Disability Support and Age Pension Increases 20 March 2016

Disability Support and Age Pension Increases 20 March 2016

by Christine Hopper

The Commonwealth granted Centrelink Disability Support and Age Pension increases on 20 March 2016.  DVA Pension and Income Support Supplement also increases from 20 March 2016.
The full rates of income support Pension benefits increased by 0.8%. The Age Pension related daily care fees for Commonwealth regulated aged care were increased to reflect the Age Pension increases of 20 March 2016.

Disability Pensions and Age Pensions increases 20 March 2016 for Single Pensioners.

The new maximum total payment for a Single Pensioner is $873.90 per fortnight, an additional $6.90 per fortnight
The maximum payment for a Single Pensioner includes the full rate of Pension of $794.80 per fortnight.
Pension Supplements totalling $79.10 per fortnight are paid to Single Centrelink clients who receive at least one dollar of Pension per fortnight.

Income and Asset Test cut-off levels after Pension Increases 20 March 2016

A Single Age Pensioner would need to have an income over $1,750 per fortnight, $45,500 per year, before the Income Test cut-out her final one dollar per fortnight of Age Pension and all of the Supplements. If your only Income was the deemed rate on your financial assets then you would need more than $1,420,000 of financial assets to generate an Income at Centrelink of $45,500 per year.
But if you had assets of $735,000 in addition to your home then the Asset Test would exclude you from any Age Pension.

A Single non-homeowner with assets of $883,000 could get one dollar per fortnight of Age Pension plus all of the Supplements provided that she was not excluded by the Income Test.
Remember that the Pension you receive is the lower amount after checking against the Income Test and the Assets Test.

Carer Payment reflects Pension Increases 20 March 2016

Carer Payment provides financial support to people who are unable to work in substantial paid employment because they provide full-time daily care to someone with a severe disability or medical condition, or to someone who is frail aged.
The amount of Carer Payment depends on the income and assets of both the carer and the person receiving care. Read more about Adult Carer benefits

The maximum rate of Carer Payment is equivalent to the full Age Pension rate. Therefore Single people receiving the maximum rate of Carer Payment would have their fortnightly Carer Payment increased to $873.90 per fortnight including the Pension Supplements. Remember that if you qualify for Carer Payment, you automatically receive a Pensioner Concession Card.

Disability Support Pension and Age Pension increases 20 March 2016 for Pensioner Couples

Each member of a couple at Centrelink, could get a maximum Pension of $599.10 per fortnight plus Pension Supplements of $59.60 per fortnight. Each member of a couple living together could receive a maximum payment of $658.70 per fortnight, that is, $5.20 per fortnight more.
Remember that a ‘couple at Centrelink’ is any two adults who share domestic arrangements and present socially as a couple. Changes in ‘personal circumstances’ such as becoming a member of a ‘couple at Centrelink’ take effect from the day that a partner moves in until the day that one partner moves out.
The lower rate for members of a couple living together is intended to reflect the shared use of some facilities and services.

The Couples Income Test reduces each person’s pension by 25 cents for each extra dollar of Income of the couple. After the Pension Increases 20 March 2016, an Age Pensioner couple living together could have a joint Income of $2,680 per fortnight, $69,600 per annum, and not be cut-off by the Income Test from entitlement to that last one dollar per fortnight each of Age Pension and the Pension Supplement.
For a Couple with financial assets of $2,170,000 the deemed financial income would be $69,310 per year. But the Assets Test would exclude a couple from receiving any Age Pension if they had financial assets of $2.170 million.

A homeowner couple living together could have $1,088,000 of assets in addition to their home before the Asset Test excluded them from that last one dollar per fortnight each of Age Pension and the Pension Supplement.
A non-homeowner couple living together could have $1,237,000 of assets and get that last one dollar per fortnight each of Age Pension and the Pension Supplement provided that the Income Test had not excluded them from any Age Pension.

Disability Pensions and Age Pensions increases 20 March 2016 for Pensioner Couples separated by illness

Centrelink allow for each member of a ‘couple separated by illness’ to receive the Single person rate of Pension but reduced according to the Income Test and Asset Test for the couple. Thus each member of a couple separated by illness who have very few other resources, could receive the new maximum rate of $873.90 per fortnight each including the Single rate of the Supplements.

Help is available. Christine at Financial Care Services is experienced with Pension Applications and the many Centrelink financial means tests.

