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Age Pension Generation Gap

While the media is focused on the CPRS and boat people, the Government has slipped through some subtle changes to Age Pension indexing likely to make Age Pensioners 25% poorer than the standard of living past governments have adhered to. From the pension increase in September 2009 a new index is being used to index pensions. It's called the Pensioner and Beneficiary Living Cost Index(PBLCI). No longer will there be any provision to keep the pension up to 25% of Average Weekly Earnings. The new index is based on the CPI. See more details in http://www.findem.com.au/resources/PBLCI%20Media%20release%20200906.pdf

Findem has calculated that over the last 20 years the new index would reduce the real value of age pension by a quarter - i.e. instead of it being around 25% of AWOTE it would now be 18% of AWOTE. So when you drop your 4 children off with the grandparents and expect them to have an ice cream bought for them (just like you did), only three of them will get one.

Posted Wednesday, 18 November 2009

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