Parliamentary Committee on Occupational Safety, Rehabilitation and Compensation: 67 is the New 40

The Hon. S.W. KEY (Ashford) (11:19): I move:

That the 27^th report of the committee, entitled '67 is the new 40—inquiry into work, health and safety and workers compensation issues associated with people working longer', be noted.

The occupational safety, rehabilitation and compensation committee—that committee really does need a new name—has had an ongoing interest in issues associated with an ageing workforce. The committee provided a briefing report to this house in March 2013, following a meeting with the then commissioner for ageing and disability, the Hon. Susan Ryan AO. Since then, there has been significant interest in the community in finding ways to assist older people to continue in the workforce for longer. Eligibility for the age pension is increasing over the next few decades, with the expectation that people will continue in the workforce until they are at least 70 years of age.

As I said, 67 is the new 40. We are all getting older and we are all getting better at the same time, in my view, particularly on this side. There is a lot of improvement over on that side, too, and certainly in you, Deputy Speaker. The committee has examined a number of areas affecting older Australian workers, including workforce participation and barriers to employment; access to workers' compensation and work insurance; different insurance coverage for workers at different ages, such as travel insurance (I was very concerned to receive evidence on that); superannuation and early retirement; healthy ageing; support, education and training; and re-entry into the workforce following early retirement, redundancy or for other reasons.

We only received a small number of submissions. We heard evidence from the Council on the Ageing (COTA) in particular and undertook research on emerging issues associated with the ageing workforce. Macro-economic factors that affect employment, savings and investments are affecting decisions that individuals make about their future. Technological change, while helpful, is also disrupting many areas of our life, reshaping the way businesses operate and affecting the labour market. The shortage of young skilled workers to replace retiring older workers is one reason that older workers are encouraged to remain in the workforce.

As I have mentioned before, the Bureau of Statistics considers anyone over the age of 45 a mature-age worker. The proportion of people over 65 years is increasing and will double by 2055. I noticed in a recent InDaily article that they are certainly looking at this issue, the headline being 'Workplace age discrimination hitting those as young as 45'. That article also talked about the Australian Human Rights Commission report, Willing to Work, but also covered a whole lot of areas that are happening in South Australia, which I think are a great concern to all of us.

There are more mature-age people in South Australia than in the nation as a whole, which of course presents some different challenges and opportunities. While there is no longer a compulsory retirement age, many people choose to retire when they become eligible for an age pension or their superannuation provisions, whatever they might be, if they have it. However, for a variety of reasons, people are deciding to work longer. A report into the workforce participation rate of workers aged over 55, comparing 34 OECD countries, found that, while New Zealand ranked second behind Iceland, Australia achieved the midway point of 16.

Nationally, people aged over 55 make up about a quarter of the population but only 16 per cent of the workforce. In 2013, the Economic and Finance Committee found the workforce participation rate of people over 55 in South Australia was below the national average. More women in older groups are now working than in previous generations, but the male population participation rate has been declining. This is largely due to technological changes that impact on mainly traditionally male occupations.

The Australian Human Rights Commission and COTA SA found that the main barriers to workforce participation of older people included discrimination due to underlying assumptions and stereotypes associated with ageing, the lack of work flexibility, the lack of training and upskilling opportunities, and physical injury or illness. Good work is beneficial for physical and mental health, but unsafe, unhealthy work reduces the prospect of healthy ageing and places increasing pressure on public health and social services.

We are all living longer, but white-collar workers have a longer life expectancy than blue-collar workers because their jobs involve more risks to health and safety. Due to the nature of work undertaken by many blue-collar workers, they are more likely to suffer serious physical injury and illness. Lower levels of education reduce their opportunity to move into other areas of employment and successfully complete retraining.

Physical and emotional demands on workers—a topic particularly for today—in the aged-care sector and many health-related fields adversely affect the ability of those workers to work longer. There is an increasing need for employers to prevent work-related injuries and to reduce the risks of ageing associated with work processes by redesigning work and work practices, ensuring healthy work environments, providing training opportunities and promoting health-related programs.

Most employers are aware of the importance of maintaining a healthy workforce but have limited knowledge of what they can do. Lack of flexible work arrangements may prevent workers from investing in their own health and wellbeing, and they may not be aware of the actions they can take. I would also say—I think this is an important aside—that, because of the high number of small businesses we have in South Australia, there are also some limits to what employers and people in workplaces can actually do without a lot of extra costs that they are not able to bear.

