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2014 Budget – Pension Age Increase and Other Pension Reforms

Qualifying Pension Age Increases

 

The Age Pension qualifying age will continue to increase by six months every two years, such that it will reach a qualifying age of 70 by 1 July 2035. This measure will not affect those born before 1 July 1958.

The following table sets out the Age Pension eligibility age by date of birth:

Date of birth between Age at which eligible for Age Pension
1 July 1952 and 31 December 1953

65½

1 January 1954 and 30 June 1955

66

1 July 1955 and 31 December 1956

66½

1 January 1957 and 30 June 1958

67

1 July 1958 and 31 December 1959

67½

1 January 1960 and 30 June 1961

68

1 July 1961 and 31 December 1962

68½

1 January 1963 and 30 June 1964

69

1 July 1964 and 31 December 1965

69½

1 January 1966 and later

70

Income test

The government will change how it deems the return from a person’s financial assets for the purposes of the pension income test. The deeming thresholds will be reset from $46,600 to $30,000 for single pensioners and from $77,400 to $50,000 for pensioner couples from 1 September 2017.

Indexation changes

The indexation of income and assets test free areas for the pension will be paused for three years from 1 July 2017.

From 1 September 2017, pension increases will be linked only to the Consumer Price Index (CPI).

Commonwealth Seniors Health Card changes

The income thresholds for the Commonwealth Seniors Health Card will be indexed annually to the CPI from 20 September 2014. Payments of the Senior Supplement will also cease after the June 2014 payment.

Source: Budget Paper No 2, pp 202–203; Minister for Social Services press release “Delivering our commitments to Australian seniors”; Budget 2014-15 Social Services booklet, pp 9–10, 13 May 2014.