, such as those guaranteeing vesting (ownership) of superannuation or the lump-sum pay-out limits that promote equity and security of retirement incomes, also indirectly accelerate job-shedding. This is an outcome that may flow from a reduction of needed flexibility of remuneration packages or retirement benefits of older workers, thereby further contributing to lower labour force participation, with adverse policy implications for retirement. US research on outlawing a retirement age before age 70 found that male participation continued to decline, while female participation stabilised, casting doubt on the effectiveness of reform legislation (Reid 1989: 183; likewise in the EU: Sarfati 2003: 261). Effective legal interventions are difficult to construct, especially for mature workers (Duncan 2003: 108–09; Duncan & Loretto 2004). Equal opportunity protections are especially hard to judge. Thornthwaite’s study in New South Wales reported thousands of information inquiries and healthy numbers of work discrimination cases going to conciliation, with very few progressing on to adjudication, thereby implying effective resolution (Thornthwaite 1993: 40). Yet in truth: Most are either dismissed or result in a private settlement [and] while the EOT has awarded specific forms of restitution to redress substantiated complaints, monetary compensation has been the usual remedy awarded. (Thornthwaite 1993: 45)

So, ‘while anti-discrimination legislation does give individual workers the power to challenge management action, it does so to only a limited extent’ (Thornthwaite 1993: 48). Individual, ‘complaint-based’ models do little to redress entrenched structural inequalities or cultural values (McVittie, McKinlay & Widdicombe 2003). Disabilities (and the operation of disability protections) further complicate analysis (Stock & Beegle 2004).


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Evaluations of equal opportunity laws reveal disappointing outcomes for older workers unless they are specifically targeted on retirement age and combined with other approaches such as delaying superannuation, as in New Zealand (Duncan 2003: 113, 116). Discriminatory outcomes continue, though employers now speak the language of commitment to equality, creating a more subtle culture of ‘new ageism’ (McVittie, McKinlay & Widdicombe 2003: 609). Given these cultural and historical relativities, a more preventative strategy might be required (Walker 1998). Educative strategies have their limits too, however (Taylor & Walker 2003). So the contribution of equal opportunities legislation to ban age discrimination in advancing citizenship rights of the aged is dubious. Legislation may help to stem the erosion of employment opportunities, but the decline seems inexorable nevertheless. Social policies (such as labour market programs), rather than equal opportunity strategies, may be needed if this is to be redressed.

Conclusion

Participation, equity, protection and security The ultimate test of policies for the aged is: (1) how well they reflect wider conceptions of participation, security, protection and equitable distribution, and (2) how well they modify market outcomes. These issues of participation, equity, protection and security can be subsumed as ‘social citizenship’. Social participation is necessarily multidimensional, but continued access to the labour market is one important indicator. As we have seen, the retirement age and age discrimination picture is not a pretty one. Some recent policies attempt to dissolve past rigidities, as with age discrimination and retirement income laws, by promoting participation and security. But no one of any age has ever been granted a right to labour market access, even during the full flush of post-Second World War full-employment commitments. Rather, at best, employment is a ‘civil opportunity’. However desirable in terms of generational equity and retention of the social status associated with productive work, endeavours to boost labour force participation in the pre- and post-retirement years may not be as rosy hued as they appear. Rather than being ‘flexible’ and


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worker-designed, any such work may often prove to be as insecure, and as exploitive, as is the case for other de-regulated labour markets (Platman 2004). Occupational superannuation cannot later correct for employment market income inequity. Whatever its form, it remains an incident of employment. Legislative correctives against inequality, such as government matching of superannuation contributions made by lower-income workers, can boost retirement incomes (pension plus superannuation) and deliver higher standards of living for such workers; but so too would tightly means-tested pension increases. Otherwise, occupational superannuation simply magnifies the (uncompensated) vagaries of participation in the market – the cost of unemployment or caring, or both, is multiplied by the consequential future diminution of pension entitlements, detracting from any individual sense of ‘security’. Neo-liberal reforms, with their associated new public management principles for creating market (or quasi market) models in place of state service provision (Beeson & Firth 1998), confirm Harrison’s insight that the private sector is now critical to thinking about citizenship rights of the aged (Harrison 1991: 213). Privatisation is evident in many sectors, especially retirement incomes and aged care services (see Carney & Sceats 2005: 219–22), where public provision is shrinking and state largesse is delivered through markets. One implication is that insufficient priority may be given to protecting the vulnerable. Thus, the aged in need of support are major clients of adult guardianship (Carney & Tait 1991a, 1997; Gordon & Brill 2001). Aged applicants and their families struggle to grasp the implication of market choices and contracts for entry to residential aged care, for instance (Wilson, Setterlund & Tilse 2003). Neo-liberal reforms struggle to promote quality (Hardy & Wistow 1998). They also render entitlement rules fuzzy and hide decision-making from public gaze, or from public-accountability systems such as merit reviews or appeals (Diller 2000; Gilman 2001; Cimini 2002). These factors diminish the political constituency and ‘voice’ for aged issues. Dependence is another marker of vulnerability and denial of citizenship rights of participation, whether in retirement incomes, accommodation or substitute decision-making (Gordon & Verdun-Jones 1986; Carney & Tait


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1991b). That ‘dependency’ is partly socially constructed. The asymmetry or lack of reciprocity in social exchange stems from such things as a lack of preventive or remedial supports, or both, excessive targeting, undue emphasis on institutional care, or too little program flexibility (narrowing the available choices). Structural shifts in labour market and household composition also contribute (Hancock 2002). Law cannot remedy this on its own, of course, but currently such structural inequities are poorly addressed by domiciliary services and support for carers, for instance (Millward 1999; Howe & Schofield 2001). Despite the recent liberalisation of the Carer Payment, for example, it still assumes that carers will withdraw from the labour market (Tilse, Rosenman & Le Brocque 1992: 66–67); it remains very tightly confined; and few receive payments related to their caring responsibilities (Tilse, Rosenman & Le Brocque 1992: 64).

