Saturday, January 15, 2011

Remembering the Australian Open

THESE days we call it the Australian Open, and celebrate it as one of the great tournaments of the world. But it wasn't always the Australian Open, and let's be honest it wasn't always a great tournament.

I remember; I was there. Fifty years ago, I strode the turf of Kooyong in what we then called the Australian championships, in the blazing hot summer of January 1961.

You don't remember Colebatch the tennis player? You're right: I was a ballboy. One of the dozens of little boys in white tennis shirts, shorts, socks and white-scrubbed sandshoes who were paid 10 bob a day (that's $1) to fetch the balls, pour the drinks, and work the scoreboards for our national tennis championships.

No one in January 1961 thought the Australian championships the equal of Wimbledon or the US titles. To us in Melbourne, they weren't even the equal of the Victorian championships, which were played in November, in the final lead-up to the real climax of the tennis year: the Davis Cup finals held each December.

The state championships were where the leading men of Australia and the final three challenging nations staked their claims for places in the Davis Cup teams. Each championship ran over 10 days, with everyone playing singles, doubles and often mixed doubles, in best-of-five-set matches.

The Australian titles seemed an afterthought, almost a nuisance. They came in late January, long after the main action was over. The other Davis Cup teams had gone home. They always ran at a loss, so to spread the losses, the championships were rotated around the four main cities in turn (Perth was then too small to count).

In 1961 it was Kooyong's turn. There was no prizemoney, no ATP or WTA points, no sponsorship. But in a daring move after squashing another bid to introduce open tennis the Lawn Tennis Association of Australia accepted an offer by Nestles to provide 3000 for players' expenses. In return, we ballboys handed out free green Milo sunshades to spectators.

There were no courtesy cars, no luxury hotels. Players from interstate and overseas were billeted out to stay in the homes of tennis lovers. The top foreign seed, Mike Sangster of Britain, found himself put up at the Eastern Hill fire station.

Today the Australian Open feels like Wimbledon. Back then it felt like a big country tournament. There were as many events as they could fit on Kooyong's courts: mixed doubles, juniors, seniors, even junior mixed doubles. Everyone wore white, with Fred Perry tennis shirts and Dunlop Volley sandshoes.

Only a handful of overseas players were there. The US and Italian Davis Cup teams had come to Australia in November to challenge for the cup, and played the NSW and Victorian titles. But American stars Barry Mackay and "Butch" Buchholz turned pro after losing to Italy's Nicola Pietrangeli and Orlando Sirola, who also went home after being routed by Neale Fraser, Rod Laver and Roy Emerson. As for the women, overseas players came to Australia only when invited and that summer, none were.

But there was more concern when a knee injury forced out our No. 1 player: Neale Fraser, the reigning Wimbledon and US champion. His only appearance in January was to open Melbourne's first tenpin bowling alley.

I shared the organisers' dismay: I wanted to ballboy for my hero. Instead, the best I got to throw balls to were the double-handed teenager Jan Lehane, and a tall lanky young bloke from Sydney called Fred Stolle.

With Fraser out, Laver, 22, was the top seed, and Emerson, 24, second. Then came the other member of our Davis Cup team, the burly, intimidating Bob Mark, and the temperamental Bob Hewitt, just 21.

Only three foreigners were seeded: Sangster, Britain's rising star with a massive serve, Christian Kuhnke from Germany, and Italy's No. 3 Sergio Tacchini, who later showed his real talent was for designing tennis gear, not playing in it.

Women's tennis in Australia was then dominated by three teenagers. Margaret Smith (later Margaret Court), 18, had stunned the tennis world a year earlier by downing Wimbledon champion Maria Bueno to win her first Australian title. But at 17 she was thought too young to go abroad, so she had spent the winter in Melbourne working out in the gym and playing pennant tennis. Her great rival Lehane (later Jan O'Neill), 19, was the second seed, with future French champion Lesley Turner (Bowrey), 18, third.

There were hardly any spectators: only 300 on the first Saturday, and 2000 for the final on Australia Day. Officials blamed this on the novelty of TV coverage with channels Seven and Two both covering the event. But there was a second reason: the heat.

It was awfully hot. Lesley Turner fainted during a doubles match and had to be carried to the dressing rooms by her opponents. Ken Fletcher tossed in his quarter-final against Laver when the temperature on court passed 120 degrees Fahrenheit (49degrees Celsius). As a ballboy, I drenched my white floppy hat and tied a wet hankie round my neck before going out onto the court.

