In 2006, then Treasurer Peter Costello announced that the taper rate by which the Aged Pension is phased-out would be halved from $3 per $1,000 of assets over the threshold to $1.50.
This change greatly relaxed the assets test for the Pension, and led to the ridiculous situation whereby retiree home owning couples with $1.15 million in other assets, and home owning singles with $775,000 of other assets, could still qualify for the part Aged Pension along with the Pensioner Concession Card.
In effect, a large number of wealthy retirees were able to qualify for welfare – an unsustainable and inequitable situation given the rapid ageing of the population and the projected diminishing number of workers available to support retirees (see next chart).
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