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Payments jump delivers welcome financial relief for pensioners

Gian T
By Gian T
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News & Politics

Payments jump delivers welcome financial relief for pensioners

1755746262550.png Payments jump delivers welcome financial relief for pensioners
The pension rise comes alongside cost-of-living support, including electricity rebates for households. Credit: Pexels

The numbers might surprise you. While you've been focused on rising grocery prices and energy bills, your Age Pension has been steadily climbing behind the scenes. Since the current government took office in 2022, pension payments have increased by almost $5,000—and there's more financial support coming your way than you might realise.



For many Australian pensioners, the bi-annual pension increases can feel modest when they're announced.



But the cumulative effect tells a very different story, one that's worth understanding as we head into what could be a challenging economic period.



Starting 20 September, those on the Age Pension, Disability Support Pension or Carer Payment will receive up to $29.70 extra each fortnight—a timely update that lands in your bank account automatically, with no action needed.



In this Article



What You're Receiving Now



Single pensioners now receive $1,149 per fortnight as of March 2025, while couples receive $866.10 each per fortnight. These figures include your pension supplement and energy supplement, representing the maximum full pension rate.









To put that in perspective, if you're a single pensioner, you're receiving approximately $29,874 per year, while couples are getting around $45,037 combined annually.



But here's where it gets interesting—single pensioners are now receiving more than $3,913 additional per year as a result of indexation over the past three years, and pensioner couples are receiving $5,902 additional per year combined.



The latest increase came in March 2025, when single pensioners saw their payments rise by $4.60 per fortnight, while couples received an additional $7 combined.



While that might seem modest, it's part of a systematic approach to keeping pensions in line with cost-of-living changes.









Beyond Your Pension - The Complete Support Package



Your pension increase is just one piece of a broader cost-of-living support package that many pensioners don't fully understand. Here's what else is working in your favour:



Energy Bill Relief That Continues



Households will receive a $150 energy rebate off their electricity bill in two quarterly payments throughout 2025.



This comes automatically—you don't need to apply. The rebates will be automatically applied to your electricity bill in two $75 quarterly instalments.



This extends the energy relief that began in 2024, when households received $300 in energy bill assistance. The ongoing support recognises that energy costs remain a significant concern for pensioners living on fixed incomes.









Cheaper Medicines on the Way



From January 2026, there's more relief coming for your medicine cabinet. The maximum co-payment will be lowered from $31.60 to $25.00 per script for those without concession cards, while it remains frozen at $7.70 for pensioners with Pensioner Concession Cards.



For many pensioners taking multiple medications, this change could save hundreds of dollars annually. The government estimates four out of five PBS medicines will become cheaper under the new arrangement.




'These challenges highlight the importance of regular indexation to ensure that payment recipients have more money in their pockets for everyday expenses'

Minister Amanda Rishworth



Deeming Rates Frozen to Help Your Assets



Here's a change that could be worth significant money if you have savings or investments. The freeze on deeming rates has been extended to 30 June 2026. Currently, the first $62,600 of your financial assets is deemed to earn 0.25 per cent, with any amount over $62,600 deemed to earn 2.25 per cent.









This freeze means Centrelink calculates your pension as if your savings are earning these low rates, even if your actual returns are higher. For many pensioners, this translates to higher pension payments than they would otherwise receive.



How the Pension Indexation System Actually Works



Understanding how your pension increases are calculated can help you better plan your finances. The base rate is indexed using a mix of three different measures: Consumer Price Index, Pensioner Beneficiary Living Cost Index and the Male Total Average Weekly Earnings.



This system is designed to ensure your pension keeps pace with both general cost increases and wage growth across the economy. These rates are adjusted in March and September each year based on movements in the CPI.










How Pension Indexation Works


The government uses the highest of these three measures to determine your pension increase:


- Consumer Price Index (general cost of living)


- Pensioner and Beneficiary Living Cost Index (costs specific to pension recipients)


- Male Total Average Weekly Earnings (25 per cent of this figure)


This ensures your pension grows with either inflation or wage growth, whichever benefits you more.




