AUSTRALIAN News - future changes to the Disability Support Pension For Australian members of the Forum (who may not have seen this item in the news). Friday, April 30, 2010 05:40am The federal government has been challenged to go further in its bid to get people off the disability support pension (DSP) and into the workforce. In response to the growing number of DSP recipients, currently around 780,000, the government plans to tighten the medical test that determines a person's ability to work. The government expects the new test, which will come into effect from 2012, will result in 6500 fewer recipients. It will fast-track the claims of people who are clearly eligible for the pension, meaning that those who are not will be streamed out of the system earlier. The loophole for recipients who live permanently overseas, but return to Australia every 13 weeks to retain their pension, will also be closed. The changes are designed to cut the growing number of DSP recipients, which has tripled since the 1980s and currently costs taxpayers about $8.5 billion a year. New research from conservative think-tank The Centre for Independent Studies suggests the measures will only have a limited effect and alternative strategies are needed. Policy analyst Jessica Brown says the best option is to apply the 15-hour work rule, introduced under the former Howard government's Welfare to Work scheme, to all DSP recipients. From 2006, all new DSP recipients had to prove they could not work for 15 hours a week to be eligible for the pension, down from 30 hours a week. The changes slowed the rate of new DSP recipients, but did not encourage existing recipients back into work because the changes did not apply to them. In the paper, Defeating Dependency: Moving Disability Support Pensioners into Jobs, Ms Brown says the 15-hour rule should apply retrospectively. Waiting for the natural rate of attrition to bring down the number of DSP pensioners will take decades, she says. 'While moves to tighten entry requirements to DSP are a step in the right direction, alone they are not enough,' Ms Brown writes in her paper. 'If new applicants are subject to the stricter work tests, it seems only fair and equitable that existing recipients are subject to the same rules. 'And making those changes retrospective could help reduce the number of people on DSP without unfairly targeting those who cannot rejoin the workforce.' Ms Brown says it's a politically sensitive area but she challenged the government to act, suggesting the upcoming Henry tax review was a good opportunity. 'There is broad bi-partisan agreement that with the ageing population having more people relying on welfare is just not sustainable,' she told AAP. 'The government is going to have to overcome the political considerations and make these measures retrospective.' Treasury secretary Ken Henry has signalled that addressing high rates of welfare dependency will be a focus of his report, which the government will unveil on Sunday.