Asset threshold changes –will my pension be affected?

We clarify what the 1 January 2017 pension changes actually mean.

Brown folder labelled pension detailing pension changes

Matt is concerned that the changes to the asset thresholds scheduled for 1 January 2017 will greatly impact his Age Pension, so we clarify what the changes actually mean. 

Q. Matt

I am contacting you about the changes that will come into effect on 1 January 2017. There is very little information about the changes that I can find. Perhaps you can help. 

As a single person I am concerned about the impact of the income and assets test. Presently, the income test is the tougher of the two. I believe that based on the existing deeming rule, a person having $250,000 would not receive the full Age Pension. 

I have read that the pension will increase, but will the utility and clean energy supplement be removed? If this is the case, then the increase may be there to compensate for the supplements being taken – is this correct?

A. When you apply for an Age Pension, your income and assets are separately assessed to determine which test results in the lower rate of Age Pension payment, and this is the payment you will receive. This is also the ongoing method by which you will be assessed. Periodic reviews of your income and assets may mean that, if the alternative test returns a lower payment than you are currently receiving, then this will be the method under which you are paid. 

It should also be noted that the pension taper rate will increase from $1.50 to $3 for every $1000 over the asset threshold your assets are and, therefore, this may result in the method under which you are paid being changed.

The asset threshold is a total of all your assets, some of which will not be subject to deeming, therefore it is not correct to assume that someone with assets of $250,000 will not receive a full Age Pension. 

The Age Pension is not due to increase, other than by regular indexation. What has actually been said is that some people will receive more Age Pension due to the changes in the asset thresholds. There are no plans to remove the Clean Energy Payment or the Pension Supplement. 

You may find the following article useful – Age Pension: Asset threshold changes


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    18th Jan 2016
    Yes the rules under which pensions are paid must be very confusing. Recently my wife was told by a person working at wherever it is you apply for pension, that the value of the house (permanent residence) would result in a significant reduction in payment. I was of the understanding that ones house was not part of the 'Assets test'. If they don't know what they're doing there's not much chance for the rest of us is there???
    18th Jan 2016
    More misinformation being needlessly spread about to worry pensioners. Centrelink staff do make mistakes, and I for one, have an exceedingly poor opinion of those public servants, having experienced their stupidity on more than one occasion. BUT I seriously doubt any of them are so stupid as to make a statement like that.

    To the best of my knowledge no-one has ever said that the principal place of residence will be included in the assets test.

    If you applied any sort of common sense to that statement, you would quickly realise that NO political party would ever contemplate committing political suicide by even suggesting it. Yes politicians are stupid, but not that stupid. They know which side their bread is buttered, believe me.
    18th Jan 2016
    This is what the current government tried on under Abbott and what it is still working towards. Remember that they never abandoned the dreaded Work Choices and are now chipping away at average poorly paid Australians. The family home is currently exempt but don't hold your breath if this government is reelected. It'll be in almost immediately I would think if that happened.
    As I always say..........the public deserves what it gets when it exercises it's right to elect governments. That's why you have to cut through the political advertising lies and go to the heart of WHAT THEY ARE WANTING TO DO. Both sides.

    18th Jan 2016
    bartpcb, OF COURSE being a homeowner has a SIGNIFICANT effect on your Age Pension!! Just look at the disparity of benefit rates between a homeowner and non-homeowner. It has been that way since sliced bread, and will get even worse WHEN, NOT IF, the family home becomes classified as an asset. Wor hard, save, and sacrifice and be penalised. Be a refugee or a deadbeat and you'd fare better for the respective amount of work you do during your life. Life's rewards for one's struggles are more often than not ass-backwards.
    18th Jan 2016
    Life ain't always fair Eddie and those who have nix are always wanting more and pointing at people like yourself who have done the very very hard yards and now have a few bob to your name.
    Personally I'd be happier if governments went after multinationals and force them to pay tax (a protected species!) and the rich with their tax shelters and deductions for things which are not even business related (also a protected species!). Sadly average Australians are always in the cross hairs of coalition governments which have nothing other in their small minds other than increasing taxes on the bottom 90% of Australians and giving the top huge tax cuts...and then the next one. This is what the current government is doing with the GST increase.....take from average citizens and drop tax rates for the rich.
    18th Jan 2016
    Does it Eddie?