Other Payments Getting Increases Too



The pension isn't the only payment seeing regular increases. Several income security payments increased from 20 September 2024, including the Disability Support Pension (DSP), Age Pension, Carer Payment and JobSeeker Payment.



If you're caring for someone, Carer Allowance is $159.30 each fortnight. Those on Disability Support Pension receive the same base rates as Age Pension recipients, ensuring consistent support across different types of pensions.



For those still receiving some income support while working, there's good news too. Pensioners, including age pensioners, can earn up to $300 per fortnight without impacting on their pension entitlement through the Work Bonus scheme.









Getting Your Full Entitlement



Many pensioners don't receive their full entitlement simply because they don't understand the system or haven't updated their circumstances. Here are key steps to ensure you're getting everything you're entitled to:



Check Your Assets and Income Regularly



The pension is subject to both income and assets tests. Centrelink uses income and assets tests to work out how much Age Pension you get. Your circumstances may have changed since you first applied, potentially affecting your payment rate.



If you own your home, you may be eligible for a higher assets limit. The system is complex, but understanding it could mean the difference between a part pension and a full pension.









Don't Forget Rent Assistance



If you're paying rent, you might be eligible for additional help. For every $1 of rent you pay above a certain amount, you'll get 75 cents of rent assistance, up to a set maximum payment.



A single person who pays at least $149 for two weeks' rent might be eligible for up to $212 of rent assistance each fortnight.



Essential Medical Equipment Payments



If you need help with energy costs, you may get an Essential Medical Equipment Payment each year if you need heating, cooling or certain eligible equipment for medical needs. This is an often-overlooked entitlement that could provide additional annual support.



The Broader Economic Context



These pension increases don't exist in isolation. They're part of the government's broader response to cost-of-living pressures that have affected all Australians, but particularly those on fixed incomes.









Commonwealth and state energy bill relief has already helped to lessen electricity price increases, with prices dropping 25.2 per cent across 2024.



This means your energy rebates are working alongside broader market changes to keep your power bills manageable.



Healthcare costs are also being addressed beyond just medicine price reductions. The government is expanding bulk-billing incentives and opening new Medicare Urgent Care Clinics, which should make it easier and cheaper to access healthcare services.



What About Other Support?



Beyond your pension, there are other forms of government support you might not be aware of:









Home Equity Access Scheme



If you need a little extra to live on each fortnight, you can apply for a voluntary non-taxable loan if you qualify for Age Pension and own a property in Australia through the Home Equity Access Scheme. This allows you to access some of the equity in your home while continuing to live there.



Concession Cards and Their Benefits



If you get Age Pension, you'll also get a Pensioner Concession Card which provides access to discounted healthcare, medicines, and often public transport and utility concessions. These savings can add up to hundreds of dollars annually.



Did you know?


Did you know?
The Work Bonus scheme allows pensioners to earn up to $300 per fortnight from work without it affecting their pension. Any unused portion accumulates in a 'Work Bank' up to $11,800, giving you flexibility in when and how much you work.



Looking Ahead



The Age Pension rates will next potentially change on 20 September 2025. The Australian Bureau of Statistics evaluates the extent of the increase based on changes in the Consumer Price Index (CPI), Male Total Average Weekly Earnings, and the Pensioner and Beneficiary Living Cost Index.



While we can't predict exactly how much the next increase will be, the system is designed to ensure your pension keeps pace with cost-of-living changes. Increases are not always certain—for example in September 2020 the Age Pension rates did not increase, although that was for the first time since 1997.



The economic indicators suggest that regular, modest increases are likely to continue, maintaining the purchasing power of your pension over time.



Some considerations to keep in mind​


While this news is overwhelmingly positive, it's worth noting that some concurrent changes may affect certain pensioners.



Deeming rates—which determine how your savings and investments are assessed for pension purposes—are being adjusted for the first time in several years.



According to National Seniors Australia, the indexation increase will lift the maximum single Age Pension rate from about $1,149 to $1,178.70 per fortnight, while couples will see a combined rise from $1,732.20 to $1,777.00.



