Transition to Work assistance

Overview

Transition to Work assistance is paid in order to assist clients to:

  • make a successful transition from benefits to employment
  • remain in employment.

Transition to Work assistance helps clients meet the costs of seeking or taking up paid work. The assistance can be used for:

  • job-seeking costs - to help with essential costs involved in seeking paid work and attending interviews
  • job placement costs - to help with the essential costs of moving into paid work (eg clothing required for work)
  • bridging finance - to meet living costs prior to clients receiving their first pay.

Transition to Work assistance may be available to clients seeking or taking up paid work. It consists of:

  • Transition to Work Grants, which replaced Work Start Grants and Pathways Payments from April 2007
  • New Employment Transition Grants
  • Seasonal Work Assistance.

Eligibility for Transition to Work assistance

Transition to Work Grants

From April 2007, Transition to Work Grants have been available to help meet the additional costs of entering into employment for:

  • clients receiving a main benefit
  • students
  • other people who meet the qualifying criteria and who face small gaps between jobs (up to four weeks) or who are re-entering the workforce.

As well as meeting essential costs from job search or entering employment, Transition to Work Grants may be available to assist with specific transition to work costs related to relocation and safety equipment and to assist with covering living costs between the last benefit payment and the first pay from a new job. A maximum of $1,500 in Transition to Work Grants is available in any 52-week period.

To receive a Transition to Work Grant, clients are required to:

  • be aged 18 years of age or over, or to be aged under 18 and have exceptional circumstances including:
    • a school early leaving exemption
    • one or more dependent children
    • being married, living as married, or living in a civil union
    • being reliant on government financial assistance, or
    • being in extreme hardship
  • meet income, asset and residency tests
  • be seeking paid work for a position of 30 hours or more per week
  • have a verified job interview for a position involving at least 30 hours of work per week, or have a verified job offer involving at least 15 hours of work per week (excluding self-employment)
  • have an essential cost because of the job interview or job offer
  • be unlikely to make the transition into paid work or to be able to attend the interview without receiving a Transition to Work Grant.

Clients generally can't receive the Transition to Work Grant if they are entering into self-employment. Clients aged under 18 years who are not receiving an Independent Youth Benefit and who are dependent children are subject to a parental cash asset and income test.

Clients seeking work involving less than 30 hours per week may access Transition to Work Grants if it is reasonable and appropriate (eg there is no full-time work available, the client is working with Work and Income to progress toward full-time employment, the client is unable to work full-time but able to work limited hours).

Income and asset limits for Work Transition Grants are shown in table 3.40 below. For clients aged 16–17 years who are dependent children, the cash assets of the people they are dependent on are taken into account.

Table 3.40 Income and asset limits for Transition to Work Grants (applicable from 1 April 2008)

Status of client Income limit1 Asset limit
Single 16-17 years $420.72 $921.08
Single 18 years or over $483.54 $921.08
Married with or without children $702.30 $1,534.76
Sole parent, one child $586.74 $1,534.76
Sole parent, two or more children $618.16 $1,534.76

Note

  1. Income limits applicable from 1 April 2008. Income limits shown are weekly and gross of income tax.

Work Start Grants

Prior to April 2007, Work Start Grants were available to meet the essential costs of taking up paid employment or attending a job interview. These grants were available to clients who would not be able to enter paid employment or attend a job interview without assistance to meet the essential costs of doing so.

To receive a Work Start Grant, clients were required to:

  • be aged 16 years of age or over
  • have a verified job interview for a position involving at least 15 hours of work per week, or have a verified job offer involving at least 15 hours of work per week (excluding self-employment)
  • have an essential cost because of the job interview or job offer
  • be unlikely to make the transition into paid work or to be able to attend the interview without receiving a Work Start Grant.

Residency, income and cash asset tests applied.

A maximum of $300 worth of Work Start Grants were available in any 52-week period, except where the client received a grant for relocation, safety equipment or bridging finance, when grants worth $550 were available. Grants were non-taxable and non-recoverable.

After April 2007, these grants were incorporated into the assistance delivered as Transition to Work Grants.

Pathways Payment

Prior to 30 April 2007, Pathways Payments were available to assist clients entering paid employment with the living costs encountered between the cancellation of the benefit and their receipt of:

  • their first wage or salary payment, or
  • their first payment as a self-employed person.

After April 2007, these payments were incorporated into the assistance delivered as Transition to Work Grants.

To receive a Pathways Payment, a client or their spouse needed to:

  • cancel a main benefit in order to enter paid employment
  • inform Work and Income before beginning paid employment
  • have a dependent child or children
  • have received one or more main benefits for a continuous period of 12 months or more prior to entering paid employment.

If a client with a debt to Work and Income received a Pathways Payment to start paid employment, their debt repayment was suspended for a period of three months.

The Pathways Payment was equal to two weeks' payment (after tax) of the benefit that was cancelled, paid at the rate received in the week before the benefit was cancelled. Pathways Payments were:

  • non-taxable
  • non-recoverable
  • not subject to income tests or asset tests.

