Single versus couple pension payments:
Are they fair?
When there is a widely experienced cost of living crisis, it’s only natural to have concerns about whether your income is keeping up with the increases. It’s also fair to ask, as a single or couple recipient of an Age Pension entitlement, whether your fortnightly payment is fair.
Today we look at how single payments and couple payments are calculated and what this means when it comes to covering basic household expenses.
How the single v. couple equation works
It’s no mystery how the Age Pension is calculated depending upon the nature of your household.
The Age Pension has three main ‘parts’:
- base rate
- supplement and
- energy supplement
which add together to create a fortnightly total.
The current fortnightly rates of payment and how they correspond are:
| Base rate | Supplement | Energy supplement | Total | |
| Couple | $732.30 | $59.10 | $10.60 | $802 |
| Couple combined (i.e. x 2) | $1464.60 | $118.20 | $21.20 | $1604 |
| Single | $971.50 | $78.40 | $14.10 | $1064 |
| Single as percentage of couple combined | 66% | 66% | 66% | 66% |
Swings and roundabouts
Based upon the above, the theory is that a single household needs two-thirds of the combined couples income to fairly cover costs.
In a sense, this is a ‘ swings and roundabouts’ theory. On certain items, singles will pay exactly the same as two members of a couple each. For instance, for a holiday airfare each passenger is charged the same amount for the same fare, so a single may pay, say $180 to travel Adelaide to Melbourne whilst the couple combined pay $360 for the shared journey. Similarly, with groceries, if a meal costs $22 in ingredients for a single, the combined couple cost could be around the $40 mark. So it seems the practice of a single receiving 66% of a couple combined means that a single is coming out ahead, if they are paying ‘half’ the cost on travel fares or groceries etc., and not two thirds.
Or maybe two can live a cheaply as one?
But then there are outgoings where two do seem to live as cheaply as one. For instance electricity for lighting or appliances, etc. A household electricity bill could be about the same amount for a single household as it is for a couple household (depending upon individual usage of course). When it comes to travel, single supplements are rarely offered, so couples can pay the same rate for a room (combined) as does a single. This is when a single might begin to feel aggrieved. Similarly, the running costs of a car for a couple could be close to those of the costs of a car owned by a single, so it could seem that singles are disadvantaged in these expenditure categories.
Which other categories might vary?
The Australian Bureau of Statistics lists 10 main categories of household expenditure, and each one (with the possible exception of medical and healthcare) might be seen to be a plus or a minus for one type of household or the other:
- Housing
- Domestic fuel and power
- Food and non-alcoholic beverages
- Alcohol and tobacco products
- Clothing and footwear
- Household furnishing and equipment
- Household services and operation
- Medical and healthcare
- Transport
- Communication
You can run your own check on each of these categories and see if you think the government’s decision to ‘split the difference’ by making the single pension payment 66% rather than half that of a combined couple household is fair. Many singles will believe it should be an even higher percentage based on the old saying that two can live as cheaply as one.
Everyone has a perspective on this matter and we’d be delighted to hear your views, based on your own experience of covering household expenses as a single or one of a couple. And don’t forget to tell us if the percentage for singles should be different …
And one more thing.
Decades ago the definition of a couple was clear cut. They were married. At least that was generally how the law and the public service saw things. But now the definition of ‘couple’ is much more flexible. This means that it is up to you to fully understand whether your status is single or one half of a couple when dealing with government services. Here’s a handy link to an article which explains the detail.
Not sure of your own entitlements? Here’s our free Age Pension Entitlement Calculator so you can quickly determine your status.
I am 69 this year and my wife Just turned 66. My wife works 20.0 hours a week and receives $1,020 a fortnight gross or $900 after tax. Because my wife has income I only receive $610 a fortnight on my age pension. If we weren’t a couple I would receive $1064 a fortnight as per your schedule.
Furthermore, because my wife earns $98 a fortnight more than half the couples pension my pension is reduced by $198 a fortnight. It hardly seems fair that we should be expected to live on $100 a fortnight less than everyone else just because of a difference in age of three years. Why should my pension be reduced at all because my wife chooses to work part time?
