Is Age Pension eligibility age set to be raised to 70?

The Age Pension age was extended to 67 on 1 July. Given an estimated 3.6 million Australians will move into retirement in the next 10 years, is it set to be pushed back even further?

The ‘burden’ of ageing populations is a regular headline and research by the Macquarie Business School now recommends further increases to the Age Pension qualifying age – all the way to 70 by 2050.

Macquarie University Business School Professor Hanlin Shang and his co-authors say there should be three more pension age increases in the next 27 years – to 68 by 2030, to 69 by 2036 and to 70 by 2050.

Age Pension age was 65 in 1909 and 60 for women from 1910, but we’re living longer healthier lives, putting a heavier ‘burden’ on the government purse, according to many sources.

Since 2017, eligibility age has increased by six months every two years.

In 2014, a Liberal Party proposal explored the possibility of raising the pension age to 70 by 2035. In 2018, then prime minister Scott Morrison abandoned any intention to lift retirement age that high.

But research is giving that proposal fresh impetus.

‘Burden’ on the pension system

Prof. Shang and Professors Rob Hyndman and Yijun Zeng conducted a statistical analysis and concluded an increase to 70 years by 2035 was too rapid. Hence their recommendation to transition retirement age to 2050 in order to maintain the old-age dependency ratio at 23 per cent.

Explaining the importance of that 23 per cent ratio, Prof. Shang says: “The ratio comprises two elements. First, it’s the number of people aged over the pension age and in retirement divided by the number of working people aged between 15 years old and retirement age.”

He says Australia’s low birth rate is a key factor affecting the future size of the workforce.

“Fewer people in the working group and more in retirement will make the old age dependency ratio (OADR) higher. What this means is there are fewer working people to support elderly people. And with more elderly people in the population, this will create a burden for the government pension system,” he says.

The Treasury office says there were 3700 centenarians in 2021 and that number was expected to hit 50,000 by 2050.

“While it’s great that we are living longer, it may not be good for the government pension system,” says Prof. Shang. “Who would have ever thought there would be so many centenarians? As people live longer, there is a longevity risk and they’ll consume more pension from the government.”

Is migration the key?

Professor Shamit Saggar, director of the University of Western Australia Public Policy Institute, is another who believes the pension age will rise.

“I wouldn’t be surprised if this government or a future government does look at trying to raise it beyond 67,” he told SBS News.

He also argues that there is a real risk the Age Pension will be underfunded because it “is dependent on how many pensioners we have at any one time, relative to the number of working Australians we’ve got”.

Prof. Saggar says there are other solutions that could ease pressure on the government budget, such as expanding the workforce through migration and better childcare policies to allow more women to work more hours.

“Migration tends to have a much younger age profile and migrants are typically more economically active than native-born Aussies,” he says. “Therefore, it is one useful way of expanding your working-age population.

“There’s lots of things that can be done so you squeeze more working hours and working days and working years out of the existing population by making work more worker friendly.”

According to the Australian Bureau of Statistics, the average retirement age is 55.4, and, on average, women retire earlier than men.

Yet the number of employees aged 65 and over in the workforce has more than doubled in the past 20 years to about 15 per cent, according to the Australian Institute of Health and Welfare. There is an increase in demand for jobs in which older people have an advantage, typically non-routine that require strategic thinking and people skills, says the Centre of Excellence in Population Ageing Research.

Let Pensioners Work campaign

National Seniors rejects calls to raise the pension age to 70, arguing that the best way to tackle declining workforce participation is to provide incentives to work for longer.

National Seniors’ Let Pensioners Work campaign is seeking a reduction in the income test taper rates so a person can keep more of their pension if they choose to continue in the workforce.

That is a fairer way than raising the pension age because it rewards people who want and need to work, it says.

Chief advocate Ian Henschke told Radio 4BC that pensioners who chose to work would benefit from extra income and their participation in the workforce would also help the economy.

“If you are on a pension, you want to keep working, let them work and it’ll be a win for the economy, it’ll be a win for the pensioners themselves and it will be a win for the government,” he said.

A further question is whether long-term Age Pension cost estimates are accurate, given the maturing superannuation system that means many more older Australians are self-funded for at least part of their retirement.

An Australia Institute research paper states that superannuation tax concessions cost almost as much as the $55.3 billion spent on the pension.

Writing for YourLifeChoices, Australia Institute senior economist Matt Grudnoff said much of the support to boost retirement incomes goes to those who do not need government support and not enough goes to those who really need it. “While spending on the Age Pension is well targeted, more than half of super tax concessions go to those who do not need income support in retirement.”

