Media Release by The Hon Jenny Macklin MP

Pensioners feeling the pinch set to get a boost

Australia’s 3.4 million pensioners will soon receive an increase in their payments to help them meet increases in their cost of living.

From 20 September this year single people receiving the maximum rate of age, disability and carer pensions, as well as veterans’ income support recipients, will receive an extra $19.50 a fortnight. Pensioner couples combined on the maximum rate will receive an extra $29.60 a fortnight.

As part of our historic pension reforms the Australian Government delivered an improved indexation system to ensure the pension keeps up with the cost of living.

Pensions are now indexed twice a year to the higher increase of two measures: the Consumer Price Index or the Pensioner and Beneficiary Living Cost Index. Pensions are then compared to the Male Total Average Weekly Earnings benchmark and are increased if necessary to meet the wages benchmark.

Over the last two years, two of the four pension increases have been driven by the pensioner living cost index and the other two increases have been driven by the wages benchmark.

This September the pension will be indexed to the rise in pensioners’ cost of living. In the six months to June 2011 the Pensioner and Beneficiary Living Cost Index rose by 2.7 per cent, compared to a 2.5 per cent rise in the Consumer Price Index and a wages benchmark increase of 2.1 per cent.

We know that pensioners on a fixed income have the least room to move in their budgets and that’s why it’s so important that when their cost of living goes up, their pension payment matches it.

Following these increases, total pension payments for people on the maximum rate, including the base rate and pension supplement, will be:

  • $748.80 a fortnight for singles, and
  • $1,129.00 a fortnight for couples combined.

In September 2009, the Government delivered the most significant reforms to the pension system in its 100 year history. These reforms delivered pension increases, a new pension supplement, a pension Work Bonus and a new indexation system.

The improved Work Bonus which began on 1 July this year gives age pensioners even more help to balance their household budgets, by letting working pensioners keep more of their pension when they work.

Over the last two years the pension reforms have delivered increases to the maximum pension of about $148 per fortnight for singles and $146 per fortnight for couples combined.



The rate from September 2009 includes the base pension and Pension Supplement. The rate prior to September 2009 includes the fortnightly value of Pharamceutical Allowance, Utilities Allowance and Telephone Allowance (at the internet rate).

From 20 September, a further one million Australians will also benefit from increases to income support payments such as Parenting Payment and Newstart.

Parenting Payment will increase by $15.60 a fortnight for singles.

Adult rates of allowances, such as Newstart, and supplementary payments are also indexed on 20 September each year to the Consumer Price Index increase for the previous six months. Allowance rates for single people (21 or over, without children) will increase by $11.90 a fortnight. Rent Assistance will also increase.

Full details of new rates can be found at Rates Indexation September 2011