The highs and lows of the 'Baby Boomer budget'

This week’s Federal Budget has delivered a mixed bag of initiatives for older Australians, according to National Seniors Chief Advocate Ian Henschke.

Mr Henschke said what was promoted as a “budget for Baby Boomers” fell short of expectations, but wasn’t without some bright spots.

The National Seniors policy team has put together the following summary of the budget from the perspective of seniors.


Highlights in the 2018-19 Federal Budget include:

From 1 July 2019, the Pension Work Bonus will increase from $250 to $300 per fortnight to earn up to $7,800 each year without impacting the pension.Expanded eligibility for the Work Bonus to include earnings from self-employment.

As part of our submission to this year’s Federal Budget, National Seniors called for an increase to the Work Bonus to $10,000 per annum to provide more flexibility for Age Pensioners to continue working and supplement their pension.

Mr Henschke said the change was less than we hoped for but any increase would be welcomed by pensioners.

“This means the first $300 of income from work each fortnight will not count towards the pension income test,” he said.

“Importantly, the Work Bonus applies in addition to the income-free area, which is currently $168 a fortnight for a single pensioner and $300 a fortnight (combined) for a pensioner couple.

“So, a single person with no other income will be able to earn up to $468 a fortnight from work and get the maximum rate of Age Pension.

“Extending access to those who are self-employed is also a positive move and this has been raised consistently by many of our members.

“The change means a pensioner who is self-employed can earn up to $7,800 per annum without impacting their pension.” 

Other employment highlights in the 2018-19 Budget for older workers include:

A new Skills and Training Incentive to provide up to $2000 per worker to fund reskilling opportunities for eligible individuals aged 45 to 70, to be matched by either the individual or the employer.Roll out of the Skills Checkpoint for Older Workers Program that offers individually tailored assessments and referrals for those aged 45 to 70, including providing workers with advice on how to best use their existing skills in the workforce or identify opportunities for upskilling.Expanding the Entrepreneurship Facilitators Program to support mature-age entrepreneurs aged over 45 years and offering mentoring and support in new locations, including regional Australia.

Mr Henschke said National Seniors had long called for career planning assistance for older workers, with a strong focus on training and skills development.

“We welcome these measures to support older workers with career transitions and identify growth sectors where they can best use existing skills,” he said.  

“Including a mature-age focus within the Entrepreneurship Facilitators Program also is positive.

“Support for mature-age entrepreneurs is something National Seniors has been advocating for some time.”  

The government also committed to establishing a Collaborative Partnership on Mature-Age Employment. It willwork with the Age Discrimination Commissioner and a range of business, peak bodies and other experts to drive cultural change in business to taking on mature-age employees and to equip managers and business owners to work with an ageing workforce.

“National Seniors looks forward to working with the Federal Government to support this collaborative effort,” Mr Henschke said.

Retirement Income

From 1 July 2019, the government will:

Expand eligibility of the Pension Loans Scheme to everyone of Age Pension age, including full and part age pensioners and those not receiving any Age Pension; andIncrease the maximum fortnightly income stream to 150 per cent of the Age Pension rate.

National Seniors believes the changes to the eligibility will help improve access to the scheme, which will now be open to anyone of retirement age who has equity in their own home, allowing them to use that equity to increase their incomes.

Full rate pensioners will be able to increase their income by up to $11,799 (singles) or $17,787 (couples) per year. The interest rate on borrowings will be 5.25 per cent and the amount owed would be repaid on sale of the home, or from estate proceeds.

Around 1.8 million Age Pensioners own their own home, including 1.1 million full rate age pensioners and 700,000 part-rate Age Pensioners.

From 1 January 2019, self-funded retirees will not need to qualify under either of the means tests to be able to utilise the scheme.

National Seniors Chief Advocate Ian Henschke said greater awareness of the scheme and information about how it could benefit older homeowners was needed.

“Older Australians need more options when considering how best to use equity in their home,” Mr Henschke said. “But this is definitely a positive step to allow older people who are ‘asset rich and cash poor’ to access more money for day-to-day living.

“However, it’s important that people understand the full implications of borrowing against their home. National Seniors members should contact our free service, the Financial Information Desk, which is available via email, for more information.

Mr Henschke said National Seniors would to continue to urge the Federal Government to consider ways to support older people through downsizing.

“Addressing the barriers to downsizing, including providing an exemption from the Age Pension means test, stamp duty concessions and increasing supply of seniors-friendly housing are key areas for future reform.”


The government will introduce a one-year exemption from the work test to allow older Australians to boost their super.

From 1 July 2019, Australians aged 65 to 74 with a total superannuation balance below $300,000 will be able to make voluntary contributions for 12 months from the end of the financial year in which they last met the work test.