Managing changed expectations Perhaps due to oversensitivity to adverse voter reaction, Australian social policy reforms have tended to be gradualist. Thus, the 1997 increase (from 55 to 60 years of age) in the age below which superannuation does not fully bite will not come into full effect until 2024, when post-1964 birth cohorts are governed by the new access age of 60 (Costello 2004). Likewise, the government’s retirement reform package of February 2004 attracted scathing criticism for eschewing less popular options, such as raising the minimum age for retiring and accessing superannuation by another five years, from age 60 to age 65 (thus preventing people from ‘double dipping’ by running down superannuation before claiming the age pension). It was also criticised for failing to adopt other measures, such as banning lump sums altogether (ensuring that income is available as an alternative to pension), lifting the age pension age from 65 to say 70 years, raising the compulsory superannuation contribution percentage (as Labor had proposed), or reducing the value of superannuation tax concessions for wealthier claimants. The values and expectations of relevant age cohorts (and society at large) play a crucial part, of course, as shown in the 1980s when people scarred by bank failures in the 1930s Depression resisted electronic


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funds transfer payments of social security entitlements – a reform that undermined their personal sense of security. Likewise, the resistance to imposition of deemed income returns on small low-interest or nointerest accounts. As already shown, this cohort effect continues. Indeed, some now doubt that the baby boom generation can be conditioned out of their expectations of taking ‘life-expanding’ early retirement (Phillipson 2004: 159–60), though others are more optimistic given higher levels of education (von Nordheim 2004: 152). The limited normative or practical effects of the law, and its unintended policy impacts, have sparked interest in other ideas. Therapeutic jurisprudence looks beyond system boundaries in the search for desired social outcomes transcending justice and fairness (Wexler 1992: 518), for instance, by critiquing excessive regulation that serves the ends of providers rather than those of end users (Kapp 2001: 88, 94). But citizenship arguably remains the most promising paradigm.

Citizenship revisited? Contemporary notions of citizenship have contributed to the positive re-imaging of ageing (Higgs 1995), challenging stereotyping of the aged and promoting diversity in social (and legal) policies and championing rights to social and political participation, or the republican version of ‘social citizenship’ (Carney 2006: chapter 5). Citizenship theory is a useful lens for assessing law and policy for the aged. However, citizenship has been eroded by neo-liberal transformations of the welfare state, leaving citizens less protected than they formerly were. Casualisation of employment has undermined citizenship through work. Transformation of non-government agencies from charitable to profit-seeking bodies (Considine 2003) limits the ability to build social capital (and citizenship) in the civil sphere (Turner 2001), such as in aged care accommodation. It also threatens to undermine both individual and program-level accountability, as risk is shifted away from the public arena (Cohn 1997). The claim of social citizenship as being neutral with regard to age or gender, as a claim to social participation and scarce resources, is necessarily a politically contested one, where resolution of generational


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divisions needs to be ironed out to foster an inclusive and tolerant social contract (Walker 2002). Here the contest between integrative and expressive values of progressive liberalism, and those more divisive impacts of neo-liberal privatisation, will shape both programs for the aged and politics generally (Polivka & Longino 2002). Overall, this chapter argues that the law is a mildly progressive force in promoting such participation, as shown in the superannuation reforms. But there are undeniable impacts from such policies on capital formation, savings incentives, labour market participation rates and wage structures: impacts that can mute public policy (as with the treatment of investment income). The political sphere occupied by citizenship theory invariably clashes with the economic sphere. While the citizenship–work nexus remains the primary vehicle of participation and opportunity, the aged are likely to win diminished shares, raising real doubts about taking the ‘civil opportunity route to occupational pensions’ (private superannuation) rather than, say, a social rights route towards a state earnings-related pension. As we have seen, the former simply perpetuates any diminished participation rights for those of workforce age. On the other hand, such analysis would provide a defence of the apparently innocuous age discrimination laws. The argument would run that, even though labour force participation rates may continue to decline, such laws nevertheless send an important symbolic message about the citizenship rights of the aged being elevated to the same plane as those of other citizens. Indeed, as the state becomes less involved in direct service delivery and more extensively involved in regulating the contractual delivery of services by others (Carney 2006), this may become a critically important role of the law. As has been demonstrated, countries strike their own balance of values in public policy: they create their own brand of welfare state. Quick to provide pensions to its pioneers, Australia retains the austere needs policy of this foundation. People of workforce age caring for the aged have been slow to win recognition of state responsibility to contribute to their upkeep. But income-support policies for the aged have largely been exempted from the transformation of welfare from a rights-based to a ‘mutual contract’ rationale.


