The new Pension Supplement is part of the Secure and Sustainable Pension Reform package which took effect from 20 September 2009. These changes apply to pensioners receiving Age Pension, Disability Support Pension (except those aged under 21 without children*), Wife Pension, Widow B Pension, Carer Payment, Department of Veterans' Affairs (DVA) Service Pension and Income Support Supplement. It is also paid to income support recipients who are over Age Pension age.
Please note that different arrangements apply to people living overseas.
Merging various pension add-ons into a single supplement
The Pension Supplement combines the range of supplements and allowances that have been paid in addition to the basic pension over recent years, and has been further increased for both singles and couples. It includes the value of the fortnightly GST Supplement and Pharmaceutical Allowance, as well as the quarterly Utilities Allowance and Telephone Allowance at the higher internet rate.
The Pension Supplement for a single pensioner entitled to the full supplement is $56.10 per fortnight, providing an overall increase of $5.33 a fortnight which includes a $5.00 increase together with indexation. This fortnightly payment for singles is explained in
Figure 1.
Figure 1: The Pension Supplement - Fortnightly Payment (Singles)
From 20 September 2009, the Pension Supplement for a pensioner couple combined entitled to the full supplement is $84.60 per fortnight, providing an overall increase of $20.73 a fortnight combined which includes an increase of $10.15 each per fortnight together with indexation. This fortnightly payment for couples is explained in
Figure 2 Figure 2: The Pension Supplement - Fortnightly Payment (Couples)
From 20 September 2009, the Pension Supplement is paid fortnightly and appears on a pensioner's statement as an addition to their fortnightly pension. Pensioners receiving the transitional rate will have the value of the Pension Supplement included in their transitional rate amount. It will not show as a separate amount.
- From 20 September 2009 transitional arrangements apply to protect the current entitlements of pensioners who would otherwise have had a reduction in their payment due to changes in the income test.
The Pension Supplement includes a 'minimum component', of $30.20 for a single pensioner and $45.60 combined for a pensioner couple per fortnight. Provided a person remains eligible for at least some pension under the means test, at least this minimum component will be paid each fortnight.
From 1 July 2010, pensioners will have the option to receive the minimum component of the supplement quarterly instead of fortnightly. Further information will be available in an article in News for Seniors next year.
The last quarterly payments of Utilities Allowance and Telephone Allowance will be paid soon after 20 September 2009.
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*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 also continue to be paid the Utilities Allowance and Telephone Allowance quarterly, if eligible.