Retirement Income

Fri, 14 Dec, 2018Danielle McCarthy

Why is the Australian government still paying the pension to 6000 dead people?

Why is the Australian government still paying the pension to 6000 dead people?

Australian pensioners over 80 years old will soon have to produce a “proof of life certificate” to continue receiving the pension.

The changes, which will come into effect from July 1, will mean that expats will have to go to an Australian embassy or consulate every two years to register that they are still alive and entitled to receive the payment.

The change follows the recent revelation that thousands of deceased expats continued to receive their pension.

Speaking about the major discrepancy, Social Services Minister Paul Fletcher, said: “We believe we will identify about 6000 people living overseas who are dead or whose families are wrongfully receiving taxpayer money.”

Based on average death rates, the Government predicts the new procedure will save $150 million over four years.

Mr Fletcher said the proof of life certificates were a fair way to make sure pension payments are only going to eligible recipients.

"Countries like the UK, Germany, Netherlands, France and Italy all have systems in place to verify whether a pensioner living overseas is still alive and we're now going to introduce a similar system," he said.

"We do have a duty to be careful and responsible with taxpayers' money and so it's appropriate to have a process in place to check that where a pension is being paid that that person continues to be alive."

Until now, the government has relied on the voluntary reporting of an overseas death by a family member or friend, allowing many deaths to go unnotified.

“The most likely explanation is that many Australians who were living overseas on a pension have died - but that has not been made known to the Government and we are continuing to pay their pension,” he said.

“In some cases it could be fraud. In others, it could be that the former Australian pensioner's family incorrectly think that they remain entitled to receive the pension formerly paid to their loved one.”

Expat pensioners will be given 13 weeks to tell the government they are alive before their payment is cancelled.