Australian retired pensioners living in Bali

Image credit:

This article, poses an interesting question, is living overseas morally wrong for people living on a government funded pension? Economically, you could argue that money is being taken out of the country, in this case Australia, but it could be any western country that offers government funded pensions. The pensions are funded by taxes and if retirees stay in the country, then the money would be spent on purchasing everyday goods, clothing, food etc, thus contributing to the economy.

On the other hand, you could argue, if the retirees don’t live in the country, then they wouldn’t require government funded services like medical care, roads etc. I have met a few foreigners living in Bali, that are from European countries, seemingly in good health but living on some kind of disability pension. In one case around 2,000 euros per month, which is very decent sum of money in Bali!

I don’t really have an answer to the debate, but I do know, at least the Australian government is tightening up the rules and has stopped people living on disability pensions from living overseas. My grandparents are in their nineties and live on the pension in Australia. I am sure it is not easy for them to live on the money provided, as the cost of living in Australia has sky rocketed. They do of course get good medical care in Australia, that is not really possible in Bali.

The article also has an interesting comparison of the price of a few items – $18 for a jar of instant coffee in Australia, sounds very expensive! Imported alcohol is one thing that is expensive in Bali. A bottle of wine like Jacob’s Creek is easily double the price in Bali, than what you would pay in Australia.

On a practical level, from what I have heard, Centrelink (the Australian social security department) seem to be fairly helpful to people moving overseas, and they can even pay directly into an Indonesian bank account.

Here is some more information from the Centrelink website:

“You can generally get Age Pension for the total period of absence however, after 13 weeks your rate may change. It may change again if you remain outside Australia for more than 26 weeks. If you are travelling to New Zealand your rate may be affected by the Social Security Agreement between Australia and New Zealand.

Once Age Pension is granted, it can be paid overseas indefinitely for any absence (including living overseas permanently), subject to proportional portability and the restriction for former residents.

Proportional portability means that if you have spent less than 25 years in Australia between age 16 and Age Pension age, you can only receive a proportion of your normal amount of payment overseas.

If you are a former resident and have been living overseas, return to Australia and then claim Age Pension, the restriction for former residents means that you need to remain in Australia for two years before you can leave and be paid overseas.”

What do you think? Do you think pensioners and retired people should be able to live wherever they want?