Workers who retire prematurely or lose their job risk the double jeopardy of having insufficient funds for their retirement and potentially not being able to find other suitable employment. White-collar workers are more likely to live longer and usually have access to healthier workplaces and flexible work arrangements. They are able to transition to retirement by reducing their hours or the number of days they work, although flexible work arrangements are not available to everyone. I cannot count the number of constituents who have come to me where really, if they had had a bit more flexibility in their workplace, they would have been able to work for much longer and more efficiently. So, we are certainly not there yet.

The South Australian Fair Work Act does not provide similar provisions to those of the commonwealth legislation in enabling people to make an application to their employer. As I said, flexible work arrangements are important for all workers, and we need to make sure that those arrangements are available to benefit all workers, particularly young ones, who may have family responsibilities, and older workers, who have a diverse number of responsibilities and needs.

I guess because of the age I am, I am very aware of my friends having caring responsibilities that include partners, friends and parents. Because of the high number of people who live by themselves, they are also taking on responsibility for neighbours. Grandchildren also seem to dominate most of my friends' lives. We need to take all those things into consideration if we seriously want people to stay in the workplace.

There is also a need to make sure that people can financially stay in the workplace and that we have proper provisions for retirement. Many people combine their retirement with joining that absolutely wonderful part of our community, the volunteers, who do a lot of unpaid work and take up a lot of responsibility in the community. We are told that in our state we are looking at a contribution of about $5 billion by volunteers into our state economy.

Flexible work arrangements, combined with the transition to retirement, allow older workers to combine working with being actively engaged with other interests, activities and family responsibilities. Many large employers embrace a multigenerational workforce and support older workers' transition to retirement. Many small employers, as I have said before, would like to do all these things, but they are really just not as available.

Our committee believes that flexible work arrangements will benefit all workers. For this reason, the committee recommends that the South Australian Fair Work Act be amended to reflect the flexible work arrangements as laid out in the commonwealth legislation The committee found that a wide range of information is available to older workers but that it is scattered. It is not easy for older people, or anybody, to locate the information that supports their interests or wellbeing and the economic opportunities available to them.

I must make special mention of COTA; it is a fantastic organisation and one I often ring up to get advice for constituents and put constituents in touch with in regard to a whole lot of issues. Because information is quite literally all over the place, the committee recommends that the Minister for Ageing develop a whole-of-government internet gateway to address this gap. This would just be one of the ways in which we could try to put that information together.

The committee recognises the limitation of this particular inquiry report and considers it an ongoing matter for the committee to monitor. We started on this road in the last session of parliament, and it seems to be an issue that keeps coming up in our committee. We have accepted the fact that the committee needs to look at this in an ongoing way, and I know it would also be of interest to the parliament.

The committee prides itself on making practical recommendations, and for this reason we have four recommendations that we believe identify policy gaps that will assist employers and older workers. The macro-economic factors are beyond the control of any one individual in the labour market, and technology is changing the way business is conducted and operates. Organisations that embrace a multigenerational workforce and acknowledge the different contributions of all workers will certainly benefit in their strategic planning in the future.

Finally, I would like to thank the Hon. Susan Ryan AO for her attendance at the committee and for her ongoing contact with the committee, and for the assistance of ReturnToWorkSA in providing statistical and research reports that helped the committee in its deliberations. As I said, I would like to thank all those who made submissions to the committee, they really were appreciated, and COTA, for their substantial contribution, and for giving up their time to appear before the committee.

I would like to thank the members of the committee. We have a great committee, which comprises the member for Fisher; the member for Schubert; until recently, we had the Hon. Gerry Kandelaars, who retired and is very much missed, but he has been ably replaced by the Hon. Justin Hanson; the Hon. John Dawkins; and the Hon. John Darley. I also express my appreciation to our excellent committee staff, Ms Sue Sedivy, and research officer, Mr Peter Knapp.

Mr KNOLL (Schubert) (11:33): I rise to speak on the latest inquiry from 'the little committee that could', the hardest working committee in the parliament. For a long time, the input from parliamentary committee members was done for love rather than for money. Certainly, we all had an enthusiastic focus on ensuring that the committee came up with some reasonable bodies of work that help to improve our work life. This issue is one that has been coming at us for a long time. It is a demographic tsunami that has been slowly and gently heading towards us since the end of the Second World War, and we are now coming into the early phases of the retirement of whole swathes of the baby boomer generation.

These changes have important implications for individuals themselves and also for the broader economy. This is also coupled with the fact that life expectancy has vastly improved. When the pension scheme was first introduced in Australia, the average life expectancy was not even at the age of retirement. Now we see that on average people are living 20-plus years beyond the age of retirement. We have had to grapple with the fact that there is going to be a large proportion of the country who no longer works. What does that mean for our society and for these individuals?

