Baby bonus means test confusion could cut cash
By Samantha Maiden and Lauren Wilson
December 29, 2008 12:01am
- Baby bonus rules change this week
- Some parents-to-be confused over means test
- Calculated on income after birth, not before
THOUSANDS of eligible families could miss out on the $5000 baby bonus as a result of confusion over the new means test for the measure.
There are even fears some couples are asking obstetricians to bring forward caesarean births or induce babies to meet the January 1 deadline for the changes, as a result of misinformation on how the new system will work, The Australian reports
For the first time, the Rudd Government
will introduce a means test, limiting the bonus from next year to couples with a combined annual income of up to $150,000.
But because the test will be applied only in the first six months after the birth, when most couples' income is dramatically reduced, the vast majority of families will remain eligible.
"People do not have to be concerned about how much money they and their partner earn before the birth of their baby. A family's income will be calculated based on their earnings in the six months following the birth of a baby," Family and Community Services Minister Jenny Macklin said.
The bonus will now be paid in 13 fortnightly instalments of about $385, replacing the lump-sum payment. The time limit on claiming the bonus will increase from 26 to 52 weeks from the date of birth or in the case of adoptions from the date the child came into the person's care.
Ms Macklin confirmed last night the Government would not reconcile income at the end of the 12 months.
That means that if a woman returns to work earlier than expected and subsequently fails the test, she will not be forced to give the bonus back.
"People do not have to be concerned if their financial situation changes in the six months following the birth due to unforeseen circumstances. No debts will be raised for unforeseen changes in income," she said.
"Debts will only be raised where compliance checks reveal that a person has knowingly provided false or misleading information," she said.
Kerry Schindlmayr, 30, from the eastern Sydney suburb of Kingsford, was aware only through word of mouth that she could still claim the bonus, despite a combined income that normally tips $150,000.
She plans to take a year off work following the birth of her second child, which means she and her husband's combined income would still be below the threshold. "I've got quite a few friends who are pregnant ... and it is really through word of mouth that I've come to know how it will work, rather than anything official," she said.
Claire Morris, 34, from Ashfield in Sydney's west, whose due date is tomorrow, did not realise the means test would be applied to the combined family income for the six months after the baby was born.
"Obviously I'll just be thrilled to have a healthy baby, but I think the changes could have been better explained."
Read more on on this story at The Australian.