Calls for pensioners to be able to earn more without penalties

There are calls for pensioners’ work allowance to be increased so they can earn more money before their welfare is docked by the government.

Under the current system, pensioners can earn up to $250 a fortnight, or $6,500 a year, before their fortnightly payment is incrementally reduced, but National Seniors Australia says the earnings restrictions make it difficult for pensioners to meet the cost of living.

According to its research, the key issue confronting the majority (51 per cent) of pensioners was the payment’s inadequacy to cover the cost of living.

Many were willing and able to work part time, but a loss of pension income was a major disincentive.

Chief Advocate Ian Henschke said raising the earning limit to $335 a fortnight ($10,000 a year) would help millions of pensioners pay for basic necessities and live with dignity.

With the single Age Pension, including supplements, is set at $894.40 a fortnight, the increase means pensioners would earn $540 more than the minimum wage a year, or an extra $21 a fortnight.

“This is hardly going to put them on easy street,” Henschke said. “Pensioners are struggling to pay for basics such as food, power and health costs.

“The cost of electricity and health insurance have skyrocketed and we are constantly hearing from seniors who are reluctant to use air-conditioning in summer or heating in winter, or who go without food or other essential items to pay their power bills.

“Our research shows one in three Age Pensioners would continue in paid employment part-time if the Work Bonus was increased to $10,000.”

The number of Australians aged 65 and over is expected to increase from 15 per cent now to more than 20 per cent by 2042, and thousands of these retirees are expected to apply for a full or part pension.

If their capacity to earn an income is not properly aligned with the rising cost of living, it will see thousands forced to live below the poverty line. Currently, about 30 per cent of Australian pensioners are living below the poverty line.

“In 2015-16, half of all men and 65 per cent of women aged 60-64 had less than $100,000 in superannuation,” Henschke said.

“Increasing the Work Bonus to $10,000pa would be a good first step to improving the lot of Age Pensioners and reducing widespread pensioner poverty.”

National Seniors Australia argues that raising the Work Bonus means pensioners will be less reliant on the welfare system, and therefore less of a burden on taxpayers and the economy.

“It provides a way for pensioners to help themselves and to make ends meet without having to rely further on government income support,” Henschke said.

Do you think the Work Bonus limit should be raised? Are pensioners forced to live on too little? Do you find if hard to make ends meet?

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