So perhaps the focus should be on the superannuation system and not on further tinkering with the Age Pension age.

Are you intending or did you work beyond the Age Pension eligibility age? Is there a case to raise the eligibility age further? Why not share your thoughts in the comments section below?

Also read: The difference a decade can make to your retirement savings

Janelle Ward
Janelle Ward
Energetic and skilled editor and writer with expert knowledge of retirement, retirement income, superannuation and retirement planning.


  1. Everything changes over time but as the pension age of 67 in Australia is now about the oldest in the world I can’t see it being increased anytime soon.
    As the article notes there are riots in France over their government wanting it raised to 64!
    The Philippine government is reducing the retirement age for public servants there from 60 to 56 on the grounds that they should be able to claim their public service life time pension at an age when they can still enjoy it.
    Even here there are some occupations such as the military and police where being pensioned off at 55 is common, and lets not even mention politicians.
    So IMO 67 is already a high number.

  2. I am entering my 66th year in earth and have always known the system to be that you go to work, you pay tax and look forward to the day you can chill and do all those great things that are promised to us each election. I am now nearing that supposed time with arthritic hips waiting for the time I get placed on a list which will put me in the huge cue awaiting surgery. I do volunteer work in order to have payments to allow me some form of enjoyment and survival. I struggle a lot of the time as mobility is not easy. I would gladly have continued paid work if surgery was made available to give me a body that would give an employer what they expected from an employee. By delaying pensionable age, the government is creating a double edged sword for people in my predicament. I hope I will be able to enjoy something of the time I will have once the golden age is reached…….whenever that may be!

  3. Just to make the obvious obvious, at 65 a male has roughly 15 years of life ahead, and maybe half of that will be in a nursing home. So if we make males work longer, they have much less time to actually do stuff in before they are incapicatated, bearing in mind that males before residential care may have home services in place and not enjoying care free years at all. Pretty much work till you drop.

    Women do live longer, generally do not enter nursing homes as soon as men do and that raises some interesting questions – such as should the retirement age of women be raised? The historical of women having a lower retirement age seems to have been an enormous error.

    To be quite contentious, if women are living longer, and have more productive years than a male, then is child bearing/rearing really the cause it is made out to be, to women having lower pay and lower occupational success? Have we jumped on an obvious connection which may not be all that relevant to their plight?

  4. Please delete my earlier comment as i don’t seem to have the control to do so. There appears to be an error in the way I described the stats. Very sorry. Although there are differences between the two sexes, the variation isn’t great between them. For example, by age 79 about 30% of males are in nursing homes, while for women it is about 23%. Reduce the age by 5 years, and the stats are about 16% and 11%. Increase the age to 84, the percentages are about 52% and 43%

    Life spans – the tables i used a few days ago could not be found but the ABS table is saying a 65year old male will live about another 20 years, while for woman it is 23 years.

    So PLEASE delete my earlier post! and please don’t post this one.

  5. I’m 61 and am only able to get shorter term contract work these days and have longer waits between the contracts. Its a long wait to 67 and I will probably use up a good portion of my super by then, unless I downsize. I could get job seeker, but I’d need to volunteer 2 days a week and there’s not much I’m keen to volunteer for, I like gardening so maybe a bushcare group, but I can’t imagine spending 2 full days in the hot sun in summer for job seeker payments, which will maybe cover some of my groceries for the week. If we could convince employers to offer stable employment to over 60’s then maybe we’d all make it to the pension age, without dipping into our super.

  6. Seems convenient to forget that when the Age Pension age was 65 back in 1909 and 60 for women from 1910, there was a levy on all workers to put funds into a Welfare Fund to cover retirement. People paid a 7.5 percent Old Aged Pension tax/levy, regardless of how current politicians try to rewrite history. These funds were £100 million in 1950, which would be several trillion dollars in today’s money.
    According to the email, in 1977 Prime Minister Malcolm Fraser transferred the balance to Consolidated Revenue but to this day the contribution is still coming out of everybody’s pay packet. but we’re living longer healthier lives, putting a heavier ‘burden’ on the government purse, so since 2017 eligibility age has been increasing by six months every two years.As noted above, from the outset the overriding goal of the pension was to provide a sufficient level of support to ensure a retired person was able to live in modest comfort. Since the introduction of the 1908 Act, this view has become entrenched.

  7. I have been on this site for many years now, and this is a topic that is on regular rotation every couple of months. Guess it is one that generates a lot of clicks for the advertisers and YLC funds.