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The aged have been less well served where economic interests clash with the social benefits entailed in citizenship rights. Investment and superannuation decisions are a case in point. Rights to labour force participation beyond (and just before) ‘statutory’ retirement ages have also struggled against more powerful economic and industrial forces. And home-based support services appear to have made slow progress in the face of public/private, waged work/unpaid carer, and national versus ‘diversified’ (federalist) dichotomies. These are divides that reflect the power of (outdated) gender discrimination, the power of economic interests bound up with respect for traditional boundaries of economic activity, and the political clout of the idea of a highly distributed, pluralist decentring of authority within markets, as captured by the neo-liberal new public management (NPM) agenda to strip government of its direct service provision role. Citizenship theory always struggled to be heard in these settings, but the difficulty of cutting through is now doubly so. This is due to the dominance (and lack of critical examination) of NPM’s privatisation agenda, and uncritical public acceptance of doomsayer messages about the undue burdens of an ageing demographic. The longer-lived society is not the problem. Rather, it is the lack of regard for durable ideas like citizenship. References Age Counts (2000) Age Counts: An Inquiry into Issues Specific to Mature-Age Workers, House of Representatives Standing Committee on Employment, Education and Workplace Reform, Canberra. Australian Institute of Health and Welfare (AIHW) (2003) Australia’s Welfare 2003, Australian Institute of Health and Welfare, Canberra, pp. 1–486. Australia Treasury (2004a) Australia’s Demographic Challenges, Australian Department of Treasury, Canberra. —— (2004b) A More Flexible and Adaptable Retirement Income System, Australian Department of Treasury, Canberra. Beeson, M & Firth, A (1998) Neoliberalism as a Political Rationality: Australian Public Policy since the 1980s, Journal of Sociology, 34: 215–31. Carney, T (2003) Disability and Social Security: Compatible or Not? Australian Journal of Human Rights, 9(2): 139–72. —— (2006) Social Security Law and Policy, Federation Press, Sydney. Carney, T & Sceats, S (2005) Retirement Security in Australia, Paper delivered at the 8th Asian Regional Conference of the International Society for Labour and Social Security Law, Association of Industrial Relations, Taipei, Taiwan (ROC), 31 October–3 November 2005, pp. 205–30. Carney, T & Tait, D (1991a) Balanced Accountability: An Evaluation of the Victorian Guardianship and Administrative Board, Office of Public Advocate, Melbourne, pp. i-vii, 1–143.


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Index

2020: A Vision for Aged Care in Australia 312 Aboriginal and Torres Strait Islander Aged Care Strategy 83–85 Aboriginal and Torres Strait Islander Flexible Care Services 78 Aboriginal and Torres Strait Islander people see Indigenous Australians Aboriginal Community Elders Service (ACES) 90–91 Aboriginal Dementia Awareness Program 83 Aboriginal Elders’ Voices 76 Aboriginal Hostels Limited 83, 84 access to transport 240–44, 364 accommodation bonds 278 Adult Education Association of Victoria 327 Adult Learning Australia 318 A Fresh Map of Life 355 Age Can Work 153–54 Age Concern 11, 313, 337 age discrimination 5, 9, 161–62, 372–75 cases involving 376 exemptions 373, 374, 375 in insurance 366, 373 age pension 5, 102–03, 192–93, 195, 209 as percentage of average weekly earnings 193


eligibility for 148–49, 152, 192–93, 194, 195, 370–71 history of 365–66 for Indigenous Australians 76 age-related government spending 214–15, 269, 274 see also health expenditure Aged and Community Services Association (ACSA) 311, 312 aged care 265–92 coordination 277, 278 cost 282 for ethnic aged 119, 127–37 for Indigenous population 78–82 funding 268–69, 272, 284–85 range of support services in 271–73 service providers 310–11 see also aged care policy and health expenditure Aged Care Act 84, 266, 277, 281 Aged Care Alliance 310 Aged Care Assessment Teams (ACATs) 106, 266–67, 271, 276, 279, 301 Aged Care Association of Victoria (ACAV) 311 aged care policy 4, 5, 6, 7, 265–92 alternatives 285–92 commercialisation 277–78

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index

criticism of 131–34 demand-side measures 281 history of 265–68, 273–79 market-based approach 281–89 see also aged care Aged Care Reform Strategy 83, 298 aged care services 4, 5, 6, 7, 223, 232 age-specific usage 133 culturally appropriate 5, 122 ethnic usage 131–33 Indigenous services 78–82, 271 special needs in 122–27 usage by proficiency in English 133 aged care workforce 290–91 aged dependency ratios see dependency ratios Ageing and the Family 356 ageing enterprise 296, 298 Ageing Men’s Health Project 105 ageing of the aged care population 20–21 ageing vulnerability index 213, 214 ageism 101 A Home for All: Cultural Care in a Nursing Home 130 Akiyama, H 352 Alsnih, R 243–44, 251 Alzheimer’s Australia 311–12 American Association of Retired Persons (AARP) 309, 313, 323 Anderson, I 5, 88 Andrews, K 150, 152, 312 Andrus Gerontological Centre Longitudinal Study of the Aging Family 358 Anglicare 311 annuities 206, 207 Anti-Discrimination Acts 373 Antonucci, TC 352 Arber, S 108–09 Arbitration Commission, Commonwealth 197, 198, 307 Arch, M 76 A Special and Distinctive Role in Adult Education: WEA Sydney 326 assimilation 120–21 Assistance with Aged Care and Housing for the Aged 231 Association of Independent Retirees (AIR) 309–10 Association of Retired Persons Australia (ARPA) 309 AusDiab Study 57 Australian Association of Adult and


387

Community Education (AAACE) 319 Australian Association of Adult Education 318 Australian Bureau of Statistics (ABS) 17, 18, 22, 45, 46, 58, 67–70, 147, 250, 291, 306, 343, 346, 356, 357 Australian Chamber of Commerce and Industry 154 Australian Constitution 167, 280 Australian Council of Disability (ACROD) 310 Australian Council of Educational Research 357 Australian Council of Social Service (ACOSS) 310 Australian Council of Trade Unions (ACTU) 154, 197 Australian Health Ministers 85, 170 Australian Housing and Urban Research Institute 223, 228 Australian Industry Group 154 Australian Institute for Health and Welfare (AIHW) 52, 168, 227, 268, 272, 290, 349, 356, 358 Australian Institute of Family Studies(AIFS) 10, 356, 357 Australian Labor Party 168, 197, 206, 221, 275, 298–99, 305–06, 366 Hawke government 194 Whitlam government 192, 193, 274 Australian Longitudinal Study on Women’s Health 344 Australian National Training Authority 320 Australian Nursing Home and Extended Care Association (ANHECA) 310 Australian Pensioners and Superannuants Federation (APSF) 308 Australian Research Council 313 Australian Seniors Computer Club Associations (ASCCA) 330 Australian Treasury/Treasurer 142, 281 Australians Working Together 152 Australia’s Ageing Society 303 average weekly hours worked 143 Averting the Old Age Crisis 303 baby boomers 6, 11–12, 25, 27–28, 30, 31, 36, 142, 169, 170, 173, 174, 177, 186, 219, 220, 224, 225, 228, 229, 236, 239, 253–54, 262, 303, 304, 307, 337, 355 Indigenous 66–7, 76 Bank of New South Wales 190

