More than half of the people on Disability Support Pension, other working age payments and youth support report having no private income, as do 48 per cent of carers. The two groups with the most significant levels of private income are the aged and those on Parenting Payment Single. Among the aged, while only The income pattern of single parents is somewhat different, with This reflects the high level of employment amongst this group.
When comparing the relative incomes of people on different payments it is important to note, as mentioned above, that there is also interaction between the means testing of particular payments and the apparent level of income. For example, pensioners can earn levels of income that would disqualify an allowee and will hence show as having some people on higher income than the allowance data.
Chart 25 and Chart 26 look at the level of private income received by income support recipients in two ways. Chart 25 shows the percentages of income support recipients with various levels of private income. Chart 26 shows the cumulative distribution of pension recipients by private income, highlighting the different private income levels of people on different payments.
Those income support recipients who do have significant levels of private income are able to achieve living standards well above the base rate of pension. While rewarding people who have private income is important to the way the income support system operates as noted in Chapter 1 , it also results in considerable variations in the living standards of recipients of transfer payments.
This is shown in Chart 27, which shows the pension and non-pension income of Age Pensioners, ranked by their total income, as a multiple of the base rate of pension. This chart also shows the distribution of private income and its effect on total income and pension income:.
The slow withdrawal rate of the Age Pension as private income increases the income test taper means there is a small but significant group of people receiving Age Pension who have household income over one-and-a-half times the Age Pension rate. Some four per cent receive incomes more than double the Age Pension rate. The proportion of Age Pensioners with significant levels of private income is expected to grow in the future as the Superannuation Guarantee matures.
There will still be some pensioners, however, with little private income or assets. Others may have withdrawn some or all of their superannuation savings under hardship and compassionate grounds. These factors restrict the capacity to accumulate savings. They also mean that, with the growing proportion of Age Pensioners who have substantial private resources, there will be increased diversity in the income and assets holdings of Age Pensioners.
As is the case with income, while most income support recipients have low levels of private wealth, particularly when the family house is excluded, some have substantial wealth or live in households with others who have considerable assets. Few income support recipients have the maximum allowable level of assets. There are different ways of looking at wealth and income support receipt. In the next analysis total household wealth is considered using ABS data that incorporates all assets including items such as the family home, which is excluded from income support assets testing arrangements and as such is not included in Centrelink administrative data and household debt.
Chart 28 examines the population as a whole divided into net wealth deciles and shows that, while income support recipients are most highly represented in the lowest wealth decile, they are also found in households across the wealth distribution.
Of particular note is the concentration of Age Pensioners and related recipients in the upper end of the middle of the distribution and the number of Disability Support Pensioners who are more highly represented at the bottom. Income support payments play a much more important role in low-wealth households than they do in high-wealth households Table This indicates that A second snapshot looks at the wealth of a subset of the income support population living in households who mainly rely on income support.
The distribution of net wealth 11 again in relation to all assets, including the family home and debts, including consumer credit and Higher Education Contribution Scheme liabilities, in these households by main type of income support received is outlined in Chart This chart ranks households receiving particular payments by wealth, from poorest to richest, and plots the cumulative proportion of households by level of net assets. Again, most households have low levels of wealth, although there are considerable variations in wealth even among households that rely on income support for half or more of their income:.
An important explanation for differing distributions is the different lifecycle points at which payments are made and the fact that assets usually accumulate over a long period.
Chart 28 and Chart 29 include the family home in the household's wealth. These recorded wealth levels therefore cannot easily be converted into cash to support living standards although owner-occupied housing supports living standards in other ways. A further insight into this is given by looking at the components of wealth. Chart 30 ranks households that rely upon income support payments for more than half their income into deciles of wealth.
For all deciles the family home is the largest component of wealth. Of particular note are the relative low levels of superannuation assets. For some this may be because they have already drawn down this asset, but for most it reflects low levels of accumulation. As noted, assessable assets—those taken into account in means testing payments—are a more limited subset of all assets. As with income, the average wealth holdings of Age Pensioners is expected to increase as the Superannuation Guarantee matures.
