Thursday, 13 November 2008

Released on behalf of Minister for Veterans' Affairs - Media Release VA111

The Minister for Veterans' Affairs, Alan Griffin, today said that lower income test deeming rates would apply for veterans from payday 4 December 2008. This is to reflect the recent reduction in interest rates and the impact the global financial crisis is having on returns on the investments of veterans.

The deeming rate will change from 4 per cent to 3 per cent for the first $41,000 of a single pensioner's financial investments ($68,200 for a couple). It will also shift from 6 per cent to 5 per cent for the balance of financial investments over these amounts. The changes are effective from 17 November and will be included in payments made from 4 December, 2008.

Department of Veterans' Affairs payments affected by the deeming rate include service pension and income support supplement.

The lowering of the deeming rates mean that part rate pensioners paid under the income test, with financial investments mainly in term deposits, shares, managed investments and other accounts, may receive an increase in their pension payments, to reflect the reduction in their assessable income.

Veterans already paid at the maximum rate will have no change to their pension payments.

This Rudd Government decision acknowledges that many pensioners and social security recipients who also rely on own-source income have been adversely affected by the global financial crisis. "In addition to the one off payments announced recently as part of the Rudd Government's $10.4 billion Economic Security Strategy, this decision will help ease some of the financial pressure on DVA pensioners," Mr Griffin said. "I have also asked DVA to update the value of pensioners' listed securities and managed investments. As a result, on November 20, nearly 18,000 DVA income support pensioners will receive an average increase of $10 per fortnight. Individual results are heavily dependent on individual circumstances.

DVA pensioners who would like to discuss the outcome of this decision should contact the Department on 133 254.

Media inquiries: Laura Ryan 0437 863 109

The VVCS - Veterans and Veterans Families Counselling Service can be contacted 24 hours a day, seven days a week on 1800 011 046.

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