Rewarding and supporting parents to re‑engage in work
Kate is a single mother with a 12 year old daughter Chrissy, and an 8 year old son Maxwell. She is unemployed and receives Newstart Allowance.
Following the establishment of the National Partnership providing training places for single parents, Kate accesses a training place and secures a Certificate III in Aged Care.
She finds a part‑time job as an aged care nurse earning $300 per week, and due to the more generous taper arrangements introduced for principal carers on Newstart Allowance, she is able to keep an extra $2,300 in disposable income each year.
New opportunities and responsibilities for single parents
In order to encourage parents to get into work, the Government will provide $179 million to reward part‑time work by reforming the income test for single parents on Newstart Allowance. Changing the taper rate from the current 50 or 60 cents in the dollar to 40 cents in the dollar from 1 January 2013 will let them keep up to an extra $3,900 of their income from part‑time work each year.
From 1 January 2013, the Government will also gradually phase out grandfathering arrangements for Parenting Payment recipients with a youngest child aged 12 to 15, to make eligibility more consistent with the treatment of other parents. Current recipients whose youngest child was born before 1 January 2000 will be exempt from this change.
Single parents will also be supported through a package of assistance totalling $103 million over four years, including:
- $80 million for additional training places for single and teenage parents delivered through a National Partnership agreement with the states and territories
- $19 million for additional community‑based support for parents through the Communities for Children program
- $4 million for access to career counselling.
Impact on disposable income for single parent on Newstart Allowance
Source: Treasury.
Note: Single parent is assumed to have two children aged 8 and 12 years old.