Newstart liquid asset test set to wring you out some more
THE latest Australian Government social security initiative is an exercise in picking on the poor and vulnerable to make inconsequential financial savings to the budget.
The Payment Integrity Bill outlines the Government’s plans to extend the time that people must wait to apply for Newstart.
If the Bill passes Parliament, it would mean single people with more than $18,000 in liquid assets (cash on hand) will have to wait six months to apply for Newstart, double the previous length of time.
The Department of Social Services revealed that 40,000 Australians on Newstart would be impacted by this change. The largest cohort of Australians on Newstart is the over-55 year old group representing one in four Newstart recipients.
If this bill is enforced, 10,000 Australians over the age of 55 will be affected. Even earning a moderate redundancy package would force many older Australians who may never work again to wait up to six months before accessing Newstart.
The change in the Newstart liquid asset test would force older Australians to run down their savings and potentially access superannuation earlier than anticipated. This places hard-working older Australians at a greater risk of living in poverty in retirement.
Older Australians in a position where they need to access Newstart need to make sure they keep their superannuation savings in the accumulation phase (as if you are still working) as much as possible. Savings in superannuation accumulation accounts cannot be assessed as part of the liquid asset test or any other Centrelink test until you reach Age Pension eligibility age.