Totally agree with Chris’s comment. We like you Chris are 66 & 68, I still choose to work, I am able to & enjoy my work. Why should he be penalized just because I choose to work, I am still fit & able to contribute to the workplace. We are struggling to make the right choices when it comes to retirement. My husband has really low super.
I’m 66 & my husband is 72, my husband was forced to retire early at 60 from a serious health issue. Because I work full-time & earn a very modest wage rate, my husand has not been eligible to receive a pension. Occasionally he will receive $29 if my fortnightly pay is under. If his pension is reliant on my income, why can’t the work bonus be combined. We’ve worked hard, paid tax our entire life & have never relied on welfare At 72 my husband should not have to rely on me for an allowance, it’s humiliating & unfair to him.
When one partner is under pension age a couple are even worse off. The under pension age partners income reduces the married rate pension for the age pensioner and can leave the married couple $117 a fortnight worse off than two age pensioners.
With regards to partners of different ages, it is worthwhile noting that superannuation balances can be shuffled from the older to the younger partner, when one is under 67. This can greatly increase pension entitlements for the 67+er With respect to the assets test.
I am a 68 year old woman who has been retired for 18 months what I don’t think is fair is that I receive a couples pension. I worked for over 50 years whilst raising 3 children returning to work before each was 6 months old as we needed my income. During my working life I paid tax as a single, I didn’t get a discount because I was married, so why shouldn’t I now receive the pension as a single just as I was taxed ???
I am a single male pensioner living in my own home (mortgage free).
If a married couple have the same situation they have two pensions to share the council rates, water rates, house insurance, repairs and maintenance, electricity, gas, and garden expenses.
I have a car to run errands locally. This luxury costs motor insurance, car registration, fuel, repairs and maintenance. A couple share those expenses.
I do believe consideration should be given to these extra costs against a single pension particularly when government has expressed a desire to keep aged people in their own homes.
Totally agree with you James as I am a single 68 year old woman that cannot retire yet as still have morgage and due to pandemics, wars etc my super is going down quicker than going up. Singles still have all the bills that couples have, may be slight difference but not a lot as insurances. running a car etc are still the same. However I think that everyone deserves from our era to get full pension whether you are a couple or not so everyone is on the same rate. This would save all confusion and hey we worked most of our lives with no such thing as a superannuation fund, or women didnt work for a big part of it as they were raising children. Besides, careers were not around for women in our younger years.
Completely agree with you James. It’s all the big expenses that become difficult as a single. eg. rates, insurance etc as you’ve mentioned. Singles definitely do it a lot harder. Remember, even as a couple, at some point it’s very likely that one person will become a single during their lifetime.
Totally agree. Very difficult to make ends meet on one pension
Living as a couple, we buy 2 lots of clothes, 2 x water usage, a bit more on electricity and 2 x food as if we go to a restaurant it’s $22x 2. Train fare x 2 and Our movies x 2 so if someone can say we can live as one , I would love them to show me how.
Hi Debra, I hear your frustration, but please bear in mind that generally a couple shares one house, one garden, one car, one of every major appliance and piece of equipment in the house, let alone much of the energy costs, water usage, internet and tasks. We pay the same council rates, and don’t always live in a tiny house! It mounts up for a single and there’s a good argument for a higher proportion than 65%. Let’s be aware of differing situations, the world is not so simple.
I agree 100%
My wife and I are in the same position.
Because I am a few years older she has to work cleaning hotel rooms
just to equal the pension income.
we rent and the rent goes up and my pension goes down.
This is causing break up of marriages which is not fair for ones mental health as well.
The government will end up with more bigger expenses and social problems.
I think everyone should be assessed as an individual. When my husband retired – and we downsized – I was not of pension age, and was no longer working, due to moving to downsize. He was paid the 1/2 of a ‘married pension’ while I received nothing. So we had to live on less than a ‘single’ pension. There is also the issue that each other has to provide all financial details for the other partner it some instances (domestic/ financial abuse) these details are not available, so the pension is not available (Thankfully not my situation). A better way would to treat everyone as an individual and allow any amount to be earnt without penalty ( reduction of pension) – with the total income (including pension) to form ‘taxable income. Far simpler for everyone.