At the same time, the government has introduced a 0.50 percentage point increase in previously frozen deeming rates, which may reduce payments slightly for those with significant financial assets.



NSA Chief Executive Chris Grice described the outcome as a 'mixed bag,' noting that while the timing of the changes helps soften the impact, some pensioners may still feel the pinch.



He also highlighted that NSA will continue advocating for reforms—such as exempting employment income from the pension income test—ahead of the next indexation round in March.



Making Sure You Don't Miss Out



The pension system can seem complex, but the basic principle is straightforward: it's designed to provide you with a basic standard of living that adjusts with economic conditions. The key is making sure you're getting your full entitlement.









If you haven't reviewed your pension circumstances recently, it might be worth contacting Services Australia to ensure your details are current. Changes in your living situation, health needs, or financial circumstances could affect what you're entitled to receive.



Remember, these increases and supports are automatic for most pensioners—you don't need to apply for pension indexation or energy rebates. But other entitlements like rent assistance or medical equipment payments might require you to notify Centrelink of your circumstances.





Example Scenario


  1. Margaret, 68, lives alone and receives the full Age Pension. In 2022, she received $967.50 per fortnight. By March 2025, her payment had increased to $1,149—an extra $181.50 per fortnight or about $4,720 per year. Combined with her automatic $150 energy rebate and cheaper medicines coming in 2026, Margaret's cost-of-living support has improved significantly, even though she didn't need to apply for anything new.





What This Means For You


The story of pension increases over the past three years shows that while individual adjustments might seem small, they add up to meaningful support over time. Combined with energy rebates, healthcare improvements, and other targeted assistance, the financial support available to Australian pensioners has expanded considerably.



What changes have you noticed in your pension payments lately? Have you taken advantage of all the support available to you? Share your experiences and tips with fellow readers in the comments below.




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DLHM said:
The article is trying to relay some positivity, but the replies are so miserable. Ingrates.

Try living in a country that doesn’t give handouts to their people.
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it did not hand out anything in my first 30 years of working
i certainly did not have children i could not afford and if u wanted something u had to work for
NOT THIS OR THE LAST GENERATION
HOW MANY PEOPLE ARE GETTING CENTRELINK PAYMENTS AND HAVE NEVER WORKED
it
 
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mitchellowe said:
if that payriseof $29 plus is coming
what rate pf CPI is that worked out at
last cpi rise of %2.4 e equalled %.04 increase of $4.30
HAS THE GOVT CHANGED THE FORMULA FOR INCREASES IN PAYMENTS OR DID THEY LIE ABOUT THE LAST INCREASE ASND AS FAR AS THE PERSONS PENSION INCREASED BY $181 since march 2022 till march 2025
thats 5 payment eqalling an average of over $35 per increase well i think that also is a lie
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Pretty sure the inflation figures are fiddled, or the criteria they use has no relevance to the reality of life on a low income. The things pensioners have to pay for - rent, council rates, water, electricity, insurance, food - have increased in price way above the stated inflation rate. Like, more like 30%++++. Things that have decreased in price, like holidays, jewellery, cars, luxury clothing etc. have no relevance to people who live on low incomes.
The pension increases are really quite pathetic and totally inadequate when you consider the increased cost of living most pensioners are struggling with.
 
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rooboy33 said:
they should be on KPIs they would not get much would they
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On KPIs, their pay packets would be negative. They would be paying big dollars for their titles.
 
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June E said:
It sounds good BUT we will see ! Everything is still costing us so much more and I know we should be grateful but really the $4.60 rise we usually get is an insult ! And the electricity rebate hardly helps anyone ! We paid our taxes for years, the gov comes along and says you have to work till you are 70 now before you get a pension and then you can get an amount you can barely live on. Due to different living circumstances not everyone owns their own homes or has superannuation but unless you were a lazy dole bludger all your life you still worked and paid taxes.
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I retired in October 2020 and I was close to 71...if it wasn't for spinal issues I would probably be still working a 30 hour week instead of 60-70 hour weeks. At least working is better than sitting around doing nothing.
 
