Labor confirmed on Tuesday it would oppose legislation tightening the pensions assets test after consulting with seniors groups and industry superannuation funds.
But Social Services Minister Scott Morrison has secured the support of the Greens, saying the measures would go to the Senate as soon as possible.
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In a statement, Mr Morrison said the measures would mean that more than 170,000 pensioners with “low and modest levels of assets” will have their pension increased by around $30 a fortnight once the changes come into effect in 2017.
“Support for the single largest savings measure in this year’s Budget, following passage of the Government’s cornerstone small business measures, demonstrates the Abbott Government is successfully getting on with the job of implementing our ‘have a go’ Budget,” he said.
“… I commend the Australian Greens, and their new Leader Senator Di Natale, supported by Senator Siewert, for their constructive engagement with the Government on this measure.”
The changes, which would come into effect from January 2017, would mean:
- Around 170,000 pensioners with modest assets would have their pensions increased by an average of around $30 per fortnight (including those on a part pension)
- Around 91,000 current part pensioners will no longer qualify for the part and a further 235,000 will have their part pension reduced
- To qualify for a full pension, the assets free area will increase to $250,000 for single home owners and $375,000 for couples
- Part pensioners owning their own home will have their maximum threshold reduced to $823,000 and $547,000 for couples and singles respectively
The move, announced on Tuesday evening, has already drawn criticism from Labor.
Deputy Opposition Leader Tanya Plibersek said the deal would cut the pension for 330,000 people, while former treasurer Wayne Swan said they were "fleecing pensioners on modest incomes [and] demonising them as welfare bludgers".
Read how the changes will impact homeowers below.
Read how the changes will impact non-homeowers below.
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