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388


Bannister, D 256 Barnes, A 340 Basic IT Enabling Skills Program 154 Bates, E 278 Bengtson, VL 335, 341, 342, 343, 345, 351 Berndt, C 74, 76 Berry, M 6 Beyond Cinderella – Towards a Learning Society 319 Biggs, S 11 Binstock, H 302, 304, 313 Birrell, B 113–14 birthplaces of older people, Australia, 1996– 2026 118 Bishop, B 301, 309 Bishop, J 66, 330 Board of Adult and Community Education 318, 329 Body Mass Index (BMI) 2 Bohr, N 17 Booth, H 25 Borowski, A 4, 6, 32, 151, 201, 303, 305, 306 Bowling, A 256 Bridge, C 220 British Election Survey 306 British Labour Party 306 Building Ageing Research Capacity (BARC) 358 burden of disease 52–58, 59 by disease 54–56 Bureau of Immigration, Multicultural and Population Research (BIMPR) 139 Burtles, B 36 Burton, L 341, 342, 343, 345, 351 Business Council of Australia 153 carer payments 276, 379 carers 267, 272, 276–77, 316 availability 289 Indigenous Australians 75, 92–93 see also women as carers Carers Australia 311–12 Carmichael, GA 21 Carnegie Report 331 Carney, T 7 cars 242, 244, 250–52, 255–60 access to 242, 244 alternatives to 259–60 impact on the environment 257–58 ownership 255 safety issues 257, 373


usage 250–52, 257 Carstensen, LL 352 Carter, J 10, 302 casemix funding 275, 288 Casey, RG 175–76 Castles, FG 22–23 Catalano, DA 345 Census of Population and Housing 18, 65, 344 Center for Research and Study of Ageing (University of Haifa) 358 childlessness 344–45 chronic illness/conditions 170–72, 186, 339 access to services 180 age related 177 funding for care 178 guidelines for care 179 impact on disability 171 team care for 182 churches 310 citizenship 380–82 Combined Pensioners and Superannuants Association (CPSA) 308 Combined Pensioners’Association (NSW) 308 Come in Cinderella 319 Commonwealth Medical Benefits Scheme 168 Commonwealth powers 167–69 Commonwealth State Housing Agreement (CSHA) 230–31, 236 Commonwealth, State and Territory Strategy on Healthy Ageing 86, 93 Commonwealth/state shared responsibility 168, 181–83, 299, 300 Community Aged Care Packages (CACPs) 231, 270–71, 276, 279, 349 ethnic usage 128, 133 Indigenous usage 78–79, 82, 91 community care/support services 89, 177, 181, 182, 222, 231–32, 266, 271–72, 275, 276 day programs 177 Indigenous usage 79 preference for 127, 128, 132, 136, 222, 232 service providers 231 community colleges 321, 322, 324 Community Options (COPS) 276 Community Sector Support Fund 308, 309 community visitors 276, 279 compulsory retirement 372, 374

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index

computer usage/internet 317, 329–30 Concord Coalition (US) 204 Connecting with Computers 330 consumer rights 169, 223 continuity of care 178, 267 Coordinated Care Trials 278 cost containment 297 Costello, P 9, 149, 213 Cotter, P 5 Council of Adult Education 327 Council of Australian Governments (COAG) 278, 299 Council(s) on the Ageing (COTA) 308, 309, 312, 329 by state activities 329 COTA-over 50s Alliance 309 Creelman, A 312 Crimmins, EM 25–26 crisis of ageing 303–04 US debate 302–03, 304 Crown, WH 32, 303 cultural diversity/multiculturalism 119–21, 337, 340–41 integration 120 culturally and linguistically diverse (CALD) 5, 28–29, 118 Daatland, SO 11 Day, C 33 Day Therapy Centres 270 Deakin, A 192 death rate 173, 339 age specific 43–44, 60 by gender 104, 106 see also mortality decommodification 297 deemed income 369 de facto relationships 346 defined accumulation funds 200 definition of aged 16 Indigenous Australians 74–75 delayed childbearing 343–44 dementia 322, 332 Dementia Awareness Week 312 democratic regimes 347 demographic transitions 335, 338, 347 demography of ageing 16, 170 by ethnicity 28–29 composition of aged population 27–29 gender differences 28 median age of population 19 number of aged 20


389

of Indigenous Australians 66–67 spatial distribution 29–30 Demos 11, 12, 337 dental provision 168, 180 Department of Community Services and Health 130 Department of Education and Employment (UK) 330 Department of Education, Science and Training 320 Department of Family and Community Services 348, 349–50, 357, 358 Department of Health and Aged Care 129, 357 Department of Health and Ageing 131 Department of Technical Education 324 Department of Veterans’ Affairs 182 dependency 378, 379 dependency ratios 9, 10, 30–32, 299–300, 303 De Vaus, D 357 Devitt, J 88 disability 4–5, 41, 45, 47–49, 53–54, 59– 60, 105, 176, 376 age specific 59 by gender 105 by health condition 47–48 definitions of 291 of Indigenous Australians 71–75 Disability Adjusted Life Year (DALY) 52, 56, 59 Disability, Ageing and Carers Survey 103 disability pension, eligibility for 149 discouraged job seekers 147 Disney, J 297 distance learning 317 diversity markers 101 divorce 12, 211, 346 Dixon, D 196 double dipping 152, 205, 379 double jeopardy (ageism and ethnicity) 121 (ageism and sexism) 101 Downing, RI 366 Dowrick, S 33 driver’s licence 251–52 requirements for holding 259 Duckett, S 5, 223 Dychtwald, K 11 early retirement 5, 150, 151–52, 319, 375 Easterlin, R 10 Economic Implications of an Ageing Australia 32–37,

