The Government's Secure and Sustainable Pension Reform package was introduced from 20 September 2009. The package included the introduction of a new Pension Supplement which combined several smaller payments into one and provided an increase above the total value of those payments.
The Pension Supplement accrues on a daily basis and is automatically paid fortnightly with a person's usual payment.
From 20 March 2013, the maximum Pension Supplement added to the rate of a single pensioner is $61.20 a fortnight and $92.20 for a pensioner couple, combined.
The Pension Supplement includes a 'minimum amount' of $32.80 a fortnight for single pensioners and $49.40 a fortnight for pensioner couples (combined).
From 1 July 2010, pensioners have been able to receive this minimum Pension Supplement amount quarterly, instead of fortnightly. Choosing this option gives pensioners more flexibility in managing their budgets and is referred to as electing to receive 'Quarterly Pension Supplement'.
If a pensioner chooses this option, they will receive a reduced amount of Pension Supplement with their pension each fortnight. However, the minimum pension supplement amount will continue to accrue daily, building up until one of the quarterly payment days occurs.
Payments of the Quarterly Pension Supplement will be made as soon as possible after 20 September, 20 December, 20 March and 20 June each year.
The amount of Quarterly Pension Supplement a person receives will vary due to their individual circumstances, such as the number of days in the quarter they are eligible to receive it.
A pensioner will receive the same total amount of Pension Supplement over the year, whether they continue to receive it fortnightly or whether they choose to receive some of it quarterly.
The following scenarios demonstrate how payment of the Quarterly Pension Supplement operates for a single pensioner or a pensioner couple, combined.
Andrew receives the maximum single rate of pension and Pension Supplement. On 20 March 2013, Andrew advises the Department of Human Services he wants to receive Quarterly Pension Supplement. The amount of Pension Supplement he receives each fortnight then reduces from $61.20 to $28.40. For his first pay day on or after 20 June 2013, Andrew receives $215.54, which is his Quarterly Pension Supplement. In this example, Andrew has accrued 92 days of Quarterly Pension Supplement.
Ray and Ruth receive the maximum rate of pension and Pension Supplement. They return home from a trip on 30 March 2013 and advise the Department of Human Services on 1 April 2013 that they want to receive Quarterly Pension Supplement. The combined amount of Pension Supplement Ray and Ruth receive each fortnight then reduces from $92.20 to $42.80. On their first pay day on or after 20 June 2013, they receive $282.28, which is their combined Quarterly Pension Supplement. In this example, Ray and Ruth have accrued 80 days of Quarterly Pension Supplement.