That is slightly above the nation’s adjusted inflation rate of 3.1 per cent.

Although directly comparable wage figures are not yet available,  the best indications suggest that wage growth, over the same time, would have covered that rise.

The latest available wage figures show average weekly earnings in Australia rose by 4.7 per cent in the 12 months to the end of August.

The Bureau of Statistics also reported today that the average cost of living for Australian pensioners rose by 3 per cent in 2011.

Both groups benefited from lower fruit and vegetable prices in the final three months of last year.

The main price rises, for working families, were in the cost of domestic holiday travel and accommodation, rents and interest charges.

The living costs, faced by pensioners, fell by 0.4 per cent in the December quarter.

They made some savings on lower pharmaceutical charges but, like other Australians, pensioners also faced higher rents in that time.

Self funded retirees saw their living costs fall by 0.1 per cent in the final three months of last year, but their costs, too, rose by 3.3 per cent over the year.

With more than $1.3 trillion already in that pot, it is one of the biggest sums of money held, anywhere in the world.

Super has produced its shocks.

Anyone hit by the losses sustained after the great crash of 2008 knows, now, just how much money our funds had invested in the share market.

The rules surrounding super, too, are well short of perfect.

Those shortfalls, though, are to be tackled seriously over the coming year.

That was made clear in a joint statement that the Treasurer, Wayne Swan and Superannuation Minister, Bill Shorten, have just issued.

They say the idea is to  “ consider ideas raised at the Tax Forum for providing Australians with more options in retirement and improving certain superannuation concessions.”

The two ministers said: “the government is already implementing important reforms to make superannuation concessions fairer for low-income earners and improve the adequacy and equity of the retirement income system”

They said these include increasing the superannuation guarantee, to 12 per cent,  introducing the low income superannuation contribution, abolishing the age limit on the superannuation guarantee and providing Australians with access to low-cost funds through MySuper.

So what else needs to be done, by a high powered expert committee called the Superannuation Roundtable, that the government has appointed to do this work?

“The first stage of work for the Roundtable will discuss and examine better ways to target and deliver certain concessions,” the two ministers said.

But everything comes with a price tag, in these days of tight budgets.

Superannuation reform is no exception.

“The Roundtable will need to consider offsetting savings from within the superannuation system for any proposals that have a budget cost,” the two ministers said.

The welfare lobby group is urging the Federal government to remember that Australia’s poor are most at risk, in troubled times.

That’s because structural changes in the economy pose social as well as economic challenges.

The group says Australia’s neediest people should not  suffer through tight restrictions in this year’s Federal budget.

Wasteful spending should be cut, instead.

ACOSS makes these points in a pre-budget statement, setting out its priorities for the new financial year.

Its Acting CEO Dr Tessa Boyd-Caine says:  ‘There is no question that, through good economic stewardship, Australia has fared relatively well during the recent global economic downturn and our unemployment rate remains relatively low.”

However, she adds: “… it is also clear that, at the beginning of 2012, progress in reducing unemployment further has stalled.

” Australia’s economic growth prospects are uncertain in the short term, and structural changes in the economy pose social challenges as well as economic ones.”

Predictably, ACOSS is recommending some extra spending, which it says would cost an estimated $3.6 billion.

These measures would include:-

• · Raising the level of payments for Newstart Allowance, Youth Allowance and other Allowance payments for single adults and young people living independently of their parents by $50 per week as recommended by the Henry Review.
• ·Doubling the number of places in the new wage subsidy scheme for long term unemployed people and substantially boost the resources available to Job Service Australia providers to work intensively with this group  and
• ·Developing a national population-based oral health program, in place of the Medicare Chronic Disease Dental Scheme and Teen Dental Program.

But it also recommends savings of an  estimated $4.8 billion, that would include:-

• · Removing the private health insurance rebate from ancillary health cover
• · Reforming the tax treatment of private trusts to reduce tax avoidance and
• · Fairer and more consistent tax treatment of lump sum termination payments such as ‘golden handshakes’

The pay rises, based on a Remuneration Tribunal report, will increase a backbencher’s pay from $140,910 to $185,000 a year.

However these rises will not take effect until next year, after proposed legislation slashing present perks is passed

Prime Minister Julia Gillard’s salary will rise to $481,000 a year.

Tony Abbott’s pay will jump to $342,250.

The Special Minister of State, Garry Gray, who processed these reforms, admitted that the cuts to politicians’ perks are overdue.