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June E said:
It sounds good BUT we will see ! Everything is still costing us so much more and I know we should be grateful but really the $4.60 rise we usually get is an insult ! And the electricity rebate hardly helps anyone ! We paid our taxes for years, the gov comes along and says you have to work till you are 70 now before you get a pension and then you can get an amount you can barely live on. Due to different living circumstances not everyone owns their own homes or has superannuation but unless you were a lazy dole bludger all your life you still worked and paid taxes.
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That’s so very right and what about the difference if you bored there’s nothing to help with that and it’s not fair. I’m 71 years old, lost everything I had, been homeless been in a place where I was hit and paying rent, friend helped me to get into a nice place but I pay bored and get no assistance at all, that’s making fish of some and flesh of others. It’s as if we that do this just don’t matter? And we we don’t get enough to survive doing this or is that the idea. Thank you 🙏🏼
 
DLHM said:
The article is trying to relay some positivity, but the replies are so miserable. Ingrates.

Try living in a country that doesn’t give handouts to their people.
Click to expand...
The Aged Pension is not a handout. When it was started - way back when - a percentage of everyone's wage was taken as a form of taxation to be earmarked for Pension Fund. This was to be handled by the govt so that when one reached retirement age there was still money coming in. As wages have increased so this deduction for the Pension Fund would have increased. But what happened to it? Eventually it probably went to consolidated revenue & people forgot about this regular deduction from their wages. Now the govt says that we have to live on a pittance because they have run out of money!!! What sort of shonky accounting allowed this to happen to the Pension Fund???
 
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Veggiepatch said:
Why does a recipient of the Jobseeker allowance get less than half the increase that Age Pension recipients?

A mere $12.50 versus $28.40? Pensioner who think they get a raw deal are joking. Jobseekers are those getting ripped off in this case!

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Jobseekers have not paid taxes all their lives to be entitled to a reasonable living standard pension. You have the option to go out & get a job so you don't have to live on the Jobseeker Allowance but many of you make the choice not to work. If you want a reasonable lifestyle and later in life a pension which allows you to live in comfort in your old age, then get of your a****s & get a job.

I started work the day after I left school & worked a 40 hour week (with only 2 weeks/year holidays when I started work) until I reached retirement age. I have earned the right to live in comfort in my old age, you haven't yet earned the right to live in comfort in your young age.
 
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CristinaV said:
The last pension increase of $4.60 cannot be classified as "MODEST". It is actually an insult to pensioners who have worked their entire adult life for this pittance of an increase.
Did it help with the daily struggles of life? NO it did not! Will the new increase in pension assist? I don't think so. Actually I think it won't assist those pensioners that still pay a mortgage or pay rent. What a disappointment!
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U are at liberty to refuse the insult, and while not all rises are the same, over a year in total amount to 5-10 times this increase. While not all are grateful, those of us who prepared for life after work are, and it is far better than most every other jurisdiction globally.
 
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THE RISE FOR 2 PEOPLE AGAINST SINGLE IAGREE WITH BUT THE DIFFERENCE I ASSETS I CAN NOT WORK OUT 2 PEOPLE CAN HAVE NEARLY DOUBLE WHAT A SINGLE PERSON HAS BUT WHEN YOUR PARTNER PASSES AWAY YOU LOSS NEARLY ALL YOUR PENSION
 
elaine41 said:
The Aged Pension is not a handout. When it was started - way back when - a percentage of everyone's wage was taken as a form of taxation to be earmarked for Pension Fund. This was to be handled by the govt so that when one reached retirement age there was still money coming in. As wages have increased so this deduction for the Pension Fund would have increased. But what happened to it? Eventually it probably went to consolidated revenue & people forgot about this regular deduction from their wages. Now the govt says that we have to live on a pittance because they have run out of money!!! What sort of shonky accounting allowed this to happen to the Pension Fund???
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The Myth of the “Pension Fund”​

There’s a persistent belief that Australians paid into a dedicated pension fund—akin to a superannuation scheme—and that successive governments “stole” it. But here’s the reality:

  • The National Welfare Fund was never a true savings fund. It was an accounting mechanism within government finances, not a separate pool of invested money.
  • The Social Services Contribution was simply a tax, merged with income tax in 1950. The fund itself was absorbed into consolidated revenue by the 1980s.
  • Claims that politicians raided a pension fund are based on a misunderstanding. There was no ring-fenced account accumulating compound interest for retirees.
 
