Youth Allowance Changes from the Australian Federal Government
Posted March 23rd, 2010 and last modified June 3rd, 2011
Changes in the Youth Allowance system now provide a wider scope to benefit more students. This is a governmental effort to increase the Australian labor force.
In order to level the Youth Allowance system for all and make it more fair for more students, the Australian Government is making Youth Allowance changes.
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When will the new Youth Allowance changes come into effect?
The new legislation for Austudy, ABSTUDY and Youth Allowance passed Parliament on 18 March this year and will start to come into effect on 1 April 2010.
Who will benefit the most from these changes?
Students from rural, regional and socio economic backgrounds will best benefit from the new rules and regulations. Those students who moved away from their home can also take advantage.
One of the reasons these changes will come into effect is to support the Government’s strong target to see a large portion of 25 to 34-year old students (40 per cent) holding a bachelor degree by 2025.
The idea is to enable more students with higher education degrees which will benefit the Australian job market.
Youth Allowance changes will enable more students for eligibility
One of the changes supports a higher yield for the Parental Income Test threshold which is currently $33,300. Starting July 1st this year, the threshold will be raised to $44,165 which will enable more students to claim ABSTUDY and Youth Allowance support.
For families with two children aged 18 and 20 at home the parental cut-out for income requirements will be raised to $108,000 from $63,000. If the children live away from home (same age as before) the cut-out will increase from the current $80,000 to $142,000.
How much support can I claim?
If you want to find out how you will be affected with this new legislation you can visit the Student Assistance Estimator. With this tool you can enter the income level of your parents and receive an estimate for the level of support you might be able to claim.
New phased-in changes lower the age of independence
The current age for independence is 25 years. When the new changes come into effect the age will be lowered to 22 years, allowing more students to become eligible for Youth Allowance. Please be aware that these changes will take place in phases as outlined below:
- From 1 April 2010 the age of independence will reduce to 24 years
- From 1 January 2011 the age of independence will reduce to 23 years
- From 1 January 2012 the age of independence will reduce to 22 years
Raised Personal Income Test threshold
With the new Youth Allowance changes the Personal Income Test threshold will rise to $400 from the current $236 fortnightly. This will enable students to support themselves financially without penalties and see them being able to earn $400 a fortnight without having their payments reduced.
- From 1 July 2012, support receiving students will be able to retain more of their student income support payments.
- From 1 January 2012, students enrolled in all masters by coursework programs will be eligible to apply for Youth Allowance.
- All university students receiving student income support will benefit from a new Student Start-up Scholarship for each year of their course. Valued at $1300 in 2010, this will increase to over $2128 in 2011.
The benefits of a Relocation Scholarship
A new Relocation Scholarship will assist students who are forced to relocate for their studies. If you are eligible for this grant then you can receive $4,000 in your first year of studies and $1,000 each for each subsequent year you study to help you with the cost of relocation.
New criteria for workforce participation independence
To enable financial assistance to the right students, the new criteria stipulate that as a young person claiming workforce participation independence you will need to work full-time for 30 hours on average each week for the term of two years.
No one currently able to claim this benefit will be disadvantaged from the changes which come into effect on 1 July 2010.
Transitional arrangements for Year 12 students of 2008
If you completed Year 12 in 2008 and took time off during 2009 as a ‘gap year,’ you will be given the ability to meet these new workforce participation criteria by 31 December 2010. To do so, you will have to commence university during 2010 and live away from home with a parental income less than $150,000.
Starting 1 January 2011, some elements of the new workforce participation criteria for independence will apply to young students from rural areas if they are forced to relocate to study because of the geographic location of their family home.
If you find yourself in this particular position, then you will be able to qualify for financial assistance by meeting some of the new workforce participation criterion for independence standards. To find out you eligibility, contact Centrelink on 13 24 90 or visit Centrelink.
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