Expanding eligibility for Parenting Payment Single and ending ParentsNext

Budget Resources

Michael Klapdor and Dr Matthew Thomas

Budget 2022–23 contains two significant measures affecting parents on income support: expanded eligibility for Parenting Payment Single and the end to the ParentsNext employment program.

Parenting Payment changes

The Government will expand eligibility for Parenting Payment Single by allowing single parents to remain eligible until their youngest child turns 14; up from the current cut-off age of 8. The Government estimates that the change will cost $1.9 billion over the 4 years to 2026–27 and will benefit at least 57,000 single principal carers. Principal carers are those caring for a dependent child under the age of 16.

Mutual obligation requirements will continue to apply to Parenting Payment Single recipients with a youngest child aged 6 or older.

The change will require legislation and is intended to commence on 20 September 2023.

Parenting Payment Single and JobSeeker Payment compared

Parenting Payment is the main income support payment for the principal carer of young children. To be eligible, a person must be the principal carer of a qualifying child aged under 6 if partnered or under 8 if single. Single parents may have to meet mutual obligation requirements such as job search when their youngest child turns 6. Some parents of children under the age of 6 were also required to participate in activities under the ParentsNext program (see below). An income test and assets test applies.

Principal carers of children who have reached the Parenting Payment cut-off ages may be eligible for other income support payments such as JobSeeker Payment, which has a lower payment rate. Table 1 sets out key differences between the two payments.

Table 1         Comparison of Parenting Payment Single and JobSeeker Payment, May 2023

Parenting Payment Single JobSeeker Payment1
Payment rate including any automatic supplements $967.90 per fortnight $761.30 per fortnight
Income test Income free area of $202.60 per fortnight plus $24.60 for each additional child. Each dollar over the free area reduces payment rate by 40 cents. Income free area of $150 per fortnight. Each dollar of income over the free area reduces payment rate by 40 cents.
Income limit —where payment rate reaches $0 under the income test For a parent with one dependent child: $2,622.35 per fortnight. $2,053.25 per fortnight

(1) For a single principal carer of a dependent child. Note that single principal carers granted an exemption from mutual obligation requirements for foster caring, being non-parent relatives under a court order, home-schooling, providing distance education or having a large family are paid the same rate as Parenting Payment Single.

Source: Services Australia (SA), A guide to Australian Government payments: 20 March 2023–30 June 2023, (Canberra: SA, 2023).

As at December 2022, there were 230,830 recipients of Parenting Payment Single and 85,580 single principal carers receiving JobSeeker Payment or Youth Allowance (Other). Around 95.5% of Parenting Payment Single recipients were female or identified as non-binary.

2006 and 2013 eligibility changes

The budget measure partially reverses a change made by the Howard Government in 2006 which reduced the cut-off age from 16 to 8. Those receiving Parenting Payment Single in July 2006 were protected from the change through grandfather provisions. The Gillard Government removed these grandfather provisions in January 2013.

The Howard Government changes were part of the 2005–06 Budget’s ‘Welfare to Work’ package (p. 132). The changes to Parenting Payment saw the introduction of mutual obligation requirements once a recipient’s youngest child turned 6 as well as the reduction in the cut-off age (p. 137). In 2005, then Minister for Employment and Workplace Relations Kevin Andrews stated that the Howard Government was concerned children were growing up in jobless households and, ‘Parents out of the work force for long periods of time are in danger of losing the skills and self-confidence necessary for them to return to work’.

Labor opposed the changes with then Deputy Leader of the Opposition Jenny Macklin stating:

We support welfare reform that goes far beyond moving people from one welfare queue to another—the dole.

Real welfare reform understands that being a parent is an important job in itself and that work makes families more secure. Real welfare reform helps parents find the balance between supporting their family and raising their kids.

The government evaluation of the 2006 changes found that single parents with children aged 8–15 who claimed Newstart Allowance (the previous name for JobSeeker Payment) following the eligibility change were more likely to leave income support compared to Parenting Payment Single recipients prior to the change. However, much of this was due to Newstart Allowance’s tighter income test and the fact that some single parents claimed other payments such as Disability Support Pension or Carer Payment (pp. 21, 34–36).

In May 2012, there were 122,630 Parenting Payment Single recipients who had been grandfathered from the 2006 changes (out of 320,828 Parenting Payment Single recipients) (pp. 83–84). In the 2012–13 Budget, the Gillard Government announced an end to the grandfathering arrangements from 1 January 2013 so that all Parenting Payment Single recipients and new claimants would be subject to the age 8 cut-off (pp. 116–17). Introducing the Bill to end the grandfathering arrangements, then Minister for Employment and Workplace Relations Bill Shorten stated:

These important changes to income support payments for parents continue this government’s focus on providing greater incentives and opportunities, particularly for single parents, to re-engage in the workforce and share in the benefits that work brings.

The removal of grandfathering arrangements will provide greater equity and consistency in the Parenting Payment eligibility rules by ensuring that all parents are assessed the same, regardless of when they first claimed income support.

The changes to parenting payment will encourage parents with school age children to re-enter the workforce sooner and to ensure a fair and consistent set of parenting payment eligibility rules.