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Doug Cameron said:
The Deeming Rates are confusing - on one hand, you've written that they are frozen for savings and investments to June 2026 - on the other, all reports indicate that the freeze ends on 20 September 2025, next month - so, which is it?
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As you said these ratres are confusing. I was looking at this yesterday and was reading that the lower deeming rate is increasing to .75% and the upper deeming rate is increasing to 2.75%.
So which one is true? This raise will happen on Sept 20, 2025. Use the link below to have a look for yourself.

www.servicesaustralia.gov.au

Deeming

Deeming rules are used to work out income from your financial assets. We add this to your other income and apply the income test to work out your payment rate.
www.servicesaustralia.gov.au www.servicesaustralia.gov.au
 
Squizzy1 said:
Jobseeker is an allowance to help finance finding a job, not a pension, which in most cases is one's only form of income.
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So a Jobseeker is classed as a lower form of life than a person on the Aged Pension?

How about the maximum wage one can earn before benefits are ceased? Age pensioners can earn up to $2575.40 per fortnight while a Jobseeker is limited to $1505.00.

Discrimination much? The cost of living is not lower for Jobseekers compared to Age pensioners so stop your complaining about being dealt a dud hand.
 
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elaine41 said:
Jobseekers have not paid taxes all their lives to be entitled to a reasonable living standard pension. You have the option to go out & get a job so you don't have to live on the Jobseeker Allowance but many of you make the choice not to work. If you want a reasonable lifestyle and later in life a pension which allows you to live in comfort in your old age, then get of your a****s & get a job.

I started work the day after I left school & worked a 40 hour week (with only 2 weeks/year holidays when I started work) until I reached retirement age. I have earned the right to live in comfort in my old age, you haven't yet earned the right to live in comfort in your young age.
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I have paid almost $500000 in income tax during my working life. Not including GST, stamp duty and other bullshit taxes invented by successive governments.

I will never come close to recouping that through Centrelink allowances.
 
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Caravan Parks are about to get bigger and more of them.
 
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Morgans Orchard said:
I will believe it when it goes in to my bank account . Last pension rise we received i read how they were surmising $24 and under . Well it was UNDER alright a lousy $4/60. My advice is don’t go spending it before you get it . People my age 88 years and over we were born and raised here worked hard and built this country ! No dole no handouts no Medicare card government housing etc what so ever . Now anyone from foreign country puts their first foot on our soil I think all this is handed to them in an envelope.
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Got to agree with you Im in my 80tys also we were too late to get big benefits from superannuation we had to go without luxuries to save for our old age..
 
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Zuki said:
"and please, please, some leaders with a vision for this wonderful paradise on earth."
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We're not going to get any vision from that bunch of clowns we have in Canberra at the moment.
Netanyahu and Trump has them in their sights.
 
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DLHM said:
The article is trying to relay some positivity, but the replies are so miserable. Ingrates.

Try living in a country that doesn’t give handouts to their people.
Click to expand...
Understand your comment . However I am grateful for my $4 odd. Just wish the food I need doesn’t go up twice as much.
 
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Veggiepatch said:
So a Jobseeker is classed as a lower form of life than a person on the Aged Pension?

How about the maximum wage one can earn before benefits are ceased? Age pensioners can earn up to $2575.40 per fortnight while a Jobseeker is limited to $1505.00.

Discrimination much? The cost of living is not lower for Jobseekers compared to Age pensioners so stop your complaining about being dealt a dud hand.
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I can't say I have much sympathy for most jobseekers, given how easy it is to find a job these days. But I do see the pension income upper limit as patently unfair and really quit absurd. A couple can be earning nearly $150K a year and still drawing a part pension, yet an asset-tested couple might only be able to earn $40K, yet a modest asset limit cuts them off. Why that inconsistence? Unless it was designed specifically to favour high-paid bureaucrats who retire on big incomes.
 
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