John Roughan: Thanks for the free ferries, taxpayers

John Roughan

Waiting at the Waiheke ferry terminal on Wednesday, a woman who didn't look a day older than me said to another, "Are you on the gold card?" The other smiled and nodded.

"Good, eh?" said the first. "Use it while you can, I reckon. The Government won't let this go on for long."

The ferry back to Auckland was surprisingly full for a weekday. It was hard to know how many of those on board were aged 65 or more. People in their late 60s these days look, dress, feel and live little differently than they did when they were 10 years younger.

I'm not sure whether to thank modern medicines, anti-smoking campaigns or a nightly glass of good red, but life expectancy has risen before our eyes. When I was a child people died in their 60s. Then, for several decades it was rare that anyone survived their 70s. Now superannuitants are commonly living into their 80s.

Who knows how high it might be by the time I'm eligible for the pension? With my SuperGold Card I might travel free on Auckland ferries for 25 years. Good eh?

No, probably. That woman had a grasp on reality. Most people do.

She doesn't really think the Government will have the gumption to stop paying for her day out any time soon. That is what we say when we feel slightly guilty for getting something on the taxpayers we do not really need and suspect the country cannot afford.

I wonder what it is like to wake up on your 65th birthday and realise you have been transformed overnight from an ordinary taxpayer to a sacred class of society known as senior citizens.

As least that's what you will call it. You won't answer to words like elderly or pensioner, though those will be the terms of the public outcry if there is any threat to your welfare. Headlines such as, "Elderly hit by Govt cuts" are nightmare material in the Beehive.

Suddenly you rank second only to children in the political pecking order. Your benefits are pretty much carved in stone.

I wonder if today's retirees feel particularly strange about this. People aged between 65 and 75 were in their forties in 1984. They were entering their peak earning years when the country's whole economic setting was changed.

Their parents, then newly retired, had spent their working lives paying tax rates as high as 66c to support a comprehensive welfare state. When the Lange-Douglas Government put a means test on national superannuation I remember Muldoon's former social welfare minister, Venn Young, explaining to me how that single act broke a long-standing social contract.

The only reason that higher-earning people had accepted 66c tax rates for so long, he said, was the promise that they would receive the same pension as everyone else when their time came.

That was 25 years ago now. Today's retired have paid income tax at barely half the rates their parents faced. Antagonism at the broken superannuation promises of both major parties has died. The politician who built a career on it was defeated last year.

The SuperGold Card was his swan-song, one of the prices the previous Government paid for his votes. It waited until the last possible moment, last October, to put free public transport on the card.

Its use is booming naturally. At the present rate of patronage it will probably exceed the $18 million budgeted for it this year but John Key says he will keep it.

When he is talking about borrowing as much as $40 billion over the next few years to offset the global recession, it probably seems churlish to be fretting about needless social gifts inherited from the previous Government.

The active retired do not need free public transport, better-off couples do not need 20 hours' free childcare weekly, students can pay the low interest on their loans, not everyone needs KiwiSaver subsidies.

All were conceived during nine years when the economy was growing, the annual budgets in surplus and the public debt was down at levels that are helping us weather this recession quite well, as the International Monetary Fund was the latest to observe this week.

But slowly, over the past 10 years, politics has been losing the discipline that did most to make the economy as robust as it has been.

When I hear Key contemplating a blow out in public debt that would take it back to pre-Rogernomics levels, I have a terrible sense that a wheel is turning full circle. It is the little, sacred costs of political weakness that add up to a debt that sours an economy.

If Key is still around in eight years to send me a gold card, the recession should be over but the bill could be weighing more heavily on the books. It would be a foolsgold card then.