Everything you need to know about the looming pension changes 84



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This week it became clear that the Liberal government had done a deal with the Greens that will see some of the original proposed pension changes passed in the senate. These changes are expected to affect hundreds of thousands of pensioners in ways that can be considered both good and bad.

The thing is that, as we know, Labor and the Greens are closely aligned and although Greens leader Richard Di Natale has publicly shared his support for the pension, the question remains whether or not Labor will try to disrupt it.

The initial proposed changes are:

  • The asset tests are tightened. The assets-free threshold increased (to qualify for full pension) from $202,000 to $250,000 for single home owners and from $286,500 to $375,000 for couple home owners.
  • Asset taper rates are changed from $1.50 to $3 per fortnight.
  • The threshold for pensioners who do not own their home will increase to $200,000.
  • The maximum value of assets to quality for a part pension will reduce. The part pension will not be available to around 80,000 people after they reduce the asset threshold (excluding home ownership) from $1.15 million to $820,000 for couples and from $775,000 to $550,000 for singles.
  • Those who qualify for the part-pension under the new rules with “modest” assets will receive a small increase to the pension.
  • Pension increases will remain aligned with indexation and not inflation.

And here’s what you need to know about their progress:

  • The tightening of the asset test is loudly opposed by the Labor party. They believe that this will not affect wealthy retirees as intended, but instead affect middle class pensioners making them worse off.
  • Asset taper rates have not had significant debate.
  • The part-pension redistribution plan aims to remove the part-pension of over 91,000 retirees completely, decrease the part pension of over 200,000 retirees however increase the part pension to around 170,000 retirees by about $30 a fortnight. This has caused a spike in spending as part-pension recipients are now looking to part with assets to qualify for the full pension.
  • The unchanged pension indexation is well received by all parties as there was fear indexation would be slowed and aligned to CPI.
  • The Labor party has publicly expressed support to see the senior supplement abolished.

If it passes the senate which it is likely to if the Greens stand their ground in supporting the policies and don’t retreat to Labor’s position, the changes will have big impacts for seniors right across Australia.

So tell us today, how will these changes affect you? 

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  1. Although I receive a part pension from Centrelink I am assessed under the income stream and not the assets stream so I don’t think it will affect me at all

    3 REPLY
    • I get a small pension from the UK monthly as I was born there – have lived and worked in Australia since 1964 – plus I also have a small pension from my job in the Commonwealth Public Service and my Centrelink pension is adjusted accordingly i.e 50c in $1

  2. I think we have to have more information with regard to people who have a partner in aged care. Having $800,000.00 in assets is going to run out pretty quick when you are paying nearly $1,000.00 per week for the partner in care, then the other partner has to live. Unless you have very smart money people helping you the asset will be eroded very quickly. Just saying.

  3. Got no assets or income so not affect me. I agree in principle with the changes but i’m a bit concerned the figures are not entirely fair.

  4. Nothing changes for me either but your A Liberal Voter, you must be getting nervous, surely your seeing what the rest of us are seeing , The Greens are are out to take disgruntled Liberal votes, many small l Liberals are not happy with this Government and The Greens are being very compliant 🙂

    3 REPLY
  5. I totally agree with Linden. Having had a family member in aged care,soon erodes your income . Although part pension rose as a single couple,there were so many other additional costs in keeping somebody in aged care … It is now a wait and see game for pensioners,the govt are playing cat and mouse with us …

  6. Can the Greens hear Col Joye warbling in the background. “Bye bye bye bye bye bye baby goodbye.”

    2 REPLY
    • I wonder if this is why Christine Milne left.
      If this is the new face of the Greens I think it will be their downfall.

    • The Greens obviously have forgotten or forgiven the Abbott lie. ” No changes to pensions…………………….”

  7. The article does not tell the full story. People who are assessed under the income test and also receive a defined benefits income from superannuation will be greatly affected. The tax free portion of the superannuation income will reduce from around 40% to 10% making a much greater portion of that income assessable. Each additional dollar of income will reduce the part pension by 50 cents. Why is this not being publicised or debated?

  8. Politicians don’t get pensions . J Howard abolished that for all post 2004 . I don’t know too many disgruntle Libs . Poorer pensioners will get more. If a person has a few hundred thousand surely they can live a very good life on that

    4 REPLY
    • If a person has a few hundred thousand he will be worse off. If a person has over a million – they won’t contribute one cent to the rise the pensioners will get. Standard Liberal policy. Pander to the ultra rich and take from those with less. Nothing new there. The Greens, siding with them against the working class is the shock.

    • If a person has a few hundred thousand they are welcome to it, must have paid high taxes or been a good saver & WOULD BE be paying TAX on their Super, I don’t have a million I am quite happy on my SMALL amount , not jealous of any one. Sick of this attitude that any one with savings has to keep SO many others now who for one reason or another has nothing, We All have had bad luck, bad health, loss of jobs etc, but manage to accumulate a small nest egg.

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