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18 Feb 09 Pension drawdown relief for retirees

In a joint media release issued on 18 February 2009, the Treasurer, Wayne Swan, and the Minister for Superannuation and Corporate Law, Senator Nick Sherry, announced relief from minimum account-based pension draw down requirements. The measure responds to concerns that meeting the minimum draw down amount in 2008-09 will mean having to sell investments assets and realise losses in a depressed market.

"In response to these legitimate concerns, the Government will suspend the minimum drawdown requirement for account-based pensions for the second half of 2008-09. This will occur through a 50% reduction in the minimum payment amount for 2008-09," Minister Sherry said.

The temporary relief also addresses the concern that the minimum draw down requirement was set based on asset values as at 1 July 2008, when equity values were higher.

The temporary suspension of the minimum payment requirement will apply to account-based annuities and pensions (payable since 1 July, 2007); allocated annuities and pensions (pre-dating the Better Super changes); account-based and allocated pensions payable from Retirement Savings Accounts, and market-linked (term allocated) annuities and pensions.

For a copy of the joint media release, No 2009/013, 18 February 2009, go here.

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