Bob Mark added to the casual atmosphere by getting married in Albury midway through the tournament and quitting the singles. He stayed long enough to win the doubles with Laver for the third year in a row, then sailed with his bride for South Africa, never to return.

(But Bob still had one more big title ahead. In September 1961, he teamed up with another Albury kid, Margaret Smith, to win the US mixed doubles title the only grand slam doubles title ever won by an Albury pair).

Bob Hewitt had bigger problems. He was hauled over the coals after his first round win over John "Doc" Fraser, Neale's kid brother. Spectators complained that Bob had not only sworn on court, but spelt it out letter by letter. Davis Cup captain Harry Hopman banned Hewitt from the team, and he, too, eventually migrated to South Africa, while winning 16 grand slam doubles titles.

Young men with attitude were a problem then as now. In Perth, the US Davis Cup team smashed up their dressing room with beer bottles after losing to Italy. At Kooyong, a Queensland junior was reprimanded after belting a ball over the railway line into Toorak.

While the players were going out in the early rounds, we ballboys worried about our own elimination rounds. Only half of us would be needed after the first four days. How would our finalists be selected? Was someone watching to see who threw the balls most accurately, who was least obtrusive on court, who was quickest on the new electronic scoreboards?

We needn't have worried. Those who were kept on were those who had chatted up the bloke in charge. Those of us who missed out instead won a valuable insight into adult life.

In the quarter-finals Fletcher forfeited to Laver, young South Australian Barry Phillips-Moore beat Kuhnke, Stolle defeated the sporting Sangster ("Too good!", he exclaimed as Stolle's drives ripped past), while Emerson thrashed unseeded John Pearce. Laver then beat Phillips-Moore, and Emerson outpointed Stolle to set up the final we all wanted.

After the obligatory rest day on Sunday the big upset came in Monday's final. Emerson used to wind up into his service like an eccentric corkscrew, but he would race around the court like an Olympic sprinter, and that day he wore down Laver over four sets to take his first Australian title 1-6, 6-3, 7-5, 6-4.

The women's championship was treated like a sideshow, attracting little coverage or centre court time. With Turner out, Smith and Lehane met in the final as usual and as usual, Smith won, 6-1, 6-4. Writing in The Age, Davis Cup great Adrian Quist hailed her as "a future world champion ... She played the first set as well as any woman player I have ever seen".

Amid all the action, no one paid any attention to the junior championships being played on the back courts. Had I been more prescient, I would have noticed a 16-year-old from Sydney who scattered his older opponents to win the boys' singles and doubles alike. But the name J. Newcombe meant nothing then, and without the moustache he did not stand out from all the other boys in white.


Saturday, January 8, 2011

Secrets to ageing gainfully - Boomers turn 65

IN THE 21st century, few issues will matter more to us than the implications of living longer. Our lifespans are increasing dramatically, and it is still unclear whether the gains will outweigh the pain. German-based demographer James Vaupel estimates that the average baby girl born now in Western societies will live to 100. Many of today's baby boys, he says, will also live to 100.

But what will be the quality of life for these older Australians? Will we expand our years of good health, employment and active living? Or will it be a future that condemns us to years in nursing homes, living with disability and senility, and draining the incomes of governments and younger taxpayers? It is hard to imagine a more important issue for our future. It is happening now, at an increasing pace, raising the need for urgent decisions that our politicians are refusing to take.

The fact that we are living longer is in itself clearly a good thing. A hundred years ago, baby boys in Australia had a life expectancy of 55, and baby girls 58. These days, the Australian Bureau of Statistics estimates, baby boys have a life expectancy of 79 and baby girls of 83. Most of that gain is due to the spectacular decline of infant mortality during the 20th century. But increasingly, it reflects better medical care and healthier living.

In 1908, when the Deakin government introduced an old-age pension of 10 shillings a week for Australians 65 and over, there were fewer than 200,000 Australians of that age. Men at 65 could then expect only another 11 years of life, and women only another 12. It wasn't too much different by 1968. But since then, our post-retirement lifespans have increased dramatically. The ABS estimates that there are now almost 3 million Australians aged 65 and over, and close to 4 million baby boomers set to join them in the next 15 years.

Their lifespans are rising fast. On 2007-09 data, the ABS says a man of 65 can expect another 18 years of life, and a woman, another 21 years. And those are understatements, because the bureau uses a conservative methodology that does not allow for future advances in medicine or community health. It won't be long before 65-year-olds can expect to live to 90.

Isn't that great? Yes . . . but who is going to pay for their retirement?

