The start of the new financial year brings with it many changes that will affect older Australians, and one of the more positive will assist anyone receiving a full or part Age Pension and some who were previously ineligible.
Adjusted income and assets test thresholds for the pension plus changed deeming rate thresholds take effect from today, meaning pensioners should see a small but welcome increase.
Services Australia general manager Hank Jongen says that about 1.4 million Australians who receive Centrelink payments will receive a boost.
“The key [Age Pension] change is indexation changes,” he says. “The government has announced increases in the asset and income thresholds – the point at which payments start to reduce.
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“What that means is that some pensioners, [and] those on part-pension rates, will receive an increase in their pension as a result of a flow-on from an increase in those limits.
“It also means that some people who are at the margins who previously didn’t qualify for a pension may now be eligible.”
The Age Pension, Disability Support Pension and Carer Payment income free area increases by $10 to $190 per fortnight for singles, and by $16 to $336 per fortnight for couples combined.
The number of assets a pensioner couple who own their home can have before it affects their rate of payment increases to $419,000 (excluding their home) – up from $405,000, which could flow through to a payment increase. A single homeowner can now have $280,000 in assets, up from $270,500.
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For non-homeowners, the new thresholds are $643,500 for couples (a $22,000 increase) and $504,500 for singles (up by $17,500).
The disqualifying asset thresholds also change from today, which increases the number of Australians who may be eligible to receive a pension payment.
The asset thresholds for eligible couple homeowners increases by $14,000 to $915,500 and for non-homeowner couples by $22,000 to $1,140,000. For eligible single homeowners, the increase is $9500 to $609,250 and for single non-homeowners $17,500 to $833,750.
Deeming rate thresholds also increase – to $93,600 for eligible couples (up by $4600) and to $56,400 for eligible singles (a $2800 increase). The deeming rate has been frozen until 2024.
Social services minister Amanda Rishworth says the increases are coming at an important time with costs of living skyrocketing.
“The indexation process complements the levers we are pulling across portfolios to help address the rising cost of living,” she says.
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“We will continue to support Australians by cutting the cost of medicines on the PBS, freezing deeming rates for pensioners, expanding access to the Commonwealth Seniors Health Card, lowering energy costs and making childcare cheaper.”
Older Australians who were previously ineligible for a Commonwealth Seniors Health Card (CSHC), which offers a big range of benefits and discounts, should also now check if they are eligible.
Pension rates are indexed twice a year on 20 March and 20 September and means test thresholds are indexed once a year on 1 July.
Age Pension rates are indexed to the higher of the increase in the Consumer Price Index (CPI) or the Pensioner and Beneficiary Living Cost Index (PBLCI), then compared against a Male Total Average Weekly Earnings (MTAWE) benchmark and increased to meet the benchmark as necessary.
The Age Pension eligibility age is currently 66 years and 6 months for those born between 1 July 1955 and 31 December 1956. For those born after 1 January 1957, the Age Pension is available at 67.
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