Changes to student payments29 June 2015
Changes to student payments
As announced in the 2015-16 Budget, the following changes will be made to student payments, subject to the passage of legislation:
- Closer alignment of parental means testing arrangements for Youth Allowance and ABSTUDY Living Allowance with Family Tax Benefit (FTB) Part A, from 1 January 2016. This will remove the family actual means test and family assets test from the means testing arrangements.
- From 1 January 2016, the treatment of maintenance income will be aligned with the arrangements applying to FTB Part A, by removing child support amounts from the Youth Allowance and ABSTUDY Living Allowance parental income test assessment.
- All dependent children will be included in the family pool calculations for the Youth Allowance and ABSTUDY Living Allowance parental income test, from 1 July 2016 (currently only those aged 16-21 years are included).
- From 1 January 2017, the treatment of child support will be further reformed by applying a separate maintenance income test as currently applying to FTB Part A.
As part of the 2014-15 Budget, the Australian Government announced a number of changes to student payments. However, these have not been implemented due to delays in passing legislation:
- Pausing indexation of the personal income free area and the student income bank for student payments for three years from 1 January 2015. This measure has been reintroduced into Parliament to start from 1 January 2016, subject to the passage of legislation.
- Pausing indexation of the parental income and family actual means free area for Youth Allowance and ABSTUDY Living Allowance for three years, from 1 January 2016 (flow on effect from measure to pause FTB Part A lower income free area from 1 July 2015).
- Removing the grandfathering of payments for the Student Start-up Scholarship when the Student Start-up Loan commences.
Please note: If the 2015-16 Budget measures of closer alignment of parental means testing with FTB Part A is implemented, the family actual means test will be abolished from 1 January 2016.
The 2013-14 Budget measure to convert the Student Start-up Scholarship into an income contingent loan, to be called the Student Start-up Loan, is still before the Senate and has not yet been implemented.
For further information, please see the frequently asked questions