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Seniors and pension changes

17 Jan 2017

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The Department of Human Services runs Financial Information Service (FIS) seminars to help seniors make informed decisions about investment and financial issues for their current and future need

With Australians living longer than ever before, the number of those aged 65 and over is projected to double by 2055.  It is critical that the social security system can meet this growth and continue to support those who need it, while encouraging those who can support themselves to do so.  Legislative changes which commenced on January 1 make the pension system fairer, better targeted and sustainable for the future.

COTA NT leading lobby group for senior Territorians says older voters appreciated the need to repair the budget but feared they were making a greater sacrifice than other groups. COTA NT has received many calls from older people who wrongly believed they were being hit by the pension changes.

Older Australians feel they are carrying a greater proportion of the weight than people who can use tax loopholes. There is also great apprehension about changes to superannuation, the pension and aged care.

All of this really has less impact than people think but it has created an atmospheric causing seniors to believe that the government just isn’t backing older Australians. The assets test changes for the pension were agreed between the Coalition and the Greens before the last Federal election but are in focus because they took effect from January 1. About 236,000 people will have their pensions reduced and 91,000 part pensioners will lose the payment altogether. But 171,500 pensioners with modest assets will get an average increase in their pension of about $30 a fortnight, of whom 50,000 will move to a full pension. The government says 90 per cent of pensioners will not see any change or receive an increase. It should not be forgotten that this deal replaced a highly unpopular earlier Coalition plan to cut the indexation of the pension.

Regrettably the government had not been effective in explaining its changes.  A lot of pensioners think their pension is going to be cut, rather than the small percentage of people on rather large assets.

The Department of Human Services runs Financial Information Service (FIS) seminars to help seniors make informed decisions about investment and financial issues for their current and future needs. These sessions are free, and a place can be booked via the Human Services website – www.humanservices.gov.au/fis

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