The world needs to look at raising the retirement age, Treasurer Joe Hockey says.
Mr Hockey on Friday called for a mature debate in Australia over the retirement age, which is currently 65 but will rise to 67 by 2023, as a way to improve the quality of life.
“As England and a number of other countries are focusing … we have to look at ways to continue to increase it as we live longer,” Mr Hockey told journalists in Sydney.
“Really we’re having a discussion about quality of life we want people to have as they are ageing and how sustainable that quality of life is.
“I would challenge everyone in Australia to have a mature debate about the quality of life we want our ageing population to have.”
Mr Hockey made the comments at a press conference with the Organisation for Economic Cooperation and Development (OECD) General Secretary Angel Gurria before Saturday’s G20 finance minister’s meeting in Sydney on Saturday.
Mr Gurria urged global policy makers to lock in ways to improve productivity, saying the pace of reform has slowed in the past two years.
Labour reforms were not being met by competition reforms, he said.
“Big reforms in the labour market did not follow up with big reforms in competition,” he said.
“All countries have something to bring to the G20 table when it comes to structural reforms.
“Australia itself did better than most of the countries during the (financial) crisis, but has its own challenges about productivity.”
The OECD on Friday backed the Australian government’s push to enhance investment in infrastructure to ensure the economy’s generally good economic performance can be sustained in the long run.
In its report, Going for Growth, the Paris-based institution calls for investment in skills to boost labour force participation.
Each year since 2005 it has made recommendations for structural changes, while taking stock of the progress made in the past two years.
“Governments have continued to make progress on many fronts despite the challenge of reforming in a subdued growth environment,” the report says.
“The pace of actions taken in areas covered by OECD policy recommendations has slowed somewhat over the past two years but remains overall well above the pace observed before the (global financial) crisis.”
On Australia, it notes that as the mining boom recedes, economic growth has eased and the economy is rebalancing away from the resources sector.
But productivity gains have also slowed in recent years to a level below that of leading OECD countries.
“Reforms to enhance investment in infrastructure and knowledge-based capital as well as to boost labour force participation would help to ensure that Australia’s good economic performance can be sustained in the long run,” it says.
The OECD’s previous recommendations for Australia include new measures to boost business research to enhance innovation and reduce the comparatively high company tax rate, while relying more on the GST.
It has also called for childcare support reforms to account for the high cost of pre-primary education and to encourage parents to work.