Financial suitability test for suitable work for principal carers 001-09140010

The financial suitability test applies only to principal carers required to satisfy compulsory mutual obligation requirements to receive Parenting Payment (PP), JobSeeker Payment (JSP), Youth Allowance (YA) or Special Benefit (SpB).

This test is not part of the 'standard' service offer to job seekers, and if not requested by the job seeker, it would otherwise only be applied by a PST-skilled Service Officer when conducting a compliance investigation or refusing to accept a suitable job offer.

Are there other factors that make the work unsuitable?

For example, availability of suitable after school hours child care.

See Suitable/unsuitable work.

• Yes, there is no need to apply the financial suitability test. Procedure ends here
• No, refer job seeker to an APS3 or above. Go to Step 2

Ensure that the job seeker understands that this test, when applied before a job offer is made or before they make a decision to leave a current job, is a guide only and the job seeker may be required to provide further information at a later time to their Employment Services Provider or another Services Australia staff member.

In most cases, the test should be applied to the job seeker's circumstances in the next full fortnight. If the work will vary between fortnights there may be a case to apply the test over a month - this should be documented.

The Centrelink/Family Assistance/Child Support/Child Care Estimator is used to run the Financial Suitability Test.

The Resources page contains a manual calculation worksheet to be used if the rate estimator is not available.

Access the Centrelink/Family Assistance/Child Support/Child Care Estimator while in the customer's record. Select Payments & Services > Centrelink rate estimator.

Choose the Compare Centrelink rates only option.

For help, see Online estimators options.

For employment income, the gross amount must be used. The Resources page contains a guide to how to code employment income for different scenarios.

If applicable to this job seeker, the View Financial Suitability Test heading will be displayed on the Results page. Click on the heading to expand the details and to run the test.

Note: the View Financial Suitability Test heading will only be available when accessing records for principal carer job seekers where the suitability test is applicable. It will not be available for all customers.

Will the job seeker be required to work outside school hours?

• Yes, ensure the job seeker is claiming Additional Child Care Subsidy (ACCS) (Transition to Work). Indicate the number of hours of care per child required outside school hours for the next full fortnight: Cost = number of hours x number of children requiring child care x 10 cents
• If care is not available from an approved child care service, reasonable costs for informal care may be included
• If the job seeker is not eligible for ACCS (Transition to Work), determine out of pocket costs (exclude Child Care Subsidy (CCS) entitlement) and record them in the box provided
• No, there are no child care costs to be considered. Go to Step 5

Work out travel costs directly related to work for the next full fortnight, including travel related to child care. Do not include costs covered by the Employment Fund. For help with reasonable costs that can be included, see Suitable/unsuitable work.

Is the cost of travel associated with the work more than 10 per cent of gross wage, or is it longer than 60 minutes to get to or return from work?

• Yes, this may be enough to determine that the job is unsuitable and the test need not continue
• No, work out the travel costs and include in test calculation

If the job seeker receives Parenting Payment single, the income test taper rate is more generous than for allowance payments and so public housing rent increases have little impact on the Financial Suitability Test and should not be considered. Go to Step 7.

Is the job seeker living in housing provided or subsidised by a state government housing authority?

This does not include community housing for which Rent Assistance can be paid.

• Yes, establish the increase in rent:
• If the job seeker lives in Victoria, South Australia, Western Australia or Tasmania: Rent increase = 25% x (gross wage plus new income support rate from Step 3, less the maximum rate of income support). The rate estimator will provide this calculation once the current rate of rent paid is entered
• Job seekers living in other states must provide a letter from the relevant Housing Authority stating the old and new rates, and date of effect of the change. If unable to provide evidence now, they can ask for the test to be applied once they do have evidence. If the evidence they provide indicates the rent increase will begin after the next complete fortnight, advise them to re-test this element at that time
• No, there are no public housing costs to consider. Go to Step 7

Final calculation will be completed by the tool as follows:

1. Total disposable income
2. Subtract any out of pocket child care expenses
3. Subtract travel costs
4. Subtract any public housing rent increase
5. Compare the final figure with the job seeker's current income support rate, excluding FTB and Rent Assistance

Job seekers who also have an assessed Partial Capacity to Work may also have specific work related costs that may be subtracted from their total disposable income if the cost is not offset by assistance through either the:

• Employment Fund
• Employment Assistance Fund

Other miscellaneous costs of accepting an offer of suitable part time work will not be included in this determination, for example, buying appropriate clothes, a uniform or other job related equipment. Principal carers may be able to at least partly defray these costs by their Employment Services Provider accessing the Employment Fund.

Is the job seeker $50 or more better off over the fortnight when undertaking the work after the test is applied?

• Yes, advise the job seeker of the result of the test and discuss any outstanding issues. Explain what will happen if the job seeker refuses the offer of work or if they cease their current employment. Go to Step 9
• No, advise the job seeker that this indicates the job may not be suitable. Contact the provider immediately to discuss this while the job seeker is present. Go to Step 9

Print the results page, or prepare a copy of the manual worksheet, and provide to the job seeker.

Record a DOC using keyword 'FSTF2F' (Financial Suitability Test for Principal Carers - Face to Face contact).

This information may be used in a later decision by a Participation Solutions Team member.

The DOC must include details provided by the job seeker that were used in the calculation, and the outcome:

• trigger for applying the test - a brief description of the circumstances which meant it was appropriate to apply the test
• gross wage and tax liability
• number of hours of out of school hours child care
• any public housing impact
• any travel cost and time estimates
• the outcome of the comparison, for example, Job seeker would be $ better/worse off