Aged pensioners will miss out on payment increase because of the pandemic, says PM Scott Morrison
Scott Morrison has defended a decision to deny millions of Australian pensioners a much-needed boost during the pandemic as public servants pocket a huge pay rise.
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Pensioners missing out on a boost to their payments next month was an unforeseen impact of the pandemic, according to Scott Morrison.
The prime minister said he and Treasurer Josh Frydenberg would work on it after the Department of Social Services revealed the pension packet would not go up in September because of the inflation rate.
“The Treasurer and I will work through those issues,” Mr Morrison said today.
A federal parliamentary committee on Tuesday was told by DSS officials because inflation went backwards in the June quarter, pensioners would not be getting any extra money in the coming months.
This means they will have to wait until at least March next year for any increase to their payments.
DSS deputy secretary Nathan Williamson said despite inflation falling in the June quarter, pension payments would not fall.
“Based onto the calculation for indexation if it’s negative we don’t reduce the pension but we also don’t increase it,” he said.
Mr Williamson was unable to confirm when they would next see an increase to their payments.
Pension payments are reviewed biannually before March and September and are assessed on any changes to the cost of living and incomes levels.
The fortnightly base rate for the aged pension is $860.60 for a single person or $22,375 a year.
For couples it’s $1297.40 a fortnight or $33,732 a year.
These amounts do not include any additional financial supplements.
CPI fell by 1.9 per cent in June quarter which was the biggest plunge in the history of the measurement.
In this period some of the falls to impact many pensioners’ hip pockets included fuel prices which plummeted by 20 per cent and rents fell by 1.3 per cent.
But the costs to climb included tobacco (up 2.7 per cent), toilet paper and cleaning wipes (up 4.5 per cent) and furniture (up 3.8 per cent).
Under a new pay arrangement in Victoria, public service employees voted to accept a pay rise of more than 3 per cent once multiple lucrative bonuses are factored in.
About two million Australians are on pensions, four million Australians are on JobKeeper and 1.6 million are on Jobseeker.
At the federal parliamentary committee it was also revealed those on Jobseeker payments – previously known as Newstart – won’t see any increases because these payment changes are based on movements to CPI.
To qualify for the aged pension in Australia you must satisfy Australian residency rules and pass both an income test and assets test.
This will determine whether you qualify for a full or part aged pension.
Pension payments are reviewed biannually in March and September and are assessed on any changes to the cost of living and incomes levels.
It comes as Australia’s unemployment rate sits at 7.6 per cent and many expect it to reach double digit numbers in the coming months.