The changes outlined within this fact sheet form part of the Secure and Sustainable Pension Reform package, most of which took effect from 20 September 2009. The changes apply to customers in receipt of Age Pension, Disability Support Pension**, Wife Pension, Widow B Pension, Carer Payment, Department of Veterans' Affairs (DVA) Service Pension and Income Support Supplement.
Please note that these arrangements apply to pensioners living overseas.
An increase to the pension rate for single pensioners
For single pensioners living outside Australia, the maximum single base pension rate has increased by A$60 per fortnight. Full-rate single pensioners receive the full increase. Single pensioners, whose pensions are reduced under the income or assets test and/or on the basis of limited Australian residence received a proportion of this increase.
This increase is paid on top of an indexation increase and took effect from 20 September 2009.
New indexation arrangements for the base pension have been introduced from 20 September 2009 to better reflect changes in pensioners' living costs, and a new, higher benchmark to average wages will take effect from 20 March 2010.
The Pension Supplement - merging various pension add-ons into a single supplement
For most pensioners living in Australia, or for the first 13 weeks for pensioners who are temporarily outside of Australia, the Pension Supplement combines the range of supplements and allowances that have been added to the basic pension over recent years. It includes the value of the fortnightly GST Supplement and Pharmaceutical Allowance, as well as the quarterly Utilities Allowance and Telephone Allowance.
Pensioners who are outside of Australia permanently or for more than 13 weeks receive a Pension Supplement Basic Amount, equivalent to the GST supplement they were previously receiving.
Figure 1 and Figure 2 below illustrate the pension system changes for single and couple pensioners overseas permanently or for more than 13 weeks.
Figure 1: Changes to Australian Pension payments
Rate for people living overseas (Single)
Figure 2: Changes to Australian Pension payments
Rate for people living overseas (Couples combined)
Income test changes
The income test taper rate has increased from 40 cents in the dollar to 50 cents in the dollar. The income test taper rate is the rate at which income in excess of the income test free area reduces the pension. The previous additional income test free area for customers with dependent children has been removed.
A new transitional rate protects existing pensioners at 19 September 2009 who would otherwise have had a reduction in their payment due to the changes to the income test. These pensioners will remain on this transitional rate until they are no longer worse off under the new rules.
This new transitional rate will be subject to Consumer Price Index (CPI) increases in March and September.
When a pension is cancelled for any reason and later restored, it will be restored under the new rules, not with the transitional rate.
For example, if the pension is stopped due to an extended absence from Australia and is restored upon return to Australia, the restored pension would be paid under the new rules.
More information
For more information about how these changes may affect you, please visit the
Centrelink website or contact Centrelink International Services on:
- From Austria 0800 295 165 (free call)
- From Canada 1888 2557 493 (free call)
- From China (North)* 10 800 6100 427 (free call)
- From China (South)* 10 800 2611 309 (free call)
- From Denmark 8088 3556 (free call)
- From Germany 0800 180 2482 (free call)
- From Greece 0080 0611 26209 (free call)
- From India 000 800 61 01098 (free call)
- From Indonesia 001 803 61 035 (free call)
- From Italy 800 781 977 (free call)
- From Korea Republic 003 081 32326 (free call)
- From the Netherlands 0800 0224 364 (free call)
- From New Zealand 0800 441 248 (free call)
- From Philippines 1800 1611 0046 (free call)
- From Portugal 800 861 122 (free call)
- From Singapore 800 6167 015 (free call)
- From Spain 900 951 547 (free call)
- From Thailand 001 800 611 4136 (free call)
- From Turkey 00 800 6190 5703 (free call)
- From UK 0800 169 5865 (free call)
- From United Arab Emirates 800 061 04319 (free call)
- From USA 1866 3433 086 (free call)
- From elsewhere, or if the above numbers are not available: +61 3 6222 3455
Note: these international free call numbers connect you directly to Centrelink International Services. This free call may not be available from every location within the country, and may not be free from mobile phones or public phones. You may need to insert coins/card in pay phones as for a local call and this may not be refunded at the end of the call.
*China (North) is the provinces of Beijing, Tianjin, Hebei, Shanxi, Inner Mongolia, Heilongjiang, Liaoning, Jilin, Shandong and Henan. All other provinces are considered to be China (South) for this purpose.
**Disability Support Pensioners under 21 without children will continue to be paid at a rate that includes the equivalent Youth Allowance rate, Youth Disability Supplement and Pharmaceutical Allowance. They will continue to be paid the Utilities Allowance and Telephone Allowance, if eligible, quarterly.