The Hon Jim Chalmers MP
The Hon Amanda Rishworth MP
Minister for Social Services
The Hon Matt Keogh MP
Minister for Veterans’ Affairs and Defence Personnel
The Albanese Government is improving incentives to get more Australians into work.
As part of the release of the Employment White Paper, the Government will make two key changes for pension and income support recipients. These include:
Starting on 1 January 2024 – pending the passage of legislation – all new pension entrants over Age Pension age and eligible Veterans will have a starting Work Bonus income bank balance of $4000 rather than $0, and existing and new recipients will retain the current elevated maximum Work Bonus balance limit of $11,800 rather than $7800.
This measure will motivate older Australians to take up, or increase, their participation in paid employment, by making permanent these enhancements to the pension Work Bonus.
These changes mean eligible recipients can earn more from work before their pension is affected, broadening their choices and increasing flexibility.
The increase to the Work Bonus income bank was temporarily introduced after last year’s Jobs and Skills Summit. The cost of making it permanent is $42.4 million through to 2026-27.
Along with permanently enhancing the pension Work Bonus, Labor will also double the employment income nil rate period to close to six months (12 fortnights) and expand access to those who enter full time employment from 1 July 2024 – pending the passage of legislation.
This will apply to recipients of JobSeeker, Youth Allowance, Austudy, ABSTUDY, Parenting Payment, Age Pension, Disability Support Pension and Carer Payment.
It is designed to address concerns that losing access to concession cards, child-care subsidies and other supplementary payments, or having to reapply and wait for income support if things don’t work out, acts as a discouragement to taking-up work, particularly short-term, casual and gig economy work.
This measure is expected to benefit around 138,000 recipients each year, particularly those on the JobSeeker Payment and Youth Allowance (other).
It will cost the Government $42.8 million through to 2026-27.
Treasurer Jim Chalmers said the changes were an investment to help build a bigger, better workforce.
“This is about putting the right incentives in place to get more Australians into work,” Dr Chalmers said.
“We want to make sure the stepping stones are in place to enable more Australians to take up a job or work more hours.”
Minister for Social Services Amanda Rishworth said the changes would help to remove barriers often faced by those looking to re-enter the workforce, particularly those looking to take up short-term, casual and gig economy work.
“Making permanent the temporary Work Bonus measure will ensure pensioners know they are supported and rewarded if they choose to work,” Minister Rishworth said.
“Around 195,000 people commence on the Age Pension each year and will benefit from the $4000 Work Bonus starting balance. If these pensioners choose to take up work or work more their earnings will have less of an impact on their pension.
“Extending the length and expanding eligibility for the employment income nil-rate period will help smooth the transition from income support to employment and we hope will result in more people getting back into work and staying in jobs for longer, without the fear that the safety net won’t be there if they need it again.
Minister for Veterans’ Affairs Matt Keogh said the opportunity to work more will support the wellbeing of veterans and their families.
“The ability to undertake meaningful work has been shown to benefit the health and wellbeing of veterans following their military service,” Minister Keogh said.
“Veterans bring to the civilian workforce so many great skills they’ve gained in the ADF, this will ensure our community continues to benefit from their wealth of experience.”
For more information on the Government’s changes, visit the Department of Social Services website.
As at 25 September 2023.