From 20 March 2014 3.6 million pensioners should see a rise in their Age Pension, Disability Support Pension and Carer Payments as announced by the Government.
The rise is in line with the Consumer Price Index (CPI) which increased by 1.9 per cent in the last six months. Pensions are measured against the CPI or the Pensioner and Beneficiary Living Cost Index (PBLCI), whichever is higher. “The rate is also benchmarked to Male Total Average Weekly Earnings to help the pension keep pace with community living standards,” said Federal Minister for Social Services Kevin Andrews in his media release. “The Coalition Government is pleased to deliver increases to those on the Age Pension, Disability Support Pension, Carer Payment and veterans’ income support,” Mr Andrews said.
Single Age Pensions will increase by $15.70 a fortnight and those on a couples Age Pension will receive an extra $23.80 per fortnight.
“In addition, around one million allowance recipients will also benefit from increases to income support payments such as Newstart and Parenting Payment on 20 March,” said Mr Andrews.
Read the full media release.
Find out more about increases to rates, limits and allowances.
Those living on a pension will, of course, welcome any increase in their payments, but this announcement by the Government claiming credit for these paltry CPI adjustments is seriously misleading.
As long as the economy is doing reasonably well and this is reflected in the CPI and the PBLCI, then pension payments and allowances will rise every six months. For the Government to claim the glory for this meagre increase is a bit rich. Those on a full single Age Pension will see their rate rise to $842.80 per fortnight, hardly a windfall.
For those in rental accommodation, many will see their payments all but gone with indexing of rent payments. And it gets worse. With the increase in CPI comes the increase in grocery bills, utility bills, fuel prices and transport costs. All of a sudden, an extra $15.70 per fortnight, or $7.80 per week, doesn’t seem so much.
For the last 24 years the Age Pension has increased by 160 per cent, much of that increase due to indexation, however, not since the 2009 pension reforms have pensioners seen any real rise in what they are paid. Living costs continue to spiral out of control for many families earning a wage, so for those managing on an Age Pension, one can only try to imagine the sacrifices which must be made.
Of course, the Age Pension isn’t an entitlement and only intercedes as to be a safety net for those who have been unable to save sufficiently for retirement. But, given that employer compulsory superannuation wasn’t introduced until 1992, those who left the workforce in the last 20 years really haven’t had much of a chance to build up a nest egg and therefore have little option but to live on this pitiful payment.
If Mr Andrews and the Government really want to do something for pensioners, they should take a look at the reforms of 2009 and replicate the increase. Then and only then can they claim credit for helping those who need it most.
Do you think a major overhaul of the Age Pension and Disability Support Pension is overdue? Or do you think that the public purse simply can’t afford any more than it gives already?