“… long-standing expensive travel entitlements will be scrapped or slashed, including the Life Gold Pass, overseas study travel, and post-service travel, Mr Gray said

“The entitlements system has suffered systemic neglect for decades and fostered a culture of hidden perks and political fixes,” he added.

The process, which led to these changes, was started by a former Prime Minister, John Howard.

The President of the Remuneration Tribunal president, John Conde, said the prime minister’s new salary would rise from $367,000, to $481-000 a year.

“In our view that is not an unreasonable salary for the prime minister of Australia, whoever he or she may be,” Mr Conde said.

He said it is important that Australia paid its politicians well enough to attract and retain people from all walks of life.

Mr Abbott’s salary will rise from $260,684 to $342,250.

Shadow Ministers will also be paid more than other opposition MPs for the first time.

The Tribunal said they did more work and should be paid for it.

A shadow cabinet minister’s pay will jump from $140,910 to $231,250, an increase of $90,340, or 64 per cent.

The nation’s 19 departmental secretaries will also get very big pay increases.

All will receive more than the Prime Minister.

Those on the lowest rung will have their pay increased from $570,000 to $650,000 over two years.

The head of the Prime Minister’s department, Ian Watt, will see his pay rise from $620,000 a year to $825,000.

Mr Gray said the Remuneration Tribunal had found that Australia’s public service leaders have responsibilities and accountabilities well beyond those of many private sector CEOs.

Yet those in the private sector were sometimes paid 10, 15 or 20 times as much, often for running smaller, less complex organisations.

That assessment comes from no less a source than the Australian Bureau of Statistics.

It has just been published in a new analysis of household wealth in this country, as part of a Social Trends report.

The Bureau’s view is remarkable because it effectively ignores events like the huge property market collapse,  in the United States.

The Bureau is just not listening to the Jeremiahs who say that the same thing could happen here.

Instead, it boldly states that: “Household wealth is likely to remain concentrated in real estate and superannuation into the foreseeable future…”

The Bureau says there are “several reasons” for that.

It says these include: “The exemption of the family home from both capital gains tax, and means testing for determining eligibility for the receipt of government pensions and benefits.”

It says this “will favour investment in the family home.”

The Bureau also notes “the ready availability of mortgage finance for negatively geared investments.”

It says this, too, “will favour investment in rental property.”

The Bureau notes that there are valuable tax breaks for super, too.

“The concessional taxation treatment of superannuation contributions, fund earnings and retirement income streams will favour investment in superannuation,” it says.

But that’s not all.

“The Federal Parliament is also presently considering the Australian Government’s proposal to gradually raise the current 9 per cent Superannuation Guarantee to 12 per cent between 2013–14 and 2019–2020,” the Bureau adds.

But how?

The Federal Treasurer, Wayne Swan, has just issued a statement, addressing that question. He  says it will do that by:-

• - Delivering a major new tax break for Australia’s 2.7 million small businesses as well as a cut to the company tax rate for all businesses, with small businesses getting a one year head-start.
• - Boosting the superannuation for 8.4 million workers, which will increase the nation’s savings pool by $500 billion by 2035.  Mr Swan said this will provide a 30-year-old worker on average earnings with an extra $108,000 in retirement savings
• - Providing a much needed extra superannuation contribution for 3.6 million low-income-earners worth a total of $900 million each year and
• - Investing in roads, bridges and other infrastructure, particularly in our great mining regions.

If you have missed out, somehow, though,  you can write to Mr Swan, care of Parliament House, Canberra ACT, to point that out.

This time, it was – effectively – the delivery of a minerals resource rent tax.

This has been a long, hard road for Labor, and it remained so right up till 2.45 in the morning, when the final vote in the House of Representatives was taken.

Indeed, the repercussions continued after that, with the Opposition Leader, Tony Abbott accusing the government of doing a “secret deal” with the Greens in the “dead of night” to get its mineral tax bills through the lower house.

They now go to the Senate, which is also expected to pass them, early in the New Year.

Certainly, the bills that were passed, in this way, were milder than Labor’s original plans, for a tax of this kind.

However, the first plans had contributed to the downfall of Kevin Rudd as Prime Minister.

And this time, Labor was much more compromising.

It secured the votes of two rural independents, Rob Oakeshott and Tony Windsor, by promising tough scientific assessment of new coal seam project approvals.

Then it agreed to the demands of another independent, Andrew Wilkie, who wanted small miners exempted from the tax.

