Changes to the deeming rate
13th February, 2013
At least 4000 Wide Bay Age Pensioners and other Centrelink pension recipients will benefit from a reduction in deeming rates from 20 March 2013, Federal Member for Wide Bay Warren Truss said.Mr Truss welcomed the reduction, which follows his calls for at least a year for the Government to cut the deeming rate, following cuts to the official interest rate by the Reserve Bank.
The Government has been demanding that banks lower their lending rates in response to lower official interest rates - but it has continued to short change pensioners by refusing to lower its deeming rates on their pensions.
The pension deeming rate will fall from 3 per cent to 2.5 percent for the first $45,400 of financial investments for single pensioners and the first $75,600 for couples.
The deeming rate will be reduced from 4.5 per cent to 4 per cent for amounts over those thresholds.
The deeming rates are used to determine how much pensioners receive under the means testing rules.
The changes mean that a single Age Pensioner will be able to have investments up to $115,825 before losing some of their pension if their only source of income is from financial investments.
Age Pensioner couples will be able to have investments up to $202,550 before losing some of their pension if their only source of income is from financial investments.
“Some pensioners will now receive a higher Age Pension, and others will now qualify for the Age Pension for the first time.”
