Government to reduce pension deeming rates

Federal Member for Chifley Ed Husic has welcomed news today that the Australian Government will reduce the pension deeming rates from 20 March 2013 for those receiving a part pension.

Mr Husic said deeming rates are used to determine how much pensioners receive under means testing rules.

“For part-rate pensioners in Chifley, this decision will provide them with an average increase of $6.80 per fortnight,” Mr Husic said.

“This issue has been raised with me a number of times and I’ve been happy to raise these concerns with the relevant Ministers.

“These changes will help relieve some of the financial pressure facing these pensioners and help them make ends meet.

The lower deeming rate will decrease from 3 per cent to 2.5 per cent for financial investments up to $45,400 for single pensioners or $75,600 for a couple.

The upper deeming rate will decrease from 4.5 per cent to 4 per cent for balances over these amounts.

Mr Husic said this change in deeming rates will coincide with the latest rise in the pension rate, a move designed to cause the least disruption.

“From March 20 this year, pensioners and some income support recipients will receive both this indexation increase and the new Clean Energy Supplement.

“Historic pension reforms delivered in recent years by Labor Governments have already delivered increases to the maximum rate of pension of $172 per fortnight for singles and $182 per fortnight for couples.

“The Gillard Government understands the pressures on pensioners and working families.  In contrast, Tony Abbott plans to claw back support for pensioners and families.

“Labor is the party of the fair go, and we will always look out for lower income Australians,” Mr Husic said.

Payments affected by the deeming rate include means tested payments, such as the Age Pension, Service Pension, Disability Support Pension and Carer Payment, income support allowances and supplements such as the Parenting Payment and Newstart.