Centrelink boost for 900,000 Aussies in federal budget leak
Deeming rates are the rates of return the government assumes people earn on financial assets, including shares, superannuation and bank accounts. They impact means testing for Centrelink payments, including the Age Pension, JobSeeker and parenting payments.
Deeming rates are adjusted to reflect the official cash rate on July 1 each year.
However, on July 1, 2022, the government froze rates at 2.25 per cent for two years as a cost-of-living measure.
The government then extended this pause for another year in last year's federal budget.
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Sources told The Australian Financial Review, the freeze would not be lifted in this month's budget, with the government wanting to avoid a major hit to welfare payments.
If rates were returned to their long-term levels in line with the cash rate, welfare recipients would be 'deemed' to earn more and have their payments cut.
Last year, for example, National Seniors modelling found single aged pensioners were about $3,300 better off a year after the government extended the freeze on increases to the deeming rate.For singles, the first $62,600 of your financial assets have a deemed rate of 0.25 per cent. Anything over $62,600 is deemed to earn 2.25 per cent.
For couples where at least one person gets a pension, the first $103,800 of your combined assets have a deemed rate of 0.25 per cent. Anything over $103,800 is deemed to earn 2.25 per cent.
There are 900,105 people who receive government welfare and who have income from other sources. That includes about 460,000 aged pensioners, 143,000 on JobSeeker payments and 120,000 on parenting payments.
Treasurer Jim Chalmers said Aussies struggling with the cost of living can expect more support in next week's pre-election budget.
But he didn't go as far as committing to an extension of the $300 energy rebate.
'What I can say is that there'll be more cost of living help in the budget, the form of that will be made clear to you and over the course of the next week or so,' he said.
'It will be meaningful and substantial, and it will be responsible.'
Centrelink payments including the Age Pension, JobSeeker, Disability Support Pension, Carer Payment and Parenting Payment will increase on March 20 with regular indexation.
The maximum single rate for the Age Pension will increase by $4.60 to $1,149 a fortnight, while the partnered rate will increase by $3.50 each to $866.10, or a combined $7 to $1,732.20 a fortnight.
A single person on JobSeeker will receive an extra $3.10 per fortnight, taking their total to $789.90 including the Energy Supplement.
Couples will receive an additional $2.80 per fortnight, which will take their fortnightly payment to $723, including the Energy Supplement.Sign in to access your portfolio
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