Australian Aged Pension

[kiwijack]

Thanks for the responses and particularly the clarification about short term holidays taken during the 2 year period when it applied. But can anyone clarify what the present AWLR is.. 25 years or 35 years?

I am waiting for CLI to advise but silence is deafening.

Thanks

[simple1]

Thanks for the responses and particularly the clarification about short term holidays taken during the 2 year period when it applied. But can anyone clarify what the present AWLR is.. 25 years or 35 years?

I am waiting for CLI to advise but silence is deafening.

Thanks

Just spoke with CLI and they expect the required legislation will be presented to parliament for enactment to increase to 35 years in July, 2014.

[kiwijack]

Thanks for that info as was waiting for CLI to contact me to clarify. Great news for me, assuming that it will only apply to those who apply after the enactment date?

Sorry for those though who will be penalised by it as no way to avoid it.

[scorecard]

Thanks for the responses and particularly the clarification about short term holidays taken during the 2 year period when it applied. But can anyone clarify what the present AWLR is.. 25 years or 35 years?

I am waiting for CLI to advise but silence is deafening.

Thanks

1. In regard to the '2 year period' (and I'm assuming this is meaning must be mainly located in Australia for 2 years immediately after approval, then after that 2 years can live abroad full time and still receive the OAP - please correct me if this is incorrect).

My question is, has anybody ever heard of a compromise arrangement on the first 2 years?

Example: Get approval with a mutually agreed proviso that the 'pensioner' can live full time abroad immediately, but must wait 2 years before receiving any payments.

2. Also can any member please give an up to date specific answer to the time period the person must be located full time in Australia immediately prior to application.

I called Centrelink on this but got differing answers.

To be clear, in terms of being in Australia for 25 years / possibly 35 years after 16 yrs of age, I qualify, but I'm confused about how long the person must be physically in Australia, full time, immediately before lodging an application for the OAP.

I heard it was two years but more recently I heard that there is now no requirement at all to be located in Australia for any time period immediately before applying (other than the 25 / 35 after 16 rule).

Specific answers to both questions would be much appreciated.

Edited February 14, 2014 by scorecard

[simple1]

Thanks for the responses and particularly the clarification about short term holidays taken during the 2 year period when it applied. But can anyone clarify what the present AWLR is.. 25 years or 35 years?

I am waiting for CLI to advise but silence is deafening.

Thanks

1. In regard to the '2 year period' (and I'm assuming this is meaning must be mainly located in Australia for 2 years immediately after approval, then after that 2 years can live abroad full time and still receive the OAP - please correct me if this is incorrect).

My question is, has anybody ever heard of a compromise arrangement on the first 2 years?

Example: Get approval with a mutually agreed proviso that the 'pensioner' can live full time abroad immediately, but must wait 2 years before receiving any payments.

2. Also can any member please give an up to date specific answer to the time period the person must be located full time in Australia immediately prior to application.

I called Centrelink on this but got differing answers.

To be clear, in terms of being in Australia for 25 years / possibly 35 years after 16 yrs of age, I qualify, but I'm confused about how long the person must be physically in Australia, full time, immediately before lodging an application for the OAP.

I heard it was two years but more recently I heard that there is now no requirement at all to be located in Australia for any time period immediately before applying (other than the 25 / 35 after 16 rule).

Specific answers to both questions would be much appreciated.

Whilst not specifically answering your questions take a look at the URL below, that I would term documented precedents rulings for Aged Pension eligibility. One quote is:

Taken in isolation, a 3 year continuous absence would be regarded as an upper limit to still being considered residing in Australia, unless there are special circumstances delaying a return. When looking at the pattern and duration of time spent outside Australia, if a person regularly spends more than 6 months a year outside Australia, then their residence in Australia is questionable.

http://guidesacts.fahcsia.gov.au/guides_acts/ssg/ssguide-3/ssguide-3.1/ssguide-3.1.1/ssguide-3.1.1.10.html

[moojar]

^^^^

Reading further on that link though: http://guidesacts.fahcsia.gov.au/guides_acts/ssg/ssguide-3/ssguide-3.1/ssguide-3.1.1/ssguide-3.1.1.10.html

"It is not uncommon for a person to remain overseas for a lengthy period of time but state that they intend to return to Australia to live at some uncertain, future date. In general, when a person states that they are leaving Australia temporarily with the intention of returning to Australia, the person's 'intent' becomes less of a factor as the length of the absence increases. A person's physical ties with a country will normally take precedence over their intentions when lengthy periods of time are involved.

