Treasurer Jim Chalmers says the government is committed to ensuring pensioners don't fall further behind as inflation rises.
A half-yearly indexation rise for pensions is set to kick in from September 20, with inflation sitting on 5.1 per cent and expected to push higher by the end of the year.
In March, age pension rates increased by $20.10 to $987.60 a fortnight for single pensioners or $25,677.60 a year.
The maximum rate for pensioner couples combined increased by $30.20 to $1488.80 a fortnight or $38,708.80 a year.
Dr Chalmers said he would update the government's expectations for inflation, as well as growth and wages, in late July when the new parliament session opened.
"The shape of the challenge to inflation will get worse before it gets better but it will get better," he told reporters in Brisbane.
"We understand that pensioners are doing it incredibly tough when it comes to their costs of essentials like groceries, electricity and petrol and in other parts of the household budget.
"We don't want to see pensioners fall further and further behind. And that's why this indexation which tries to keep up with the skyrocketing cost of living is so important."
Meanwhile, construction activity in Australia has taken another dive, according to figures released by the Australian Bureau of Statistics on Wednesday.
Work on new dwellings fell 6.5 per cent to 49,017 in the March quarter, and work on private sector houses was down 11.6 per cent to 29,672. That follows a 6.2 per cent fall in the December quarter.
The value of total building work done fell 0.5 per cent to $30.4 billion in the March quarter, in seasonally adjusted terms.
Also on Wednesday, a Business Risk Index survey by credit reporting bureau CreditorWatch indicated that business confidence is faltering, with trade receivables down by 18 per cent and trade payment defaults up 18 per cent year-on-year.
"We continue to see a disturbing rise in trade payment defaults, our leading indicator for future business insolvencies," CreditorWatch chief executive Patrick Coghlan said.
"Court actions are also back to pre-COVID levels, reflecting that the banks are back to their regular collection activity after the 'loan holidays' that they provided during the peak of the pandemic."
Looking ahead, jobs figures for June will also be released on Thursday, with the unemployment rate widely tipped to fall to 3.8 per cent from 3.9 per cent.
This would be the lowest unemployment rate since 1974.
Australian Associated Press
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