News

Zali Steggall MP speaks on the hardships pensioners are facing

26 November 2025

 

Australia's support system and tax system should make it easier, not harder, for our older Australians to keep working. But instead of rewarding their contribution, the Work Bonus now punishes them with sudden tax hits, pension losses and complex rules.

At a time when we are relying on their skills and experience, the system is pushing them away. That's wrong and it undermines the very workforce we need to strengthen. We need to tackle age discrimination in the workforce but have more incentives in place for older Australians to continue working where they can and if they want to. I've met recently with Mary and Joseph to Warringah local residents, their hard working age pensioners who are living this reality. Mary teaches English at TAFE. She rents owned no assets beyond an old car and cannot live on the pension alone. When extra classes are available, she's happy to take them. But every additional dollar above the income limit reduces her pension by $0.50. Worse, if she crosses the income threshold of just $52,759, even by just a few hundred dollars, she's hit with a tax bill in the thousands and goes backwards. The stress of these unpredictable penalties make her hesitate to take on extra work when it's available. This is not an isolated case. It reflects the broader systemic failures of this system. Other TAFE teachers have reported purported similar struggles feeling forced to retire despite rising rents and living costs. We hear a lot in this place about the need for productivity and the fiscal impact of an ageing population. This means that we need a more flexible support and welfare system that works for our changing economy, ensuring older Australians can work without the fear of unpredictable tax bills. This should include the flexibility to manage rising rents, cost-of-living pressures and reduced retirement savings. We must act to keep our system fair by lifting and smoothing out the thresholds, reviewing income test, taper rates, aligning pension Work Bonus and tax settings and ensure that the ATO hardship provisions are flexible for low income welfare recipients. A fairer system will deliver greater dignity, choice and help strengthen our economy. Now, I've written to the government and the minister about this issue that we have to be able to smooth this out. It just makes no sense that when we have shortages that people who are willing and able to continue contributing to take on those extra shifts, they go backwards because as soon as they go over that threshold, the tax bill, they get hit with is in the thousands. And so and they simply can't then meet it because of the issue of cost of living and everything else being tight.

So I urge the government, I hope the minister will respond and meet with me to discuss this very urgent issue. Thank you. And I give the call to the Assistant Minister for Social Services. Thank you. Deputy Speaker.