- There have been few direct measures announced in the 2026-27 Budget specifically for Australian pensioners and seniors
- However, there have been funding announcements surrounding at-home and residential aged care
- The government has also moved to reduce private health insurance rebates for Australians aged over 65 in line with the standard 24% rebate
The 2026-27 federal budget has been long touted as one squaring up "intergenerational unfairness".
In delivering tax reforms aiming to help younger Australians get into the housing market, there has been rather less focus on measures to specifically assist older Australians.
Here are the announcements contained in the 2026-27 Budget papers:
Boost to aged care
- Additional $3.7 billion investment into the aged care sector
This will cover:
- boosted incentives for aged care providers to add an extra 5,000 aged care beds annually
- delivery of up to 20 specialist dementia care program units
- expanding the Hospital to Aged Care Dementia Support Program from 11 to 20 locations nationally
- more generous assistance under the Support at Home program
- Affordable personal care
The government is committing $1 billion to fully subsidise and remove co‑contributions for at-home personal care services through the Support at Home program.
This follows a backlash against the government's earlier decision to impose a co-payment for in-home showering, continence management, and dressing support.
There will also be an extra $390 million to speed up the release of Support at Home packages and make the program "fairer and more affordable".
- Fairer access to aged care homes for the less well off
The government will direct $1.1 billion towards future spending to increase and restructure the Accommodation Supplement for aged care to protect equity of access for lower income seniors.
It's also planning to introduce an additional payment for aged care homes with more than 60% low-means residents.
- Improved aged care sector quality, safety and viability
The government is providing more than $565 million to improve the quality of residential aged care, including increasing minutes of care delivered to older Australians and strengthening regulatory oversight.
Medicare levy low-income threshold to be increased
The government has also announced it will increase the Medicare levy low-income thresholds for pensioners, seniors, families, and singles by 2.9% from the 2025-26 income year.
It's expected to benefit more than one million Australians on lower incomes who'll continue to be exempt from the Medicare levy, or pay a reduced levy rate.
Cheaper medicines pledge
The federal government will invest almost $6 billion to deliver cheaper, life-saving medicines through the Pharmaceutical Benefits Scheme (PBS).
This will include treatments for cystic fibrosis, chronic kidney disease, and various cancers.
The maximum general co-payment under the PBS will be reduced to $25 and the concessional rate will be frozen at $7.70 until 2030.
All eligible older Australians will have free access to the respiratory syncytial virus (RSV) vaccine Arexyv which will be listed on the National Immunisation Program.
Dental Services for Adults
The federal government has pledged to fund the Public Dental Services for Adults agreement for the first time.
Public dental services have largely been funded by state and territory governments in the past.
The federal contribution will help support the delivery of dental care to low-income adults with eligibility determined by each state and territory.
Giving and taking away
But as well as extra funding in some areas, there will be cuts to others including:
- Private health insurance subsidy cuts for over 65s
The changes will see the lowering of the 28% subsidy on the cost of private health insurance premiums for eligible Australians aged between 65-69 while those aged 70 and over will also see their existing 32% rebate reduced.
In dollar terms, this will equate to older Australians paying, on average, between $226 to $255 a year more for private health cover.
All private health insurance holders will receive a standard 24% government rebate on their premiums, no matter their age, from April 2027.
The federal government had said the money raised from cutting back the subsidies would be directed to the aged care system.
Seniors wanted cost relief
In its pre-budget submission, National Seniors Australia (NSA) had called for cost-of-living relief, particularly for older people who rely on the age pension as their sole income.
But in this Budget, there have been no direct handouts in the form of household energy subsidies.
NSA said its latest survey, conducted in February 2026, found pensioners were most worried about being able to afford energy and insurance over the next 12 months.
Those who receive a combination of pension and private income, or are self-funded retirees, were most concerned about their ability to afford private health insurance.
The federal government had said its modelling showed the number of people expected to cancel their private health insurance polices because of rebate changes was about 0.4% of the total market.
Previously announced changes
As well as the measures outlined in the federal budget, there are several previously announced changes affecting older Australians that will kick in from 1 July 2026.
These include:
The program began in November 2025 (replacing the previous Home Care Packages program) with providers setting their own prices for at-home aged care and support services.
The government will cap prices from 1 July with the aim of preventing excessive charges for at-home care.
The pricing will take into account labour, travel, and admin fees while providers will also be required to publish their charges.
Tax concessions will be cut for retirees with superannuation balances over $3 million, as of 1 July 2026.
Those affected will be subject to 15% tax on the proportion of earnings related to their total superannuation balance that exceeds the $3 million threshold.
Those with $10 million or more will be subject to an additional 10% tax, applied the same way.
Both thresholds will be indexed in line with CPI.
This will apply all Australians earning between $18,200 and $45,000 a year.
The rate will further drop to 14% from 1 July 2027.
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