Plans to tighten pension portability

A new rule proposed by the Coalition Government would reduce the amount of time pensioners can travel overseas before having their pension adjusted.

If passed into law, the change would come into force from 1 January 2017.

National Seniors Chief Executive Dagmar Parsons said the proposal to tighten Age Pension portability unfairly targets many older people who choose to take an extended overseas trip to visit their family and friends.

“Pensioners should not be disadvantaged from travelling overseas for more than six weeks if this is the most practical option for them.

“Reducing the time allowed overseas from 26 weeks to just six weeks is too severe, given the rules for Australian Working Life Residency have already been tightened.

“This will affect a significant proportion of current and future older Australians, especially migrant pensioners,” Ms Parsons said. 

Under the proposal, older people who do not meet the Australian Working Life Residency requirement of 35 years (tightened from 25 years) will have their pension adjusted if they travel overseas for more than six weeks.

Currently, pensioners can be overseas for 26 weeks before their benefits are affected. After 26 weeks the rate of payment is based on how long a pensioner has lived in Australia between the age of 16 and Age Pension eligibility age, which is currently 65.

Pensioners who have lived in Australia as an Australian resident for 35 years will not be affected by the proposed changes.

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