This section outlines the broad eligibility criteria for the income support payments in the Australian transfer system. Most such payments apply a week waiting period or residence requirement to newly arrived residents, with exemptions for certain specified new entrants.
Payment rates and means testing provisions as at 1 July are outlined at Appendix C. Generally, a claimant is required to be an Australian resident and in Australia at the time of claim, unless they are claiming under an International Social Security Agreement. To receive Age Pension a person must have prior residence of 10 years or more, with at least five years in a continuous block they can include, under certain International Agreements, periods of residence in the agreement country.
Under certain limited circumstances people may be exempt from the year residence requirement. Disability Support Pension is for people aged 16 and over new entrants must be under Age Pension age , with a physical, intellectual or psychiatric impairment assessed as 20 points or more under the Impairment Tables that prevents them from working, or being re-skilled to work, for 15 hours a week at or above the minimum wages for at least the next two years.
Recipients of the payment at 10 May are required to be unable to work 30 hours a week. Similar prior residence requirements as Age Pension apply unless the person became unable to work while in Australia. Special provisions allow recipients who commence work or increase their earnings on a long term basis to have their eligibility 'suspended' for up to two years, rather than cancelled, allowing them to return to payment if they cease work or reduce their hours of work.
Disability Support Pension is non-taxable for recipients under Age Pension age. Carer Payment is a pension for a person providing constant care for a person with disability or severe medical condition, or who is frail aged; a child with profound disability; two or more children with disability; or an adult and that adult's dependent child who needs care permanently or for an extended period.
The person being cared for must receive an income support or service pension, or not have qualifying residence for a pension, or meet the Special Care Receiver income and assets limits.
They are not required to live with or adjacent to the person being cared for. A Carer Payment recipient can participate in employment, education, training or unpaid voluntary work for up to 25 hours a week without it affecting their eligibility.
Bereavement Allowance is a pension paid for up to 14 weeks to a recently widowed person, without a qualifying child for Parenting Payment Single, following the death of their partner the period can be extended if the widow is pregnant. Newstart Allowance is for people between 21 and Age Pension age who are regarded as unemployed, and who satisfy the requirements of an activity test or are exempted from activity testing, for example, due to a temporary incapacity for work.
Activity requirements are tailored to the individual's capacity to work. For example, reduced requirements apply to people with disability with a partial capacity to work and principal carers of older children aged 6 to 15 if partnered and 8 to 15 if single. The most common activity requirement is to seek and accept suitable work. Other agreed activities are designed to improve employment prospects. Sickness Allowance is for people who are temporarily incapacitated for work or study as a result of illness, and who have a job or course of study to return to if aged 25 plus.
Parenting Payment is for principal carers of dependent children. Claimants must have a qualifying child aged under six if the carer is partnered or under eight if the carer is single. A person must enter into an activity agreement with part-time requirements if the youngest child is aged six or more. Those who were on Parenting Payment at 30 June , must have a qualifying child aged under 16 and must enter into an activity agreement with part-time requirements if the youngest child is aged seven or more.
Parenting Payment for a single parent is a pension. Parenting Payment for a partnered person is an allowance. To receive Parenting Payment a claimant must have two years prior Australian residence. This period is waived for people whose partner dies while they are in Australia. Widow Allowance is for older women born on or before 1 July widowed, divorced or separated prior to turning 40 and with no recent workforce experience at the time of initial claim.
No recent workforce experience is defined as having not worked at least 20 hours a week for 13 weeks or more in the 12 months before claim. Payment rates and means testing as for Newstart Allowance for a single person. Youth Allowance is an income support payment for young people aged and full-time students aged Youth Allowance student is for full-time students in secondary or tertiary education or training and full-time Australian Apprentices aged 16 to 24 years.
The student must be undertaking an approved course of study. Youth Allowance other is for young people aged 16 to 20 who are not in full-time study, seeking or preparing for work or temporarily unable to work. Youth Allowance for non-independent under 18 year olds is paid to a parent, unless the parent directs in writing otherwise.
