The Treasurer has announced relief from minimum account-based pension draw down requirements.
Currently, it is a requirement that minimum payments be made from a superannuation account-based pension at least annually. Minimum payments are determined by age and the value of the account balance as at 1 July each year. The minimum annual payment rule is designed so that retirees draw down on their superannuation capital over their retirement.
Retirees with a lower income may qualify for the age pension.
The Government will suspend the minimum drawdown requirement for account-based pensions for the second half of 2008-09 through a 50 per cent reduction in the minimum payment amount for 2008‑09.
For those people who have already taken half of the current minimum payment for 2008-09, the annual nature of the minimum payment rules means that a further payment will not be required until the end of the 2009-10 year.
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.
UPDATE 27 February: Treasury Fact Sheet