1.1.S.120 Severe financial hardship - assets test hardship

Usage

This definition is to be used when applying hardship provisions to social security pension (section 23(1)-'social security pension') and social security benefit (section 23(1)-'social security benefit') income support recipients.

Act reference: SSAct section 23(1)-'social security pension', section 23(1)-'social security benefit'

Definition

A single person is in severe financial hardship if:

their readily available funds are equal to or less than the specified limit (as set out below), AND
they CANNOT reasonably be expected to sell or borrow against assets (1.1.A.290) to improve their financial position.

A partnered person is in severe financial hardship if:

the combined readily available funds of the person and their partner are equal to or less than the specified limit for a member of a couple (as set out below), AND
they CANNOT reasonably be expected to sell or borrow against assets (1.1.A.290) to improve their financial position.

Readily available funds - allowable limits

The readily available funds limits for Age, DSP, CP and associated FaHCSIA closed payments (e.g. WidB, YA (student), Austudy and ABSTUDY) are:

for a single person, the annual MBR of age pension (plus pension supplement and CES) payable to a single person,
for a member of a couple, twice the annual MBR of age pension (plus pension supplement and CES) payable to a partnered person.

The readily available funds limits for NSA, PPP, YA (other), SA, WA and PA are:

for a single person with no dependent children, the annual MBR of NSA, (plus CES) payable to a person who is single with no children,
for a single person with a dependent child or children, or who is aged 60 years or older and has been on income support for more than 9 months, the annual MBR of NSA, (plus CES) payable to a person who is single with dependent children or aged over 60 with 9 months on income support,
for a member of a couple, twice the annual MBR of NSA, (plus CES) payable to a partnered person.

The readily available funds limit for PPS is:

the annual MBR of PPS plus pension supplement basic amount and CES.

Act reference: SSAct section 1129 Access to financial hardship rules-pensions, section 1131 Access to financial hardship rules-benefits

Policy reference: SS Guide 4.6.7 Asset Hardship Rules

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Last reviewed: 20 March 2013

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