Firstly, from a personal point of view, trying to do things to keep people in work longer is important because superannuation reform as it existed in the 1990s means that people who are now retiring have only had superannuation for 20 or 30 years, and those nest eggs are not potentially enough to retire on. It is obviously not an issue for parliamentarians who have been in this parliament since 2002 or longer, but it is a real issue. There is a personal and economic case for an individual to say, 'Hey, I need to do what I can to stay in the workforce for longer.'

From a money point of view, that is certainly an issue, but there is also an issue around transition. The number of older people who I have spoken to—and certainly the workers who worked for me who were around the retirement age—wanted to transition into retirement because they had seen friends around them who had had a hard stop date. Unless they had something to go on to, some sort of volunteer work or activity to keep them busy, they actually quickly deteriorated in retirement.

There is this idea of transitioning into retirement. In the same way that we look at working mothers and fathers going into part-time roles, older people should and could be afforded the same level of flexibility. That is the key recommendation of our committee, and something we are all very committed to, because we want to make sure that people step down into retirement so they can transition not only their work life but the other side of their non-work life—their family life, their recreational life. We want to ensure that that transition is done in way that they can adjust and keep themselves happy, healthy and fulfilled.

There are also some real positive health benefits from getting this right within the right context. The member for Ashford talked about blue-collar versus white-collar and redesigning work. There are some positive health benefits in keeping people in the workforce. From an economic point of view, there is also a very strong case to answer. It probably impacts upon the federal government more in terms of personal income taxation, but it also flows through to consumption and GST revenue.

There will be a whole cohort of workers retiring who will be living on a smaller fixed income and who will be spending less. They are still very valuable, but from an economic standpoint it does create an issue because they turn from being taxpayers into service takers. That creates financial implications for the federal government. From a state government perspective, issues like payroll tax come into play, as does the provision of aged-care services and subacute primary healthcare services to older Australians and older South Australians as they age.

What our report highlights and what it seeks to continue the conversation on is moving perceptions of older workers. That is where I think the biggest shift needs to happen. I know from personal experience the value that older workers bring to a workplace. Much more often they bring stability, wisdom and experience. They bring a mentoring role to younger workers around them that is extremely valuable. There are plenty of older workers. As someone who was quite young running a factory, there are plenty of guys I looked up to who gave me a lot of their time in helping to get the job done better for everybody.

We need to harness that wisdom and experience by making sure our workplaces can handle and are equipped to provide for older workers in the same way we provide flexibility for working parents and those with a disability. Workplaces need to become more flexible to the individual needs of a worker so that we can provide that wonderful symbiotic relationship between employee and employer.

In appendix 1, we talked about technological change in the labour market. Appendix 1 can be viewed in two ways. It could be viewed from the point of view that many older workers work in more traditional manufacturing industries and those industries are declining as a result of technological change, therefore there are fewer jobs around for aged workers. I choose to look at it differently because I believe the implication there is that somehow technological change is bad. What technological change can and does do is help to keep older workers in the workplace.

For older workers, making a job less physically demanding would be important, and technological change can very much aid that. Again, I have seen that very much within my own business, that in helping to reduce heavy manual lifting and heavier physical tasks while still maintaining fine motor tasks and fine motor skills, we can help people to be healthier, fitter and stronger and still maintain a broad level of dexterity.

While technological change is certainly replacing labour, it is also helping to keep the existing labour in the marketplace. In fact, the insinuation of the report—and this is a correct insinuation—is that we are going to have a smaller workforce as a proportion of the total population who are of working age, 18 to what will be 65 or 70 years old. There is a real juxtaposition between saying there are enough jobs for older people and the truth, which is that we are going to run out of healthy working age workers as a proportion. Again, when we talk about having a larger aged retired cohort who are going to require aged-care services and primary healthcare services, we are going to need people to be able to fulfil those roles. When we look at the balance of society as a whole, there are not going to be enough people, so technological change is important.

For instance, we may not be screwing screws into the side of a car door anymore, but if technological changes help, so that an aged-care nurse does not have to physically lift someone out of the bed because the chair or the bed does that for them, that means that an older worker may potentially be able to stay in a role within the aged-care industry for a lot longer. Certainly, aged care is one of the high-growth industries across the country.

Overall, I think this report adds to some good work that has been done by many other people across the federal government and across the non-government sector, but again I think it is a small contribution to help inch our society towards dealing with this issue and providing, as the member for Ashford said, some very practical examples of how we get that done. I am extremely proud to be a long-serving member of the occupational safety, rehabilitation and compensation committee. Hopefully we will change the name, but I hope to stay on it for as long as I can.

The Hon. S.W. KEY (Ashford) (11:43): As I was saying earlier, this is an area that I suspect we will need and want to look at and make sure that we do try to initiate some change. I commend the report to the house.

Motion carried.