Bill has been paid under the transitional Age Pension rules since 2009, but a recent change has seen his payment drop and he wants to know why.
Q. Bill
I am on a transitional pension; this started with the Age Pension changes in September 2009.
Recently, Centrelink started to include an amount for funds in a rolled over pension, that is, they appear to have deemed the total value of the amounts held. This only seems to have started in the current year.
As a transitional pension-holder, I was under the impression that the pension qualifications were frozen at 2009 requirements. Is that correct or have I misunderstood?
A: A spokesperson for the Department of Human Services says the transitional safety net rules protect pensioners who would have had an immediate reduction in pension due to the changes to the income test that started on 20 September 2009.
The transitional safety net rules do not mean that Age Pension qualifications were ‘frozen’ at 20 September 2009 requirements, the spokesperson said.
Pensioners continue to be paid under the transitional rules if this results in a higher rate of payment.
Once a pensioner commences to be paid under new rules, he or she no longer has access to the transitional safety net rules.
The rule change by which your funds in a rollover pension are now assessed has resulted in a change to your eligibility to be paid under the transitional rules. You can view details of the 2015 deeming rule changes here.
If you have a Centrelink question, send it to newsletters@yourlifechoices.com.au and we’ll do our best to answer it, or find someone who can.
Related articles:
What are transitional Age Pensions?
Retirement income concerns rise
Could deeming rates eat away at your pension?
Financial disclaimer: All content on YourLifeChoices website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for the ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.
