5.4.6.10 Qualification for Special Employment Advance Payments

General qualification criteria

To qualify for a SEA, a person must meet the following criteria:

Criterion More Detail
ALL of the following
be qualified for a SEA qualifying entitlement, AND  
have received some kind of income support payment, for the 3 months immediately before applying for the advance, AND

Example: A recipient may have been receiving:

a) PPP for 2 months and DSP for one month, or

b) YA for 2 months and NSA for one month.

request, and be entitled to, between $50.00 and $500.00 in advance, AND  
not owe any debt to the Commonwealth that is being recovered, or may be recovered by repayments from their social security payment, except for certain pension PPS recipients, AND SSAct Part 5.2 for debts recoverable from a person's social security payment.
be able to repay the advance without suffering financial hardship, AND  
ONE of the following

In cases of UNRECEIVED INCOME:

  • the person or the person's partner has earned, but not received income, and
  • the unreceived income has the effect of reducing the applicant's MBR of entitlement (1.1.M.53) by at least 50%, and
  • the recipient is in severe financial hardship, OR
The test for severe financial hardship (1.1.S.125) is the same test used in assessing whether to waive a waiting period.

In cases of RETURN TO WORK EXPENSE:

  • the person has received a definite offer of employment in Australia for a period of at least 6 weeks, and
  • would not be able to take up the offer of employment without the SEA, and
  • the expected income from the employment will reduce the recipient's MBR of entitlement by at least 50% over the relevant paydays, or the person will lose qualification for their social security payment.
 

Act reference: SSAct section 23(1)-'social security entitlement', section 23(1)-'income support payment', Part 5.2 Amounts recoverable under this Act

Pensioners

Pensioners are already able to qualify for an advance.

Some of these criteria are explained in more detail later in this topic. Others are explained in the SS Guide topics referenced.

Act reference: SSAct section 38B Notional continuous period of receipt of income support payments

Policy reference: SS Guide 5.4.6.20 SEA - Return to Work Claims, 5.4.6.30 SEA - Income Not Received Claims, 5.4.6.40 Formula for Calculating Special Employment Advance Payments, 5.4.6.50 Repayment of Special Employment Advance Payments

Three month qualifying period

While recipients generally cannot qualify for a SEA while they are receiving any of the following income support payments, periods where they received them count towards the 3 month qualifying period:

  • sickness allowance,
  • partner allowance,
  • special benefit, and
  • benefit PPP (1.1.P.50).

Effect of income maintenance period on 3 month qualifying period

In the case of a recipient who has a reduced rate payable for the period covered by the IMP, this time can be counted toward the SEA 3 month qualifying period. In the case of a person who has a nil rate of payment resulting from the IMP, the time they are serving the IMP cannot be counted toward the SEA 3 month qualifying period.

Minimum 50% reduction in maximum basic entitlement test

Note: In the examples given, the rates used applied as at 20 March 2010 and are shown in dollars per fortnight (pf). Current rates can be obtained from the A guide to Australian Government payments booklet on the DHS website.

Where a claim for a SEA is made because of the unreceived income of either the SEA claimant or their partner, the effect of the income that has not been received must be to reduce the recipient's MBR of entitlement by at least 50%. If the recipient has received other income in the same period as the unreceived income, this is not taken into consideration in this test.

Example: A single recipient entitled to $462.80 per fortnight basic NSA has earned $300.00 but has not received it. In addition the recipient receives $200.00 pf investment income. Under the benefits income test (4.2.2) the $300.00 unreceived income has the effect of reducing the recipient's payment by $124.00. The $200.00 investment income is not included in this calculation. Because the unreceived income does not reduce the recipient's MBR of entitlement by 50%, the person is not entitled to a SEA.

A person may qualify for SEA based on the effect that their partner's unreceived income has on the claimant's own payment.

Example: A partnered recipient is entitled to $417.70 pf basic NSA. Their partner earns but does not receive $1,200.00 in the fortnight. The effect of the partner's income (using the benefits income test at 4.2.2) is to reduce the claimant's NSA by $246.00. As this reduction is in excess of 50% of the recipient's own MBR of entitlement, the recipient can claim the SEA.

If the recipient's earned income in itself were high enough to reduce their MBR of entitlement by 50%, regardless of the interaction with ongoing investment income, then the person would satisfy the 50% reduction test.

Example: A single recipient entitled to $462.80 pf basic NSA has earned $500.00 but has not received it. In addition, the recipient receives $100.00 pf investment income. Under the benefits income test (4.2.2) the $500.00 unreceived income has the effect of reducing the recipient's payment by $244.00. The $100.00 investment income is not included in this calculation, but even so the reduction from earned income would be enough to reduce the MBR of entitlement by over 50%. The person would be entitled to claim a SEA.

Where income has been averaged over a period, and income from that source has not been received, the relevant income not received is the averaged amount, not the actual amount earned in the fortnight.

Example: A recipient with one child entitled to $601.30 basic PPS has income from casual work averaged out over 3 months. The average fortnightly income is $600.00. This reduces MBR of entitlement by $173.36. Even if the person earns $1,000.00 in a particular fortnight from this casual work, but does not receive it, the person would not be entitled to a SEA, as the averaged amount does not reduce the MBR of entitlement by 50%.