A person who has spent the majority of their time overseas in the last few years and who returns to Australia to claim a benefit will not necessarily be eligible from the day they return to Australia. The person must demonstrate that their physical ties with Australia have been re-established, or are in the process of being established and that they intend to reside again in Australia.

Example 1: Derek is single, aged 56, and has spent the last 2 years in Thailand as he prefers the climate and cost of living. He initially went for a short holiday and when he came back he rented out his furnished property in Australia on an indefinite basis and took on a long term lease of an apartment in Thailand. He is not employed. He keeps in contact with extended family by phone and has a return trip booked to Australia for medical treatment. He has to renew his Thai visa every year and does not consider himself to be a resident of Thailand because he is not eligible for a permanent visa there. He plans to return to Australia one day and for this reason has not sold his house.

Derek's argument that he does not have a permanent visa to stay in Thailand does not override the fact that he spends the majority of his time living in Thailand. Based on the duration of his absence and the fact that his plans to return to live in Australia are vague, at this point in time he is considered to be residing in Thailand.

Example 2: John and Belinda are both retired and have rented out their home in Australia for 2 years while they are in Europe. Their vehicle is on loan to John's brother in Australia who is looking after their furniture. They have purchased a townhouse in Perugia in Italy for their daughter who will be studying at a nearby university for 4 years and they see it as a good investment. They plan to have an extended holiday in Europe after their daughter has settled into her first year of study. They have a firm plan to return to Australia at the end of the 2 years as John expects to be doing contract work for his previous employer. Due to the fact that their plans in Europe are for a defined period and a short term purpose and there is other supporting evidence, they are considered to still be residing in Australia."

[moojar]

Found a newsletter published by a welfare rights mob - https://www.welfarerights.org.au/rights-review

Their December 2013 edition has a piece on portability that states:

PORTABILITY

CHANGES TO AUSTRALIAN WORKING LIFE RESIDENCE

REQUIREMENTS

Some pensions (eg Age Pension) can be paid indefinitely

while a person is overseas.

Currently, after 26 weeks of absence, a person’s rate will

drop to a proportional rate, unless they have at least 25

years of “Australian working life residence” between the

ages of 16 and 65.

From 1 January 2014, the Australian working life

residence requirement for the maximum rate will

increase from 25 to 35 years.

This change will also apply to all international

agreements, except the agreements with Greece and

New Zealand.

People living overseas prior to 1 January 2014 will not

have their rate calculated this way unless they return to

Australia for longer than 26 weeks and then leave again.

Date of effect: 1 January 2014

Someone above said the legislation hasn't gone thru yet, and is to take effect on 01 July (?). The article must have been written around the time of the election in that case - KRudd jumped the gun a bit on the election, missing some sitting weeks.

For those of you not in Oz, btw, the in-coming government is doing the usual Liberal thing of targeting welfare "bludgers". A welfare review is underway and a tough May budget is promised, so hold on to your hats!

[moojar]

Hi All, I have just read thru the entire 38 pages of this thread would you believe, over several days. My couple of posts above were made before I had reached the end, so apologies for a bit of duplicated information there.

The thread had an interesting flow - a wonderful sharing of information for the first few years from 2008, some argumentative / smug types lowered the tone about halfway thru, and of late parochial politics has come into in. (Howard saved / Rudd & Gillard spent it all, or was that Howard wasted the mining boom and Rudd & Gillard kept us out of recession during the GFC? Not sure now, I'll have to go ask my mate Rupert Murdoch. ) Picture supporters of the LNP wearing yellow shirts in Oz and Labor wearing red shirts, and you'll get an idea of the current level of "debate". Federal politics has become less like running-the-country and more like an ongoing State of Origin match.