Under this government there have been better participation outcomes for individuals who have not been grandfathered under the Howard government’s Parenting Payment Single policy of 2006.

In practical terms the evidence shows us that while grandfathered Parenting Payment recipients do better than most job seekers, principal carer parents on Newstart do even better.

Campaign to reverse the age cut-off changes

There has been a long-standing campaign from community groups such as Single Mother Families Australia (previously the National Council for Single Mothers and their Children) and the Australian Council of Social Service (ACOSS) to reverse the 2006 and 2013 changes to Parenting Payment. This campaign has been backed by the Australian Greens and, more recently, by independent MPs including Zoe Daniel and Monique Ryan. In March 2023, the Albanese Government’s Women’s Economic Equality Taskforce wrote to the Minister for Women, Katy Gallagher, listing the reinstatement of the Parenting Payment Single for women with children over 8 as a priority for urgent action.

Why is the cut-off at age 14 and not 16?

The 2023–24 budget measure will not fully reverse the 2006 changes as it will lift the youngest child cut-off age to 14 rather than 16. According to the joint media release announcing the measure, ‘By 14, children have typically settled into high school and need less parental supervision, and single parents are in a much stronger position to take on paid work’. When asked about the age 14 cut-off in an interview, Minister for Social Services Amanda Rishworth stated:

Obviously 14 year olds are settled into high school, they're becoming more independent, which does allow a parent to do more work. I would note that as part of the broader social security system, there is still a higher rate of payment that sole parents will get when their children, their youngest child is between 14 and 16. There is a higher rate that you get with dependent children. But this is about recognising that the role of parenting does evolve and that there is more opportunity to take on more hours and more work.

No research evidence has been offered to demonstrate why age 14 is significant in terms of allowing parents to undertake more work, or how it differs from earlier ages in terms of the level of parental supervision required or the level of income support needed by single parents. Other payments for those caring for children do not stop at age 14 or even 16—Family Tax Benefit can continue to be paid until a child is aged 19 (if they are finishing secondary school). According to a Parliamentary Budget Office costing for MP Zoe Daniel, increasing the cut-off age to 16 would cost $1.2 billion over 3 years to 2025–26 compared to $916.6 million for the age 14 cut-off.

Under the changes, there will still be a higher rate of JobSeeker Payment for single principal carers but only for those with a youngest child aged 14 or 15.

Single Mother Families Australia CEO Terese Edwards stated that while ‘ecstatic’ about the budget measure, her organisation would continue to push for the cut-off age to be raised to 16.

Parenting Payment Single recipients will not receive a rate increase

A separate 2023–24 budget measure will see most non-pension income support payment rates increased by $40 per fortnight (see the separate Budget Review article, ‘Social security cost of living measures’) but Parenting Payment Single rates will not be increased. When the Coalition provided a $50 per fortnight increase to non-pension payments in April 2021, Parenting Payment Single was included.

ParentsNext abolition

The Government has also announced that it intends to abolish the ParentsNext employment program from 1 July 2024, and develop a replacement voluntary program (p. 106). Compulsory participation requirements for current participants have been paused from 5 May, but eligible parents may still volunteer to participate.


ParentsNext is one of the main Australian Government initiatives designed to assist parents to commence or return to work. The program is targeted at disadvantaged young parents who are at risk of long-term income support recipience. It is intended to assist parents with young children in planning for future employment by arranging activities and connecting them to local services to prepare them for work by the time their children are at school.

Parents with a youngest child aged under 6 who are in receipt of Parenting Payment and who have not been employed for the past 6 months are eligible to participate, with participation compulsory for parents who meet certain high-risk criteria.

When the program was first introduced as part of the 2015–16 Budget it was confined to 10 disadvantaged local government areas (p. 159). The 2017–18 Budget provided funding to expand the program nationally from 1 July 2018 (p. 93).

Under the expanded ParentsNext program, participants became subject to Targeted Compliance Framework. This resulted in them being subject to sanction, rather than simply payment suspension, when they failed to meet a participation requirement without reasonable excuse. Participants could also have their payment suspended automatically when their attendance at an appointment or activity had not been reported or recorded. Previously, this was subject to the discretion of employment service providers.

Criticism of the program

The program has been the subject of a great deal of criticism.

The report of a Community Affairs References Committee inquiry into ParentsNext in 2019 stated that, while the program is billed as being supportive, the Committee had received extensive evidence that it was ‘causing anxiety, distress and harm for many of its participants. In fact, many have argued that ParentsNext is causing more harm than good’ (p. 71).

In February 2023, the Select Committee on Workforce Australia Employment Services similarly found that the program is doing ‘too much harm for the good it does’ and recommended that it should be abolished at the end of its current contract (in June 2024) and replaced with a new pre-vocational service, co-designed with parents, carers and their advocates, ‘which focuses on building participants’ capacity and which values raising children’ (pp. vii, 1, 12).

In its Budget response, ACOSS has stated that it welcomes the abolition of ‘the punitive ParentsNext program and immediate cessation of mutual obligations of parents subjected to ParentsNext’.


All online articles accessed May 2023

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