Rates for people with children are similar to equivalent Newstart Allowance rates. A lower rate is paid to partnered young people without children or living away from home. Rates are lower again, and age related, if the young person is living at home. Youth Allowance for non-independent young people is subject to parental means testing arrangements: a parental income and family assets test applies unless a parent receives an income support payment or holds a low income Health Care Card; a family actual means test applies to families with specified financial arrangements.
The payment includes young people assessed as only having a partial capacity for work—this group is not subject to parental means testing. Austudy Payment is for people over 25 who are full-time students in study or training or full-time Australian Apprentices.
Payment rates and income testing are the same as Youth Allowance for an independent young person, except that they are not paid the lower 'at home' rate. Payment rates are generally equivalent to Youth Allowance Student and Newstart Allowance for over year-olds.
Special Benefit is for those who are in financial hardship but who are not eligible for any other type of payment. The rate of Special Benefit is discretionary but cannot exceed that otherwise payable to Newstart Allowance or Youth Allowance recipients. The payment is activity tested in some cases, and is paid subject to strict liquid assets test limits and any income is subject to a dollar for dollar income test. Special Benefit may be paid to newly arrived residents within the week waiting period.
Payments closed to new entrants : Some recipients receive payments that are closed to new entrants. Recipients are not subject to participation requirements. These payments include:. A service pension is paid to veterans on the grounds of age or invalidity, and to eligible partners, widows and widowers. The age service pension is paid to veterans who have qualifying service and the partner service pension is paid to eligible partners and widows.
These service pensions are paid five years earlier than the Age Pension in recognition of the intangible effects of war. The invalidity service pension may be granted at any age up to age The rate of service pension is indexed in the same way as Age Pension. Disability pension is available to compensate veterans for injuries or diseases caused or aggravated by war service or certain defence service rendered on behalf of Australia before 1 July It is a non-taxable pension.
Instead of a recipient having to approach Centrelink and qualify for one of three or four different income support payments such as Age Pension or Disability Support Pension under the Social Security Act , the person can claim the Income Support Supplement with the Department of Veterans' Affairs. From 1 July , there is no longer an age requirement for the Income Support Supplement. In analysis the Service Pension and Income Support Supplement are treated as income support as they are both means tested payments.
This section outlines the broad eligibility criteria for family assistance payments in the Australian transfer system. Payment rates and income testing provisions as at 1 July are outlined at Appendix C.
It is available to parents who provide care of dependent children for 35 per cent or more of the time. FTB Part A also includes assistance for families with private rental costs for families with children aged under 16 Rent Assistance , three or more children Large Family Supplement , and multiple births with three or more surviving children of the one confinement Multiple Birth Allowance.
FTB Part A has two rates—a 'maximum' rate and a 'base' rate paid—both subject to income but not assets tests. Children aged 13 to 15 have a higher maximum rate than younger children because teenagers cost more. Lower rates of payment are available for children from 16 to 24, as Youth Allowance becomes available to children in low income families once a child turns However, increases in the generosity of FTB rates and means testing arrangements for children aged under 16 relative to those applying to Youth Allowance now result in almost all families experiencing a reduction in government assistance when a child turns Family Tax Benefit FTB Part B is a per family payment, paid to single parents and couples with one main income earner with a dependent child aged under 16 or a qualifying full-time student aged 16 to FTB Part B has a higher rate for families with a child aged under 5.
FTB is a paid as a fortnightly payment to most families based on an estimate of total family adjusted taxable income. Families can elect to wait until their adjusted taxable income is known and claim the payment as a lump sum. FTB supplements are available at the end of the tax year and can be used to offset any debt arising from an incorrect estimate of income.
Where the care of a child is shared between two or more adults each with more than 35 per cent of the care who are not members of the same couple, FTB can be 'shared'.
FTB is not subject to assets testing. Double Orphan Pension is provided to a guardian or approved care organisation with the care and control of a child where both parents have died or one parent has died and the other parent is unable or unavailable to care for specific reasons.
Maternity Immunisation Allowance is a one-off lump sum payment for children who are aged 18 to 24 months and fully immunised unless exempted. From 1 January it will generally be made in two payments: for children who have received the immunisations required for an 18 month old and a four year old. Family assistance payments are non-taxable. Child Care Benefit CCB is available for families using child care provided by an approved child care service or registered carers.
