How the CPI rate affects your pension
Learn how the Consumer Price Index increase affects your pension.
On the first payday in January and July each year, we adjust your pension in line with the Consumer Price Index (CPI). The CPI takes into account a range of factors as set by the Australian Bureau of Statistics (ABS). This includes the price of food, clothing, housing, health and transportation. Once the ABS releases the CPI figures, we can determine whether your pension is due for an increase.
We'll send you an email or letter from 30 June 2022 with your CPI update for July 2022.
If you have not been receiving your pension for the full six months before the CPI increase, you'll only receive a proportion of the increase in your pension. For more information, visit the Australian Bureau of Statistics website.
CPI Update for July 2022
July 2022 Calculations
CSS, PSS, MilitarySuper, DFRDB aged under 55
How the CPI pension adjustment is calculated:
| (March 2022 CPI figure) – (September 2021 CPI figure) × 100 | = Pension CPI increase | ||
| (September 2021 CPI figure) | |||
| Calculation for July 2022 | |
|---|---|
| (123.9 – 119.7) x 100 |
= 3.50877 = 3.5%1 |
| 119.7 | |
| 13.5% When rounded to the nearest tenth of one percent | |
Follow this link to the ABS website to see the consumer price index rates used in the calculation.
DFRDB aged over 55
How the CPI pension adjustment is calculated:
| (March 2022 CPI figure) – (September 2021 CPI figure) × 100 |
= Pension CPI increase |
| (September 2021 CPI figure) |
| ∴ (123.9 – 119.7) x 100 |
= 3.50877 = 3.5%2 |
| 119.7 |
|
|
2 3.5% when rounded to the nearest tenth of one percent |
|
Follow this link to the ABS website to see the consumer price index rates used in the calculation:
PBLCI increase calculation
How the PBLCI pension adjustment is calculated:
| (March 2022 LCI figure) – (September 2021 LCI figure) × 100 |
= LCI increase |
| (September 2021 LCI figure) |
| ∴ (123.3 - 119.6) x 100 |
= 3.09365 = 3.1%3 |
| 119.6 |
|
|
3 3.1% when rounded to the nearest tenth of one percent |
|
Follow this link to the ABS website to see the PBLCI rates used in the calculation:
As CPI results in a higher value, the rate of 3.5% is used in the next step.
Calculating the indicative amount:
Increase the indicative amount of $22,911.12 by 3.5%.
$22,911.12 is the indicative amount substituted in January 2022.
($22,911.12 x 3.5%) = $23,713.01
Calculating the Male Total Average Weekly Earnings (MTAWE):
The MTAWE is contained in Publication 6302.0 – Average Weekly Earnings. To get the annual rate we multiply the November 2021 MATAWE figure of $1,577.10 by 52.
$1,577.10 x 52 x 27.7%[3] = $22,716.55
[3]27.7% is set in the DFRDB legislation in section 98GA
Now compare the CPI indicative result of $23,713.01 of the calculation with the MTAWE result of $22,716.55. CPI of $23,713.01 is greater.
As CPI results in a higher increase, DFRDB/DFRB pensioners over the age of 55 will receive an increase of 3.5% for July 2022.
Historical CPI rates
What are the historical CPI rates?
| CSS, PSS, MilitarySuper & DFRDB under 55 | DFRDB over 55 | |
|---|---|---|
| January 2022 | 1.50% | |
| July 2021 | 1.10% | |
| January 2021 | 0% | |
| July 2020 | 1% | 1.50% |
| January 2020 | 1.10% | |
| July 2019 | 0.50% | 1% |
| January 2019 | 0.80% | |
| July 2018 | 1.10% | 1.50% |
| January 2018 | 0.80% | |
| July 2017 | 1% | 1.30% |
Frequently Asked Questions
Will my pension go down?
Are there any other changes to my pension?
No, there are no changes to the amount or date we pay you each fortnight. Your pension will be paid as normal.
Is this connected to the recent tax changes?
What can I do about my living costs?
Here are some useful services:
My pension is classed as a DSB, will the tax withholding detailed in my CPI letter reflect this?
I receive an adjusted tax withholding under the Douglas court decision, will my CPI letter reflect this?
Your CPI letter will list two sets of tax components.
The first set are your indexed fortnightly pension components. These are the indexed unadjusted components, and are not used for tax purposes.
The second set are your fortnightly lump sum tax components. These are the adjusted tax components for lump sum purposes, and include variations for Disability Superannuation Benefit (DSB), or pre-1983 tax free component if required. Your fortnightly tax withholding is calculated using this set of components.
It’s important to note that your fortnightly pension components and fortnightly lump sum tax components will be the same, unless you are classed DSB or served in the Defence forces prior 1 July 1983.