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By Mark Gleeson, Senior Technical Services Manager
From 20 March 2020, JobSeeker Payment replaces Newstart Allowance as the main working age payment. As part of the Government’s welfare reform package, many payments cease from 20 March 2020.
You should advise affected clients of the changes in order to manage their expectations and to consider possible strategies to maximise their payment. Legislation to implement the changes was passed in 2017.
The following payments will cease on 20 March 2020:
JobSeeker is effectively the new name for the Newstart Allowance from 20 March 2020 and it becomes the main working age Centrelink payment. Clients receiving Newstart Allowance do not need to do anything and will automatically transfer to the JobSeeker Payment. Clients continue to receive the same rate of payment and continue to hold the health care card, providing their circumstances do not change.
From 20 March, eligible clients can receive JobSeeker Payment if they satisfy at least one of the following requirements:
The following table illustrates the outcomes for clients receiving various payments from 20 March 2020.
Clients currently receiving
Newstart Allowance ends on 20 March 2020 and the client transfers to the JobSeeker Payment. There are no changes if the client continues to satisfy the requirements.
The client continues to receive Sickness Allowance until the medical certificate expires. After expiry, the client may be able to transfer to the JobSeeker payment. No new claims of Sickness Allowance accepted from 20 March 2020.
Widow Allowance was closed to new recipients on 1 July 2018. The payment ceases on 1 January 2022 when the last of the existing recipients transfer to the Age Pension.
Partner Allowance ceases on 1 January 2022 when the last of the existing recipients transfer to the Age Pension.
Widow B Pension
Widow B Pension recipients will automatically be transferred to the Age Pension from 20 March 2020. Please note, no new Widow B Pensions have been granted since 20 March 1997.
Wife Pension ends on 20 March 2020 and the client will then have three options:
Bereavement Allowance recipients at 19 March 2020 continue to receive payment until the end of their bereavement period which is generally 14 weeks. There are no new claims of Bereavement Allowance from 20 March 2020.
You may wish to use the table above to guide your client through their possible options from 20 March 2020. Clients who are affected should receive communications from the Department of Human Services about the upcoming changes. In most cases, clients will be transferred automatically to the new JobSeeker Payment.
If your client is expected to continue receiving Centrelink benefits, you may wish to explore the possibility of certain strategies to maximise the amount of the payment, for example:
If you have any questions, or would like more information, please contact the IOOF TechConnect team on 1300 650 414.
DisclaimerThe information in this section of the website is intended for financial advisers only and is not to be distributed to clients. It has been prepared on behalf of Australian Executor Trustees Limited ABN 84 007 869 794 AFSL 240023, IOOF Investment Management Limited ABN 53 006 695 021 AFSL 230524, IOOF Investment Services Ltd ABN 80 007 350 405, AFSL 230703 and IOOF Ltd ABN 21 087 649 625 AFSL 230522 based on information that is believed to be accurate and reliable at the time of publication.