Document ID: chunk:federal_register_of_legislation:C2009A00081:clause:5_198ze:p1
Version: federal_register_of_legislation:C2009A00081
Segment Type: clause
Provision Reference: sch 5 cl 198ZE (pt 1/2)
Character Range: 142913–145524

198ZE  Adjustment of indexation on and after 20 March 2012
 (1) An indexation factor that:
 (a) is worked out under section 59D for indexation on a day that is on or after 20 March 2012; and
 (b) is (indirectly) relevant to the indexation of the amount specified in paragraph 30(1)(b);
is, for the purposes of the indexation of the amount on that day, to be reduced by the brought forward CPI indexation amount, but not below 1.
Note 1: An indexation factor worked out under section 59D is (indirectly) relevant to the indexation of an amount specified in paragraph 30(1)(b). This is because:
(a) section 198 provides for indexation of the amount by reference to the pension MBR factor worked out under section 59LA; and
(b) the pension MBR factor depends on the increase in the single pension rate MBR amount, which in turn depends (under section 59G) on indexation of the pension MBR amount under section 59C, which involves the indexation factor worked out under section 59D.
Note 2: The indexation of an amount specified in paragraph 30(1)(b) on that day depends on a pension MBR factor that is worked out on the basis of the indexation factor worked out under section 59D and reduced under this section.
Note 3: Once the brought forward CPI indexation amount becomes 0, there will be no further reduction of the indexation factor.
Example: Assume that the indexation factor worked out under section 59D on 20 March 2012 is 1.003. The brought forward CPI indexation amount in relation to 20 March 2012 is 0.004 (as there has been no previous reduction). That indexation factor is reduced to 1 on 20 March 2012.
 Further assume that on 20 September 2012 the indexation factor worked out under section 59D is 1.010. The brought forward CPI indexation amount in relation to 20 September 2012 is 0.001. That indexation factor is reduced to 1.009 on 20 September 2012.
 The brought forward CPI indexation amount in relation to later indexation days is now 0 so there is no further reduction of the indexation factor.
 (2) A living cost indexation factor that:
 (a) is worked out under section 59EAB for indexation on a day that is on or after 20 March 2012; and
 (b) is (indirectly) relevant to the indexation of the amount specified in paragraph 30(1)(b);
is, for the purposes of the indexation of the amount on that day, to be reduced by the brought forward PBLCI indexation amount, but not below 1.
Note 1: A factor worked out under section 59EAB is (indirectly) relevant to the indexation of an amount specified in paragraph 30(1)(b). This is because:
(a) section 198 provides for indexation of the amount by