Pension payment reprieve?

While pensioners are still reeling from the news they will not receive an indexed Age Pension increase next month – the first time indexation has not been applied in 25 years – Prime Minister Scott Morrison has hinted that some further assistance may be on the way.

Mr Morrison said the fact that pension indexation would be frozen in September was a result of the deflation figure recorded last month and that such an event was unpredictable.

However, when asked about the pension freeze at his press conference on Wednesday, he suggested there could be more assistance coming to help counteract the fact that pensions would not rise until at least March next year.

“Some $1500 has been paid to pensioners this year as part of the pandemic response and that was done in July and April,” Mr Morrison said.

“Already pensioners have received two bonus payments so far this year, but the treasurer and I will work through those issues (the indexation freeze).

“It was not intended, nor will it be the case that you’ll see those payments reduce. We’ll work out the exact response and the circumstances and we’ll announce that when a decision is made,” Mr Morrison said.

While he did not go into detail about what the response would entail, it might mean that pension recipients could receive another one-off payment.

Labor’s shadow social services minister Linda Burney was scathing of the indexation freeze and said pensioners were being dealt a “double whammy” with this news and the continuing low interest rate environment in Australia.

Ms Burney also suggested that given the economic conditions, pensioners were not guaranteed an indexed increase in March either.

“This is the worst possible time to be putting the squeeze on the household budgets of seniors and the most vulnerable,” she said.

“Pensioners have been facing rising health, dental, energy and grocery bills for years. And now they are set to go a full year without payment being indexed.

“With interest rates at record lows, pensioners with modest savings are facing a double whammy.

“Average GP out-of-pocket costs alone have gone up by $11 under this government,” Ms Burney said.

“Cutting the pension is in the Liberal-National DNA. This government has tried to cut the pension or increase the pension age to 70 in every single budget – and they have cut $1 billion from pensioner concessions.

“Scott Morrison needs to explain why he is allowing pensions to stagnate in the middle of the coronavirus crisis.”

Do you expect the government to jump in and offer extra assistance to pensioners given the indexation freeze? Is more assistance the right thing to do given the current indexation freeze?

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