Labor’s plan to solve the housing crisis and help pensioners with a financial boost
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If you’ve been considering relocating and downsizing your home, this might be the perfect time to take the leap as the Labor government recently announced a proposal that could benefit thousands of pensioners.
Pensioners are set to receive greater financial incentives if they decide to downsize their homes in a bid to boost housing stock for families, as part of the Labor government’s promise to match a plan that was first proposed by the Coalition.
Social Services Minister Amanda Rishworth stated that she hoped ‘thousands’ of older Australians would benefit from the change, which will lessen the impact on pension payments if homeowners make a considerable amount of money from their property sale.
‘We don’t want people putting off downsizing to a more suitable home because they are concerned about the impact it could have on their payment rate and overall income.’ she said.
Have you been thinking about downsizing your home? Source: Claridge Court
‘These changes will give pensioners more flexibility to find a suitable new home and it will, hopefully, free up larger housing stock for younger families who may need it.’
The changes–which will be introduced to the Parliament on Wednesday–extend the asset test exemption on home sale proceeds from 12 months to 24 months, giving pensioners more time to buy or build a new home before the extra money in their bank account begins to affect their pension payments.
The government will also decrease the deeming rate–which calculates income from assets–on home sale proceeds from 2.25 per cent to 0.25 per cent.
Rishworth’s office detailed that, under the current system, a couple that sells their home for $1 million could see their pension reduced by $229 per fortnight, while a single pensioner selling their home for $600,000 could have their pension reduced by $143 per fortnight. These proposed changes would see no reduction in pensions in either case.
Former Prime Minister Scott Morrison previously proposed the policy on 15 May, which is the weekend before the election. Albanese told ABC’s Insiders program on the same day that Labor would carry on with Coalition’s policy, calling it ‘a modest announcement to extend a downsizing program’.
‘This suggestion by the government is a practical one. We’ll support it, but we will have much more in our offer to the Australian people next Saturday.’ Albanese stated at the time.
The proposed changes are the latest initiatives to support pensioners. They came after an indexation increase to welfare payments was made earlier this week. The government also previously announced a new $4,000 work credit for pensioners to take on more employment without it affecting their payments, as one of the major outcomes of the Jobs and Skills Summit.
A new program aims to support people with a disability. Source: iStock
In addition, Rishworth announced a new program that will provide job opportunities in the tourism, hospitality, accommodation, and visitor industry, particularly for those who have a disability.
In a joint announcement with the Tourism Minister, Don Farrell, Rishworth set aside $3.3 million for the Visitor Economy Disability Pilot, as last week’s jobs summit brought light to several challenges faced by people with a disability when finding employment.
More than half of Australians with a disability are currently in the labour force, a gap of roughly 30 per cent compared with the wider population. Sitting at 10 per cent is the unemployment rate for people with a disability, which is twice the rate compared to people without a disability.
‘Employing someone who is living with a disability should not be seen as a charitable act.’ Rishworth said. ‘It makes good business sense. When the visitor economy is crying out for workers, people living with a disability should get the same opportunities to have meaningful careers in the sector.’
The program will fund ‘local navigators’ in regional areas, who will assist businesses in looking for and hiring people with a disability.’
Farrell said that tourism was among the several key industries facing significant job shortages over the coming years.
‘The tourism sector is crying out for workers and if we can create pathways to open up jobs and careers for people living with disabilities in this sector, then it is a good thing for everyone.’
What are your thoughts about these changes? Do you think that they are in line with what seniors need? Anything that puts more money back in pensioners' pockets sounds good to us! Let us know in the comments.
Learn more about downsizing your home by watching the video below:
Source: One Minute Economics
Pensioners are set to receive greater financial incentives if they decide to downsize their homes in a bid to boost housing stock for families, as part of the Labor government’s promise to match a plan that was first proposed by the Coalition.
Social Services Minister Amanda Rishworth stated that she hoped ‘thousands’ of older Australians would benefit from the change, which will lessen the impact on pension payments if homeowners make a considerable amount of money from their property sale.
‘We don’t want people putting off downsizing to a more suitable home because they are concerned about the impact it could have on their payment rate and overall income.’ she said.
Have you been thinking about downsizing your home? Source: Claridge Court
‘These changes will give pensioners more flexibility to find a suitable new home and it will, hopefully, free up larger housing stock for younger families who may need it.’
The changes–which will be introduced to the Parliament on Wednesday–extend the asset test exemption on home sale proceeds from 12 months to 24 months, giving pensioners more time to buy or build a new home before the extra money in their bank account begins to affect their pension payments.
The government will also decrease the deeming rate–which calculates income from assets–on home sale proceeds from 2.25 per cent to 0.25 per cent.
Rishworth’s office detailed that, under the current system, a couple that sells their home for $1 million could see their pension reduced by $229 per fortnight, while a single pensioner selling their home for $600,000 could have their pension reduced by $143 per fortnight. These proposed changes would see no reduction in pensions in either case.
Former Prime Minister Scott Morrison previously proposed the policy on 15 May, which is the weekend before the election. Albanese told ABC’s Insiders program on the same day that Labor would carry on with Coalition’s policy, calling it ‘a modest announcement to extend a downsizing program’.
‘This suggestion by the government is a practical one. We’ll support it, but we will have much more in our offer to the Australian people next Saturday.’ Albanese stated at the time.
The proposed changes are the latest initiatives to support pensioners. They came after an indexation increase to welfare payments was made earlier this week. The government also previously announced a new $4,000 work credit for pensioners to take on more employment without it affecting their payments, as one of the major outcomes of the Jobs and Skills Summit.
A new program aims to support people with a disability. Source: iStock
In addition, Rishworth announced a new program that will provide job opportunities in the tourism, hospitality, accommodation, and visitor industry, particularly for those who have a disability.
In a joint announcement with the Tourism Minister, Don Farrell, Rishworth set aside $3.3 million for the Visitor Economy Disability Pilot, as last week’s jobs summit brought light to several challenges faced by people with a disability when finding employment.
More than half of Australians with a disability are currently in the labour force, a gap of roughly 30 per cent compared with the wider population. Sitting at 10 per cent is the unemployment rate for people with a disability, which is twice the rate compared to people without a disability.
‘Employing someone who is living with a disability should not be seen as a charitable act.’ Rishworth said. ‘It makes good business sense. When the visitor economy is crying out for workers, people living with a disability should get the same opportunities to have meaningful careers in the sector.’
The program will fund ‘local navigators’ in regional areas, who will assist businesses in looking for and hiring people with a disability.’
Farrell said that tourism was among the several key industries facing significant job shortages over the coming years.
‘The tourism sector is crying out for workers and if we can create pathways to open up jobs and careers for people living with disabilities in this sector, then it is a good thing for everyone.’
What are your thoughts about these changes? Do you think that they are in line with what seniors need? Anything that puts more money back in pensioners' pockets sounds good to us! Let us know in the comments.
Learn more about downsizing your home by watching the video below:
Source: One Minute Economics
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