Financial Care Services offers Short Consultations to help you check your financial position against the means tests for an Age Pension, DSP or a Carer Payment.

If you think that you might be eligible for a part Pension or Carer Payment you can call Christine on 03 9808 0338 to arrange a Short Consultation, 45 minutes in person or by telephone and/or email to discuss your position.

Please email to ask for the Age Pension Illustration Personal Data form for a special ‘short consultation’ .  You will also receive the Financial Services Guide that provides detailed information about Financial Care Services. 

The ‘$99 Special Age Pension Illustration Short Consultation’ provides personal factual financial information in the form of an Illustration of the amount of Age Pension you could receive today provided that you satisfied the age and residency conditions for DSP or an Age Pension.  The ‘$99 Special Age Pension Illustration Short Consultation’ does not include any discussion of your situation or any ‘financial advice’ regarding rearrangement of your assets or changes to your superannuation provisions.

Christine could also assist you with collating your personal data, estimating how much Pension or Carer Payment you could expect to receive and completing the Centrelink forms for you to sign. Normal hourly rate consultation fees apply for assistance with personal data collation, completing Centrelink forms and attendance at a Centrelink office with you.

Financial Care Services also offers a ‘Retirement Planning Consultation’ that includes an analysis of your financial situation and personal financial retirement planning advice. 

Retirement Planning Consultations require very detailed personal and financial information to be provided by the client to allow for the potential implications of your health status and any liabilities to be considered in addition to the structuring of your assets to generate an income in retirement.

Financial Care Services charges professional hourly rate fees  for all consultations that include financial advice and/or discussions about your financial position. 

DVA War Widow Pension increases 20 March 2016

The amount of the DVA Pensions paid as compensation to War Widows increased on
20 March 2016 to $887.90 per fortnight including Supplements. This ‘compensation’ is not subject to any financial means testing.

The means tested Income Support Supplement, ISS, is paid to War Widow and DVA Disability Pensioners who have limited financial resources. The maximum rate of ISS increased to $262.00 per fortnight including Supplements.

Veterans with ‘qualifying service’ can claim the Service Pension from DVA. The Service Pension is paid at the same rates and subject to the same financial means testing as the Age Pension. Read more about veterans pensions and compensation at DVA Pensions and Benefits

Aged Care fees increases 20 March 2016

The Basic Daily Care fee for Commonwealth regulated residential aged care is set as 85% of the Single person rate of Age Pension excluding the Supplements. Thus the Basic Daily Care fee has increased to reflect the Age Pension increases of 20 March 2016.
The new Basic Daily Care fee is $48.252 for Standard residents including Respite care residents.

The means tested fees for permanent residential aged care or home care were adjusted to reflect the Age Pension increases of 20 March 2016.

Help with understanding residential aged care fees

New residents with substantial assets and/or significant income are expected to finance their own hoteling costs and personal support and care costs. Centrelink administer the means testing of aged care residents deemed capacity to contribute to their aged care costs.  The means testing arrangements are very complex.

Whilst all aged care residents pay the standard rate of Basic Daily fee for housekeeping, residents who still own their former homes pay teh full costs of their chosen aged care accommodation. Thus the level of Accommodation Room Price agreed has a major impact on the cost of living in formal aged care.

Entering permanent residential aged care has the potential for major financial commitments.  Therefore specialist aged care financial advice is needed before you sign up for an aged care placement.

Financing residential aged care is complex; if you sell the former home to pay the Refundable Accommodation Deposit the aged care resident’s Age Pension might be reduced but if you lease the house the ongoing Age Pension plus the rent might not be enough to cover the daily fees.

Help is available. Christine at Financial Care Services is experienced with the complex web of Accommodation Charges, RADs and daily fees for aged care and the interaction with Age Pension rules.

Before you commit to placing a family member in Commonwealth regulated residential aged care consult Financial Care Services about the options and fee levels. Call Christine on 03 9808 0338 to arrange a Consultation to discuss your family member’s position. 

If you would like further confidential, independent and professional advice about Commonwealth regulated residential aged care, Centrelink, lifestyle or financial issues please contact Christine Hopper .

Disclaimer. These Insights are a general over view based on our understanding of the Social Securiy and DVA Pension arrangements. Individual entitlements to Social Security and DVA benefits are determined based on your actual situation as documented to Centrelink or DVA.

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