Senator Eric Abetz

“A Coalition Government will introduce new indexation arrangements for Defence Force Retirement and Death Benefits Scheme (DFRDB) members, benefiting Tasmania’s veterans and ex-service,” Senator Eric Abetz said today.

Senator Abetz said that these changes recognise the unique nature of military service. Better indexation arrangements are a necessary part of a fair, equitable and fiscally responsible military superannuation system.

Under a Coalition government, from 1 July 2011 those DFRDB members aged 55 years or older in Tasmania will have their military superannuation pensions indexed to the greater of the Consumer Price Index (CPI), Male Total Average Weekly Earnings (MTAWE) or the Pensioner and Beneficiary Living Cost Index (PBLCI).

Currently this superannuation scheme is indexed only in line with movements with the CPI.

Widows of DFRDB superannuants will also benefit from the announced changes.

“This is the right thing to do. Australia’s service personnel, past and present, after giving so much to their nation, deserve to live out their lives in the knowledge that they have financial security,” says Senator Abetz.

“Labor broke its election promise to ‘fix’ the issue of military superannuation indexation and this is yet another example that the Labor Government is all talk and no action.”

“This is a fully costed and fully funded policy. Savings already identified by the Coalition will be used to offset the $98 million cost over the forward estimates. A further $100 million will be invested into the Future Fund as a first step towards funding the new arrangements beyond the forward estimates,” Senator Abetz said today.

“This change brings into line the indexation of DFRDB superannuation with the aged pension. Currently DFRDB superannuation is indexed according to the CPI.”

“If the indexation rate had increased in line with the aged pension, military superannuants would have received an extra $28.40 per fortnight to their pension (if they received the full pension rate) in March this year.”

“We are committed to real action to support Tasmanian veterans, and this initiative by the Coalition will ensure that all those who have served their nation are properly looked after in their retirement. After all, military service is unique and unique solutions are required to recognise that service.

“Above all else, Australia’s service personnel, past and present, after giving so much to their nation, deserve to live out their lives in the knowledge that they have financial security,” Senator Abetz said today.