    Over and over again we debate the same things, as if you cannot remember reading and responding to the previous article a few months ago. That sounds like a serious health issue in the making right there.

    There is an old expression that if you say something often enough people will believe it. Maybe, but not me. I may be old, but I can still think for myself.

    In previous iterations of these articles, most writers were blaming the Liberals for all the woes we pensioners suffer. Fair enough, they made life hell for us. The unspoken part of this was that it was all going to change under Labor. And guess what, NOTHING has changed – as I keep writing over and over again in my replies here. Nothing is going to change, it is what it is.

    You can continue to complain till the cows come home. It is futile. There seems to be some belief here that politicians read YLC. I can assure you they don’t.

    I’ll finish my little rant with another expression – If you are NOT part of the solution, you are part of the problem. If you really want change, then YOU need to do something and writing little letters to YLC isn’t gonna cut it – ever.

  8. I really think any government should practice what they preach, Equality in Australia.
    This also means what each and every Australian is entitled too.
    So Equality means you and me get the exact same in everything to be very fair.
    So if an elected member of parliament gets more Superannuation than you and I or he or she leaves the Parliament after 3 sitting terms they are entitled to there Pension for Life.
    So where is the equality where you and me now have to wait until 67 years old and a member of parliament who say is 50 years or under 67 years can obtain a cash payment pension every fortnight.
    So there is no equality between us and them.
    Kevin Rudd for example retired Prime Minister on his pension then gets a plum position Ambassador for Australia in the USA earning more per fortnight than you and i can earn under the current Centrelink laws we abide by.
    So this shows no equality between me , you and them..

    So yes i can see more dabbling in the future fund where are pension money is parked and invested and as they spend it the balance will decrease and because of their mismanagement the Aged Pension will rise in qualifying age in the future to make adjustments to the balance and decrease the benefits we are entitled too.

  9. Amazing how we older people weren’t classed as excess baggage when we were working and paying taxes which most did for fifty years or more. If politicians can’t handle the economy then why are they there, time they looked at the way they work out how to achieve a satisfactory solution to the ageing problem.

  10. All the money that was available for the pension is disappearing because it is being spent on families earlier in life.
    Last I read Australia’s pension cost was 4% of GDP and the third lowest in the world and one of only a few under 10%. I am not suggesting that pensions should be more than 10% of GDP but would between 5 and 10 be unreasonable? As has been stated many over 55 are on Jobseeker payments anyway with the need to meet “mutual obligations” to receive a payment. Employers don’t want older employees for the most part. Some consideration for people who have already worked most of their lives would not be out of place.

  11. Due to many aged pensioners, supplementing their retirement with their super and/or in many cases fully funding their own retirement are not a burden on the government. The fact is, there are fewer pensioners relying on the pension every year, and the so-called burden on Centrelink is decreasing every year. In my opinion, every Australian is entitled to a full pension despite their assets. Pensioners have paid for their pension via taxes.

  12. I am 67, will be 68 next year. Fortunately am still working full time. Plan to cut down a day next year if financially viable. I have a small mortgage, trying to save up more super if I can. (dont have bucket loads like politicians!) As someone else mentioned a lot of money is spent on families, helping them with economy at present. These taxes that they are spending come from those older persons who continue to work.
    There was a few years ago an incentive to keep working and you got a bonus paid after so many years – I remember my dad did this. That has now been scrapped.
    Its all very well saying increase the pension age but what about those who cannot work till that age; builders, etc. They should be looking at quality of life for people, assisting them where they can.
    While they are at it how about mandating the amount that energy companies pay rebate on solar systems, instead of being greedy and wanting more money – but thats another argument.

  13. I suggested some time ago that any one under the age of 30 Y.O should not receive Newstart, get a job. Of course anyone on DSP etc would continue to be paid but those that are capable of working go and work. As a country we can not afford the $3.8Billion a week we pay out in social security. So fix it .

  14. In 2014 it wasn’t a proposal and they didn’t “explore the possibility” it was presented as policy to be implemented there and then. (Over time of course) The only reason it didn’t happen was because it was blocked in the Senate. I don’t think that a “Professor” from the Macquarie Business School is really qualified to be telling 60 plus year old bricklayer that he should work until 70.

  15. Might I suggest that we look at it another way.
    I suggest that Australia no longer means test for the pitiful old age pension. The advantage of that being that Centrelink and all associated bodies would no longer be necessary to the degree that they are today and squillions would be saved by the cutting of the excessive number of staff that are in those departments. Furthermore it would no longer be necessary to have all these arguments about how much the pension age should be raised which seem to occur with monotonous regularity.

