The housing crisis in Australia has reached alarming levels, particularly for retirees who rely on rental properties. Many pensioners are facing severe financial hardship, with a significant number struggling to afford basic necessities such as food and utilities. The Grattan Institute reports that two in three older renters are living in poverty, and without immediate intervention, the situation is expected to worsen.
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One such pensioner, 67-year-old Debra Basham, has shared her distressing experience of skipping meals because her rent and bills consume most of her income. Her story reflects the broader issue affecting thousands of retirees across the country.
The Call for a $2 Billion Increase in Rent Assistance
The Grattan Institute has proposed a substantial increase in Commonwealth Rent Assistance (CRA) to help alleviate the financial burden on pensioners. Although the CRA saw a 10% increase in September 2024, this adjustment has proven inadequate given the steep rise in rental prices.
Currently, pensioners receive an extra $12 to $19 per fortnight following the last increase, but rents in major cities have surged well beyond this. Domain reports that weekly rent in Sydney has increased by $540, in Brisbane by $410, and in Perth by $390 over the past four years. While rent prices have stabilized, they are not expected to decline, making additional assistance crucial.
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Why a Small Rent Assistance Increase Won’t Solve the Problem
NSW Tenants Union CEO Leo Patterson Ross has expressed concern that merely increasing Rent Assistance without addressing the broader issues in the rental market will not be enough. According to Ross, rental price hikes continue to outpace increases in assistance, leaving pensioners and other low-income renters struggling to keep up.
A proposed 50% increase in CRA would provide an additional $53 per week ($2,750 per year) for singles and $40 per week ($2,080 per year) for couples. This increase would enable retirees to afford up to $350 per week for rent, significantly improving access to affordable housing. The estimated cost of this increase to taxpayers would be $2 billion annually.
Who is Eligible for Rent Assistance?
Commonwealth Rent Assistance is available to Australians receiving specific social security payments, including:
- Age Pension
- JobSeeker Payment
- Austudy & Youth Allowance
- ABSTUDY Living Allowance
- Farm Household Allowance
- Special Benefit
To qualify, individuals must meet minimum rent payment requirements, which vary based on household composition. Currently, the maximum fortnightly payment is $188.20 for a single person living alone or $125.47 for a single person in a shared household.
The Impact on Older Australians
The rising cost of rent has had devastating consequences for many pensioners. Women over 55 are particularly at risk of homelessness due to factors such as divorce, caregiving responsibilities, and limited superannuation savings. Many have lost their homes after a separation and now face uncertain financial futures.
National Seniors Association CEO Chris Grice has emphasized the urgent need for action, calling for the CRA rate to be tied to rental price changes rather than overall inflation. Without such a change, pensioners will continue to fall behind as rental prices outstrip their financial support.
A System in Need of Reform
The current CRA system only benefits those already in rental housing and receiving Centrelink payments, excluding many individuals who need support. A broader review of rental policies and housing affordability measures is necessary to create lasting solutions.
Without significant intervention, the number of retirees living in poverty will continue to rise. A $2 billion cash boost to Centrelink rent assistance could provide much-needed relief, ensuring that older Australians can afford a safe and dignified retirement.
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