From next week, Australians on Centrelink are set to receive a budget increase. As a continuation of the government’s indexation policy, which aims to keep government support in line with inflation, payments will increase by 2.4% from September 1, 2025. The increase will be felt across a variety of payments including JobSeeker, Age Pension, Disability Support Pension, and Parenting payments.
The Reasoning Behind the Increase
Centrelink’s March and September schedule stems from a periodic average wage and inflation check. The most recent data shows inflation to be stubbornly high, which is a problem for Australians. Based on the current consumer price index data, the September increase will be set at 2.4% and the Reserve Bank of Australia will continue to keep interest rates higher than normal due to the consistently high housing, energy, and grocery prices.
What the 2.4% Increase Means for Centrelink Beneficiaries
For pensioners, the maximum basic rate will increase by almost $25 per fortnight and rise by $38 for couples. For those recipients of JobSeeker payments, their base rate will rise by approximately $16 every fortnight. Similarly, those receiving Parenting Payments will see an analogous increase. Youth Allowance, Austudy, and other payments designated for students will also see increases, although those increases may be described as more modest.
Mixed Recipient Reactions
An increase of payments, however, is viewed positively by recipients and described as long overdue. Within the same breath, recipients and workers have highlighted the need for more far-reaching systemic changes. Individuals in Melbourne and Sydney, whose rental affordability is in a crisis, voiced that the extra fortnightly payment would be “swallowed up” by the ever-increasing housing costs. On the other hand, some retirees deemed the indexation essential to maintaining the purchasing power of their pension while dinning their rising cost-of-living pressures.
Economic and Political Context
The timing of the September adjustment comes at a politically sensitive time as the Albanese Government is seeking to prove it is addressing the cost-of-living crisis. The Treasury has pointed out that the social security indexation is a blunt increase of the social welfare payments due to the automation of the process which is enshrined in law, not a discretionary increase by the government. This clarification has not quieted the arguments in parliament with the Opposition taking a position that greater structural changes to welfare is necessary to ensure that “work pays” but at the same time, protecting the most vulnerable.
What Happens Next
Informing the Australians, no action is required to receive the payments, as payments will be changed automatically to the new values as of September 1. Payment adjustment is already in progress. Payment tables will be updated and posted on the Services Australia website in the coming week with the precise values of increase for each category of support.
