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Key changes urged to Age Pension means test
The Federal Government should consider imposing a dollar cap on the value of the family home that is exempt from the Age Pension means test, according to the Institute of Actuaries of Australia.
The institute has used a pre-Budge submission has urged the move as part of a broader review of the Age Pension means tests to improve fairness in the system between homeowners and non-homeowners.
The submission said it was notable that 95 per cent of homeowner couples were projected to be on retirement incomes of at least the Association of Superannuation Funds of Australia modest level, compared to only 28 per cent of renting couples.
It said single female private renters were projected to have the lowest levels of retirement income adequacy, with only 23 per cent expected to achieve the ASFA modest level, compared to 35 per cent for single male renters.
“Actual rental payments are significantly higher than the level of Centrelink rental assistance, with the maximum Centrelink rent assistance being $136 per fortnight for a single renter living alone whereas the median rent is closer to $400 a fortnight,” the submission said.
The submission said CEPAR research indicated that Commonwealth rental assistance had fallen as a per centage of average rental payments since 2001 and that the institute was therefore recommending that Commonwealth rental assistance be increased by 40 per cent to provide more meaningful support for recipients.
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Speaking to Super Review, the $70 billion fund has unveiled its new solution to address the ‘cognitive load’ of retirement as members enter their golden years.
New research has suggested it’s time to reconsider the home as a fourth pillar of the retirement income system, alongside the age pension, superannuation, and voluntary private savings.
New research has revealed over 60 per cent of retirees believe their super fund offers retirement income products suitable to support their retirement lifestyle.
Some retirees are “needlessly” paying two sets of fees and often more tax than they need to, according to the industry body.
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