Today marks a significant shift for millions of Australians who rely on Centrelink payments. These changes come amid ongoing adjustments to financial support systems aimed at addressing inflationary pressures. According to Yahoo Finance, the Australian government is implementing a cash boost to provide assistance to recipients across various sectors, including pensioners, job seekers, and other Centrelink beneficiaries.
However, while some individuals will see a direct increase in their payments, others, particularly pensioners, may face adjustments due to changes in the deeming rates, which have remained frozen for the past five years. Let’s explore the details of these changes.
Centrelink Payment Boost: Who Gets What?
From September 20, Centrelink payments will increase as part of the government’s twice-yearly indexation. This adjustment happens in March and September to keep payments aligned with inflation and rising living costs.
More than five million Australians will see an increase in their payments, which include pensioners, job seekers, carers, and others relying on financial support. Specifically, 2.6 million retirees (age pensioners) will benefit, along with those receiving JobSeeker, ABSTUDY, Parenting Payment, Commonwealth Rent Assistance, the Disability Support Pension, and Carer Payment.
Here’s a breakdown of the increases:
- Age Pension (single): The maximum fortnightly payment will rise to $1,178.70, up $29.70.
- Age Pension (partnered): Each partner’s maximum payment will increase to $888.50, up $22.40.
- JobSeeker (singles aged 22 or over): The fortnightly rate will rise to $793.60, an increase of $12.50.
- JobSeeker (partnered): Each partner will receive $726.50 per fortnight, up $11.40.
- ABSTUDY: Recipients will also see an increase to $793.60 per fortnight, up $12.50.
- Parenting Payment: The maximum rate will rise to $1,039.70, an increase of $16.20.
- Parenting Payment (partnered): The rate for each partner will increase to $734.30, up $11.40.
These increases provide much-needed support to those facing the rising cost of living. However, some recipients may be impacted by changes in the way their assets are calculated.
Deeming Rates: The First Increase in Five Years
While the cash boost is a welcome change, pensioners and other Centrelink recipients with significant savings may feel the sting of a new policy. For the first time since 2020, deeming rates are being raised. These rates determine how much income the government assumes recipients earn from their financial assets, regardless of the actual returns.
Starting today, deeming rates will increase:
- For singles with assets under $64,200 (or $106,200 for couples), the rate will rise from 0.25% to 0.75%.
- For assets over these amounts, the rate will rise from 2.25% to 2.75%.
Approximately 771,000 Centrelink recipients will be affected by this change, which includes 460,000 retirees, 96,000 JobSeeker recipients, and 62,000 Disability Support Pension recipients. The increase reflects easing inflation and the government’s decision to adjust rates to better align with current financial conditions.
If you’re impacted by this, don’t worry—Centrelink will automatically apply the new rates, so no action is needed on your part. However, the higher rates could reduce your payments if the government assumes you’re earning more than you actually are from your savings or investments.
What Other Changes Are Happening?
Along with the increase in payments and changes to deeming rates, there are a few other key adjustments that could benefit pensioners:
- Income thresholds for receiving a part pension will rise. For singles, the new threshold will be $2,575.40 per fortnight, an increase of $59.40. Couples will see the threshold increase to $3,934, up $89.60.
- The asset thresholds for the part pension will also increase. For single homeowners, the threshold will rise to $714,500, an increase of $10,000. For non-homeowners, it will increase to $972,500. For couples, the asset thresholds will rise to $1,074,000 for homeowners and $1,332,000 for non-homeowners.
Finally, there’s also an important change for seniors who may be eligible for the Commonwealth Seniors Health Card. Starting from September 20, singles with taxable incomes below $101,105 and couples with incomes below $161,768 may qualify for this health card, which offers additional support.
