On January 1 this year, changes to the single parenting payments came into effect for people who began receiving those payments before July 1, 2006.
Previously, there were two types of parenting benefits available. Known as Parenting Payment (Partnered) and Parenting Payment (Single), both were subject to income and asset tests. The difference was that Partnered payments were available until the youngest child turned six. Single payments were made until the youngest child turned eight.
However, the system also allowed for single parents to continue receiving the payment until the youngest child turned sixteen if they met specific criteria.
What are the changes?
On January 1, this last clause was changed. That is, all parenting payments were treated equally. Single parents who previously met the criteria to continue receiving payments after their child turned eight will no longer receive the parenting payment.
These parents ceased to receive the Single Parenting Payment from January 1. If eligible, some were moved to other payments offered by the government, including the NewStart Allowance.
The change in the parenting payment system is estimated to have affected up to 80,000 people.
What does this mean?
The NewStart allowance was designed to provide financial support for people looking for paid work.
Thus, the inference made by moving single parents from a parenting payment to the NewStart Allowance, is that single parents need to work to support their children.
There were some glitches in the changeover that incorrectly informed many people who had been moved to the NewStart Allowance that they were no longer eligible for concession cards. Centrelink has since corrected this and concessions cards are still in place for those receiving these payments.
However, these changes are rarely as simple as they first appear.
|
Facts |
Single Parenting Payment |
NewStart Allowance |
|
Maximum per fortnight |
$633.70 |
$533.00 |
|
Income test |
Income over $176.60 per fortnight (plus $24.60 for each additional child) reduces your payment by 40 cents in the dollar |
Income over $62 per fortnight reduces your payment by 40 cents in the dollar |
|
Maximum income so still can to receive part payment |
$1,835.85 per fortnight (plus $24.60 for each additional child) |
$1,394.50 |
|
Pensioner Concession Card* |
Yes |
Yes |
|
Health Care Card** |
No |
No |
|
Pharmaceutical Allowance |
Yes |
Yes |
|
Rent Assistance |
Yes |
Yes |
|
Mobility Allowance |
Yes |
Yes |
|
Telephone Allowance |
Yes |
Yes |
|
More information > |
Parenting Payment > |
Newstart Allowance > |
The difference
The change to the Single Parenting Payment means that some single-parent households are now receiving up to $223 less a fortnight. On top of that, if the parent is working and earns more than $1400 a fortnight, the NewStart Allowance will cease.
So, it’s a fine line between earning an income and earning too much income that results in less money coming into the household.
The change also assumes that many single parents were not already working in paid employment. Many already were working but under the new system, they find they can earn less before their government payments are reduced.
Meanwhile, the government declares the changes to parenting payments will produce $728 million in budget savings over the next four years.
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*If you are eligible for Newstart Allowance after your Parenting Payment is cancelled, you will receive a new Pensioner Concession card.
**If your Parenting Payment is cancelled, but you still receive the Family Tax Benefit, you will still be eligible for the Health Care Card.