The government cuts you might not know about

Budget tightening sees many benefit payments scrapped

There’s been a lot of chat around the government’s latest budget, and speculation about which proposed welfare cuts will happen. Keeping track of it all can be tricky.

So first, here’s a bit of good news for single parents. While partnered families will lose Family Tax Benefit Part B once their youngest child turns 13, this cut won’t apply to single parent families.

Now the bad news – here’s 9 proposed cuts to benefit payments.

  1. FTB end of year supplements to go?
  • The government wants to phase out the end-of-year supplements paid to Family Tax Benefit recipients by 2018.
  • Currently, families receiving the full rate of FTB Part A get an end-of-year supplement of $726.35 per child, and FTB Part B recipients get a supplement of up to $354.05 per family.
  • They instead want to increase the maximum FTB rate by $10 a fortnight.
  1. A freeze on income thresholds will freeze many out of FTB
  • The government will freeze the income limits used in assessing eligibility for Family Tax Benefit.
  • This means that as your income rises a little in line with inflation, your benefit payments might be cut off.
  • The income limit freeze will likely cause over 115,000 families to see their FTB payments reduced or gone altogether.
  1. Single mums in Centrelink’s sights
  • Centrelink are on the look-out for single parents who fail to tell Centrelink if they have a partner.
  • In an attempt to crack down on over payments and welfare fraud, Centrelink are targeting single parents to uncover any failure to report a change in circumstances.
  1. Energy supplement runs out of steam
  • New Newstart applicants will no longer receive the $4.40 a fortnight energy supplement.
  • This cut will also hit single parents who move from Parenting Payment to Newstart.
  1. Dental dollars scrapped
  • The Medicare Child Dental Benefits Schedule winds up on 31 December 2016.
  • The $1000 worth of free dental care offered to kids in families on Family Tax Benefit won’t be renewed, so be sure to have your kids’ annual dentist appointment before the end of the year!
  • You can read more about this cut in our post here.
  1. Youth Allowance payments hit
  • If you have a child on Youth Allowance or Austudy, their payments will be affected if you get a job.
  • If you move from a benefit payment or pension into employment, or start earning more, your child’s payments will be reassessed.
  1. Students will have to repay HECS/HELP sooner
  • If you’re a student with a HECS or HELP debt, the government are proposing you start repaying it from a lower rate of earnings.
  • The proposed change is for a minimum repayment of 2% per annum once you earn $51,957 or more. That’s about $20,000 less than average male full time earnings, so is sure to stretch the average graduate!
  • The government will also scrap the up-front discount currently offered on fee payments.
  1. Students hit again
  • The Student Start-Up scholarship has been axed. This handy little bonus of $1,025 used to be paid to Austudy and Youth Allowance recipients as the start of each semester.
  • Instead, these students will be eligible to apply for a Student Start-Up loan, that they’ll have to later repay.
  1. Centrelink now count your Parental Leave payments as income
  • As of last month, Centrelink will now include your Parental Leave pay or Dad and Partner Leave pay as income when they’re assessing your eligibility for Family Tax Benefits and other payments.
  • You can read more about this cut in our post here.

And as always, City Finance are happy to assist customers receiving Centrelink payments.

  • Cash Converters and other lenders have announced they will stop lending to people who are on low incomes and receive Centrelink payments, and only offer higher loan amounts to employed people on higher incomes.
  • But at City Finance, we support customers receiving Centrelink payments and low income earners.
  • Contact us or pop into your local branch today for more information on how we can tailor a fast flexible personal loan to your needs.