Treasury Boss Martin Parkinson Thinks It's Unrealistic That Some People Will Work Until They're 70

A construction worker uses a jack hammer at Aussie Stadium October 12, 2006 in Sydney, Australia (Photo: Getty Images)

It is unrealistic to expect some Australians employed in physically demanding roles to work until they are 70, according to outgoing treasury head Martin Parkinson.

The retirement age in Australia will rise to 70 from 2035. The measure was announced in the federal budget and is designed to ensure the system is sustainable as the population ages.

“We can’t realistically expect the brick layer to become a brain surgeon,” Parkinson said.

Speaking at a business lunch in Sydney, Parkinson said the country needs to consider how it would provide roles for older Australians who would not be able to continue physically demanding jobs.

“I’ve got to be frank and say I think we as a community haven’t yet come to grips with that,” he said.

“It is unrealistic, as you implied, to believe that someone who is doing manual heavy labour can necessarily go through to age seventy,” Parkinson said in response to a question from the floor.

“Some people may be able to — they may just be lucky,” he said.

“But I think what that leads us to — and remember we are not going to 70 until the mid 2030s — but what that leads up to is a need to start to think more seriously about how people manage different careers through their life, and how we manage the transition from one to another.

“As a society we are going to have to think about that. Some people have, but I think collectively that’s unfinished business.”

Measures to encourage businesses to hire older workers were included in the budget unveiled last week. These include a $10,000 payment to companies that hire a person over age 50 on a full-time basis, who was also formerly on benefits, or a pro-rata subsidy for part-time roles.

The 2014 budget will be Parkinson’s last as treasury secretary, after Treasurer Joe Hockey asked the prime minster to extend his term earlier this year. The prime minister has previously said he wanted to replace Parkinson due to the stark difference in economic policy between the current and former government.

Hockey’s first budget as treasurer contains several contentious measures designed to bring the budget back to surplus by the beginning of the next decade, including significant spending cuts and tax increases.

Parkinson also argued in his speech that tough decisions were necessary to rein in Australia’s finances, ensuring the country is able to withstand an economic shock in the coming years.

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