You are using an older browser version. Please use a supported version for the best MSN experience.

Call to restrict pension to the poorest

AAP logoAAP 2/01/2017

Senate crossbencher David Leyonhjelm wants Australians to drop their sense of entitlement to the aged pension.

The Liberal Democrats senator believes the pension should only be paid to poor people and claiming it should be "nothing to be proud of".

"The intention of the pension system is not to help you leave your money to your kids, you're supposed to sell down some of your assets," he told ABC Radio on Monday.

"Some people get very niggly about that."

His comments come in the wake of furore over the federal government's recent changes to the pension assets test which came into effect on Sunday.

The amount of assets (excluding the family home) someone can have before pensions are hit has increased but pensions will cut out more quickly for those with assets exceeding $375,000 for homeowner couples, $450,000 for single non-homeowners, and $575,000 for non-homeowner couples.

An estimated 330,000 Australians had their pensions cut and 90,000 of them lost it entirely after the tighter assets test came into force.

But 170,000 pensioners will get about $15 a week extra because their assets will no longer affect their pensions.

Labor opposed the pension assets test changes.

"Pensioners right across the country are going to have their household budgets cut," Opposition frontbencher Doug Cameron said in a statement.

The government argues that 90 per cent of pensioners will either benefit or be unaffected by the changes.

It reiterated the family home remains exempt.

image beaconimage beaconimage beacon