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You can find the current article at its original source at http://www.theguardian.com/world/2014/may/01/commission-of-audit-aged-pension-should-be-more-tightly-means-tested
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Commission of Audit: aged pension should be more tightly means tested | Commission of Audit: aged pension should be more tightly means tested |
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Aged pensions should be more tightly means tested, including the family home in some cases, the eligibility age should be linked to life expectancy and new indexation should be implemented to ensure it rises more slowly, according to recommendations in the Commission of Audit. | |
But the government moved to immediately rule out the inclusion of the family home in any means test for the aged pension. | But the government moved to immediately rule out the inclusion of the family home in any means test for the aged pension. |
The commission's plans would lead to eligibility for the pension rising to 70 in 2053, with new means testing applying to recipients in 2027-28 and the worth of the family home considered in the test on a value over $750,000 for a couple and $500,000 for singles in today’s dollars. | |
After the report was released government sources ruled out including the family home in the means test. | After the report was released government sources ruled out including the family home in the means test. |
The pension income test now means a single person with $47,000 in annual income receives some pension. Changing the income withdrawal rate from 50% to 75% would reduce the income allowed to $32,700. | |
The commission has recommended the pension should be better targeted to ensure it is regarded “primarily as a social safety net”. Currently, the pension is increasing in real terms and also relative to wages earned by those in paid employment. | |
The pension is now 27.7% of male total average weekly earnings and the commission described this as “an anachronism” due to the increased workforce participation of women. | |
It has called for the amount to be linked to the lower average weekly earnings, which is lower because it takes in the female wage, but at a rate of 28%. | |
The commission has also proposed tighter testing on the commonwealth seniors health card by adding deemed income from tax-free superannuation to the income test. | |
It has also backed calls to extend the preservation age (now 55 years and changing to 60) to 62 by 2027 and then tie the superannuation preservation age (at which you can access super) to five years below the aged pension. | |