New Employment Transition Grant

A New Employment Transition Grant is available to clients with one or more dependent children during the first six months that their benefit is stopped due to employment. To receive a grant, these clients must be unable to work because:

  • the client, their partner (if any) or their dependent child becomes sick and:
    • no paid sick leave is available, or
    • the client has exhausted their entitlement to paid sick leave
  • there is a breakdown in childcare arrangements and:
    • no paid leave (including paid annual leave) is available for this purpose, or
    • the client has exhausted their entitlement to paid leave (including their entitlement to paid annual leave).

Residency and cash asset tests apply. Clients in self-employment must also declare that:

  • they have been unable to be involved in their business over the period because of their illness, the illness of their partner or child, or the breakdown in childcare arrangements
  • there was in fact a loss of income (rather than a delay of income because work was re-scheduled)
  • provision was not available from the business to cover the loss of income.

The maximum daily rate of New Employment Transition Grants is limited to the lesser of:

  • the actual loss of gross income
  • $59.50 per day (as at 1 April 2008).

A total of no more than $595.00 in New Employment Transition Grants may be paid to a client within the six-month qualifying period. Grants are non-taxable and non-recoverable.

Seasonal Work Assistance

Seasonal Work Assistance is available to clients during the first six months after their benefit is stopped because they began seasonal horticultural work. To receive this assistance, clients must have lost income through being unable to work because of adverse weather conditions.

Residency, income and cash asset tests apply. Seasonal Work Assistance is only available to clients undertaking work in a list of horticultural industries approved by MSD's Chief Executive. At the end of June2007, this assistance was available to people working in the fruit, vegetable, wine, flower, hops, hemp, tobacco, olive, and nursery plant industries.

The amount of Seasonal Work Assistance payable depends on the client's family circumstances and on the actual net income lost during the week. The amount of assistance to be paid per week is the lesser of the actual net income lost for the week or the maximum weekly payment the client may be paid. The maximum weekly payments available as at 1 April 2008 are shown in table 3.41 below.

Table 3.41 Maximum rates of Seasonal Work Assistance payable (applicable from 1 April 2008)

Hours of work lost (over one week) Maximum weekly payment
Single person Married person, person in civil union, or sole parent
1-8 hours $40.00 $73.00
9-16 hours $80.00 $146.00
17-24 hours $120.00 $219.00
25-32 hours $160.00 $292.00
33-40 hours $200.00 $365.00
Over 40 hours $200.00 $365.00

A total of no more than $730.00 in Seasonal Work Assistance may be paid to a client within the six-month qualifying period. This assistance is non-taxable and non-recoverable.


Trends in payments of Transition to Work assistance

Please note that some clients may have received more than one payment of Transition to Work assistance during the same financial year.

Trends in the number of clients receiving Transition to Work assistance reflect a combination of:

  • trends in the number of job seekers leaving the register to enter paid work (this number has decreased, in line with decreases in the numbers of registered job seekers)
  • the emphasis that Work and Income has placed on assisting clients to obtain and retain paid work.

Trends in the number of Transition to Work Grants, Work Start Grants and Pathways Payments provided

The combined number of Transition to Work Grants, Work Start Grants and Pathways Payments provided has increased over the last two years, after decreasing in the previous two years (see table 3.42). Reductions over the last two years in the number of Work Start Grants, and reductions in the number of Pathways Payments over the last year reflect the replacement of this assistance by Work Transition Grants. Earlier reductions in numbers of Work Start Grants reflect lower numbers of job seekers registered and leaving the register for paid employment.

Transition to Work Grants accounted for virtually all of the grants provided in 2007/2008, compared with 21% in 2006/2007 (see table 3.42).

Table 3.42 Trends in the types of expenditure met by Transition to Work Grants, Work Start Grants and Pathways Payments provided

Type of assistance 2003/2004 Number 2004/2005 Number 2005/2006 Number 2006/2007 Number 2007/2008 Number
  Work Start Grants1
Bridging Finance - Non-student 7,994 5,974 5,516 4,692 1
Job Search Costs - Non-student 8,313 6,462 6,485 5,614 1
Work Placement Costs - Non-student 47,231 40,270 36,342 31,290 36
Bridging Finance - Student 71 57 43 49 0
Job Search Costs - Student 73 58 91 49 0
Work Placement Costs - Student 686 676 721 403 0
Total Work Start Grants1 64,368 53,497 49,198 42,097 38
  Transition to Work Grants2
Bridging Finance - Benefit recipient 0 0 0 1,199 6,516
Bridging Finance - other 0 0 0 1,103 7,876
Job Placement Costs 0 0 0 8,232 52,202
Job Search Costs 0 0 0 2,160 13,952
Unspecified 0 0 0 9 0
Total Transition to Work Grants2 0 0 0 12,703 80,546
  Pathways Payments3
Total Pathways Payments3 6,269 6,719 6,934 6,673 0
  All payment types
Total payments made (all types) 70,637 60,216 56,132 61,473 80,584

Notes

  1. Numbers of Work Start Grants recorded in SWIFTT during years ended June. Work Start Grants were superseded by Transition to Work Grants from April 2007.
  2. Numbers of Transition to Work Grants recorded in SWIFTT during years ended June. Work Transition Grants were available from April 2007.
  3. Numbers of Pathways Payments recorded in SWIFTT during years ended June. Pathways Payments were superseded by Transition to Work Grants from April 2007.

