Politics eroding super benefits

12 Mar 2015

ROSS EASTGATE TOWNSVILLE BULLETIN MARCH 12, 2015

DEJA VU obviously ain’t what it used to be.

Fifty years ago ADF recruits contributed to a compulsory, self-funded, non-transferable, superannuation scheme with no employer contributions.

It supposedly took into account the generally short nature of full-time military service by allowing members to commute a portion of their final benefit to help fund a home or business purchase on retirement, with a residual preserved benefit based on life expectancy.

It would guarantee their comfort through their usually early retirement.

Or so they were told.

Somewhere in between politicians intervened, the scheme was rolled into commonwealth public service superannuation schemes and its funds and assets absorbed into consolidated revenue.

While the commutation was interpreted by some as a loan against entitlements, it is simply a one-off payment that many DFRDB recipients discovered to their cost exceeded “reasonable benefit limits”, whatever they were.

The reality for most DFRDB recipients is that their residual fortnightly benefit is nowhere sufficient to sustain even a basic lifestyle, particularly when recipients of more generous pension schemes rule that military pensions should be indexed below CPI.

DFRDB was superseded by the Military Superannuation Benefits Scheme which is now also to be replaced with yet another scheme which politicians claim will provide better benefits to ADF members in their retirement.

Or so they are being told.

The same politicians have also floated the idea of selling or privatising the Defence Housing Authority.

ADF recruits 50 years ago understood when they married they would be entitled to a defence-provided married quarter at a subsidised rental and even marriage allowance.

Married quarter patches provided cheap accommodation with built-in social support in the event of individual or group crises.

Large villages often comprising imported, prefabricated, basic accommodation were constructed contiguous to major defence bases.

Married quarters varied in quality but apart from those allocated to some senior appointments were generally less than glamorous.

Even surplus wartime huts were pressed into service when extended families outgrew basic three-bedroom quarters.

Defence even assumed control of the 1956 Melbourne Olympic Games village as married accommodation, the least said about which the better.

More enlightened minds sold off defence housing, bulldozed married quarter villages and began a process of moving married ADF personnel into housing controlled by DHA and supposedly better integrated with the wider civilian community.

It has not been the perfect solution, but at least it has been an agency with some understanding of the peculiar circumstances and needs of peripatetic defence families.

For many serving ADF families, renting rather than buying remains a preferred option.

Most separating ADF personal still have to contemplate purchasing their first home while attempting to find rewarding employment in a society which often treats them with suspicion.

Appropriate pay and conditions, suitable accommodation during service and a superannuation scheme adequate to their long-term needs often influence whether individuals serve on or separate.

Politicians promise but outcomes don’t always match expectations.

It’s deja vu all over again.