The 2017–18 Mid-Year Economic and Fiscal Outlook (MYEFO) includes three measures limiting access to welfare for new migrants to Australia:
- introducing a three-year waiting period before new residents can access Family Tax Benefit, Paid Parental Leave and Carer Allowance
- extending the existing Newly Arrived Residents Waiting Period that applies to some working-age payments such as Newstart and Youth Allowance from two years to three and
- extending the Assurance of Support requirement for family visas (where a person agrees to be financially responsible for a new migrant) from two-years to three.
The measures are intended to commence 1 July 2018 and will save an estimated $1.3 billion over the period to 2020–21. Minister for Social Services, Christian Porter, stated in a media release that in 2020–21, around 50,000 families would be serving the new waiting period for family payments, and around 30,000 people would be serving the extended waiting period for other payments.
Extending the Newly Arrived Residents Waiting Period
The Newly Arrived Residents Waiting Period applies to a range of mostly working-age income support payments including Newstart Allowance, Youth Allowance, Austudy, Carer Payment, Sickness Allowance and Special Benefit. A two-year residency requirement applies to Parenting Payment rather than a waiting period. Residency requirements are part of the qualification requirements for payments, while waiting periods are periods where a payment cannot be paid despite a claimant being otherwise qualified. For Parenting Payment, the effect of the residency period is essentially the same as a waiting period.
During the 104 week period, a newly arrived resident is not eligible to receive the specified payments. A 26 week waiting period was introduced from January 1993 for some payments and then extended in 1997 to 104 weeks and to a wider range of payments. The waiting period applies from the date the person arrives in Australia or the date they are granted permanent residence, whichever is later.
Some new residents are exempt from the waiting period including refugees or humanitarian entrants and their families, and single parents who only became single parents after their current period of residence in Australia commenced.
The proposed measure will further extend the waiting period to three years.
Residency requirements rather than waiting periods apply to pension payments. The current qualification requirement for Age Pension and Disability Support Pension (DSP) is for at least ten continuous years of Australian residency, or for multiple periods exceeding ten years with at least one period of five years duration or more. There is an exemption from this requirement for refugees or former refugees who reside in Australia and, for DSP, for those who are Australian residents at the time their disability arises. The Government currently has a Bill before the Parliament to change the residency requirements for these pensions.
New waiting period for access to family payments and Carer Allowance
Currently, no waiting period applies for new permanent migrants to access Family Tax Benefit, Carer Allowance, Paid Parental Leave or child care payments. Residency requirements do apply meaning that claimants must be Australian citizens, permanent Australian residents or New Zealand citizens residing in Australia with the right to live in Australia permanently. Some exemptions apply for those holding certain humanitarian visas and in exceptional circumstances but generally, temporary visa holders are not eligible for these payments.
The proposed three-year waiting period will apply to Family Tax Benefit, Paid Parental Leave and Carer Allowance but not to child care payments. The affected payments are intended to assist with the costs of raising children and with the costs of caring for someone with a disability or illness. An income-test applies to Family Tax Benefit and Paid Parental Leave but the income test limits are set at a level where many people in work are able to receive some support. Introducing a three-year waiting period for access to these payments will mean that many skilled permanent migrants working in Australia will be unable to access the same financial support for their children or for their care-work as their colleagues.
Minister Porter stated that the measures ‘will reinforce the foundational principle that Australians’ expectation of newly arrived migrants is that they contribute socially and economically for a reasonable period before having access to our nation’s generous welfare system’. He also stated that exemptions will continue to apply for humanitarian or vulnerable families such as those affected by domestic violence.
The Federation of Ethnic Communities’ Councils of Australia has raised concerns that the measure will ‘create an underclass of migrants’ and Carers Australia has stated that delaying access to Carer Allowance could have real health consequences for care-receivers.