The Australian Government recognises the impact of the global recession on the incomes of self-funded retirees and is providing extra assistance in the 2009-10 Budget.
From 1 July 2009, the Government will halve the minimum amounts self-funded retirees have to draw down from their account-based pensions for 2009-10.
This extends the drawdown relief provided by the Government for 2008-09, recognising the impact of the global recession
This change will assist pension account balances to recover from capital losses associated with the global recession. It will also reduce the need for self-funded retirees to sell assets at a loss in order to meet the minimum withdrawal required in 2009-10. This measure will cost $27 million over two years.
From 20 September 2009, the Australian Government will provide around 300,000 self-funded retirees with access to the Seniors Supplement.
The Seniors Supplement will be available to self-funded retirees who are eligible for the Commonwealth Seniors Health Card or the Department of Veterans' Affairs Gold card with current Seniors Concession Allowance. It incorporates existing payments of Seniors Concession Allowance and the higher rate of Telephone Allowance.
For singles, the new supplement will increase payments by $129 a year, bringing their rate of payment to two thirds of that received by couples combined.
The Seniors Supplement will be $790.40 a year for singles and $1190.80 a year for couples combined. Payments will be made quarterly.
The Seniors Supplement is equivalent to the minimum rate of the Pension Supplement to be paid to part pensioners. This alignment will allow a seamless transition as seniors move from the part pension onto the Commonwealth Seniors Health Card if their income increases.
Eligible seniors will also continue to be eligible for other concessions linked to the Commonwealth Seniors Health Card.
These concessions include a reduction in prescription medicines under the Pharmaceutical Benefits Scheme, a discounted Medicare safety net threshold, and concessional travel on the Great Southern Rail Services.
The Government has also decided not to proceed with proposed changes to include gross tax-free superannuation income in the income test for the Commonwealth Seniors Health Card, which was due to come into effect on 1 July this year.