I am 15 years or so away from OAP age myself, under the current rules. Trying to get a handle on things so I can take an early retirement when my job is inevitably sent offshore. But I know the OAP goalposts are going to move - "the Age of Entitlement is over" seems to be the current catchphrase here in Oz, so stand by for a bumpy ride.

Thank-you for all the great information posted here - I would not know about the Hobart C/L mob but for you guys for example. Long may this thread run.

Edited February 20, 2014 by moojar

[Berek]

I'm very similar to you Moo. I think we've got Buckley's chance of getting anything better from this or any other gov. This generation should not feel entitled to much at all. However after paying tax for 36 years so far, I do think that a portable pension isn't too much to ask.

[Xangsamhua]

There's some talk in the press this morning that the required age for age pension in Oz may increase to 70 for those now under 30. Apparently this is being discussed in the UK at the moment.

[harrry]

There's some talk in the press this morning that the required age for age pension in Oz may increase to 70 for those now under 30. Apparently this is being discussed in the UK at the moment.

http://www.smh.com.au/federal-politics/political-news/health-welfare-and-education-tough-choices-loom-for-treasurer-joe-hockey-20140221-337n4.html

This indicates.

Treasurer Joe Hockey has used the world stage to warn that Australia will run out of money for health and education, and must consider unpopular options such as lifting the retirement age to 70, introducing big new taxes, and redesigning the e

Read more: http://www.smh.com.au/federal-politics/political-news/health-welfare-and-education-tough-choices-loom-for-treasurer-joe-hockey-20140221-337n4.html#ixzz2u35SLZZq

[moojar]

One of the current concerns is people retiring early and using their superannuation to pay off debt and do that Big Europe Trip, etc., then putting their hand out for the pension at 65. Which just happens to be my game plan.

In reaction to this the government is already increasing the super 'preservation age' from 55 to 60 over a number of years. I'd expect further increasing the preservation age will be on the cards soon.

Yeah, increasing the OAP age for under 30s? I read a lot of the reader comments on the Sydney Morning Herald website, and there is often a lot of anger expressed towards 'baby boomers' by the younger crowd. Usually when the article is about real estate / investment properties / negative gearing, but still, a lot of anger and resentment out there. And I wonder how those younger people are going to react if they are told they must work longer to pay for our retirements? Hmmm, Thailand might be the safest place for us.

[simple1]

One of the current concerns is people retiring early and using their superannuation to pay off debt and do that Big Europe Trip, etc., then putting their hand out for the pension at 65. Which just happens to be my game plan.

In reaction to this the government is already increasing the super 'preservation age' from 55 to 60 over a number of years. I'd expect further increasing the preservation age will be on the cards soon.

Yeah, increasing the OAP age for under 30s? I read a lot of the reader comments on the Sydney Morning Herald website, and there is often a lot of anger expressed towards 'baby boomers' by the younger crowd. Usually when the article is about real estate / investment properties / negative gearing, but still, a lot of anger and resentment out there. And I wonder how those younger people are going to react if they are told they must work longer to pay for our retirements? Hmmm, Thailand might be the safest place for us.

I wonder what percentage of the 'younger crowd' are receiving middle class welfare, do they complain about that?

Has Hockey or anyone else commented on how the superannuation funding from the Future Fund for public sector employees is tracking?

Edited February 22, 2014 by simple1

[moojar]

I'm very similar to you Moo. I think we've got Buckley's chance of getting anything better from this or any other gov. This generation should not feel entitled to much at all. However after paying tax for 36 years so far, I do think that a portable pension isn't too much to ask.

I know what you mean Berek - it is only since reading this thread that I even realised portability is an issue. I'm still coming to terms with it - knocked me for six.

I understand they have to stop those crafty foreigners rorting the system. But once we meet the 35 years 'AWLR' requirements you'd think we'd be free to come and go as we please without penalty - we've paid our dues. Just seems like it is in the Centrelink DNA to make it as hard as possible for their "customers".