    Please detail just what you reckon the difference is, or stop talking such damn rubbish.
    18th Jan 2016
    Hasbeen, by the comments I've seen you post you should refer to yourself as "Neverwere". If you can't interpret my message you are even thicker than you appear!
    18th Jan 2016
    Thought that Eddie's post was crystal clear Hasbeen. I fully understand that having enough to eak out a living no better than the pension means that you are fair game.
    Eddie is not talking about very wealthy people who have abused the tax system with creative accounting and expensive lawyers to find loopholes. He is talking about people who have worked hard for decades, saved rather than spent, invested wisely, gone without and done it really tough. Then at the end one sees money thrown at rorters and people who have never worked a day in their miserable lives. Leaves a not so nice taste!
    Does that about cover it Hasbeen?
    18th Jan 2016
    Thank you, mick, yes, you understand what I am saying, but I think your words would mean more to the cat than Hasbeen.
    18th Jan 2016
    I have no trouble understanding Fast Eddies point of view. I agree with him.
    A home owner, who worked hard copped the high interest rates when mortgages cost more than rents gets no assistance regardless of the amount of rates, insurance or maintenance.
    Workers who have saved diligently for retirement often get no government payments at all.
    It is going to get harder for these people. Today I read Morrison wants to put 15% GST on everything so that corporate tax can be lowered to 22%.
    You can bet the self funded retirees won't be compensated.
    I'll also bet it won't improve wages or unemployment one bit either.
    ex PS
    19th Jan 2016
    Home owners have a great advantage as retirees, I could not imagine having to live on a pension and having to pay rent. I nfeelm that owning your own home can make the difference between living in comfort and living in poverty in old age.
    I have no problem with pensioners getting more money if they don't own a home it makes sense to look after those who need it most.
    I take issue with people that would have us believe that discussions such as these should not be politicised, most decisions that have an effect on seniors are politically motivated and should be assessed with this in mind.
    I would also remind some contributers that there are many seniors out there that have worked hard all their lives but for various resons have not managed to buy or keep a family home. Just as all wealthy people do not neccessarily work hard, it does not follow that the less well off are lazy.
    18th Jan 2016
    These LNPs who declare ecenomic war on the us oldies in a variety of forms (yes, not even the gold Opal card is safe!) then swan off to cushy jobs overseas (eh, Joe?) don't deserve to get back in. It's a "slash and burn" policy that they follow, while cozying up to Big Business and allowing them to pay their taxes overseas at reduced rates (eh, Turncoat?) while they are permitted to plunder and pillage our country. Am I angry? YOU BETCHA! OUT LNPs, OUT
    18th Jan 2016
    disillusioned, the Gold Opal Card is issued by the NSW State Government, not the Federal Government who pay pensions! We really need to get our facts straight here folks!

    For those outside Sydney, The Gold Opal Card is only for NSW Seniors and Pensioners to travel on NSW trains, buses, ferries, light rail. It is an extremely generous system allowing us to have our fares capped at $2.50 for all day travel. It covers us to travel from Nowra in the south, to Newcastle in the north, and to Bathurst in the west! It has been capped at that rate for some years, so it will have to realistically rise eventually.
    19th Jan 2016
    It is a shame the opal card needs constant topping up unlike the e toll which can have money left on it for use when you need it.

    I got an opal card, paid my $50 and was refunded the money. I don't use public transport except to go to the airport. I'll have to figure out how to get funds back onto the card when I do want to use it.

    Lots of infrequent users of public transport are bemused by this aspect of the opal card.