Trends in the number of New Employment Transition Grants provided

The number of New Employment Transition Grants provided each year has trended upward since 2003/2004 (see table 3.43).

Table 3.43 Trends in the number of New Employment Transition Grants provided

New Employment Transition Grants provided1
2003/2004 Number 2004/2005 Number 2005/2006 Number 2006/2007 Number 2007/2008 Number
Total 362 569 535 702 841

Note

  1. Numbers of New Employment Transition Grants paid in years ended June.

Trends in the number of Seasonal Work Assistance payments provided

The number of Seasonal Work Assistance payments has increased over the last year, following a decrease between 2003/2004 and 2006/2007 (see table 3.44). As well as lower numbers of job seekers entering paid work (as numbers of job seekers fall), this reflects the impact during 2003/2004 and 2007/2008 of stormy weather patterns on the opportunities to undertake seasonal work.

Table 3.44 Trends in the number of Seasonal Work Assistance payments provided

Seasonal Work Assistance payments provided1
2003/2004 Number 2004/2005 Number 2005/2006 Number 2006/2007 Number 2007/2008 Number
Total 2,890 1,878 1,492 1,130 1,754

Note

  1. Numbers of Seasonal Work Assistance payments made in years ended June.

Trends in expenditure on Transition to Work assistance

Trends in expenditure on Transition to Work Grants, Work Start Grants and Pathways Payments

Combined expenditure on Transition to Work Grants, Work Start Grants and Pathways Payments has increased over the last two years (see table 3.45), reflecting increases in both the number of grants paid and in the average value of each grant paid.

Table 3.45 Trends in the value of Transition to Work Grants, Work Start Grants and Pathways Payments provided, by expenditure type

Type of assistance 2003/2004 Amount ($000) 2004/2005 Amount ($000) 2005/2006 Amount ($000) 2006/2007 Amount ($000) 2007/2008 Amount ($000)
  Work Start Grants1
Bridging Finance - Non-student 1,663 1,223 1,161 1,030 0
Job Search Costs - Non-student 699 529 526 443 0
Work Placement Costs - Non-student 5,825 4,851 4,373 3,742 4
Bridging Finance - Student 15 11 8 9 0
Job Search Costs - Student 8 7 10 5 0
Work Placement Costs - Student 84 82 95 53 0
Total Work Start Grants1 8,294 6,703 6,173 5,281 5
  Transition to Work Grants2
Bridging Finance - Benefit recipient 0 0 0 383 2,113
Bridging Finance - other 0 0 0 325 2,469
Job Placement Costs 0 0 0 1,414 9,450
Job Search Costs 0 0 0 201 1,259
Unspecified 0 0 0 1 0
Total Transition to Work Grants2 0 0 0 2,324 15,291
  Pathways Payments3
Total Pathways Payments3 2,376 2,589 2,642 2,781 0
  Total value (all payment types)
Total value ($000)4 10,670 9,292 8,815 10,386 15,296
Average value per payment ($) 151 154 157 169 190

Notes

  1. Expenditure on Work Start Grants recorded in SWIFTT during years ended June. Work Start Grants were superseded by Transition to Work Grants from April 2002.
  2. Expenditure on Transition to Work Grants recorded in SWIFTT during years ended June. Transition to Work Grants were available from April 2007.
  3. Expenditure on Pathways Payments recorded in SWIFTT during years ended June. Pathways payments were superseded by Transition to Work Grants from April 2007.
  4. Due to rounding, values shown may not add to totals given.

Trends in expenditure on New Employment Transition Grants

Expenditure on New Employment Transition Grants has trended upwards since 2003/2004 (see table 3.46). This reflects increases in the average value of the grants paid as well as an upward trend in the number of grants made.

Table 3.46 Trends in expenditure on New Employment Transition Grants

Expenditure on New Employment Transition Grants1
2003/2004 Amount 2004/2005 Amount 2005/2006 Amount 2006/2007 Amount 2007/2008 Amount
Total ($000) 72 125 116 168 225
Average value per payment ($) $200 $220 $217 $239 $268

Note

  1. Expenditure on New Employment Transition Grants recorded in SWIFTT in years ended June.

Trends in expenditure on Seasonal Work Assistance payments

Expenditure on Seasonal Work Assistance payments has increased over the last year following decreases over the last three years (see table 3.47). This reflects both changes in the numbers of payments made and fluctuations in the average value of payments.

Table 3.47 Trends in expenditure on Seasonal Work Assistance payments

Expenditure on Seasonal Work Assistance payments1
2003/2004 Amount 2004/2005 Amount 2005/2006 Amount 2006/2007 Amount 2008/2008 Amount
Total ($000) 388 278 222 156 280
Average value per payment ($) $134 $148 $149 $138 $160

Note

  1. Expenditure on Seasonal Work Assistance payments during years ended June.

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