Happened to mention my early retirement / OAP plans to two acquaintances btw, and got a bad reaction from both of them - it is the spending of the pension money outside of Oz that they objected to. So I'll keep my mouth shut in the future and do what I can to stay 'resident'.

[BookMan]

There's some talk in the press this morning that the required age for age pension in Oz may increase to 70 for those now under 30. Apparently this is being discussed in the UK at the moment.

70 sounds about right. Retire early and fund it yourself.

Issues of peoples wealth being locked up in Homes and Trusts will come to the fore in years to come. Barring a property crash of monumental proportions, people retiring , sitting on properties worth 1 million, 2 million, will have to reverse mortgage before they can get the OAP.

The younger crowd will increasingly resent a burden to pay OAP and also have to pay astronomically high house prices.

Of course, no age group is going to want to concede anything.

[BookMan]

I'm very similar to you Moo. I think we've got Buckley's chance of getting anything better from this or any other gov. This generation should not feel entitled to much at all. However after paying tax for 36 years so far, I do think that a portable pension isn't too much to ask.

Past tax payments have nothing to do with future entitlements. OAP was always meant to be a safety net. What has happened along the way is people are living longer and instead of claiming an OAP for 5 years, now they might need one for 20 years

Can be assured at some stage in the mid term future it will become almost impossible to claim OAP while living overseas. It may well be difficult to claim much even living in OZ.

[moojar]

I'm very similar to you Moo. I think we've got Buckley's chance of getting anything better from this or any other gov. This generation should not feel entitled to much at all. However after paying tax for 36 years so far, I do think that a portable pension isn't too much to ask.

Past tax payments have nothing to do with future entitlements. OAP was always meant to be a safety net. What has happened along the way is people are living longer and instead of claiming an OAP for 5 years, now they might need one for 20 years

Can be assured at some stage in the mid term future it will become almost impossible to claim OAP while living overseas. It may well be difficult to claim much even living in OZ.

Absolutely correct on your first point, and sadly I suspect your second point will prove to be correct also.

[simple1]

I'm very similar to you Moo. I think we've got Buckley's chance of getting anything better from this or any other gov. This generation should not feel entitled to much at all. However after paying tax for 36 years so far, I do think that a portable pension isn't too much to ask.

I know what you mean Berek - it is only since reading this thread that I even realised portability is an issue. I'm still coming to terms with it - knocked me for six.

I understand they have to stop those crafty foreigners rorting the system. But once we meet the 35 years 'AWLR' requirements you'd think we'd be free to come and go as we please without penalty - we've paid our dues. Just seems like it is in the Centrelink DNA to make it as hard as possible for their "customers".

Happened to mention my early retirement / OAP plans to two acquaintances btw, and got a bad reaction from both of them - it is the spending of the pension money outside of Oz that they objected to. So I'll keep my mouth shut in the future and do what I can to stay 'resident'.

May have mentioned this before, but a review of Aged Pension payment for people wishing to move overseas, without restrictions at retirement age, was conducted and actually 'proved' it was less cost to the Fed Government to do so; it was politically canned due to potentially negative reaction by constituents.

[moojar]

Has Hockey or anyone else commented on how the superannuation funding from the Future Fund for public sector employees is tracking?

Have not heard a mention of it, sorry. This article paints a rosy picture though. Also a great example of a News Corp "unbiased" piece, if you're not familiar with their style.

http://www.heraldsun.com.au/business/costello-from-future-fund-founder-to-keeper/story-fni0d8gi-1226817062329

[BookMan]

I'm very similar to you Moo. I think we've got Buckley's chance of getting anything better from this or any other gov. This generation should not feel entitled to much at all. However after paying tax for 36 years so far, I do think that a portable pension isn't too much to ask.

I know what you mean Berek - it is only since reading this thread that I even realised portability is an issue. I'm still coming to terms with it - knocked me for six.

I understand they have to stop those crafty foreigners rorting the system. But once we meet the 35 years 'AWLR' requirements you'd think we'd be free to come and go as we please without penalty - we've paid our dues. Just seems like it is in the Centrelink DNA to make it as hard as possible for their "customers".

