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5.12.3 Payability of Pension Supplement
Last amended 17 December 2012
Pension supplement is a daily entitlement. Where a person receives service pension, PSup is paid as part of that pension and is subject to reduction under the income test or assets test along with the pension.
Minimum pension supplement amount
The minimum pension supplement amount (minimum amount) applicable to a person's family situation is payable as long as the amount of service pension payable to the person is not reduced to nil under the income test or assets test. If the rate of service pension is greater than nil but less than the person's minimum amount, the rate of service pension paid is increased to the rate of the person's minimum amount. If the amount of service pension payable to the person is reduced to nil under the income test or assets test, PSup will be cancelled.
Example of payment arrangements for a service pensioner
A single veteran's rate of service pension including PSup is calculated at 10 cents per fortnight under the income test. The rate of service pension paid to the veteran is maintained at the minimum amount. The veteran's income subsequently increases and the rate of service pension (including PSup) is reduced to nil. No PSup is payable.
Minimum amount for ISS
Where a person receives income support supplement, there is no separate PSup component added to their rate of ISS. However, the minimum amount rules do apply where the rate of ISS payable to the person is income/assets reduced.
Minimum amount not payable for residents overseas.
The minimum amount is portable for up to 6 weeks of a temporary absence from Australia. For pensioners residing permanently overseas, the minimum amount is not payable.
Basic pension supplement amount
The basic amount of pension supplement remains payable regardless of whether or not a pensioner is overseas.
There are no specific obligations for pension supplement. Standard pension obligations apply.
The pension supplement is added to a person's maximum basic rate. The pension supplement is calculated as a 'combined couple' rate. The 'not a member of a couple' rate is 66.33% of the 'combined couple' rate. The member of a couple rate is 50% of the combined couple rate. From 1 July 2010, the minimum pension supplement amount will be able to be claimed on a quarterly basis rather than on a fortnightly basis.
The minimum pension supplement is an annual rate and is paid fortnightly. From 1 July 2010, the minimum pension supplement will become more flexible, with recipients able to elect to receive the payment quarterly. It is calculated as a combined couple rate and is indexed twice a year in line with CPI increases. The 'not a member of a couple' rate is 66.33% of the combined couple rate. The member of a couple rate is 50% of the combined couple rate. The minimum pension supplement commenced on 20 September 2009 and replaced utilities allowance and telephone allowance.