Registered care includes nannies, relatives or friends registered as carers. Families who are eligible for CCB for approved care can get up to 24 hours of CCB per child per week regardless of their work status. Families where both parents or a single parent are working, studying, training or looking for work for at least 15 hours a week unless exempted are eligible for up to 50 hours of CCB per child per week for approved care.
CCB for registered care is paid only where both parents or a single parent are working, studying, training or looking for work at any time in the week. There is a weekly limit of 50 hours of CCB for registered care. CCB for approved care is subject to a family income test. The maximum rate is payable if a parent is on income support, or if their family income is below the relevant income threshold.
Most families using approved care choose to receive their CCB as a reduction in fees. The other option is as a lump sum after the end of the year. There is no income test for CCB for registered care. To receive payment, the claimant must have been assessed as eligible for CCB and both parents or a single parent must be working, studying, training or looking for work. This section outlines the broad eligibility criteria for supplementary payments in the Australian transfer system as at 1 July Further detail is provided at Appendix D.
It is paid at a rate of 75 cents for every dollar above the threshold until a maximum rate is reached. The maximum rates and thresholds vary according to a customer's family situation and the number of children. For singles without children, the maximum rate may also vary according to whether or not accommodation is shared with others.
For families with children aged under 16 it is paid as part of the FTB Part A and subject to the family payment income test unless receiving income support and the maintenance income test.
RA is withdrawn at the same rate as the primary payment, for example, 20 per cent for families receiving RA with FTB Part A, 60 per cent for allowance recipients and 40 per cent for pensioners 20 per cent for each partner. RA is non-taxable. Remote Area Allowance RAA provides assistance to income support customers residing in defined remote areas, recognizing that many do not get the full benefit of tax zone offsets.
RAA is a contribution towards some of the costs associated with living in particularly remote areas. It is paid in addition to the income support rate and is not reduced by the income or assets test. Telephone Allowance TAL is a quarterly payment to assist with the cost of maintaining a telephone service.
It is paid to pensioners, certain allowees and Commonwealth Seniors Health Card holders who are telephone subscribers. A higher rate of Telephone Allowance is payable for income support recipients of Age Pension age, Commonwealth Seniors Health Card holders, and Disability Support Pension and Carer Payment if a person or their partner have a home internet connection.
Utilities Allowance UA is a payment to assist with regular household bills. UA is paid quarterly. Eligibility test days are 20 March, 20 June, 20 September and 20 December. Education Entry Payment EdEP is a lump-sum payment to assist with the cost of beginning approved study.
Work for the Dole Supplement is a fortnightly supplement to help Newstart Allowance recipients and Youth Allowance recipients with the cost of participating in Work for the Dole programs.
Language, Literacy and Numeracy Supplement is a fortnightly supplement to help people on eligible income support payments with the costs associated with participating in the Language, Literacy and Numeracy program.
Pension Bonus Scheme pays a one-off lump sum to people who defer receipt of Age Pension and continue to work. Pension Bonus Bereavement Payment is one-off lump sum to the surviving partner of a deceased Pension Bonus Scheme member who did not make their claim for a Pension Bonus before their death.
Crisis Payment is a one-off payment to help people who are in severe financial hardship. It is available to social security income support recipients forced to leave their own home due to extreme circumstances, such as a natural disaster, or who are victims of domestic violence, newly released prisoners or newly arrived humanitarian entrants.
Mobility Allowance is a non—means tested income supplement for people with disability aged 16 or over and unable to use public transport without substantial assistance. There are two rates of Mobility Allowance. A higher rate is paid to recipients of Disability Support Pension, Newstart Allowance and Youth Allowance Other working at least 15 hours a week or looking for such work, the lower rate is paid to other recipients. Carer Allowance is for people who provide daily care and attention at home to a person with disability or medical condition who is: aged 16 or over with substantial functional impairment; or a dependent child under age 16 who needs substantially more care than child without disability.
Carer Bonus payments were made in June following the Budget and in each of the preceding four Budgets. Recipients eligible for both the Seniors and Carers Bonuses received both. Pensioners and specified allowance recipients aged 60 and over and on income support for nine months or more, 'principal carers' and those assessed as having a 'partial capacity to work' are issued a Pensioner Concession Card.
