The Federal Government has used the Budget to include untaxed superannuation in the income test for new recipients of the Commonwealth Seniors Health Card.
While the Federal Treasurer, Joe Hockey, has stood by the Government’s pre-election promise not to announce any adverse changes to superannuation or pensions, he foreshadowed significant changes beyond the life the of the current Parliament, including linking pensions to inflation twice-yearly from September 2017.
As well, he announced that asset and associated income test thresholds would be indexed between now and 2017, before remaining at fixed levels for three years.
He said the changes would mean that pensions would always rise with the cost of living, and the value of the pension would continue to rise, but the system would be much better placed to meet the challenge of a significant increase in demand.
Hockey also used his Budget speech to confirm that the age of eligibility for the age pension would increase to 70 by 2035, noting that “to ensure more consistent treatment of senior Australians with similar incomes, untaxed superannuation will be included in the income test for new recipients of the Commonwealth Seniors Health Card”.
He also said that to “better target assistance”, the annual Seniors Supplement would be abolished from 1 July, this year.