Budget 2025: Government to means-test teen beneficiaries

Thursday, 22 May 2025

Social Development Minister Louise Upston said young people “can't expect to go automatically onto a benefit, and parents must be ready to help”.

Eighteen and 19-year-olds on the benefit who could be supported by their parents will soon no longer be able to claim Jobseeker or Emergency Benefit support.

From July 2027 eligibility for those two benefits would be tightened through a parental assistance test, the Government announced during the Budget lock-up on Thursday.

This will save the Government $84 million a year once it's implemented, from 2027. The exact details of what the income threshold will be are yet to be announced, with Cabinet decisions to be made in the coming weeks.

'I think parents are going to welcome that policy, because I have met with the parents of young people who have said, 'what am I meant to do to get my son off the couch playing Playstation all day, when the Government just gives him a welfare cheque? How do I motivate him to get a job?'' said Finance Minister Nicola Willis, asked about the policy during the Budget lockup today.

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'We think this is a policy that will allow more young people to fulfil their potential.'

The Government recognised some wouldn't be able to rely on parental support, and there would be “narrow exceptions”, said Willis.

“In general it's our expectation that where parents are able to support young people they will not be able to receive the benefit.“

Minister for Social Development and Employment Louise Upston said young people “can't expect to go automatically onto a benefit, and parents must be ready to help”.

'This change strengthens financial incentives to enter employment, education or training.

Nicola Willis delivered the Budget on Thursday.

'Recent forecasts show that people under the age of 25 on Jobseeker Support will spend an average of 18 or more years on a benefit over their lifetimes - 49% longer than in 2017. This is a human tragedy.'

Upston, and Minister of Revenue Simon Watts, also announced that low and middle income families claiming Working for Families would receive an average of an extra $7 a week, through changes to the abatement threshold.

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The threshold will change from $42,700 to $44,900, and the abatement rate from 27% to 27.5%. Families with incomes closer to the threshold will get up to $23 a fortnight.

That would be funded by income-testing the first year of the Best Start tax credit, with payments starting to diminish above a family income of $79,000, and a cut off of $97,000.

The Government also announced it would continue to support community foodbanks, with a $15m fund for 2025-2026.