Third anniversary of historic pension reforms

Today marks three years since the Australian Government delivered major reforms to the pension system to strengthen the financial security of seniors, carers and people with disability.

Since the reforms took effect in September 2009, pensions have increased by $172 a fortnight for single pensioners and $182 a fortnight for pensioner couples on the maximum rate.

The improvements this Labor Government has made represent the most significant changes to the pension system since its introduction more than 100 years ago.

Labor’s reforms included the biggest ever boost to the pension, a new pension supplement and carer supplement, an improved indexation system and the introduction of the seniors work bonus.

On the third anniversary of these historic changes, 3.5 million Australian pensioners will receive a boost to their payments.

Total pension payments for pensioners on the maximum rate, including the base rate and pension supplement, are now:

• $772.60 a fortnight for single pensioners, and
• $1,164.80 a fortnight for couples combined.

Single people receiving the maximum rate of Age Pension, Disability Support Pension and Carer Payment, as well as veteran income support recipients, will receive an extra $17.10 a fortnight. Pensioner couples will receive an extra $25.80 each fortnight.

We understand that pensioners have limited room to move in their budgets. That’s why the improved indexation system is so important – it helps ensure that when pensioners’ costs of living go up, the pension goes up with it, and means pensioners can share in our nation’s prosperity.

Senior Australians are benefiting from a range of Labor initiatives, including:

Improved indexation of the pension

We introduced a new pensioner living cost index to better reflect changes to pensioners’ costs of living by considering the goods and services pensioners buy – not what others in the community buy – recognising that pensioners spend more of their income on essentials like food, utilities and health, including pharmaceuticals.

Supporting seniors to work

We know the important contribution senior Australians have made and continue to make to the community and the economy.

The improvements we made to the Work Bonus last year have encouraged more senior Australians to stay in or take up work and continue to contribute their valuable skills and knowledge, as well as remain connected to their community and to the workforce.

In the last 12 months, about 137,000 age pensioners have been able to work while keeping more of their pension under the pension income test because of the Seniors Work Bonus.

Under the new Work Bonus, age pensioners are now able to earn up to $250 a fortnight from employment without it being assessed as income under the income test. This means they have more money in their pockets each fortnight. Pensioners can also build up any unused amount of the $250 fortnightly exemption to a maximum of $6,500 to use later.

A new Carer Supplement

Carers, who do so much for this country, have also benefited from the Government’s pension reforms, with a $600 Carer Supplement paid each year to recipients of:

• Carer Payment;
• Carer Allowance;
• both Wife Pension and Carer Allowance;
• both Department of Veteran’s Affairs Partner Service Pension and Carer Allowance; and
• Department of Veterans’ Affairs Carer Service Pension.

About 560,000 people received a Carer Supplement in July this year.

Helping seniors make ends meet

Under the Household Assistance Package, about 3.5 million pensioners have already received an initial payment to assist with any early impacts of the carbon price.

Initial household assistance payments were paid to pensioners in May and June this year. Single pensioners received $250 and pensioner couples received $380 combined.

From March 2013, pensioners will receive ongoing assistance worth about $338 a year for single pensioners and about $510 a year for couples combined, which can be paid fortnightly or quarterly. This payment will increase over time.

We have delivered for Australia’s pensioners and we’ll keep delivering to make sure they get the fair go they deserve.