The government has cut the deeming rate in response to falling interest rates, saying 630,000 age pensioners and 350,000 other people receiving payments will benefit. But a leading seniors group said the government has not done enough. The lower deeming rate, on assets up to A$51,800 for single people and $86,200 for couples, falls from 1.75 per cent to 1 per cent.The upper deeming rate, on assets above those amounts, falls from 3.25 per cent to 3 per cent.Deeming is a method the government uses to calculate income from financial assets. It assumes that money invested in financial assets earn a particular amount of income regardless of the actual return. The deeming rate is used for income testing of the age pension, service and veteran's pension and other Centrelink payments.It covers a wide range of assets, including bank accounts, gold, managed investments and loans.The Minister for Families and Social Services Anne Rushton says the change will take effect next month but will be backdated to July 1.She said age pensioners whose income is assessed using deeming will receive up to $40.50 a fortnight for couples - an extra $1053 a year.National Seniors Australia said the change was welcome but did not go far enough. It said the new rates remain well above the rate pensioners will earn on bank accounts.National Seniors chief advocate Ian Henschke said in a media release: "What the government is telling pensioners is that they are earning 3 per cent on their investments, when most term deposits are not even returning 2 per cent. How is that fair?"