But that left a shortfall in the government’s revenue projections – and the Greens, who had a casting vote, held up the bills, until that was filled.

When the House voted on the bills, in this year’s clearest case of legislation by exhaustion, only a few MPs, including the Greens MP, Adam Bandt, knew how the government planned to fill that gap.

The Greens leader, Bob Brown, said the government had insisted on secrecy, on that topic.

Tony Abbott responded sharply, saying “the Australian people and the Parliament have been kept in the dark.”

But not for long.

Just a few hours later the government announced that it would be deferring its promised phase down of interest withholding tax for a year.

That filled the  revenue hole very nicely.

Great politics, too.

Who cares, anyway, about the hankers who pay this tax, on certain foreign transactions?

Julia Gillard explained later, that this move had already been “under consideration” anyway, for some time.

That’s believable.

The government has been combing through its receipts, very carefully, over recent months.

It has been looking for spending it can cut in the new financial year, to get its budget back into surplus

The government’s latest victory, coming so close on the passage of its carbon tax – a courageous*  decision – if ever there was one – left ministers in a triumphant mood, as the parliamentary year drew close to its end.

One, Anthony Albanese, even mocked Mr Abbott, telling parliament the opposition leader was looking forward to the Christmas break, in the hope that Santa would leave him a policy.

* Note. A courageous decision, in the words of Sir Humphrey Appleby, is one that could cost you the next election.

That happened shortly before 3am, after the government reached a deal with the Greens.

The deal gave the government the vote of the lone Green member of the lower house, Adam Bandt.

The bills are now  expected to have a clear passage, when they reach the Senate early next year.

However the Coalition has promised to repeal the tax, if it wins government.

The Federal Treasurer, Wayne Swan, is jubilant.

He says revenue raised by the tax will spread wealth created by the mining boom to the broader community.

The government says it will do that by funding higher superannuation contributions and tax breaks for small business.

An amendment sought by the Tasmanian Independent Andrew Wilkie to exempt smaller mining companies was included in the deal.

The Greens had said they would not pass the bills, unless the shortfall of $20 million a year, that this created, was filled by the mining industry.

However full details of the deal struck by the government and the Greens on this point have yet to emerge.

That’s understandable.

They have a lot at stake.

Even so, what they say is important, as it might help you decide what’s best for you.

The funds are arguing their case through the Association of Superannuation Funds of Australia, ASFA.

ASFA is warning workers to beware being caught out by  “a popular myth about superannuation returns.”

It admits reports, suggesting that people would be better off, putting their money into term deposits, rather than  super, have been common  since  the global financial crisis.

The most recent appeared in the Melbourne Age, last Sunday.

However ASFA’s chief executive, Pauline Vamos, insists that:”Over the longer term, the majority of people in the majority of funds are better off with their retirement savings in superannuation than putting all their money in a term deposit.”

In doing so, of course,  she invites the famous remark of the British economist,  John Maynard Keynes, who once said “in the long run, we are all dead.”

But ASFA’s argument – and calculations – are worth a look.

As Ms Vamos , says:”It is important to remember that superannuation is a long-term investment, taxed at concessional rates.

“And is invested in a larger number of different types of assets.

“We must also remember that funds provide a range of services for the benefits of fund members and the important role the superannuation pool plays in the economy.”

The accumulation of superannuation not only assists Australians in retirement, it also boosts the Australian economy, increasing the nation’s GDP, creating jobs and providing much-needed private and public infrastructure investment.

The Association’s press release contains a table, comparing net returns for investors on balanced superannuation funds and term deposits.

These figures were taken from that table

Super funds

Over 7 years       Over 10 years

5 per cent         5.1 per cent

Term Deposits

For a taxpayer on a 30 per cent tax rate         Over 7 years           Over 10 years

                                                                              3.7 per cent                   3.4 per cent

Simon Bennison, who heads the Association of Mining and Exploration Companies, has called a media briefing to explain his case.

The Federal government needs Mr Bandt to  vote for the tax, to get it through the House of Representatives.

The Greens leader Bob Brown says his party will not support the proposed tax, a key part of the government’s platform, unless miners make up a $20 million a year shortfall, in the amount of revenue it was expected to raise.

The shortfall arises from an exemption, for small miners, that the government accepted, after meeting the Tasmanian Independent, Andrew Wilkie.

The government and the Greens have been talking on this issue today.