Remember when women could retire 5 years earlier than men? Maybe there was wisdom in that?
Pension for couples should be halved and paid separately to each person in the couple – so it can go into their own bank account. Seen too much elder abuse where women are not allowed to make decisions on their own money.
Should have universal basic income or a system like NZ where any excess income is sorted out at tax time. No need to report income to Centrelink. Would save a bucket load of money running Centrelink, and just imagine, Robodebt could never have happened with a system like this.
Hi Maggie, thank you for sharing your thoughts! The good news is that the Age Pension actually is split 50/50 for couples and each person nominates which bank account their half is paid into to help avoid financial control/abuse.
And to avoid one person splurging it all on the pokies !!
The Government does not care about the elderly just their large pensions of 100’s of thousands of dollars a year
I think there is a disparity that is often overlooked for single pensioners. If you are a single pensioner, as well as having only the single pension income to pay for rates, electricity, vehicle expenses, etc. you also have the sole responsibility for household duties and tasks. This can be very exhausting and isolating especially as you get older. You often need to pay someone to help out with general household and car maintenance, cooking, heavy lifting, gardening, financial and legal advice, etc. You just can’t do it all by yourself! I know that sometimes with couple pensions there is not an equitable split of duties, but there are two people there to work it out. I really believe that single households would need more than two-thirds of the combined couples income to fairly cover costs.
What does seem unfair is if you collect your super as an income stream it will reduce your fortnightly pension even if your super value and assets are under the threshold. How can your own money be classed as income
Hi Maggie, thank you for your comment! You may be slightly misunderstanding how superannuation is assessed though. Centrelink will deem super as earning the same income whether it is in an income stream or left in accumulation phase so there is no difference in how the super is assessed regardless of how you are using it. CLICK HERE to learn more about deeming.
How does it work for two in a partnership for 33 years when one goes into nursing home and she has her son as POA and EPOG. I am at home still visiting each day but the pension assessment has been made on our combined assets to which I have access to only mine?? Most of her funds will go to nursing home payments and the POA will take control. I do not want her money just a realistic assessment.
Hi Laurie, thank you, for sharing your situation! Centrelink do take into account couples separated by illness and assess them slightly differently. You are allowed to earn a higher income and have higher assets then couples still able to live together. You can call Centrelink on 132 300 to explain the situation and they will help you with the next steps.
Am 66 years, my wife 64 still at work she works 25 or 27 hours a week. her super is about 120k. I was force to retire due to chronic health since 2018 july, and I was refuse sickness benefit from social security, I got 200k on my retirement acc and a lifetime pension of $222.00 p/f and we owe a block of land, I got no mortgaced and a pop-up caravan ann one family car. my question is: if I pospone my claim until she 67, is there any benefit in that or should claim at 66 and 6 month? thanks
Hi Cerda, Thank you for seeking clarity! From an Age Pension perspective there is no benefit in delaying your claim. You only receive back pay to cover from the day you lodge your claim up to the day you are approved. You receive no back pay or benefit for waiting to apply for the Age Pension and we recommend lodging your claim as soon as you are eligible.
what a shock, I’m 67 hubby is 51 so I applied for the pension, we downsized, and moved to the country to be mortgage free, paid off our remaining high mortgage left with a small <50k bank balance, hubby and i no income since moving 3 months, just got pension half of a couple rate only. how do we live on that.
there are a lot of singles sharing a house but each get the single pension, doesn’t seem fair.
All persons should get the same pension and the question of whether someone is married or single should not be asked. If a single can not manage on the single rate, find someone to share with. All income tax was paid as individuals. Jobseeker obligations were required as individuals.
As soon as centrelink started treating jobseekers as individuals requiring both members of a couple to comply with mutual obligations then they should also treat both members of a couple as individuals when it comes to a pension. Centrelink seems to want to make the rules to be always be in their favour.