Age pension and other Centrelink payments to climb from March 20

Centrelink benefits are heading higher next week, but is it enough to cover the cost of living crunch? See how much they will rise.

The age pension and other social security benefits will next week deliver more than five million Australians their largest payment rise in almost a decade.

From March 20, the rate for a single person receiving an age pension, disability support pension or carer payment will rise by $20.10 a fortnight to $987.60, while for a couple it climbs $30.20 to $1488.80 a fortnight.

Social Services Minister Anne Ruston said the 2.1 per cent increase in payments was “the largest increase since 2013” and was expected to cost the government an extra $2.2 billion per year.

However, the current surge in inflation – driven largely by fuel prices skyrocketing above $2 a litre – means the rise won’t cover higher costs for many pensioners. Other retirees are being urged to check if they may qualify for a part pension.

Senator Ruston conceded that “cost of living pressures are real” and she noted that the government had driven down costs such as electricity to their lowest levels in eight years.

“We use a specific calculation to increase pensions that takes into account the actual expenses of senior Australians,” she said.

Social Services Minister Anne Ruston says cost of living pressures are real. Picture: Amanda Parkinson

“It gives a higher weighting to fuel and transport costs in recognition of their significance to pensioners, which helps ensure the rate of the age pension maintains senior Australians’ purchasing power in the economy.”

Other government benefit increases from next week include the Jobseeker Payment rising by $13.20 to $629.50 per fortnight for a single person without children, and the Parenting Payment Single increasing by $18.10 to $874.10.

Fortnightly maximum rent assistance will increase to $145.80 for singles and up to $193.62 for families.

Tribeca Financial CEO Ryan Watson said the current increases in food, fuel and other everyday items meant “a 2 per cent pension increase just simply doesn’t cut it” for many people.

The government is also increasing asset test limits for pensioners to enable more people to access a part pension. The threshold for a single homeowner rises $6750 to $599,750, and a homeowner couple will be able to have assets totalling $901,500 – up $10,000 – and still be eligible for a part pension. The family home is excluded from pension asset tests.

“We see quite a few people who think that they actually aren’t eligible for at least a part age pension,” Mr Watson said.

“But, with the right advice and guidance, a part pension can become possible for some and it can make such a difference to their quality of life,” he said.

Mr Watson said people could maximise their age pension eligibility by:

• Considering spouse splitting, where a younger partner’s superannuation was topped up to better enable an older partner to get a pension.

• Planning before retirement with the help of a trusted financial adviser.

• Gifting money to family members or others, but this needed to be done at least five years before becoming eligible for an age pension. “Advice sooner rather than later is the key,” he said.

Originally published as Age pension and other Centrelink payments to climb from March 20