We have summarised the key points from the 2021-2022 budget, that we believe will have the most impact on our clients.

Please keep in mind that all budget measures are proposals and will require the passage of legislation to become effective. 

2021 Federal Budget - Social Security and Family Assistance Summary

Pension loan scheme

Currently, the Pension Loans Scheme allows older Australians to obtain a voluntary non-taxable fortnightly loan from Centrelink. The loan and all costs and accrued interest must be repaid to the Commonwealth, including from your Estate. Under current rules, the amount you can access as a loan is up to 1.5 times the maximum payment rate of your eligible pension each fortnight.

In the Budget, the Government has announced that they will be increasing the flexibility of the Pension Loans Scheme (PLS) by allowing participants to access up to two lump-sum advances in any 12 month period up to a total value of 50% of the maximum annual rate of the aged pension. Based on current Age Pension rates, the total PLS is around $12,385 per year for singles, while couples combined could receive around $18,670. The Government will also introduce a No Negative Equity Guarantee meaning that the Government will not claim back more than the sale price of the house used to guarantee the payment when it is sold.

Note, the total amount eligible people can receive under the pension loans scheme, including any lump sum advance payments, has not changed. The total amount cannot exceed 150% of the maximum Age Pension which is around $37,155 per year for singles and around $56,011 per year for couples.

To raise awareness of the Pension Loan Scheme, the Government will also spend $21 million on advertising and raising awareness of the scheme.

Aged Care

Anyone who has contact with the Aged Care system either as a resident or a family member of a resident will know that the system is in desperate need of a cash injection. The Government announcement of $17.7 billion to be spent on aged care reform is an excellent start and a direct response to the Royal Commission into the quality and safety of the system. The funding includes spending on:

  • $6.5 billion for 80,000 additional Home Care Packages over the next two years
  • $798.3 million to provide greater access to respite care services and payments to support carers
  • $7.8 billion for a new funding model for residential aged care, with a $10 per person per day supplement of the Basic Daily Fee
  • $189.3 million over four years from 2020-21 to implement the new funding model, the Australian National Aged Care Classification (AN-ACC)
  • $117.3 million to support structural reforms, including the implementation of a new Refundable Accommodation Deposit (RAD) Support Loan Program

We await further detail with interest and hope that the proposed changes will not make the existing application process more complicated.

Increased support for unemployed Australians

Effective – 1 April 2021

As already legislated, the government has made several changes to working-age payments from 1 April 2021:

  • the base rate of working-age payments has been increased by $50 per fortnight. This increase applies to JobSeeker Payment, Youth Allowance, Parenting Payment, Austudy, ABSTUDY Living Allowance, Partner Allowance, Widow Allowance, Special Benefit, Farm Household Allowance and for certain Education Allowance recipients under the Department of Veterans' Affairs Education Scheme.
  • the income-free area of certain working-age payments has been increased to $150 per fortnight. This applies to JobSeeker Payment, Youth Allowance (other), Parenting Payment Partnered, Widow Allowance and Partner Allowance.
  • the temporary waiver of the Ordinary Waiting Period for certain payments was extended to 30 June 2021
  • the eligibility criteria for JobSeeker Payment and Youth Allowance (other) for those required to self-isolate or care for others due to COVID-19 was extended to 30 June 2021.
  • face-to-face servicing for job seekers has recommenced, implementing a graduated return in job search requirements from 15 per month from April 2021 to 20 per month from July 2021, and mandating job seekers in online employment services to complete their career profile in the jobactive system, to allow better job matching.

We're here to help

If you have any questions or concerns about the proposals from the Federal budget announcements, please contact your Ulton Wealth Management Advisor to discuss.

Learn more

Want to learn more about the other announcements from the 2021 budget? We have broken the full budget down into 6 main categories for usability.

Individual_Summary   Business_Summary   Superannuation_Summary   Social_Security_Summary   Economy_Summary   Other Summary-1


The Commonwealth of Australia, Budget 2021-22, https://budget.gov.au/

Australia Taxation Office, First home super saver scheme,   https://www.ato.gov.au/individuals/super/withdrawing-and-using-your-super/first-home-super-saver-scheme/

SMSF Association 2021-2022 Federal Budget Summary https://www.smsfassociation.com/resource-library/2021-2022-federal-budget-update

Australian Government Services, How much can you get, https://www.servicesaustralia.gov.au/individuals/services/centrelink/pension-loans-scheme/how-much-you-can-get

FirstTech Federal Budget Briefing 11 May 2021, https://www3.colonialfirststate.com.au/adviser/platforms/news-and-updates/cfs-news/federal-budget-may-2021.html

Wealth Management Disclaimer

Our liability is limited by a scheme approved under Professional Standards Legislation, except where we provide financial services as an authorised representative of Ulton Wealth Services Pty Ltd (holder of Australian Financial Services License No. 497721). 
This communication has been prepared on a general advice basis only. The information has not been prepared to take into account your specific objectives, needs and financial situation. The information may not be appropriate to your individuals needs and you should seek advice from your financial adviser before making any investment decisions. Sub Authorised Representative No.245052 of Ulton Wealth Management Pty Ltd. All Ulton Wealth Managers can provide financial services as Sub-Authorised Representatives of Ulton Wealth Management Pty Ltd. ABN 73 168 815 450 | Corporate Authorised Representative 460875 of Ulton Wealth Services Pty Ltd | ABN 86 614 308 628 | AFSL 497721.

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