More than 26,000 retired Australian Defence personnel will receive a boost to their military pension next year.

The Federal Government has announced changes to Defence superannuation that alter the way payments to members of two schemes are indexed.

From July 2014, payments to members of the Defence Forces Retirement Benefits (DFRB) scheme and the Defence Force Retirement and Death Benefits (DFRDB) scheme will be indexed the same way as aged and service pensions.

But it will only apply to members aged 65 and over.

There are more than 56,500 members in the two superannuation schemes, with about 26,700 currently aged 65 and over.

Minister for Defence Materiel Mike Kelly says the change will cost $34 million over four years.

"It will be welcome as a means by which these pensioners can keep pace with the actual cost of living in that period of life when they're looking for actual income support," he said.

The Coalition has promised similar indexation changes, but they would apply to members aged 55 and over.

Opposition veterans affairs spokesman Michael Ronaldson says the Coalition's plan is available for younger veterans and has more generous indexation.

"Today's announcement is a pale imitation of the Coalition policy. It's only for those over 65," he said.

"If this is a desperate attempt to keep Mike Kelly in Eden-Monaro then it has been an abject failure it will be judged as it should be, very harshly, by an ex-service community that is looking for fair indexation."

The Defence Force Welfare Association (DFWA) has long argued the current indexation rules are unfair.

DFWA national president David Jamison says the Government's changes are a good first step.

"We're pleased. It's taken us a long time to get commitments from the Government and we're pleased that they've finally taken the first step.

"We're hoping that in the future they will increase the coverage to include all people in all military superannuation schemes."

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