Happened to mention my early retirement / OAP plans to two acquaintances btw, and got a bad reaction from both of them - it is the spending of the pension money outside of Oz that they objected to. So I'll keep my mouth shut in the future and do what I can to stay 'resident'.

May have mentioned this before, but a review of Aged Pension payment for people wishing to move overseas, without restrictions at retirement age, was conducted and actually 'proved' it was less cost to the Fed Government to do so; it was politically canned due to potentially negative reaction by constituents.

Id be interested in details of that review. Where can it be referenced?

[Xangsamhua]

This is an interesting option from the Liberal Democratic Party (they have one incoming senator from NSW):

I don't know what the reference to the "savings account approach" means, or how practicable the whole proposal is, but someone's been giving some thought to expats in retirement.

For those who are in receipt of aged pensions and wish to permanently relocate to countries with a lower cost of living, the Liberal Democrats will offer a system of actuarially-calculated lump sum payments to replace the pension. There will be no opportunity to re-enter the welfare system upon return to Australia except through the savings account approach, leaving those who sign up to the offer in the same position as non-citizens with respect to welfare.

http://ldp.org.au/index.php/policies/1167-welfare

[simple1]

I'm very similar to you Moo. I think we've got Buckley's chance of getting anything better from this or any other gov. This generation should not feel entitled to much at all. However after paying tax for 36 years so far, I do think that a portable pension isn't too much to ask.

I know what you mean Berek - it is only since reading this thread that I even realised portability is an issue. I'm still coming to terms with it - knocked me for six.

I understand they have to stop those crafty foreigners rorting the system. But once we meet the 35 years 'AWLR' requirements you'd think we'd be free to come and go as we please without penalty - we've paid our dues. Just seems like it is in the Centrelink DNA to make it as hard as possible for their "customers".

Happened to mention my early retirement / OAP plans to two acquaintances btw, and got a bad reaction from both of them - it is the spending of the pension money outside of Oz that they objected to. So I'll keep my mouth shut in the future and do what I can to stay 'resident'.

May have mentioned this before, but a review of Aged Pension payment for people wishing to move overseas, without restrictions at retirement age, was conducted and actually 'proved' it was less cost to the Fed Government to do so; it was politically canned due to potentially negative reaction by constituents.

Id be interested in details of that review. Where can it be referenced

I have done some searches to try & relocate the content without success, may be you are more capable in search structure? From memory the review was conducted in late 1990s / early 2000s

[harrry]

May have mentioned this before, but a review of Aged Pension payment for people wishing to move overseas, without restrictions at retirement age, was conducted and actually 'proved' it was less cost to the Fed Government to do so; it was politically canned due to potentially negative reaction by constituents.

Id be interested in details of that review. Where can it be referenced

I have done some searches to try & relocate the content without success, may be you are more capable in search structure? From memory the review was conducted in late 1990s / early 2000s

http://www.dss.gov.au/about-fahcsia/publications-articles/research-publications/social-policy-research-paper-series/number-16-cost-benefit-analysis-of-portability-policy?HTML

Covers this and may be the one you mentioned. I am not fond of the whole study but it does cover portability and saved costs.

[Berek]

Past tax payments have nothing to do with future entitlements. OAP was always meant to be a safety net. What has happened along the way is people are living longer and instead of claiming an OAP for 5 years, now they might need one for 20 years

We'll it'd be down to semantics to argue but every year of paying tax has gone to someone else's pension (baby bonus, subsidised childcare, dole bludgers, maternity leave etc etc) so why should I miss out? Don't take that as me sooking I'd like to get something back after paying out all these years

[moojar]

^^^ I've been mulling this over myself. Here we have all that middle-class welfare that Mr Hockey is unlikely to touch, seeing as his side of politics brought most of it in. And it will in fact be added to shortly with the ridiculous paid parental leave of up to $75,000 for mothers to take six months off work. Yet they are attacking the OAP and Medicare. Why? They've sniffed the wind and have a good idea what the majority are thinking / feeling is all that I can come up with.

