Additionally, a doubling in the taper rate from a fortnightly reduction in pension payments of $1.50 to $3 for every $1,000 above the asset test amount – equating to $78 a year for every additional $1,000 – effectively means “the new taper rate assumes pensioner assets earn 7.8 per cent per annum”.

“In our low-return world, we believe most asset classes will likely struggle to deliver 7.8 per cent per annum in returns, especially the conservative asset classes such as cash and fixed income favoured by many in the pension phase,” Plato managing director Don Hamson said.

This reflects remarks made previously by the Association of Superannuation Funds Australia (ASFA) that changes to the taper rate and asset threshold will have an impact on how retirees plan for their retirement.

“While some individuals with relatively low retirement savings will receive a small increase in their age pension after 1 January 2017, others will receive a lower age pension, or none at all, until they run down their superannuation,” ASFA chief executive Martin Fahy said.

“As a result, many individuals and couples will require higher levels of private savings for a comfortable standard of living in retirement.”