  16. Trust a room full of chair polishers to want to increase the retirement age to 70. Only a small percentage of workers work in jobs that aren’t physical in nature and hard on the body. People that have worked in areas like mining and construction are lucky to live to 67, let alone stretching it to 70. How about allowing them some years to enjoy retirement, not working them into their grave.

  17. The rise on age pension was abrupt, the way they should rise the age pension must be based when you born and give a gap that cannot affect those who reached the age pension and now they have to wait two years more, you said: “Since 2017, eligibility age has increased by six months every two years.” so that mean that you are 65 now, they raised up to the age of 67 so in 2 years again the age pension will rise to 69 years and you will never retire, per example a person who reached the age pension when they have reach 65 should not be affected so those born in 1958 should get their pension and those who born in 1959 – 1960 should wait until they get 67, that’s the way should works, this is the clear abuse of the square head politicians.

  18. So many wonderful and accurate replies re the levy which we are still paying and it was Malcolm Fraser who put the levy into Consolidated Revenue. Who was his Treasurer? Little Johnny Howard “The Rodent” Who had Interest rates at 22% The HIGHEST in Australia’s History and who used “Who do you trust to keep “Interest Rates” low to win an election. All my young life I worked in the mines, as did my Father before me, then I had a job that required long hours of walking. At 60 my knees and hips were in a terrible state but John Howard wouldn’t give me the Invalid Pension and I had to keep working for another five years before I was eligible to collect the pension. All this extra work did more damage to my knees and hips, so much so that I’m now looking overseas to have an op to repair my knees and restore my quality of life so I can enjoy my last few years on this wonderful Earth. How much profit did the Com Bank Make? How much did the Last Liberal Government pay for Consultants? Australia is a very Rich Country if we were receiving the correct return on our Gas that alone would cover the Pension. Wake up Australia, they should be lowering the Pension Age, not increasing it. I’m 86, should I now be returning to Work. Maybe I’ll have to because in spite of all the recent increases my Gas and Electricity will now INCREASE by $1000.00 a year. The last Pension increase wasn’t enough to buy a cup of coffee.

  19. I have read most of the comments and break my heart, the way those shinning bum politicians and public servants see their parents, uncles and friends and the hard worker in Australia is deplorable, always attacking the weak people (pensioners) but they want to expend billions in a Nuclear powered submarines, Hey politicians Australia has become a place hard to live is too expensive!!!!!

  20. Heartless, thoughtless statistics. I am about to octogenerate, but at 60 I was already considered too old and room had to be made for younger people to enter my profession. Fortunately, I am unlikely to be around in 2050.

  21. To Kev, the pension is Un-Funded ie: It comes from daily revenue I don’t believe the Government has this pot of money that it dips into each week to pay all of the fortnightly pension payment. It is funded from daily revenue Taxes, GST etc

  22. How about removing the burden on taxpayers by taking away the Single Parent pension for those that keep having child after child with the same man but are supposedly “single”? They will soon be a bigger burden than age pensioners. One accidental pregnancy l’d believe but when it come to 2. 3, 4, or more, something isn’t adding up and centrelink don’t even question it.

  23. The current pension in Australia is not a lot of money, however people can prepare for their retirement a lot better by using salary sacrifice, or what Is simply known as TTR Transition to Retirement, this has a lot of $ benefits attached to it besides the major one that being, less tax while you are still working and boosts youR super quiet rapidly, this I believe should be started 10 to 15 years out from retirement, doing this makes for a comfortable retirement.

  24. A far fairer way of setting the pension age would be to base it on the number of years worked paying income tax and in the case of women allow so many years for each child reared. If for example everyone was required to work 45 years those who did manual work could retire in their early sixties and some of our professional student who remain at Uni into their mid to late twenties would retire at 70+ and be physically capable of doing so.
    If as it is (erroneously) claimed the self funded pensioners are costing so much then why not give everyone the same pension and tax any additional income? I say erroneous because a tax concession is not the same as paying a pension out of tax receipts. Don’t believe me then if I withhold paying you $1000 it’s not the same as demanding you pay me $1000 is it?

  25. RodM.. something like 5.6% of everyones tax payment went into a pension fund decades ago so there was a huge pension fund until Malcoln Fraser couldn’t keep his bloody hands off it and rolled it into consolidated revenue and they would now like you to believe that they are paying you a pension out of the goodness of their heart! not so we paid for it !!!

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