Currently people aged 65-74 must work a minimum of 40 hours in any 30-day period in the financial year to keep making contributions to superannuation.

National Seniors has advocated for removal of the work test for those aged 65-74 who, for a range of personal and health reasons, may not be able to meet the requirements.

“A one-year exemption is welcome, but we will continue to call on the Federal Government to abolish the work test,” Mr Henschke said. “This would provide the flexibility needed for older people to contribute more to their superannuation savings and improve their standard of living in retirement.

Other superannuation initiatives announced:

From July 2019, an increase in the maximum number of allowable members in self-managed superannuation funds and small APRA funds from four to sixA cap on administration and investment fees charged on superannuation accounts with balances of $6,000 or less at three per cent of the account balanceBanning superannuation funds from charging exit fees for any account, andChanges to strengthen the ATO-led consolidation regime by requiring the transfer of all inactive accounts where the balances are below $6,000 to the ATO. The ATO will also, for the first time, be given powers to reunite ATO-held accounts with the member’s account where possible.

Aged Care

The budget includes a $5 billion package for aged care featuring:

Home Care Places – provision of 14,000 additional high-level home care packages ($1.6 billion over four years) Residential Careplaces – 13,500 additional residential care places and 775 new restorative places offered through the 2018-19 Aged Care Approvals Round.

National Seniors called for doubling the number of home care packages at levels 3 and 4 to address current shortages.

Chief Advocate Ian Henschke said National Seniors welcomed the additional home care packages announced.

“The total waiting list for home care was more than 104,000 as at December 2017, and this figure has been increasing between 10,000 and 20,000 a quarter,” Mr Henschke said.

“With 78 per cent of the waiting list - 82,237 people – needing level 3 and 4 packages, many older people will still not be able to access the care they need at home.

“This is a critical issue that needs more attention and resources from the government.”

The budget also included improvements to the My Aged Care website and a trial of navigator services to assist people seeking information about aged care, which National Seniors had been calling for.

“Many of our members have raised concerns about the complexity of accessing aged care services and the anxiety they feel as decisions are often made during times of crisis,” Mr Henschke said.Other initiatives include:

Aged Care Quality and Safety Commission – the commission will be established to bring together aged care regulation, compliance and complaints handling into a single entity to enable faster response to care failures ($253.8 million over four years from 2018-19). This was announced by the government last month.Quality Care Fund - $50 million over two years from 2018-19 to assist residential aged care providers to improve the quality of their services.Palliative care - $32.8 million over four years from 2018-19 for a trial aimed at improving palliative care for Australians living in residential aged care facilities - contingent on funding being matched by the states and territories.Mental health - $82.5 million over four years from 2018-19 for mental health services for aged care residents.Rural, regional and remote services – $40 million of capital spending for aged care facilities in regional, rural and remote Australia.

Healthy Ageing

Providing additional funding to support the mental and physical health of older Australians, including:$22.9 million to encourage older Australians to remain physically active$29.2 million over four years from 2018-19 for a trial of support strategies using mental health nurses to help older people stay independent for longer in their own homes.


Dementia management – $5.3 million for organisations to develop innovative technological solutions to assist Australians living with dementia, their families and carers to better manage their care.

Elder Abuse

Specialist elder abuse support service - $22 million for trials of specialist elder abuse support services.Enduring powers of attorney - working with the states and territories to develop a national online register of enduring powers of attorney.

Strengthening powers of attorney arrangements through development of an online register was one of the many recommendations that National Seniors made to the Australian Law Reform Commission’s Elder Abuse Inquiry.

“We welcome this commitment to tackling the issue of elder abuse, but will be looking for ongoing funding from the Federal Government for specialist elder abuse support services beyond the trial period, Mr Henschke said.

Cost of Living

National Seniors was disappointed no specific initiatives were announced to address the rising cost of living pressures facing older Australians on low fixed incomes.

Mr Henschke said no funding was allocated to increase the Age Pension or Commonwealth Rent Assistance for those pensioners.

“While the Federal Government has claimed that the National Energy Guarantee will deliver a $400 reduction to the average Australian household’s annual power bill, this remains to be seen,” Mr Henschke said.

“Given this uncertainty, it is disappointing that the Federal Government continues to propose removing the Energy Supplement to new pension recipients.”

In its budget submission, National Seniors encouraged the Federal Government to implement reforms to reduce energy prices, which have skyrocketed over the past decade, and to retain the Energy Supplement.

Click here to hear Chief Advocate Ian Henschke interviewed by Radio National’s Fran Kelly about this week’s Federal Budget and how it will affect older Australians.

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