So how is the Age Pension indexed, and what were the announced changes?
Age Pension Indexation
Indexing the Age Pension is a multi-step process, involving three numbers:
- CPI: Consumer Price Index
- PBLCI: Pensioner and Beneficiary Living Cost Index
- MTAWE: Male Total Average Weekly Earnings
The Age Pension is currently indexed twice a year, on 20 March and 20 September. In short the Age Pension is indexed to the higher of the change in the CPI or the PBLCI, and then compared to the MTAWE.