[moojar]

I have just come across the attached 'Federal Budget 2013/14' fact sheet published by my superannuation fund manager, thought some of you living offshore might find it useful.

SA003_FederalBudget2013-2014_MAY13.pdf

It refers to last year's budget, and with the change of government since then some of it is no longer correct. - no longer hitting the wealthy, no longer helping the non-wealthy.

I will post this year's if / when it becomes available.

[BookMan]

Past tax payments have nothing to do with future entitlements. OAP was always meant to be a safety net. What has happened along the way is people are living longer and instead of claiming an OAP for 5 years, now they might need one for 20 years

We'll it'd be down to semantics to argue but every year of paying tax has gone to someone else's pension (baby bonus, subsidised childcare, dole bludgers, maternity leave etc etc) so why should I miss out? Don't take that as me sooking I'd like to get something back after paying out all these years

You didn't miss out mate. Your taxes went to help provide services for your everyday enjoyment of what Australia has to offer. Roads, infrastructure, medical, defence forces etc etc.

Not everyone uses all services paid for by their tax. Indeed tax paid is not with a proviso that it is used only for services designated by any one individual.

This is not a personal attack on you, but your comment about 'why should I miss out?' is an unfortunate statement on how so many Australians think these days. Me. Me. Me.

[David48]

^^^ I've been mulling this over myself. Here we have all that middle-class welfare that Mr Hockey is unlikely to touch, seeing as his side of politics brought most of it in. And it will in fact be added to shortly with the ridiculous paid parental leave of up to $75,000 for mothers to take six months off work. Yet they are attacking the OAP and Medicare. Why? They've sniffed the wind and have a good idea what the majority are thinking / feeling is all that I can come up with.

Abbott has a PR issue with Woman.

It was just spin for the then Labor government, but the mud stuck. Tthe Parental Care scheme is portray TA as being 'woman focused' ... again ... spin.

I agreed with Labor's policy and I think that the coalition's one is to generous.

I'm not sure what part of Medicare is being attacked, but I am in favour of a 'co-payment' when you visit the Doctor ... cira $10 ... it places a value on visiting the GP. Ditto Emergency at the Hospital.

What part of the OAP is the Government attacking?

[moojar]

^^^ I've been mulling this over myself. Here we have all that middle-class welfare that Mr Hockey is unlikely to touch, seeing as his side of politics brought most of it in. And it will in fact be added to shortly with the ridiculous paid parental leave of up to $75,000 for mothers to take six months off work. Yet they are attacking the OAP and Medicare. Why? They've sniffed the wind and have a good idea what the majority are thinking / feeling is all that I can come up with.

Abbott has a PR issue with Woman.

It was just spin for the then Labor government, but the mud stuck. Tthe Parental Care scheme is portray TA as being 'woman focused' ... again ... spin.

I agreed with Labor's policy and I think that the coalition's one is to generous.

I'm not sure what part of Medicare is being attacked, but I am in favour of a 'co-payment' when you visit the Doctor ... cira $10 ... it places a value on visiting the GP. Ditto Emergency at the Hospital.

What part of the OAP is the Government attacking?

A lot of noise being made about the cost of Medicare to the budget / government. Seems to be some softening up going on via friendly media, for future changes. The fear is we will end up like the USA on the IR and health fronts - fine if you are well off, crap if you are not.

I wouldn't mind paying a $10 Medicare co-payment either, if that was my only outlay. But a visit to the GP already costs me $25 to $30 out of my own pocket, after the Medicare rebate. And that is on top of the 1.5% (?) levy coming out of my salary.

OAP - similar friendly-media softening up underway, talk of raising the eligibility age to 70 and even taking the value of one's home into account in the asset test.

I have lived in Malaysia and have experience of Singapore, and have seen how powerful a friendly / controlled media is - it is akin to brain-washing of the "masses". No coincidence those governments are seldom threatened at election time.

Edited March 5, 2014 by moojar

[CeeBee]

_{From 20 March 2014 the Australia OAP will increase by $15.70 pf (just over 1%), in line with the COL increase. Inflation of only 1%???}