Centrelink changes: what you need to know
IPSWICH residents who are currently receiving a part or full age pension may be one of the hundreds of thousands of retirees affected by the changes to the Aged Pension asset test.
Centrelink will send out letters to the nation's retirees summarising the new rules before Christmas this year.
The changes, set to start on January 1, 2017, could increase pensioners' entitlements, or take some or all of them away.
Blair MP and Shadow Minister for Ageing Shayne Neumann stood firmly against the changes and said while some may benefit, a new assets test would lessen or completely eliminate pensions for a large number of seniors with substantial investments.
"I voted against the Liberal Government's changes to the pension assets test," he said.
"I opposed it in the Parliament but unfortunately the Greens and the Liberals did a deal to cut the pension.
"This policy is flawed. The cuts will impose disincentives to save, and strong incentives to spend down assets.
"This is not in the best interests of pensioners, or the sustainability of the system as a whole."
Mr Neumann said there was little time for residents to prepare for the changes before 2017 and that the policy would result in added worry for many seniors who may already be suffering from financial stress.
The Blair MP said he would continue to oppose the changes and fight for the region's seniors.
"Labor is again committed to standing up for pensioners in the new parliament, we will fight for pensioners in Ipswich and the Somerset Region," Mr Neumann said.
What exactly are the changes?
THE Age Pension assets test thresholds will change, meaning pension payments will reduce by $3 per fortnight for every $1,000 of assets above the lower assets test threshold.
Currently, the taper rate is $1.50 (75c each for couples) per fortnight, which means from January 1, 2017, pensions will reduce at a faster rate.
People who lose their Age Pension in 2017 as a result of the changes will automatically be entitled to receive a Commonwealth senior's health card and/or a low income health care card.
These cards will provide access to things such as Medicare bulk billing and less expensive pharmaceuticals.
Preparing for the changes
DEPENDING on how the changes may impact you, there are a number of things worth planning for:
How you might replace any lost income if your entitlements are reduced
How you might be able to trim down your assets before the changes come in, to retain your current entitlements-for example, gifting within annual limits, moving savings into a spouse's super, or bringing holidays or home renovations forward
How strategies outside of asset reduction may be able to help-working for longer or reviewing your budget in retirement.
For more visit www.amp.com.au.