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390


246, 301, 348 critiques of 33–35 Economic Planning and Advisory Council (EPAC) 148, 209, 303 Edgar, D 356 education, lifelong see lifelong education educational activities 317 costs 317–18, 321 cultural courses 320 health benefits 319, 320, 332 nursing home involvement 330–31 participation surveys 322–24 policy 318–22 elder abuse 276, 364 employers 145, 153 employment 102, 142–64 see also labour force participation early exit from 142, 151 employment policy, proposals 163–64 Encel, S 5, 7 end-of-life decision making 364 equal opportunity laws 377 Esping-Andersen, G 297 ethnic aged 117–39 English proficiency of 125–27 policy suggestions for 138–39 recent arrivals 124–25 Ethnic Aged Care Framework 131, Ethnic Aged Services Grants (EASG) 131 ethnic diversity 118–19 ethnic-specific needs 118, 122–27 European Union Council 370 Expectations of Life: Increasing the Options for the 21st Century 319 Extended Aged Care at Home (EACH) 89, 231, 270–71, 272, 279, 349 Extended Care Centres 301 factors affecting employment prospects 145 family 334–59 obligations 335, 354 public policy 347–50 family care see community care Family Characteristics Survey 346 Family in the Postmodern World 352 Family Law legislation 211 Faure Report 317, 318 fertility 4, 170, 334–35, 337, 339–40, 342, 343, 345, 348–50 effects of social change on 23 effects on population ageing 21–23,


26–27 total fertility rate (TFR) 21–22 Field, J 136 financial planning 364 Fine, M 6 Flexible Service 271 Fogel, RW 62 friendship 352–53 for-profit community care providers 278 Foster, C 196 Fraser, M 192, 193 Freedman, VA 51, 59 Fries, J 58 Future Fund 199 Gates, RC 366 gender-related differences 99–114 in employment 104 in family roles 342–43 in health experiences 104–06 in housing 103 in pension eligibility 102 in travel patterns 246, 248 in retirement income 104, 211 Generation X 220, 337, 355 gerontological research 100, 101, 313 feminist perspective 100, 109 masculinist bias 100 political economy framework 101 Gibson, D 87, 89 Giddens, A 352 Global Ageing and the Challenge to Families 358 Global Burden of Disease Study 52 Global Conference on Lifelong Learning 318 government outlays see public expenditure grandparents 343, 344, 346–47, 364 grey power 7, 297, 302–04 Griew, R 87, 89 Growing Older 320 Growth, Economic Competitiveness and Employment 318 Guest, R 33 Gutmann, D 110 Handbook of Ageing and the Social Sciences 341 Harvey, D 243, 254 Hawke, R 194 health 40–62, 104–106, 253 by sex 54 of Indigenous Australians 70–74, 85–86 prevention programs 177–78

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index

relationship to marital status 106 risk factors 45–46, 56–58, 178 self-reported 46, 70–74 health care services 4, 5, 7, 40, 266 access to 179 coordination 178 culturally appropriate service provision 88–89 effect of ageing on provision of 169 integration of 181 performance-based funding 169 see also medical care services health expenditure/costs 7, 40, 61–62, 169, 266, 271, 274 funding systems 176 impact of ageing on 173–74 impact of technology on 174 projections 174–75 integrated purchaser model 182 health insurance 288, 301 health policy 167–86 suggestions for 181–85, 186 health workforce 179, 182–83 Healthy Ageing Research Agenda 358 Healthy Ageing Research Network 358 Hensher, D 243–44, 251–52 High Court 374 Hogan Review 283–86, 289, 290, 310 Hogan, WP 229, 282 Home and Community Care Act 83 Home and Community Care (HACC) services 133, 180, 222, 234, 270, 276, 278, 279, 301–02, 349 Indigenous usage 79–81, 83 Home and Independence Study 112 home equity conversion (HEC) 228–29 homelessness 230 home maintenance/modification 232–36 home ownership 221, 222, 223, 224, 226, 365 as asset 227 as source of wealth 228 equity value 228 home units 221, 225 Hospital Benefits Act 274 hospitalisation 177, 181, 266 bed days 266 Household Income and Labour Dynamics in Australia (HILDA) Panel Study 357 household/family types 336, 337, 342, 351 cohabitation 336 conjugal 336


391

nuclear 336 parenthood within cohabitation 336, premarital single 336 reconstructed 343, 354 single parenthood 336, 343, 346 see also de facto relationships House of Representatives Committee for Long Term Strategies 319 House of Representatives Standing Committee on Community Affairs 319 House of Representatives Standing Committee on Expenditure 299 house prices 228 housing 6, 103, 221–37, 364 affordability 221 impact of post-retirement income 225–26 Indigenous 91 medium density 224 options for the vulnerable 223 tenure 103 value 223, 228 see also home ownership housing costs 231 owners and tenants 227 housing policy 221, 222, 223, 236–37 assistance 222 first homebuyers 222 home equity conversion 228–29 impact of life expectancy 224 housing stock 221, 223 household work 110, 111 Howard, J 149, 299 Huber, J 337, 355 Hughes, ME 351, 353, 356 Human Rights and Equal Opportunity Commission (HREOC) 150, 374 immigration 117 by country of origin 117–18 impact on population ageing 26–27 income 102–03 of owners and tenants 227 proportion paid as rent 227 income inequality 196, 254 income stream 207–08, 213 Income Tax Assessment Act 190, 191 Indigenous Australians 5, 42, 65–95 age by gender 68, 69 care services for young-old 87–88 eligibility for age pension 76, 192 impact of assimilation policies 76 impact of protection policies 76

