Bendigo Labor candidate, Lisa Chesters, today welcomed the announcement by Ministers Macklin and Shorten of the reduction in pension deeming rates from 20th March this year.
“The reduction will benefit more than 28,700 pensioners in the Bendigo Electorate by better reflecting the returns available to them from their financial investments,” Ms Chesters said.
Deeming rates reflect the standard rates of return that pensioners can earn from their financial assets. They are used to determine how much pensioners receive under means testing rules.
“This decision will provide part-rate pensioners with an average pension increase of $6.80 per fortnight, and will help to take some of the financial pressure off pensioners.”
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.
Changes to deeming rates are generally made at the pension indexation points to minimise disruption for pensioners.
“This change comes on top of another increase to the pension under Labor’s new indexation system,” Ms Chesters said.
“From March 20 this year, pensioners and some income support recipients will receive both this indexation increase and the new Clean Energy Supplement.”
“Labor’s historic pension reforms have already delivered increases to the maximum rate of pension of $172 per fortnight for singles and $182 per fortnight for couples.”
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.