Release type: Media Release


Budget 2013-14: Better support to help more Australians enter the workforce


The Hon Bill Shorten MP
Minister for Employment and Workplace Relations, Financial Services and Superannuation

The Gillard Government is providing Australians receiving income support with greater incentives to find work, increasing the amount they are able to earn and keep, and providing extra assistance to undertake study and training.

The 2013-14 Budget contains three measures—totalling around $300 million—to help job seekers in the transition to work.

“The Gillard Government will invest an estimated $258 million to enable around 800,000 Australians on income support to earn up to $38 more per fortnight before their payments are affected,” Minister for Employment and Workplace Relations, Bill Shorten, said.

Under this change, Australians on Parenting Payment Partnered, Newstart Allowance, and Widow, Sickness or Partner Allowance will be able to earn $100 per fortnight, up from $62, before their income support is reduced.

This raises what is known as the income free area for the first time in more than a decade. The income free area will, for the first time, be indexed by CPI from 1 July 2015, ensuring its real value remains over time.

“By allowing people to keep more of what they earn, this is a practical investment to give Australians on income support more incentive to stay in or re-enter the workforce,” Mr Shorten said.

About 150,000 Australians on income support who are currently earning more than $62 per fortnight are expected to benefit with an average increase of $19 per fortnight to their payments, or an average of $494 a year. The benefit is available to a further 650,000 people on income support per year if they take up work.

The package will also provide tens of thousands of single parents receiving income support with extra assistance for study and training to help them return to the workforce.

The Budget includes a $39.7 million investment over four years to extend the Pensioner Education Supplement (PES) to all single principal carer parents receiving Newstart Allowance.

From 1 January 2014, single principal carer parents receiving Newstart Allowance who take up approved study will be entitled to PES. The supplement is paid at a rate of $62.40 per fortnight or $31.20 per fortnight for a concessional study load.

“The Gillard Government is committed to ensuring single parents receiving Newstart are supported in training and education to help them get back into the workforce,” Mr Shorten said.

It’s expected that around 25,000 additional single parents will take up the PES over the next four years.

Currently, only those single principal carer parents who were in receipt of PES at the time they moved from Parenting Payment Single to Newstart Allowance on 1 January 2013 are entitled to receive PES until they finish their current studies. From 1 January 2014, all single principal carer parents receiving Newstart will have the opportunity to take advantage of this initiative.

This extra support comes on top of the more generous income test for single principal carer parents on Newstart Allowance which began on 1 January 2013.

Mr Shorten said thousands of single parents would also receive additional support through a $2.2 million investment to extend access to the Pensioner Concession Card.

From 1 January 2014, around 2,000 single parents a year who become ineligible for the Parenting Payment due to the age of their youngest child and who do not qualify for any other income support payment due to their earnings, will have access to benefits under the Pensioner Concession Card for 12 weeks.

Pensioner Concession Card holders and their dependants may receive benefits including bulk-billed GP appointments, reduced out-of-hospital medical expenses and medicines listed on the Pharmaceutical Benefits Scheme at the concessional rate.

Mr Shorten said increasing the income free area actions a majority recommendation from the Senate Inquiry into the adequacy of the allowance payment system.

“These changes build on the significant initiatives already delivered by this Government to support unemployed Australians, youth and single parents to transition into work,” Mr Shorten said.

This builds on the Gillard Government’s $1.1 billion Income Support Bonus of $210 for singles and $350 for couples a year being delivered to all job seekers for the first time this year – the first instalment was paid in March this year, with the next instalment on its way in September.

Tony Abbott and the Opposition voted against the Income Support Bonus in the Parliament and would rip it away in a heartbeat. The Gillard Government is protecting the family payments system while the Opposition wants to cut it to the bone.

This budget keeps our economy strong, makes the smart investments for our future and ensures every Australian gets a fair go.

We are investing for the future, putting jobs and economic growth first and protecting the important services that Australians rely on.

The Gillard Government is doing this to keep our economy one of the most resilient in the world – we have low unemployment, solid growth, contained inflation and low interest rates.