New arrangements for people with disabilities and an enhanced Newstart
People with disabilities
People in receipt of the Disability Support Pension (DSP) prior to 1 July 2006 will remain on DSP with no part-time work obligation. They will be subject to the normal review process for DSP which will apply the existing eligibility criteria (which is broadly whether that person is capable of 30 hours work per week at award wages).
People seeking to go on DSP on or after 1 July 2006 will have new eligibility criteria. They will receive DSP if they are assessed as being incapable of 15 hours work a week at award wages. If they are assessed as being capable of 15-29 hours work per week they will receive enhanced Newstart and be subject to an obligation to seek part-time work of at least 15 hours per week.
People applying for DSP between 11 May 2005 and 30 June 2006 will be assessed for eligibility for DSP under the existing test — that is whether they are able to work 30 hours per week at award wages. However, their ongoing eligibility will be reassessed in normal periodic reviews against the new, 15-29 hour per week at award wages test after 1 July 2006. If they are assessed as being capable of 15 hours work per week at award wages they will have an obligation to undertake part-time work and will receive enhanced Newstart.
From 1 July 2006, Mobility Allowance will be increased to $100 per fortnight for people with disabilities who have a part-time obligation. DSP recipients who are working 15 hours per week may also be eligible.
An enhanced Newstart
From 1 July 2006, the Government will invest $943 million to enhance Newstart. The maximum withdrawal rate will be reduced from 70 cents to 60 cents in the dollar. Further, people will be able to earn up to $250 per fortnight before this rate commences, compared to $142 for Newstart now.
The new income test will also benefit recipients of some other allowances.
| Income support recipient | Obligation | Payment | |
|---|---|---|---|
| Parent, youngest child aged under 6 | Existing recipient (on 30 June 2006) | None | Parenting Payment (single or partnered) |
| New applicant (from 1 July 2006) |
None | Parenting Payment (single or partnered) | |
| Parent, youngest child aged 6 or over | Existing recipient (on 30 June 2006) | Part-time(b) | Parenting Payment (single or partnered) |
| New applicant (from 1 July 2006) | Part-time | Enhanced Newstart Allowance | |
| Person with disabilities, capable of working 15-29 hours per week | Existing recipient (on 10 May 2005) | None | Disability Support Pension |
| New applicant (11 May 2005 to 30 June 2006) | None(c) | Disability Support Pension(c) | |
| New applicant (from 1 July 2006) | Part-time | Enhanced Newstart Allowance | |
- When the youngest child turns 6, a part-time obligation is applied and enhanced Newstart Allowance is payable.
- Existing recipients of Parenting Payment have a 12 month grace period before new obligations commence. This means their obligations commence from the later of 1 July 2007 or their youngest child’s seventh birthday.
- These applicants will be reassessed after 1 July 2006. If the reassessment indicates they can work 15-29 hours per week they will be placed on enhanced Newstart and have a part-time work obligation.
12 2005-06 Budget Overview