In 2006, there were 14 million Australians aged 15 to 64 conventionally defined as "working age" and 2.7 million over 65. The ratio of workers to retirees was 5.2 to one. By 2056, on conservative assumptions, the bureau projects that those of working age will grow by half, to 21.5 million, but the number of us 65 and over will treble to 8.1 million. The ratio of workers to retirees would then be 2.6 to one. How could tomorrow's workers be expected to finance so many retirees? Especially when those aged 85 and over, with the most chronic needs for care, are projected to increase from 322,000 to 1.72 million?

Treasury is obsessed with the costs of an ageing society. It has been the theme of its three Intergenerational Reports over the past decade. That they all came up with very different numbers shouldn't obscure their conclusion: that our ageing will cost future workers a fortune.

First, there are hospital and medical bills. About half the beds in our public hospitals are occupied by people over 65, who make up barely an eighth of the population. People aged 75 to 84 run up pharmaceutical bills five times larger than those aged 45 to 54, and 10 times larger than those aged 25 to 44. They visit the doctor three times as often as those aged 45 to 54. The more older people we have, the more our health system will cost.

Treasury projects that in the next 40 years, health spending per head will rise threefold, from $2290 now to $7210 (in today's money) in 2050. And that is because, it projects, real health spending on the over 65s will increase to eight times today's levels. Most of the growth in health spending will be driven by us growing old. Treasury estimates the Commonwealth's health spending alone will swell from 4 per cent of gross domestic product now to 7.1 per cent by 2050. Add the state government's hospital bills, and we are looking at big tax increases to pay for that.

Second, there is aged care. By 2050, assuming no change in the rates of severe disability, about half a million of us will be living in nursing homes. The cost of aged care is projected to quadruple, from $460 a head now to $1840 in 2050. Taxpayers' share of that would shoot up from 0.8 per cent of GDP now to 1.8 per cent.

Third, there are pensions. Australia's pension system is relatively cheap, because we pay our pensioners less than Europe does, and exclude the well off. But even with superannuation balances set to swell, Treasury projects that in 2050, almost 80 per cent of retirees will be on the pension in some form, lifting pension costs from 2.4 per cent of GDP now to 3.9 per cent.

Fourth, there are all those concessions for older Australians. Without reforms, these will impose growing costs on state governments and business, and hence on future workers.

Fifth, there is tax-free super. In 2006, to win votes, the Howard government decided to allow people over 60 to take their superannuation payouts without paying any tax (other than the 15 per cent their super fund pays on income earned). At a stroke, it gave away hundreds of billions of dollars of future government revenue, and created a big new tax loophole for retirees again, paid for by those still working.

At the Australian National University last month, Access Economics director Chris Richardson used his speech during a graduation ceremony to warn the new graduates that this tax break would make it even harder for them to finance the older generation in retirement. "You can't have a maximum 15 per cent tax on a big, growing chunk of the population without massive cost," Richardson said. "Eventually that policy will cost us a fortune, and will be recognised for the mistake it was. Eventually some government will get the courage to abolish it and then will lose the next election."

Treasury estimated that, even with offsets in other areas of spending, ageing and health pressures would lift Commonwealth spending by 4.7 per cent of GDP by 2050. To finance that would require tax rises equivalent to $60 billion a year in today's Australia. How could future taxpayers pay for that? But Treasury derives these projections by assuming that we do not change the way we behave. And fortunately, the way we behave is changing dramatically.

EVERYTHING happens to us later now. We spend much longer in education: 40 per cent of Australians aged 20 to 24 are still studying, mostly full-time. We find our partners later (if at all), and marry later (if at all). We have our children later: in Victoria in 2009, 60 per cent of mothers giving birth were aged 30 and over, and 5 per cent were 40 and over. And we buy our homes much later (if at all).

A generation ago, most men aged 50 to 65 were candidates for early retirement. They had begun working young, they married young, and now their children had grown up, their houses were paid off, and their bodies were worn out from physical work. Most women that age had retired from the paid workforce when they married, and those who kept working retired by 60. Even if people wanted to keep working, a recession came every decade or so, and employers coped by targeting older workers: in the recessions of the '70s, '80s and early '90s, hundreds of thousands of workers were pushed into early retirement.

It is a different world now. Many men and women over 50 find themselves embracing, shall we say, a new paradigm. They have careers. They began working later than their parents did, and will go on much longer. Many still have dependent children at home, or semi-dependent adults. If they own their home and more and more don't they still have a mortgage to feed. Most jobs today don't wear out their bodies, and most workers don't have enough savings to retire on.

