- The Australian government will reintroduce the liquid asset test for JobSeeker applicants from 25 September.
- If a recipient has over $11,500 in liquid assets their payments can be temporarily paused.
- The Department of Social Services confirmed on Thursday that any early super withdrawals sitting in savings accounts will be included, potentially rendering some Australians ineligible for JobSeeker.
Some Australians are in for a shock as the Morrison government begins stripping back its economic support measures.
As the JobKeeper and JobSeeker programs get overhauled from September, eligible Australians can expect to receive less no matter their financial situation.
Those on JobSeeker, however, face being taken off altogether as the Department of Social Services reintroduces the liquid assets test in its second phase starting on 25 September.
Under the test, recipients will have payments halted if they are found to have above $5,500 in ‘liquid assets’ such as savings.
With the Department retaining discretion over what is exactly might contribute to that exclusion, officials revealed that another hardship measure might momentarily rule some Australians out of contention.
“I think probably the easiest way to explain it is that, yes, if someone has drawn down on their super and that money is now sitting as a liquid asset in their savings account, that will count towards the total of their liquid assets which will be assessed for the liquid asset waiting period,” Deputy Secretary of the Department’s COVID-19 Taskforce Nathan Williamson confirmed.
In other words, hardship cases can be rejected from government support until they can spend enough of their buffer to qualify.
The conclusion comes with a catch, however.
“If it had been used to retire debt or pay down a mortgage — those types of mechanisms which we understand some people are using the drawdown of super for — then it wouldn’t be counted,” Department Secretary Kathryn Campbell said.
It’s an interesting development. In effect, it compels Australians to spend or deploy a chunk of their retirement savings today rather than maintain a financial buffer for tomorrow.
“If you make people spend all of their hard-earned savings before receiving income support then they are left in a precarious position during the rest of this pandemic,” Greens Senator Rachael Siewert wrote in an opinion piece for social policy publication ProBono. “For many people the only way they can survive on JobSeeker is by supplementing that income with what little savings they have.”
“This could be the difference between hanging on with the mortgage until they find more work – or losing the family home. Taking that safety net away is not only unfair, but also irresponsible and it will have a chilling effect on the wider economy,” she said.
Of course, with 1.6 million-odd Australians on the allowance, a Coalition government concerned with a budget blowout isn’t going to tolerate any hangers-on – particularly as it doubles down on its claim that Australians would prefer welfare to a job.
With the super scheme awash with concerns over how some Australians will now self-fund their retirement, it may be tricker keeping them all off the pension when their time comes.