ACOSS CEO Dr Cassandra Goldie said:

“It is extremely disappointing that despite the budget challenges, the Government appears to be prioritising people with investment assets by effectively reversing last year’s budget changes to deeming rates. Those affected are by and large better off in their post working life than those relying on the full pension who will receive a cut to their payments through lower indexation changes in the last Budget.

“The 2014 Budget change to the deeming rates above which assets are deemed to earn a higher rate of interest income was a sensible step towards a better targeted retirement incomes system. It affected older Australians with investment incomes who rely on a part pension. In the interests of ensuring the system targets those who need assistance, ACOSS also supports the abolition of the Seniors Supplement.

“Lowering the indexation of the Aged Pension will have much greater impact on all pensioners, especially those already struggling without the advantage of having investments, and would lead to this group falling behind community living standards.

“It is unclear what public policy interest this change of heart serves, the total cost of which ($200 million per year) is almost equal to the $270 million cut from vital community services in the 2014 Budget.

“What the government should’ve been announcing today is that it had changed its mind on damaging proposals, such denying people under 30 years of age unemployment payments for six months of each year, and further cuts to struggling sole parents through parenting payment changes.”

“This ad hoc announcement, in the absence of consultation, flies in the face of the Prime Minister’s commitment to good government. A wholescale review of the retirement incomes system is needed, which examines the superannuation and pension systems with a view to securing adequate and sustainable retirement incomes for the future.”