JobSeeker Update

The federal government has announced several changes to the JobSeeker payment beginning from Friday 25 September. This includes a reduction in the coronavirus supplement from $550 to $250 as well as some changes to eligibility.

Income Free Threshold

The income-free threshold for both JobSeeker and Youth Allowance will increase to $300 per fortnight, with recipients losing 60 cents for every dollar earnt above this threshold.

Asset Limits Reinstated

Recipients will no longer be able to access JobSeeker if they have assets worth more than $482,000, or $268,000 for homeowners. The Liquid Assets Test will also be reinstated, meaning people with more than $5,499 in savings must wait a set period before receiving payments.

Partner Income

Recipients will face a 27 cent reduction in their payments for every dollar their partner earns above $1,165.

Mutual Obligations

From Monday 28 September recipients must search for up to 8 jobs each month, however this change will not apply to Victorians.

If you need any assistance with these changes to JobSeeker, contact one of our accountants on 03 5612 1400.

References:

https://www.servicesaustralia.gov.au/individuals/news/job-seekers

https://www.servicesaustralia.gov.au/individuals/news/upcoming-changes-income-and-means-tests

Material contained in this publication is a summary only and is based on information believed to be reliable and received from sources within the market. It is not the intention of RGM Financial Planners Pty Ltd ABN 36 419 582 Australian Financial Services Licence Number 229471, RGM Accountants & Advisors Pty Ltd ABN 69 528 723 510 or RGM Finance Brokers Pty Ltd ABN 81 330 778 236 (RGM) that this publication be used as the primary source of readers’ information but as an adjunct to their own resources and training. No representation is given, warranty made or responsibility taken as to the accuracy, timeliness or completeness of any information or recommendation contained in this publication and RGM and its related bodies corporate will not be liable to the reader in contract or tort (including for negligence) or otherwise for any loss or damage arising as a result of the reader relying on any such information or recommendation (except in so far as any statutory liability cannot be excluded).

Liability limited by a scheme approved under Professional Standards Legislation.

Extension of the JobSeeker Program

The Government is extending the JobSeeker Coronavirus Supplement to eligible recipients to 31 December 2020. The amount of the supplement will be adjusted to reflect the gradually improved economic conditions and improving labour market.

Both existing and new recipients eligible for the Coronavirus Supplement will continue to receive $550 per fortnight up to and including 24 September 2020. From 25 September, the $550 per fortnight Coronavirus Supplement, which effectively doubled the fortnightly income support payment, will be reduced to $250 per fortnight. 

New eligibility testing

From 25 September 2020, new eligibility testing and access to payments for new and existing JobSeeker and other income support recipients will also be introduced. These include; 

  • Income free threshold increase: from 25 September 2020 until 31 December 2020, the income free threshold for the JobSeeker Payment recipients will increase from $106 per fortnight to $300 per fortnight. The threshold for other income support payment recipients will increase to $300 from $143 per fortnight. 

    This means recipients can earn up to $300 per fortnight and continue to receive the maximum payment rate for the JobSeeker Payment and other income supper payments. If recipients earn over that threshold, they will still see their JobSeeker allowance tapered down.
  • Means testing: the government will also re-introduce an asset test for eligibility for all payments and the Liquid Assets Waiting Period (LAWP) for all payments will be reinstated.
  • Partner income testing: the partner income test cut-out will increase to $3,086.11 per fortnight, or $80,238.89 per annum for individuals with no personal income from 25 September 2020. The partner income test taper rate will increase to 27 cents on 25 September 2020 until 31 December 2020.
  • Reinstated job-seeking requirement: from 9 June 2020, the mutual obligation requirements were reintroduced including; 
    • voluntary job searches;
    • at least one phone or online appointment with a JobSeeker’s employment services provider;
    • voluntary participation in activities, either online or in person; and
    • no payment suspensions or penalties for failure to comply.

Please don’t hesitate to give us a call and speak to an Adviser on 03 5120 1400 if you have any questions about how the changes to the JobSeeker Payment will impact your financial situation. 

Information in this article has been sourced from the Treasury website: https://treasury.gov.au/sites/default/files/2020-07/Fact_sheet-Income_Support_for_Individuals.pdf

Material contained in this publication is a summary only and is based on information believed to be reliable and received from sources within the market. It is not the intention of RGM Financial Planners Pty Ltd ABN 36 419 582 Australian Financial Services Licence Number 229471, RGM Accountants & Advisors Pty Ltd ABN 69 528 723 510 or RGM Finance Brokers Pty Ltd ABN 81 330 778 236 (RGM) that this publication be used as the primary source of readers’ information but as an adjunct to their own resources and training. No representation is given, warranty made or responsibility taken as to the accuracy, timeliness or completeness of any information or recommendation contained in this publication and RGM and its related bodies corporate will not be liable to the reader in contract or tort (including for negligence) or otherwise for any loss or damage arising as a result of the reader relying on any such information or recommendation (except in so far as any statutory liability cannot be excluded).

Liability limited by a scheme approved under Professional Standards Legislation.

COVID-19 – An RGM Perspective

To our valued clients,

Well, to say the last two months has been crazy is an understatement! Whether it be from a financial, social or health point of view, I’m not sure any of us have ever experienced anything like the Coronavirus. With a bit of luck the peak of this wretched pandemic is behind us and we can all look forward to slowly moving back towards some form of reality.

From an RGM perspective, it has undoubtedly been a stressful time. We pride ourselves on helping our clients navigate any issues they may have, but the last two months has challenged our own internal expectations on the level of service we provide to you all. Whether it be the 200+ businesses that we’ve helped with their JobKeeper applications or simply providing critical advice for those clients doing it tough financially, the entire RGM team have stuck together and as business owners we feel privileged to have such a dedicated team around us.

Interestingly enough, the number of business clients that have suffered financial strain has been lower than expected due to various factors, whether that be sound strategic planning or the JobKeeper program itself. Clients of our financial planning division have derived benefit out of our investment diversification model to ensure losses to their portfolio’s were minimized. However, there are still a number of our clients that have been stood down from their jobs and we hope that the JobKeeper or JobSeeker program have provided them some much-needed support.

Rest assured, there may well be further pain to come, however we are confident that those suffering financial turmoil will be back to their best in no time.

Lastly, thank you to all of you that have adhered to our altered trading conditions. At this stage we still have our offices closed to the public except for those that urgently require a face-to-face meeting or do not have access to the likes of Zoom and Microsoft Teams. We will be back to normal soon enough in accordance with advice sought from the Victorian State Government.

If for nothing else the last two months have taught us to expect the unexpected and remember, through crisis comes opportunity. The opportunity to change the way we live, invest, conduct our own business and treat those around us. Take this opportunity to reassess your financial future and remember, don’t be scared to ask us for help.

Yours in business,

Joe Auciello

Partner

On behalf of the Partners at RGM