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392


policy suggestions for 95 spatial distribution 81 survival rate 70–71 see also aged care Industrial Relations Reform Act 373 informal care 176–77, 266, 267, 272 availability of carers 290 informal learning 322–23 book clubs 322–23 infrastructure 242, 254–55, 260, 281 Inglehart, R 336 Inquiry into Long-Term Strategies to Address the Ageing of the Australian Population in the Next 40 Years 348 Institute of Technology 325 institutional discrimination 121 Insurance and Superannuation Commission 202 intergenerational equity 222, 223, 229 intergenerational relations 7, 31, 334–59 Indigenous Australians 75–76 Intergenerational Report 32–37, 149, 150, 208– 09, 223, 281, 282, 301, 304 critiques of 33–35 intergenerational support 31 International Monetary Fund 214 International Social Science Survey 357 International Year of Older People (IYOP) 328 Internet see computer usage interpersonal relationships 350–52 Investing in Australia’s Aged Care 301 investments 369 Is Retirement Working? 319 Jackson, N 340 Jackson, O 77, 78 Jobwise Outreach 153 Johnson, CL 345 Jones, B 11 Kahn, RL 352 Keating, P 194, 203, 209, 299 Kendig, H 223, 356 Kennewell-Taylor, B 77, 78 Kewley, TH 193 Kippen, R, 24, 26, 27 Kirkwood, T 2 knowledge-based economy 320 labour force participation 5, 34, 35, 142– 49, 370, 376, 377–78


by age 145 by Indigenous Australians 95 gender differences 143–45, 376 of women 147 part-time 149, 151 projections 143, 145, 151 see also employment labour force participation rates 143, 145 by education, gender and age 147 by employment type 146 retention rates for older persons 153 Lapsley, H 278 Laslett, P 11, 330, 355 Later Years of Queensland 308 Latham, M 202 law 363–82 impacts on policy 380 impact on social participation 381 Law Reform Commission, NSW 373 Law Reform Commission, Victoria 374 Learning, Education, Training and Information in the Third Age 331 Learning in Later Life 331 learning institutions 324–28 funding 324 history 324 Learning to Be 317 leisure courses 321, 322 Lesthaeghe, R 335, 336 Liberal-National coalition 4, 7, 168, 192, 305, 366 Fraser government 192, 193 Howard government 212, 267, 277, 281, 297, 299 Menzies government 274 life expectancy 1–2, 5, 24–25, 40–42, 58– 61, 170, 172–73, 266, 339 disability-free life expectancy (DFLE) 50–52 effects of obesity on 25–26, 57 gender differences 25, 41–42, 43, 339 healthy life expectancy (HALE) 50–55 implications of changes in 2, 11 international comparisons 51–52 of Indigenous Australians 87 see also longevity lifelong education/learning 316–32 definition 317–18 funding 318, 321, 324 participation 322–24 proposed federal technical colleges 325 Lifelong Learning – Life Transitions and the

6/3/07 3:48:41 PM

index

Older Learner 317 Lifelong Learning – Key Issues 320 lifestyle housing 224 location of housing 223, 224, 228, 249 in relation to transport 224, 225, 242–43 of retirement housing 224 longevity 10, 24, 25, 100–01, 107, 209, 342 see also life expectancy Long-Term Care (LTC), private and national 288–89 Lopez, AD 52 Lowenstein, A 358 lump-sum retirement benefits 152, 191, 200, 205, 207, 208, 367–68, 371, 376, 379 Luscher, K 354 MacKay, H 12 Manton, KG 50 marginalisation of older people 9 of Indigenous Australians 93–95 market pillar of retirement income 190–92, 194, 199 Marottoli, R 256 Marras, J 335 marriage patterns/matrimony 335, 337, 340, 356 beneficial effects of 350–51 Martin, LG 51, 59 Marx, Karl 221 Mathers, C 4, 104, 170 mature-age workers 5, 371, 375 see also older workers mature-age students 324–25 Mature Age Employer Champion Award 153 Mature Age Industry Strategy 153 Mature Age Worker Tax Offset 154 Mature Age Workplace Strategy 153 McCallum, J 104, 356 McCormack, J 305, 306 McDonald, P 4, 21, 22, 23, 24, 26, 27, 33 means tests 192, 193, 195, 365, 366, 369 for retirement accommodation 229–30, 232 means-tested programs 189, 192, 227–28, 230, 272, 283, 297, 300 Mechanics Institutes 324 medical care services 5–6, 279, 373 medical profession 169 Medicare/Medibank 168, 176, 179, 185–86 Medicare Gold 184, 306 Melbourne Institute of Applied Economic


393

and Social Research 357 Melbourne Technical College 325 Metz, D 244, 248 Millennial Children 337 Minchin, N 206 Ministerial Advisory Committee of Senior Victorians 302 Ministerial Advisory Committee on Ageing (NSW) 302, 346–47 Mission Australia 311 mobility 6, 239–44, 253, 256 Moors, G 336 morbidity 172–73 see also population health Morris, J 249–50 mortality rates 1, 4, 41–45, 58, 334, 339, 341 age specific 43–45 causes of 1, 2, 4–5 effects on population ageing 24–26 of Indigenous Australians 67, 70, 341 Mullan, P 9 multiculturalism see cultural diversity multigenerational arrangements 342 Multipurpose Service (MPs) 78–79, 271 Murdoch, Iris 322 Murray, CJL 52 Myer Foundation 232 Myles, J 196–97 National Aboriginal and Torres Strait Islander Reference Group 83 National Aboriginal and Torres Strait Islander Survey 70 National Aged Care Advisory Committee 302 National Aged Care Alliance 310 National Aged Care Workforce Strategy 290 National Board of Employment, Education and Training (NBEET) 320 National Centre for Social and Economic Modelling (NATSEM) 349, 356 National Commission of Audit (NCA) 281 299–300 National Council of Women 308 National Health and Medical Research Council 168, 313, 357 National Health and Pensions Bill 175 National Health Surveys 46, 47, 70 National Heart Foundation 45 National Institute of Labour Studies 290 National Nutrition Surveys 57