Other allowance recipients excluding student payment recipients and eligible FTB families are issued a Health Care Card. A low-income Health Care Card can be claimed, subject to an income test, by other low income families and individuals. Concession Cards also remain available to certain income support recipients for a period if they leave payment due to employment income.
While all cardholders have access to low-cost pharmaceuticals and a concessional Medicare Safety Net threshold, holders of the Pensioner Concession Card may receive additional concessions provided by state, territory and local governments. Discounts can apply to: fares on public transport, rates council and water , utilities electricity , and motor vehicle registration charges. The level of these concessions and others available to cardholders vary between state, territory and local government.
Further details on concession cards see Appendix H. This appendix provides a brief history of indexation arrangements and discusses the different indexation arrangements that apply to pension and allowance payments. Indexation arrangements have varied over the years. In general, until the mids pension rates were increased on an ad hoc basis, although there were brief periods when pension rates were indexed annually to price movements. Twice yearly indexation in line with CPI increases was in place between and and restored in In the incoming government commenced implementing a commitment to increase the pension level until it reached 25 per cent of average weekly male earnings.
This benchmark was met for the first time in The question regarding duration since last worked also previously required people to only refer to jobs that were worked for at least 2 weeks, but since July the '2 weeks' requirement was removed. For more details, refer to the updated Retirement and Retirement Intentions questionnaire provided in this publications Data downloads section.
Retirement and Retirement Intentions microdata will be available 8th May via TableBuilder. For more information see About TableBuilder. Previously, data from the Barriers and Incentives to Labour Force Participation survey would also be included in the same TableBulder product. Data items relating to this survey are not yet available, and will be released on 28 August to co-incide with the publication of Barriers and Incentives to Labour Force Participation, Australia.
Retirement and Retirement Intention data in published outputs will no longer have perturbation applied, an approach consistent with other ABS Labour statistics publications. In order to make the data easier to use, table names have been changed to shorter and more concise names that better describe the contents of each table.
The content and the layout of each table has not changed. Search ABS. Latest release. Retiree statistics and the retirement plans of people aged 45 years and over. Reference period. Next release Unknown. Key statistics There were 3. Average retirement age of all retirees was Half a million people intend to retire within 5 years. Average age people intend to retire is Check out the table below to see at what age you might qualify.
Australians are living longer, so more people require a bigger pool of savings to fund the additional years after they finish working, with many having to explore the possibility of working for longer too. As for how much money you might need each year, June figures from the Association of Superannuation Funds of Australia ASFA show individuals and couples, around age 65, who are looking to retire today, would need a certain annual budget to fund different types of retirement lifestyles 4.
ASFA figures are based on the assumption people own their home outright and are relatively healthy 5. See the suggested annual budgets below compared to current Age Pension rates being paid by the government 6. Health is a key factor when it comes to participating in the workforce, particularly as you get older. This can affect your ability to accumulate super and other savings to fund your retirement.
But the author rightly points to the difference between individuals and households. The latest ABS numbers have Australia with about 9. If one does some back-of-the-envelope calculations on the basis of family payments and income assistance, it would seem that more than half of all households are receiving payments.
So the conclusion that fewer than half of all individuals, but more than half of all households are in receipt of government payments would seem correct. The final point is on the trends — again, I agree with the author.
The number of income support recipients as a fraction of the population is falling, not rising. I think that is probably correct. Recent falls in the fraction of recipients have been due to policy changes, particularly to means test programs more strongly. It may not be the case that the fraction of recipients will rise to two-thirds of the Australian population, but it could well be the case that the fraction of recipients will rise if policy does not continue to tighten eligibility, given an ageing population.
Portsmouth Climate Festival — Portsmouth, Portsmouth. Edition: Available editions United Kingdom. Become an author Sign up as a reader Sign in. We then ask a second academic to review an anonymous copy of the article. You can request a check at checkit theconversation. Please include the statement you would like us to check, the date it was made, and a link if possible.
Welfare FactCheck David Leyonhjelm.
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