Prior to his resignation as President of the Federation of Greek Elderly Citizens Clubs of Melbourne and Victoria for health reasons, John Kostoulias had sent a letter to Prime Minister Anthony Albanese raising the issue of the cost of living affecting many retirees.

In a recent response to Kostoulias sent to Neos Kosmos, the Australian Government addresses concerns regarding pensioners’ cost of living, highlighting key measures and updates regarding pension rates and cost of living relief initiatives. The government stressed its commitment to supporting vulnerable Australians and ensuring the sustainability of the Age Pension, reflecting its ongoing efforts to address economic and social challenges faced by senior Australians.

Read the full letter below:

Dear Mr Kostoulias

Thank you for your letter of 5 March 2024 to the Prime Minister, the Hon Anthony Albanese MP, regarding pensioners’ cost of living. Your letter was referred to the Minister for Social Services, the Hon Amanda Rishworth MP, as this matter falls within her portfolio responsibilities. I have been asked to reply on behalf of the Minister.

The Australian Government appreciates the important economic and social contribution senior Australians make to our community and is keen to ensure that pensioners’ living standards are safeguarded by the Age Pension. Pensions are funded by taxpayers and targeted through the means test to those who need it most.

Pensions such as the Age Pension are paid at the highest rate of income support payments in the Australian social security system because recipients are not expected to work to support themselves. The Australian Government expects to spend around $59 billion on the Age Pension in 2023-24 to assist around 2.6 million eligible Australians.

Pensions increase regularly to keep pace with the cost of living. Under social security law, base pensions are indexed in March and September to the higher of the increase in the Consumer Price Index (CPI) and the increase in the Pensioner and Beneficiary Living Cost Index (PBLCI). CPI and PBLCI measure changes in prices on a range of goods and services such as food, health care, transport, housing costs and utilities costs. Base pension rates are also benchmarked to wages.

On 20 March 2024, the maximum total pension rate for single pensioners increased by $19.60 to $1,116.30 a fortnight or $29,023.80 a year. The maximum rate for pensioner couples combined increased by $29.40 to $1,682.80 a fortnight or $43,752.80 a year.

Photo: Supplied

Photo: Supplied

The Government is committed to maintaining a strong safety net for all Australians who need help and cannot support themselves. It has recently delivered a range of cost of living relief measures designed to support the living standards of vulnerable Australians, including:

& Up to $3 billion under the Energy Bill Relief Fund to eligible households, including pensioners and other income support recipients. In Victoria, the total bill relief is $250 per eligible household.

& An investment of $5.7 billion over 5 years to strengthen Medicare, including $3.5 billion to triple the bulk billing incentive for the most common General Practitioner consultations including for pensioners, as well as a doubling of the maximum dispensing quantity for over 300 Pharmaceutical Benefits Scheme medicines, which lowers out-of-pocket costs.

You mention supermarket prices. On 25 January 2024, the Australian Government announced it will direct the Australian Competition and Consumer Commission to conduct an inquiry into Australia’s supermarket sector. An issues paper and consumer survey were published on 29 February 2024. An interim report will be provided to the Government by 31 August 2024. More information is available at www.accc.gov.au/inquiries-and-consultations/supermarkets-inquiry-2024-25.

In addition, the Prime Minister has appointed Dr Craig Emerson to lead the 2023-24 review into the Food and Grocery Code of Conduct to address harmful practices stemming from an imbalance of bargaining power between supermarkets and their suppliers. If you would like to make a submission, or view the consultation paper and the interim report, see treasury.gov.au/review/food-and-grocery-code-of-conduct-review-2023.

In addition to their main payment, pensioners can receive a range of benefits and concessions that increase their economic security, including:

  •  assistance for people who rent in the private rental market, through Commonwealth Rent Assistance;
  •  the exemption of the principal home from the assets test for homeowners;
  •  subsidised prescription medicines under the Pharmaceutical Benefits Scheme;
  •  subsidised health care and related products;
  •  subsidised aged care; and
  •  concessions provided by state and territory governments, which could include subsidised rates, electricity, gas, water, public transport and vehicle registration fees. Concessions offered vary between states.

For more information on concessions in Victoria, you can visit services.dffh.vic.gov.au/concessions-and-benefits.

Thank you again for writing. I trust this information is of assistance.

Yours sincerely

Rita Scholl

Director

Age Pension and Payment Rates Policy Section

Payment Structures and Seniors Branch

30 April 2024