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394


National Population Council 10 National Respite for Carers Program 271 National Seniors Association (NSA) 308–09 National Strategic Framework for Aboriginal and Torres Strait Islander Health 85–86 National Strategy for an Ageing Australia (NSAA) 93, 15 0–52, 301 criticism of 150–52 National Superannuation Committee of Inquiry (chair, Hancock) 193 Nelson, B 330 neo-liberalism 297–302, 313, 347, 363, 365, 378, 380, 381 New South Wales Anti-Discrimination Board 374 New South Wales Council of Social Service (NCOSS) 310 New South Wales Healthy Ageing Framework 93–94 New South Wales Law and Justice Foundation 364, 375 Nixon, R 304 non-profit agencies 274, 275 Northern Territory Health Department 87 nursing home benefits 274, 300 obesity 2, 25–26 occupational pensions 189 see also superannuation Occupational Superannuation Standards Act 198 Offices of Ageing 300, 301 Old Age and Autonomy: The Role of Service Systems and Intergenerational Family Solidarity (OASIS) 358 older men 99–114 Older People’s Welfare Council 308 Older Persons Electronic Network (OPEN) 329 older voters 7, 304–07 older women 5, 6, 99–114, 190, 221, 224, 239, 241, 246, 346 older workers 9, 34, 142, 152 see also workforce participation Olsberg, D 6, 228, 229 Olshansky, SJ 50 Organisation for Economic Co-operation and Development (OECD) 143, 146, 150, 169, 239, 257, 261–62, 318, 370 owner-occupancy 227 Ozanne, E 7


paid work see employment Parsons, T 100 Participation Support for a More Equitable Society (McClure Report) 152 Partners in Culturally Appropriate Care (PICAC) 131 part-time work 143 see also labour force participation Pension Bonus Scheme 213 Pensioners Health Card 310 Peterson, P 8, 304 Pharmaceutical Benefits Scheme 168, 179– 80, 301 Phillipson, C 354 Pickard, L 291 Pierson, P 196–97 pillars of retirement income 190, 366 Pillemer, K 354 Pinder, R 322, 326 politics 296–313 population ageing 4, 7–11, 13, 15–39, 239, 334–35, 355 economic impact of 209 implications for demand on services 40 implications for health expenditures 40, 61–62 policy implications of 4, 30–37 role of law 7 see also aged care policy population health, changes in 49–52 compression of morbidity hypothesis 50, 59, 61, 172 dynamic equilibrium explanation 50 expansion of morbidity hypothesis 49– 50, 61 impact on health expenditure 173–74 Medawar hypothesis 172 population projections 16–17, 29, 31, 58, 59, 226, 231, 340 by birthplace 118 positive ageing 11, 332 Poverty Inquiry 374 Premiers’ Conference 299 pressure groups 307–13, 313 Prices and Incomes Accord 197 primary health care 177–78, 179, 181–83 assessments for elderly 182 for chronic conditions 178–79 multidisciplinary approach 182 private savings (third pillar) 189, 194, 210, 212, 366 Probus 325

6/3/07 3:48:42 PM

index

Productivity Commission 32–36, 143, 145, 174, 208, 215, 246, 247, 261–62, 290, 296, 348, 363 property taxes 227 public expenditure 297 see also health expenditure public housing 221, 227, 230–32 reduction in provision 221, 227 waiting lists for 222, 230 public pillar of retirement income 192–93, 208–09 see also pensions public transport 249 usage, by age 246–47, 249, 252, 255–56 Quality and Equity in Aged Care 134 quality of life 256–57, 330 Queensland Aged Care Strategy 85 Ranzijn, R 5 Rapson, V 113–14 Reasonable Benefit Limits (RBLs) 206, 207, 213, 216, 367, 370 redundancy payments 371 religious organisations 335 see also churches rent assistance 227–28, 230 replacement migration policy 337, 347 research into ageing family 356–59 Research Network on Ageing Well 357 Research School of Social Sciences, Australian National University 357 residential aged care services 6, 177, 222, 223, 268, 271, 272, 283, 364, 378 clustering 129, 130 Indigenous 79, 89 residential regulatory service accreditation 279 residential facilities 266, 297 entry criteria 275 high care 266, 269–70, 278 hostels 275 low care 266, 270 nursing homes 266, 273–75 quality of care in 275, 279 resources, differences by gender family 106–09 health 104–06 wealth 102–04 retirement communities 353 retirement homes 221 retirement income 5, 6, 16, 148–50, 364,


395

365–70, 376 adequacy 202–03 changes in 189, 215–16 compulsory national contributory scheme 148, 149 equity 210–12 Indigenous 94 three pillar system 149, 190 see also superannuation and pensions retirement income policy 145, 189–216 objectives 194, 210–12 remaining challenges 214 Reynolds, SL 25–26 Rimmer, S 7 Rosenbloom, S 244, 249–50, 251, 252, 258 Rosenthan, L 341, 342, 343, 345, 351 Rowland, DT 101 Royal Melbourne Institute of Technology (RMIT) 325 Russell, C 5 Saito, Y 25 –26 Salt, B 12 School of Arts 324 Schultz, JH 32, 201, 303 self-funded retirees 297, 321, 371 Self-Funded Retirees of Western Australia 308 Senate Select Committee on Superannuation 202–03, 208 Senate Standing Committee on Employment, Education and Training 319 Senior Citizens Clubs 111 Senior Generation 337 Seniors Health Card 310 Serow, WJ 22 service pensions 193, 209 sexism 101 see also discrimination shared care 280 Sidney Myer Fund 312 Skidmore P 337, 355 Smith, LR 5 social/human capital 135–37, 138, Becker definition 137 social insurance 189, 193 socialisation patterns 335 social networks 106–09, 352 social participation 377, 380–81 social policy 297–315, 379 social regression 345 social security system 148–55, 368

