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Pension recipients subject to new rules

Legislation boasting new rules and requirements for recipients of the Age Pension and Disability Support Pension (DSP) is currently before parliament prior to being introduced later this year.

Changes to the Age Pension eligibility are on their way (Source: Shutterstock)
Changes to the Age Pension eligibility are on their way (Source: Shutterstock)

The changes, which are anticipated to come into effect as of 1 July 2018 will now require Aged Pension and DSP recipients to have:

  • Ten continuous years of Australian residence, including at least five years during their Australian working life, or

  • Ten continuous years of Australian residence and proof they have not received activity tested income support for cumulative periods of five years of more, or

  • 15 years of continuous Australian residence

Currently the residency requirement for the Age Pension is 10 years in total, with at least five years of unbroken residency.

Despite the changes estimated to save taxpayers $119 million, a Department of Social Services spokesperson says the changes are unlikely to affect 98 percent of Aged Pension and DSP recipient and there will be a number of exemptions to these requirements.

“Welfare reform is essential to ensure Australia has a welfare system that remains financially sustainable for future generations,” the spokesperson says.

“The ‘Enhanced residency requirements for pensioners’ measure is expected to save Australian taxpayers more than $119 million over the forward estimates [and] 98 percent of people applying for the Age Pension or Disability Support Pension will be unaffected by this measure.”

The spokesperson adds that Australian taxpayers “should not be expected to support migrants to Australia if they arrive close to retirement age or have been a long-term recipient of an activity tested payment, such as Newstart Allowance”.

According to the Department of Social Services, most people claiming the Age Pension will already have sufficient residence because they were born in Australia and/or lived here for many years prior to reaching retirement age.

The Department also refers to existing exemptions to residence requirements that will remain, such as humanitarian entrants, or in relation to DSP, where a person incurs a continuing inability to work after arrival in Australia; with access to Special Benefit also remaining available for people who are not eligible for another payment and who experience financial hardship.

In 2017, records show that there were approximately 2.5 million Australian Age Pension recipients, and 750,000 DSP recipients.

Despite the Department of Social Services assurance that 98 percent of Australians will be unaffected,  The Federation of Ethnic Communities’ Councils of Australia (FECCA), the national peak body representing Australians from Culturally And Linguistically Diverse (CALD)  backgrounds, says that Federal Government plans to extend the waiting time for new migrants to access welfare payments will hit the most vulnerable of new arrivals.

FECCA Chairperson, Mary Patetsos says the move would impose considerable hardship.

“We are disappointed by this decision to extend the waiting period for benefits to three years from its current two years,” Ms Patetsos says. 

“FECCA believes that this move will create an underclass of migrants—new arrivals who find themselves at even more risk financially as they try to settle into Australia.

“These measures will negatively impact the Australian born children of migrants and disproportionately affect women.

“These changes make it harder for migrants to settle in this country—for the sake of what is a relatively modest Government budget saving.”

Ms Patetsos has appealed to the Government to rethink this measure.

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