    I agree it is a generous system at $2.50.
    18th Jan 2016
    There's a fair bit of confusion in the above posts.
    Yes, having your own home, whatever it value, does result in a lower rate of pension than a non-homeowner.
    But the value of that home is not taken into account in the assets test.
    It can be a ten million dollar home in the best suburb or a shed in the outer suburbs.
    It is simply that if you are a homeowner, you are assessed differently to a non homeowner.
    18th Jan 2016
    Well said Fast Eddie, I totally concur with your statement.
    18th Jan 2016
    Is there ever a time that someone with a genuine question regarding anything at all can get a response from some contributors that seem to have a not so hidden agenda ie getting rid of the current government, it seems some contributors have an obsession with their views on who should be running the country, and forecasting what is going to happen after the election, after 50 years of voting I realised that most politians are there to feather their own nest, no matter which political party is in power, just my opinion of course!
    18th Jan 2016
    Dim if its about the Proposed Pension changes, can I help?

    I have posted a fair bit about this in recent weeks
    18th Jan 2016

    A bit more, this article has a link to previous articles, most of my info , and others comments is in that article.
    18th Jan 2016
    Thanks for the offer rodent, but I was only referencing some of our politically active contributors that seem to think that this site is their very own political platform, I appreciate the offer of help from yourself and I believe that that is what this site should be about. I will be uneffected by the proposed changes, may even get a small increase according to the Centrelink financial advisor, who I have found to a good source of information.
    ex PS
    19th Jan 2016
    Dim, unfortunatley political views run deep in a lot of us. The fortunate part is that it is quite easy to spot the punter who is one eyed and unfair in their criticysms and allow for their prejudices.
    I for one have been guilty of backing one political party no matter what for decades.
    I can now say that from a retirees prospective I have decided that to blindly follow any party no matter what , will only end in disaster. I don't have allegance to any party I vote against any political party that is going to do me harm in the long run.
    18th Jan 2016
    Poor old Hasbeen, shouldn't be hearing from you for a while, until you get a ghost writer or learn the word comprehend. Cheers Jacka.
    18th Jan 2016
    Here i go again ,nearly had a nervous breakdown applying for the OAP in the first instance as i was ''one of a couple'' Now got to try and figure what my assetts are allowed all over again and getting 6 or 7 explanations from different c/link staff. Not exaggerating here ,i needed the intervention of a senators office first time around to sort them out
    18th Jan 2016
    What is the list of items that are classed as an asset?
    18th Jan 2016
    Simply type "Centrelink assets test" into your browser and then tap the "search" button. This will make you a REAL Believer, Believer .
    B j
    18th Jan 2016
    Try your Federal local members office they have a Pensioners & seniors information kit.It has all the useful information.When I went to Centrelink to enquire about pension showed the woman behind the desk this book she said where did Yu get that from never knew it exisited.(lack of training)hope they still make this kit as the last one I received was a good couple of yrs ago worth a try.
    19th Jan 2016
    Correct, these are very useful. Just make sure you get the latest version- with Pension Rates as at 20 Sept 2015
    19th Jan 2016
    Have NOTHING and get the full aged pension>>>>> $1000 fortnight, and also save some, oh yeah....that's the way to go.
    19th Jan 2016
    Stone the crows and stuff a parrot: I get free licence, car rego, many other things are free too, Gold Opal $2:50 daily rate, prescriptions for $5.20 each, discounts on power and gas bills. How about a thank you for what we pensioners get instead of the constant whinging?
    19th Jan 2016
    Pixapd - you are talking through your hat. Where did you get all your misinformation from ?
    I am on a full age pension and know for a fact that it is NOT $1000 per fortnight. My licence and car reg are NOT free either and the last time I had a prescription filled , it cost me $6.10 ---- NOT $5.20. The only thing you are right about is that I do get a discount on my power bills.
    So please get your facts right before you 'post' and reveal your ignorance.
    I do however, agree with your statement that we should stop whinging, there are some people who will never be satisfied with their lot in life and they are often the ones who didn't plan for the future during their working lives.
    19th Jan 2016
    Notelle... Go to jail, go directly to jail, do not pass GO do not collect $200. By the way I live in NSW..and you are correct in one way...I rounded up my pension to $1000 fortnight but it is only $996:40 and scripts are $5.20 with the New Govt really need to find out matters before commenting.

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