Last Sunday, March 20, the highest Age Pension increase for nine years was enacted. The majority of the 3.9 million older Australians in retirement live on a full or part Age Pension. So this is a significant, across the board,  income boost. But it is more than just that. The rule changes announced last week will now also enable many more Australians to now qualify for at least a modest part-pension thus re-setting their retirement income aspirations. Today we explore the who, what, when, why and how of these important changes to assist you to better understand the many ways in which your household income will be affected.


The rate changes apply to every single or partnered Australian currently on a full or part Age Pension. They are also of acute interest to those who have previously missed out. As well as a rate increase, the qualifying thresholds have been increased. This means that more Australians will now qualify for the first time ever. If you do not know if you might or might not qualify, the first important point is age – here’s a handy article to help you understand if you are actually old enough to qualify.

What and when?

As mentioned, there has been an increase in the base rate for those already receiving the Age Pension. This increase, as per the tables below, also includes an increase to the pension supplement. The total increase amounts to 2.1%. This increase has been calculated by reviewing movements in the Consumer Price Index (CPI) or the Pensioner and Beneficiary Living Cost Index (PBLCI), whichever was greater. The amounts were then benchmarked against a percentage of the Male Total Average Weekly Earnings (MTAWE).

Sunday’s increase is the highest since 2013 when the introduction of the Clean Energy supplement, by the then Gillard Government, resulted in a total increase of 4.6%. Many commentators have noted that whilst a 2.1% increase this month is substantial, it still falls short of the 2.6% increase in the CPI recorded in the December 2021 quarter. Expectations for CPI for the March 2022 quarter are higher still, particularly in regard to fuel, health costs and groceries. In addition to the base rate, rental supplements have also been increased by $3 per fortnight for singles and $2.80 per fortnight for couples. This increase, however, may do little to ameliorate the substantial increase in rentals, driven by the lowest residential rental vacancy rate since 2017, now 1.1% across all Australian capital cities.

Single (per fortnight) Pre 20 March 20 March 2022 Increase (per fortnight)
Base $882.20 $900.80 $18.60
Supplement $  71.20 $  72.70 $  1.50
Energy Supplement $  14.10 $  14.10 $0
Total $967.50 $987.60 $20.10
Partnered (each – per fortnight) Pre 20 March 20 March 2022 Increase (per fortnight)
Base $665.00 $679.00 $14.00
Supplement $  53.70 $  54.80 $  1.10
Energy Supplement $  10.60 $  10.60 $0
Total $729.30 $744.40 $15.10


As covered above, the base rate and supplement increases are scheduled to be reviewed twice a year and to become law by the 20th of March and September. In recent years, the assets and income thresholds have also been reviewed at this time. It is an obligation of the government of the day to review the Age Pension against price movements and typical wage and salary earnings so that those dependent upon social welfare do not fall too far behind. However, it is also true that those non-homeowners who are on a full Age Pension generally tend to be living below the poverty line, with 30% or more of their fixed income needed for rental payments.

How (will this affect you)?

There are many ways you could be affected by these Age Pension changes. Firstly, of course, an increase of $523 for singles and $785.20 for couples (combined) per annum is significant. However, with the current high increases in petrol prices, groceries, medical bills, household goods and predictions of $7 cups of coffee, this extra income will probably not go far. For instance, the approved increases in private health insurance due, in most part, to be applied from April 1 are 2.7%. On a single’s plan of, say $2,800 per annum, this will take $75 of the increase, and with out-of-pocket expenses often $50-$100 for specialist visits, an extra $523 a year can soon disappear.

The other ways you might be affected relate to changes in income thresholds and assets thresholds for Age Pension eligibility. Today we also cover income threshold changes and asset threshold changes in more detail

Commonwealth Seniors Health Care Cards

It was disappointing to see that there weren’t any changes to the disqualifying income threshold for the Commonwealth Seniors Health Care Card.  These thresholds are usually increased in September  but given all the other changes and inflationary pressures an increase might have been expected now.

This card provides a safety net for many people that miss out on the Age Pension.  Health costs are one of the many expenses that are significantly reduced for holders of this card. There is now very little extra that people can earn above the Age Pension income test before they also miss out on the CSHC – just over $30 a week (single).   Here are the current CSHC eligibility criteria.

Here to help

Age Pension entitlement rules are complex. Understanding which assets to include, and how your assets are deemed to add to your income, can be plain confusing. That’s why the customer service team at Retirement Essentials is on hand to step you through the rules that relate to your particular situation, and how you can maximise your entitlements whilst always complying with Centrelink regulations. If you need financial planning advice we also offer affordable one-off adviser consultations to discuss the bigger issues associated with your retirement income.

Our free calculator has all the latest rates and thresholds and will help you work out what you could be entitled to receive.

Check Your Entitlements