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396


social wage 197 Sontag, S 109 Spouse Accounts 211 State Education Board (Victoria) 325 stolen generation 76–77 suburbanisation 254–55 superannuation 103–04, 148–49, 190–91, 194, 196366–68, 371, 373 allocated schemes 369 award superannuation 197, 198, 200 contribution splitting 213 coverage 191, 196–201 defined benefit plans 200, 201 discrimination in 373 eligibility for 191, 198 employer contributions 190, 198 occupational 366, 378 regulation law 368 voluntary contributions 204 see also retirement income superannuation funds 198, 200 assets 199 choice of 214 defined contribution/accumulation 200, 201 regulation of 201–02 Superannuation Guarantee (SG) 197, 199, 200, 209, 214, 371 Superannuation Guarantee Charge 103–04, 148, 149 Superannuation Guarantee Charge Act 198 Superannuation Industry (Supervision) Act 202 Supported Accommodation Assistance Program (SAAP) 230, 236 Surkin, J 335, 336, 341, 352 Survey of Disability, Ageing and Carers 47 Survey of Income and Program Participation (US) 51 Swerissen, H 5 Sydney Technical College 324 Sykes, R 83 TAFE system 325 taxation 33, 150, 154, 190–91, 194, 297, 303, 305, 320, 321, 322, 367–69, 371, 373 death duties 365 expenditures 191 and superannuation 190–91, 204–06, 208, 212, 216 of housing investment 228


of inheritance 229 Teaching and Learning Towards the Learning Society 318 technological change 240 Temple, J 29 tenants 221, 227, 230 The Challenge of an Ageing Population 301 The Fourth Age of Learning Report 330 The Third Age 319 The Way Forward 270, 301 Third Age 4, 30, 224 Thompson, EH 101 Thornthwaite, I 376 Tickle, I 25 Tobias, M 177 Torres, S 123 training 319, 320 Training Account 154 Transition to Work 152–53 transport 6, 240 transport policy issues 258–62 travel behaviour 240, 241–42, 244–50 by number of trips 247, 251 by type of transport 245, 246, 247, 250 cross-national study 244–45, 246, 252 underemployment 155 unemployment gender differences 160–61 impacts of 156–60 long-term 5, 9, 142–44, 146–47, 155 mature-age 155–63 rates, by education, gender and age 147 United States Medicare costs 173 UNESCO Institute of Education 317, 318 Universities of the Third Age (U3A) 111, 317, 327–28 U3A Online 328 university extension courses 317, 321 University of Melbourne 325 Extension Board 327 University of New England 326 University of Sheffield 322 user-pays policies 7, 267, 278, 282 value orientation 123–24, 336–37, 363 Van de Kaa, DJ 341 Veterans Home Care program 270 Victorian Activity and Travel Survey (VATA) 246, 248 Victorian Association of Health and Extended Care (VAHEC) 311

6/3/07 3:48:43 PM

index

Victorian Burden of Disease Study 59 Victorian Indigenous and Housing Study 91 Visitable Housing Law (UK) 234 vocational education 320, 321, 322, 324, 325 voluntary health insurance 274 voluntary travel 243 volunteers 316, 317, 324 Waite, LJ 351, 353, 356 Walker, A 302, 307, 313 walking 244, 248 welfare state regimes 347 welfare system 7, 9, 365 Weston, R 22–23 Whitlam, EG 192, 193 widowhood 107, 109–10 Winfrey, Oprah 323 women and superannuation 191, 204, 210–12, 215 women as carers 132, 176, 276, 343, 344


397

married 148 work incentives/disincentives 150–51, 153, 154 child care 151 maternity leave 151 women voters 307 Workers Education Association 317, 322, 323, 325–27, 329 funding 322 history 326 Working Men’s Colleges 324 World Bank 148–49, 214, 300, 303, 364 World Values Survey 357 World Health Organisation (WHO) 364 WHO International Classification of Impairments, Disabilities and Handicaps 47 years lost, by disease and sex 54 years lost due to disability (YLD) 53–54

6/3/07 3:48:43 PM

This new text covers a wide range of issues, including health, retirement incomes, aged care, family relations, employment, housing and town planning. Special attention is given to the particular structural disadvantages affecting women, Aboriginal Australians and ethnic minorities. This comprehensive new volume will be an essential reference for policy makers and for students in social policy, sociology, gerontology and public health. It constitutes a distinctive Australian contribution to international debates on the implications of an ageing world. ‘Ageing is everybody’s business as we enter previously uncharted demographic waters with pundits warning of a geriatric tidal wave and dangerous demography. In this excellent book we have Australia’s leading scholars of ageing – demographers, sociologists, health economists and social policy analysts – assembling and analysing new evidence on ageing. Our baby boomers are entering retirement and face the contradictions of longer life, better health, but greater chronicity, more wealth, but financial uncertainty. These and more contradictions pose enormous policy challenges for governments and communities. DR ADAM GRAYCAR Head, Cabinet Office, Government of South Australia and Australia’s first Commissioner for the Ageing (in South Australia) from 1985 to 1990

UNSW

PRESS

longevityfullcoverv2.indd 1

Longevity and SOCIAL CHANGE in AUSTR ALIA

B OROW SK I E NC E L OZ A N N E

UNSW PRESS

LONGEVITY and SOCIAL CHANGE in AUSTRALIA

Australia, like other industrialised countries, confronts the prospect of a steadily ageing population. The expectation of life has increased spectacularly during the past century, putting Australia second only to Japan.

BOROW SK I

 E NC E L  OZ A N N E

8/3/07 11:39:42 AM

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