Their choice is simple: they keep working. The speed of the shift is dramatic. Even a decade ago, most women had retired by their late 50s, and only one in five went on working past 60. Now, almost two-thirds of women in their late 50s are still working, as are 43 per cent of women in their early 60s, and 17 per cent in their late 60s. And this revolution is rolling on rapidly.

But it is not only women staying at work in record numbers. By last year, 80 per cent of men were still working in their late 50s, 62 per cent in their early 60s, and almost one in three were working on into their late 60s. Even past the age of 70, 7.5 per cent of men are still working. The ABS surveys of our retirement plans show the new paradigm is rapidly taking hold. Between 2005 and 2009, the number of workers over 45 planning to retire by 60 dropped from 22 per cent to 13 per cent. Those planning to retire at 65 or later rose from 47 per cent to 58 per cent.

But the number who plan never to retire shot up from 384,000 to 575,000. It's a new world out there, and this revolution has a long way to run. Australia is still far behind the world leaders. In 2009, when a record 59 per cent of Australians aged 55 to 64 were in work, Iceland had 81 per cent of people of that age in work. And Iceland by then was in deep recession.

The potential economic gains from this cultural shift are enormous, particularly if the government were to remove the incentives to early retirement in time to influence the retirement plans of those 4 million baby boomers. Suppose the government moved fast enough so that by 2020, we matched Iceland's employment rates for older workers.That would increase our 2020 workforce by about 1 million workers. The sheer momentum of the revolution now under way will take us halfway there, but removing bad policies would accelerate that and could pay for the costs of our ageing society. The potential gains are even bigger if the over 65s keep working until they are 70, or even longer. There is no biological reason to retire at 65. If baby boomers on average will live to 90, as seems possible, then 65 is early retirement. And with the prospect of 5 million Australians over 65 by 2025, early retirement is a luxury we can no longer afford. So, what can we afford?

ALL over the Western world, governments are risking their lives to implement reforms to stop ageing populations driving their countries bankrupt. In Paris, President Nicolas Sarkozy withstood weeks of street protests to lift the qualifying age for a full pension from 65 to 67. Germany's previous Social Democrat/Greens government lost power partly because it delivered hard-headed reforms in which future pensions will be cut if there is not enough money in the pension fund to pay them.

But voters resent losing future benefits. So Australian governments have alternated between timid reforms (Keating, Rudd) and making the problem worse by adding new entitlements rather than trimming existing ones (Howard). The Keating government in 1992 decided to lift the age at which we can access our superannuation payouts from 55 to 60 between 2014 and 2024. A year later it decided to increase the female pension age from 60 to 65 between 1996 and 2013. The Howard government dodged the tough decisions, leaving it to the Rudd government to decide to raise the pension age from 65 to 67 between 2017 and 2023.

But the crunch is now. The first baby boomers turn 65 this year; 4 million of them will hit retirement age over the next 15 years. If we want to influence the choices they make, we don't have 15 years to wait. What's the point of introducing reforms so slowly that they take effect only after the baby boomers have retired?

As the OECD has pointed out, Australia is lagging badly on reform where it is most needed. Treasury and the Reserve Bank warn we are facing a shortage of workers. Yet as the first baby boomers turn 65, that is still our pension age for men, the same as 100 years ago. Women can take the pension at 64. We can take our super payouts tax-free at 60, or with low taxes at 55.

Where is the sense of urgency? Why is Canberra allowing the wave of baby boomers to pass into retirement before it takes action? Why not make 2011, the 65th birthday of the baby boom, our year of reform, so we make the changes we need to make, in the time we need to make them?

Reforms work best when they are done across the board. They need to remove the incentives to early retirement, and promote the shift to a new culture of working to 70 or beyond. They need to give high-care nursing homes a reliable source of funding, and invest in tackling the biggest ageing cost of all. Six issues stand out:

End the anachronism by which Australians living to 90 or 100 can access their retirement nest eggs from 55. Start lifting that age immediately, not in 2014, so it reaches 60 by 2020, and 65 by 2030.

Roll back the age at which people can take their super tax-free to 65 as soon as possible, and then raise it in line with the pension age.

Speed up the move to a higher pension age, by lifting it by six months each year from 2015, to reach 67 by 2018, and then to 70 by 2024.

Promote a culture in which working to 70 and beyond is seen as normal. Tackle the ageism of corporate HR managers.

Give high-care nursing homes a secure financial base by allowing them to charge accommodation bonds, as low-care homes already can, and as was proposed in 2004 by the Hogan report.

Increase public investment in research into Alzheimer's disease and other causes of disability in old age, so Australians can live long lives without losing quality of life.

Labor says it is a government of reform, focused on creating jobs and caring for those in need. What better way to prove it?