

The Australian Age Pension is indexed twice a year, in March and September, to help pensioners keep up with inflation and the rising cost of living. The upcoming adjustment on 20 March 2025, while modest, will still bring a slight increase to pension payments. But how much will it add to your fortnightly income? Let’s break it down in detail and explore the key factors influencing these changes.
Table of Contents
Why Does the Age Pension Increase?
Age Pension rates are reviewed twice a year based on three key economic indicators:
- Consumer Price Index (CPI) – Measures general price increases across the economy.
- Pensioners and Beneficiaries Living Cost Index (PBLCI) – Reflects cost-of-living changes for pensioners.
- Average Weekly Ordinary Time Earnings (AWOTE) – Ensures pensions do not fall below 25% of average earnings (though it is rarely applied).
For the March 2025 adjustment, the CPI rose by 0.4%, and the PBLCI increased by 0.2% over the relevant six-month period (June–December 2024). Since CPI is the higher measure, it will be used to determine the pension increase.
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Breakdown of the Age Pension Increase – How Much More Will You Receive?
Based on the available data, here are the estimated increases in Age Pension payments from 20 March 2025.
Current Age Pension Rates (Before 20 March 2025)
Payment Type | Single (per fortnight) | Couple Each (per fortnight) | Couple Combined (per fortnight) | Couple Apart Due to Ill Health |
---|---|---|---|---|
Maximum Basic Rate | $1,047.10 | $789.30 | $1,578.60 | $1,047.10 |
Maximum Pension Supplement | $83.20 | $62.70 | $125.40 | $83.20 |
Energy Supplement | $14.10 | $10.60 | $21.20 | $14.10 |
Total Payment | $1,144.40 | $862.60 | $1,725.20 | $1,144.40 |
Estimated New Age Pension Rates (From 20 March 2025)
Payment Type | Single (per fortnight) | Couple Each (per fortnight) | Couple Combined (per fortnight) | Couple Apart Due to Ill Health |
Maximum Basic Rate | $1,051.29 | $792.46 | $1,584.92 | $1,051.29 |
Maximum Pension Supplement | $83.53 | $62.95 | $125.90 | $83.53 |
Energy Supplement | $14.10 | $10.60 | $21.20 | $14.10 |
Total Payment | $1,148.92 | $866.01 | $1,732.02 | $1,148.92 |
How Much More Will You Receive?
Payment Type | Extra Per Fortnight | Extra Per Year |
Single | $4.52 | $117.52 |
Couple (Each) | $3.41 | $88.66 |
Couple (Combined) | $6.82 | $177.32 |
Couple Apart Due to Ill Health | $4.52 | $117.52 |
While this increase is better than nothing, it remains a relatively small adjustment, especially considering ongoing cost-of-living pressures.
What If Inflation Decreases? Could Pensions Drop?
Some pensioners wonder whether their payments could actually decrease if inflation falls. However, Australian social security laws ensure that Age Pension rates never go down—they can only stay the same or increase. If CPI or PBLCI were to drop, pension rates would remain unchanged until the next indexation period.
Other Changes That May Affect Pensioners on 20 March 2025
Along with the base rate adjustments, several other pension-related figures will also change:
- Income & Asset Limits – These thresholds, which determine pension eligibility, will increase.
- Commonwealth Rent Assistance – Given rising rental costs, there is speculation that the government may increase rent assistance.
- Pension Supplement & Energy Supplement – While the pension supplement is indexed to CPI, the energy supplement is not expected to change.
Is the Current Indexation System Fair?
While CPI and PBLCI determine Age Pension adjustments, some retirees feel these measures do not fully capture the real cost-of-living pressures faced by pensioners.
- Do you believe the calculated increase accurately reflects your day-to-day expenses?
- Should the government consider an alternative method of pension adjustments?
Many pensioners are calling for reforms that better align pension increases with actual living expenses, especially in areas like housing, healthcare, and utilities.
Need Help Understanding Your Age Pension Entitlements?
If you’re unsure about how these changes impact you, you can:
- Use the Age Pension Entitlements Calculator to check your eligibility.
- Book an appointment with a financial expert to explore ways to maximize your pension payments.
Stay tuned for official confirmation from the Department of Social Services and Services Australia, and check back for updates as they are announced.
Final Thoughts
While any pension increase is welcome, the March 2025 Age Pension adjustment remains modest. Given ongoing financial pressures, pensioners should stay informed about potential policy changes, rent assistance updates, and other benefits that could provide additional support.
For now, mark your calendar for 20 March 2025 and prepare for a slight bump in your pension payments!
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