In the case of a definite job offer, the income that the person expects to earn over the first 6 weeks of employment must reduce the recipient's MBR of entitlement by at least 50%. As in the examples above, income from other sources is not taken into consideration in this test. If a person returning to work will completely lose their entitlement to payment (i.e. they cancel their payment), then the person does not have to satisfy the 50% reduction rule.

Effect of working credit or an income bank on the 50% reduction in maximum basic entitlement test

Note: In the examples given, the rates used applied as at 20 March 2010 and are shown in dollars pf. Current rates can be obtained from the A guide to Australian Government payments booklet on the DHS website.

When establishing whether a person's MBR of entitlement has been reduced by 50% any working credits or income bank (as in the case of YA) must be taken into consideration as they reduce the amount of earnings that are counted under the income test.

Example 1: A single student recipient entitled to $377.00 pf basic YA has earned $200.00 over the past fortnight but has not received it. Under the YA income test, the $200.00 earned would not effect the person's payment as students receiving YA have an income free area (4.2.8.50) of $236.00 pf. Because the unreceived income does not reduce the person's MBR of entitlement by 50%, the person is not entitled to a SEA.

Example 2: A partnered student recipient entitled to $377.00 pf basic YA has earned $1,045.00 over the past fortnight, but not received it. Their partner is in receipt of NSA and has not earned any other income over the past fortnight. The person has a $400.00 income bank credit. The fortnightly income free area of $236.00 and income bank credit of $400.00 is used to offset the $1,045.00 fortnightly earnings. Applying the personal income test (4.2.8.50) the rate of payment would be reduced to $139.60. As the income reduces the person's rate by more than 50%, the person would be eligible for a SEA.

Example 3: Ruth is a single parent with one child receiving PPS and is entitled to the maximum rate of $601.30 pf, as she has no other income. She commences employment and has earned $850.00 over the past fortnight, but has not yet received it. She has accrued 500 working credits. The fortnightly income free area of $166.60 and the 500 working credits are used to offset the $850.00 fortnightly earnings. After using the working credit depletion amount to calculate the affecting income, the normal income test rules are applied to the affecting income to determine the reduced payment of $527.94. As the income has not reduced Ruth's rate by more than 50%, she is not entitled to a SEA.

Policy reference: SS Guide 3.1.11.30 Working credit depletion

Maximum basic rate of entitlement & reduction due to parental income

Note: In the example given, the rates used applied as at 20 March 2010 and are shown in dollars pf. Current rates can be obtained from the A guide to Australian Government payments booklet on the DHS website.

A person's MBR of entitlement is the rate before any reduction due to parental income. Recipients of YA whose rate is reduced by parental income, must show that income from employment is going to reduce the MBR of entitlement by 50%, not the parental income reduced rate that they are actually receiving.

Example: A YA (other) recipient is entitled to $377.00 MBR of entitlement pf, however, the person only receives $100.00 pf after the reduction due to the parental income test.

The recipient earns $200.00 pf from a casual job. The effect of this income under the benefit income test (4.2.8.60) pf is a reduction of $69.00 of the parental income reduced rate - so the recipient is only entitled to receive $31.00 payment.

Even though the person's normal payment is reduced by well over 50%, the reduction due to the recipient's personal income is less than 50% of the MBR of entitlement of $377.00, so the person would not be entitled to a SEA.

Validation of claims

Recipients claiming a SEA must provide verification of their employment details, including who their employer is and their expected earnings. In addition, recipients seeking a SEA for a specific expense related to returning to work must provide verification of this expense. It must be established that the person cannot take up the employment without the item or service for which the SEA is claimed.

Maximum outstanding SEA

The outstanding balance of a person's SEA must never exceed $500.00. Recipients applying for a SEA, who already have an outstanding SEA, will only be eligible for an additional SEA to a value that will not increase the total amount of the SEA outstanding to more than $500.00.

Example: A person with an outstanding SEA balance of $350.00 may only apply for an additional SEA of up to $150.00.

Recipients with debts (1.1.D.40) owed to the Commonwealth

Recipients who do owe debts to the Commonwealth under SSAct Part 5.2 do not qualify for an advance payment. This includes debts that are only recoverable under SSAct Part 5.2, such as debts recovered on behalf of other Government departments.

Example: An Austudy debt being recovered under Part 5.2 disqualifies the applicant for an advance.

Exception: If a PP overpayment is caused solely by the change of partner status in a transfer from PPP to pension PPS pay cycles, the person still qualifies for an advance.

Recipients with other debts

Recipients with debts not recoverable under SSAct Part 5.2 may qualify for a SEA.

Act reference: SSAct section 1228 Overpayments arising under other Acts and schemes, Part 5.2 Amounts recoverable under this Act

Recipients currently repaying a previous advance

Recipients do not need to fully repay existing advances (either a SEA or a normal advance) or a previous instalment of a SEA before another SEA is granted. Their outstanding SEA balance must never exceed $500.00.

Last reviewed: 1 July 2015