The new Age Pension payment rates that will take effect from 20 September were revealed by YourLifeChoices on Monday, and will give single pensioners an additional $32.70 per fortnight and couples an extra $49.40 per fortnight.
But new income and assets test thresholds for part Age Pensions were also announced, which may mean some retirees will be entitled to an increase in payments. Plus, income limits for eligibility for the Commonwealth Seniors Health Card will also increase.
Eligibility for the Age Pension is based on your age, which rose to 67 on 1 July, residency rules and income and assets tests.
New income and assets test thresholds for part pensions
The income test looks at money you receive from employment and other earnings. The assets test looks at what you own, such as your savings, investments and property. If your income or assets are above certain thresholds, your Age Pension payment may be reduced, or you may not be eligible to receive the pension at all.
Assets and income tests for a full Age Pension change just once a year on 1 July. But assets and income tests for part Age Pensions change twice a year, on 20 March and 20 September.
For singles, pension disqualifying income limits from 20 September 2023 will increase by $65.40 to $2397.40 per fortnight. The limit for couples combined will increase by $98.80 to $3666.80 per fortnight. For illness-separated couples, the increase will be $126.40 to $4481.20 per fortnight.
If you earn over these limits, you will not be eligible to receive any Age Pension payment. However, the Work Bonus will have an impact.
Pension disqualifying assets test limits will also increase from 20 September 2023.
The disqualifying limit for single homeowners will increase by $11,000 to $667,500 and for single non-homeowners by $11,000 to $909,500.
The disqualifying limit for homeowner couples combined increases by $16,500 to $1,003,000 and for non-homeowner couples by $16,500 to $1,245,000.
For illness-separated homeowner couples combined, there will be a $22,000 increase to $1,183,000 and for non-homeowner illness-separated couples combined, the new disqualifying limit will be $1,425,000.
Services Australia says the cut-off point will be higher if you receive Rent Assistance with your pension. Different cut-off points also apply if you are paid a transitional rate of pension (this may apply if you were receiving a pension before 19 September 2009).
Commonwealth Seniors Health Card
Income limits for eligibility for the Commonwealth Seniors Health Card (CSHC) will increase as a result of indexation, by $5400 to $95,400 per annum for singles and by $8640 to $152,640 for couples combined.
The CSHC is a concession card that delivers cheaper healthcare and some lifestyle discounts if you’ve reached Age Pension age.
Pensioners ’still behind’
National Seniors chief advocate Ian Henschke says the pension increases are welcome, but is highly critical of the current system, which he says leaves pensioners behind – especially when inflation is unusually high.
“What we need is additional targeted support for people with limited means and to stop punishing those who need to work,” Mr Henschke says.
He also says the 20 September increase to rent assistance is a good start but more needs to be done to help renters.
“We recently heard from a couple who pay more than $920 per fortnight in rent. As pensioners, this leaves them with only $907.40 a fortnight to pay for food, fuel, utilities and other expenses.
“In our Employment White Paper Submission, we have called on the government to simplify the tax and transfer system to boost workforce participation, as well as increase income and savings.
“We want a change to income test rules for pensioners who want to work, and work more.”
He says that could be achieved by reducing the taper rate from 50 cents to 32.5 cents in the dollar to align with the tax system. That is simple, fair and will help solve critical workforce shortages and boost the budget bottom line, he says.
Would you be keen to see a change in the income test rules so you could work more without penalty? Share your views in the comments section below.
Also read: September 2023 Age Pension payment rates revealed
