Many older Australians are the beneficiaries of the May 2023 Federal Budget, with a cash boost for over-55s on JobSeeker, increased Rent Assistance and significant assistance for winter power bills for those on pensions and payments.
It will also be cheaper to see a doctor, with bulk-billing changes hailed by the Treasurer as the centrepiece of the Budget.
The $7.5 billion improvement in Medicare, indicates “the days of raiding the welfare budget” seem to be over, says commentator Laura Tingle.
Aged care workers will receive their biggest pay rise in history and the people for whom they care should also benefit from happier carers.
Dr Chalmers says cost-of-living relief is the Budget’s “number one priority”.
“Our overriding ambition is to help the people who need it most,” he told ABC’s David Speers. “We want to look after people, but we want to do it in a sustainable way.”
He added that he was “very proud” of the $4 billion surplus forecast, along with smaller deficits over the next few years.
“It’s a budget in Labor’s best traditions but also Australia’s best traditions: help for the vulnerable, broadening and extending more opportunities, and investing in the future of our country and its people,” he said.
“In dollar terms, it is the biggest budget turnaround on record, because of our responsible economic management.
“We are now forecasting a surplus this year, smaller deficits after that, and less debt throughout the budget. If this eventuates, this will be the first budget surplus in 15 years.”
How did older Australians fare?
“There are many direct benefits that older Australians will receive in their wallets out of this year’s budget,” says Council on the Ageing Australia CEO Patricia Sparrow.
“Energy relief of up to $500 per year, cheaper medicines, $15 a week more rent assistance, $20 a week more in JobSeeker payments, an additional $46 more a week in JobSeeker if you’re 55 years or older battling ageism when looking for a job for more than nine months.”
JobSeekers better off
JobSeeker recipients will receive an extra $40 per fortnight. But to help support older Australians struggling to re-enter the workforce and older women avoid poverty and homelessness, Australians aged between 55 and 60 who are currently on JobSeeker support payments will receive the much bigger boost.
“The majority of people aged 55 and over on JobSeeker are women, many with little to no savings or superannuation, and who are at risk of homelessness,” said Dr Chalmers.
Around 52,000 single Australians will receive a $92.10 fortnightly boost to their payments, lifting to $745.20. Prior to the announcement, the rate only applied to over-60s.
Rent Assistance has been raised by 15 per cent – a $2.5 billion investment that could equate to around $15 a week
More than 1.1 million households receiving the maximum Commonwealth Rent Assistance will benefit when the government beefs up the rate to 15 per cent.
Bulk-billing incentives will triple for pensioners and concession-card holders
Nearly 12 million Australians visit their doctors free under a boost to Medicare designed to encourage GPs to bulk-bill children under 16, pensioners and other concession card holders.
GPs will be able to claim the higher incentives for face-to-face consultations longer than six minutes as well as some telehealth consultations.
“This $4.9 billion investment will see more GPs bulk-billing pensioners and healthcare card holders without charging a co-payment,” says Ms Sparrow.
More Home Care packages
To enable more senior Australians to age in place, the government is committing $166.8 million for an additional 9500 home care packages.
Around six million Aussies with chronic health conditions will be able to buy two months’ worth of medicine for the price of a single script, saving concession card holders up to $43.80 and general patients up to $180 per year, per medicine. The $1.2 billion in savings will be reinvested in community pharmacies.
Energy bill relief
The government will set aside $14.6 billon over the next four years to help alleviate cost-of-living pressures that have continued to escalate over the past year. The ‘Energy Price Relief Plan’ will deliver up to $500 in electricity bill relief for eligible households, affecting around five million households.
The amount of relief received will be dependent on the state in which you live, your financial circumstances, and the pricing arrangements in your state or territory.
Helping older Aussies with disabilities
Around $487 million will be put towards sustainably extending the Disability Support for Older Australian Program, which provides support to vulnerable older people with a disability.
More incentive to work
The government will extend the measure to provide age pensioners a once-off credit of $4000 to their Work Bonus income bank and temporarily increase the maximum income bank until 31 December 2023.
Older Australians doing it toughest, such as renters and those on pensions and payments, will benefit from the increases in Rent Assistance and energy relief.
There are also measures self-funded retirees and some of those nearing retirement should note.
The Budget confirmed that tax concessions available to individuals with a total superannuation balance (TSB) exceeding $3 million will be reduced from 1 July 2025.
The headline tax rate for affected individuals will increase from 15 per cent to 30 per cent for earnings corresponding to the proportion of a TSB greater than $3 million.
This will affect some 80,000 individuals in 2025-26, or approximately 0.5 per cent of individuals with a superannuation account.
The halving of the minimum account-based pension (ABP) drawdown rates will end on 30 June and will return to pre-COVID levels from 1 July 2023.
This will particularly affect retirees with account-based pensions in their SMSFs, says SuperGuide writer Harry Chemay.
More money staying in workers’ pockets
From 1 July 2026, to help improve retirement outcomes for all workers, employers will be required to pay their employees’ super on the same day they pay salary and wages.
High income earners earning more than $120,000 will be happy to know the Stage 3 tax cuts will not be wound back as suggested by some economists. Labor has already faced criticism for not “making the tough call” to wind back the cuts, set to cost $20 billion a year when they come into effect in 2024.
That means pensioners can earn up to $11,800 before their pension is reduced, supporting pensioners who want to work, or work more hours without losing their pension.
For years the Coalition has branded Labor as a party that spends too much and can’t manage budgets. This government was quick to capitalise on the political windfall of delivering the first surplus – albeit minor – in 15 years. But the glow will be short-lived.
Some speculate the Treasurer may have spent more than necessary on cost-of-living measures. Some say the Budget is inflationary and may undo all the sacrifices we’ve made so far to bring inflation back to manageable levels.
Prime Minister Anthony Albanese said the support is meant to be “about helping people struggling to make ends meet while not adding to inflation”.
“It will be about providing affordable, effective and targeted cost-of-living relief, delivering historic investments in Medicare and health, supporting vulnerable Australians, growing the economy and strengthening the budget to make our finances more secure for the future,” he said earlier on Tuesday.
There are also those who say this Budget does little in the way of bringing in money in to pay for some of the promised measures. Ad there are those who say it’s just not enough.
“This Budget takes some important steps forward on many fronts, but a bolder vision is needed to adequately fund health, aged care, income support and other essential services, as well as invest in an adequate safety net and reforms to fairly and inclusively accelerate action on climate change,” says Australian Council of Social Service CEO Dr Cassandra Goldie.
“The government is providing an increase of $2.85 a day for people with the least. The Stage 3 tax cuts will deliver $25 a day to people on the highest incomes. We have our priorities wrong.”
What do you think of the Budget? Will you benefit? Is it enough? What would you have liked to see included? Why not share your thoughts with our members?