Seniors budget pain shock
The combined impact of pension and concession changes in the State and Federal budgets will leave some retirees more than $16,000 a year worse off, an analysis by The Weekend West reveals.
The Abbott Government's clampdown on who gets the age pension will result in some retired couples losing annual payments of between $1892 and $14,467. Some single pensioners will lose between $410 and $10,042 a year.
The effect of the pension changes announced in Tuesday's Federal Budget were exacerbated on Thursday when the WA Government's Budget cut discounts seniors get on electricity bills and water and local government rates. Currently, West Australians aged over 60 on a Commonwealth concession get half-price water and council rates.
From July 1, 2016, the discount is capped at $550 and $600 respectively, leaving some seniors in some suburbs having to shell out an extra $900 a year.
The State Government also restricted access to the $272-a-year cost of living allowance, designed to help pay electricity bills. That payment has previously gone to all seniors but from July 1, only those holding a Commonwealth concession card will qualify.
The interaction of the Federal and State budgets means thousands of West Australians will lose part or all the age pension when they are also losing discounts on household bills.
Across Australia, 230,000 people will have pensions cut and 91,000 will lose it altogether from 2017. Hundreds of thousands preparing for retirement who previously thought they would get the pension are rethinking things.
There is more pain in store for those who reach pension age after January 1, 2017, but do not qualify for payments under the new rules. That cohort could miss out on Commonwealth concession cards that give medical scripts for about $6 instead of up to $37, causing medication costs to jump from $70 a year to $450.
Those at the sharp edge of the changes will be couples who want to retire after January 1, 2017, who own their own home and have assets outside their home totalling more than $823,000.
They stand to lose $14,467 a year in pension and the cost-of-living allowance. They face paying full freight for medication and will have their council and water rates discounts slashed.
Financial planners estimate this group will be more than $16,000 a year worse off.
