More than five million Aussies, including over 2.5million pensioners, will receive a much-needed cash boost weeks. 

From March 20, people receiving the full single rate of Age Pension, Disability Support Pension or Carer Payment will receive an increase. 

The $22.20 boost to their fortnightly payment means their annual pension is now $5,545 higher than when Labor came to government. 

Aussies who receive Commonwealth Rent Assistance, JobSeeker, ABSTUDY (aged 22 and over), and Parenting Payments will also see an increase.

This is a provisional indexation rate, to be officially confirmed in the coming weeks.

‘Thanks to indexation, more than five million Aussies should expect to see a boost to their payments,’ Minister for Social Services Tanya Plibersek said.

‘We’ll continue to make sure the system is there to support those who need it most, ensuring that everyone can make ends meet and no one gets left behind.

‘To make sure our social security system delivers value for taxpayers, it must be grounded in fairness, which is why we have made responsible adjustments to deeming rates.’

Minister for Social Services Tanya Plibersek (pictured) has announced a boost to social security payments for more than five million Australians

A change to deeming rates – a simplified way of assessing how much income people can earn from their financial assets – will also come into effect on March 20 after the Australian Government Actuary (AGA) recommended lifting the rates.

The lower deeming rate will be updated to 1.25 per cent for financial assets under $64,200 for singles and $106,200 for couples.

The upper rate will be 3.25 per cent for financial assets over these amounts.

National Seniors Australia described the 0.5 per cent change as ‘measured’ and suggested it would ‘lessen the blow for pensioners’.

‘NSA called for any lift to deeming rates to be gradual, modest, and timed with indexation,’ chief executive officer Chris Grice said in a statement on Friday.

‘While the increase will have some impact on pensioners, it could have been worse given interest rates remain stubbornly high.

‘If interest rates continue to rise and government reverts quickly to the old method to set deeming rates, there could be significant financial impacts, with lower pensions and higher aged care co-contributions.

‘Pensioners with limited savings are still feeling cost of living pressures and need to be supported through measures to help improve their standard of living.’ 

The change will come into force on March 20 (pictured, Centrelink office on the Gold Coast)

COTA, a charity representing people aged over 50, said the pension increase was good news given many older Australians are struggling to make ends meet – but echoed NSA’s calls for deeming rates to rise only gradually.

‘Any increase in the Age Pension is welcome,’ chief executive officer Patricia Sparrow said in a statement. 

‘COTA’s recent State of the Older Nation report showed for one in four older Australians, poverty is not an abstract concept, but a lived experience.

‘While it won’t solve the cost of living pressures many people face, an increase in the pension will make a small difference when it comes to managing rising costs for essentials like food, energy, insurance and healthcare.’

She added that the rise in deeming rates must be considered within the context of what older Australians are experiencing in the ‘real world’. 

‘Deeming rates were frozen for several years, which protected pensioners during a period of economic volatility and rising interest rates,’ she said.

‘Rather than reverting immediately to the full rate, this measured approach provides important stability for older Australians managing tight household budgets.’