C36/1998 VETERANS' CHILDREN EDUCATION SCHEME - RENT ASSISTANCE (RA)

Purpose

The purpose of this instruction is to advise on the payment of rent assistance to eligible VCES beneficiaries.

Background

Recipients of the “homeless” and “double orphan” rates of education allowance have been eligible for rent assistance since January 1995.

From 1 July 1998, this eligibility for rent assistance was extended to VCES beneficiaries who are recipients of the “living away from home” rate of education allowance and who are aged 16 or over.  Eligibility has been extended to align these students with the provision of rent assistance to recipients of the “living away from home” rate of Youth Allowance.

Like all other VCES benefits, the provision of rent assistance will not be subject to a means test.

Conditions of payment of RA

For RA to be payable, certain conditions will have to be met.  These are:

• proof of rent payable has to be provided,

• the rent paid has to be above the current rent threshold, and

• rent assistance is subject to a maximum amount.

When RA cannot be paid

Rent assistance cannot be paid:

• •              for a “living away from home” student under 16 years of age; or
• •              in advance (except for secondary students in boarding schools where the “living away from home” rate is paid a term in advance under paragraph 3.4.3 of the VCES); or
• •              while a student is resident overseas, even if rent payments continue during their absence from Australia, and regardless of the reason for, or the length of the absence; or
• •              when a student who receives RA returns to the parental home at the end of the educational year eg. a student at boarding school.  (A student who has a requirement to maintain accommodation until the following educational year - eg. a uni student who is renting a flat and does not return home to live during the long summer break - may continue to receive RA.); or
• •              to a student who is a homeowner; or
• •              to a student who is a tenant of a state or territory housing authority.

Rent assistance formula

The formula to be used for the provision of rent assistance is:

(fortnightly rent – current rent threshold) x 75%

Amount of RA payable

The amount of RA payable is the lower of the calculated amount or the maximum RA amount.

Rent thresholds

The current fortnightly thresholds for rent assistance are:

Category

Rent threshold (pf)

$

Maximum RA (pf)

$

single student

71.60

74.80

sharer

71.60

49.90

member of a couple where the partner does not receive a rent increased benefit (from any source)

116.60

70.60

member of a couple where the partner does receive a rent increased benefit (from any source)

116.60

$35.30

Indexation of thresholds

The rent threshold and the maximum rate of RA are indexed twice annually with any increase taking effect from the first payday on or after the 20 — th March and 20 — th September indexation dates each year.

Board and lodging

• Board:
• •              is defined as the provision of meals on a regular basis in connection with the provision of lodging; and
• •              is not counted as rent for RA.
• Only the amount paid for lodging in “board and lodging” is counted as rent for rent assistance.
• The student should be asked if an identifiable amount of “board and lodging” is paid for lodging.  The student's estimate or statement of the amount paid for lodging should generally be accepted without further investigation, providing it is within the guidelines.

If the amount paid for lodging is not able to be identified, two-thirds of the total amount will be considered as the rent component.

• Sharers

• The maximum rate of rent assistance for single people who are sharers is
• two-thirds of the maximum rate for singles living independently.
• A student is to be assessed as a sharer if:
• •              he/she is a single person without dependants, and

• he/she has the right to use, in common with other people, a major area of accommodation, and

• meals are not included in accommodation costs.

A major area of accommodation is defined as:  a bathroom, a kitchen or a bedroom.

Sharers are subject to a lower maximum rate of RA.

Attachment A gives examples to assist in determining whether a student is a sharer or not.

• Boarding Schools

• Students at boarding schools are to be treated as single students.  They are not to be considered as sharers.

• Students living in university halls of residence

• University students living in halls of residence could be either:
• •              boarders and lodgers, or
• •              sharers (if meals are not included in accommodation costs).

• Residence owned by Government housing authority

• A student living in a housing authority property and who pays lodgings to the tenant is eligible to receive RA.
• Note:              If the student is the tenant of the housing authority property that student is not eligible for RA as they are already receiving Government assistance.

• Residence owned by parents

• If the student receiving the “living away from home”  rate lives in a home that is owned by the parents but is not the parents' principal home, the student is eligible for rent assistance.

Rent verification

Rent verification procedures define acceptable proof of the amount of rent paid to include:

• a signed rent book; or

• a rent verification form signed by the landlord; or

• a recent rent receipt, not more than 6 weeks old; or

• a current lease or tenancy agreement in the student's name and not more than 12 months old; or

• a signed letter or statement from the landlord, or the person to whom rent is paid, not more than 6 weeks old; or

• an account from a boarding school showing the amount paid for lodging (or board and lodging); or

• failing any of the above, a statutory declaration (including details of who the rent is paid to, who they share with, and the break up of rental expense between the occupants).

Rent receipts, letters or statements provided in verification must show the name of the person issuing the receipt or letter, the name of the person to whom it is issued, the amount, the date  and the address of the property for which rent was or is payable.

Frequency of rent verification

Rent is to be verified at least annually and:

• before granting assistance;

• when changing address;

• on advice that the amount of rent payable has changed;

• whenever there is sufficient doubt that the student is entitled to the amount of rent assistance being received.

It is important to ascertain whether the amount of rent being paid is for full board and lodgings or only for lodgings (accommodation).

Where a student who is already receiving  RA at the maximum rate advises that the amount of rent payable has increased, verification should still be sought.  This is because the periodic changes to the thresholds each March and September may affect the amount of RA payable within a relatively short time.

The letter advising the student of approval of RA should contain a clause obliging the student to advise of any change in circumstance in relation to rent arrangements, including arrangements over holiday breaks.

Rent assistance codes

Pension Code 1156 should be used for payment of the combined amount of education allowance and rent assistance.  As rent assistance is not taxable, care should be taken to ensure that only the education allowance component of the total payment is then entered into the tax screen.

Claim forms

No claim form for RA is prescribed.  However, a form to assist with an application for RA is currently being developed.  If a written request for RA is received by letter or written statement, this may be accepted as an application for RA.

Start date of rent assistance

Rent assistance is payable, where a student is eligible, from the first payday after 1 July 1998.  VCES Secretaries must ensure that all VCES beneficiaries aged 16 and over who are currently receiving the living away from home rate of education allowance are individually advised of their possible entitlement to rent assistance and invited to submit an application.

Provided that an amount of rent is payable by the student, there is no requirement that the student must actually make that payment before rent assistance can start (eg at the beginning of a new lease).

Examples

Some examples of whether a student is to be classed as a sharer:

Category

Sharer (Yes/No)

a single student residing alone in a flat, apartment, or house

No

a single student in a flat, apartment, or house sharing one or more major areas of accommodation with at least one other person

Yes

a single student living in a boarding house or house who receives regular meals as part of the board and lodging arrangements and does not pay extra for the meals

No

a single student living in a boarding house or house who has to pay extra for meals

Yes

a single student living in a university hall of residence and who receives meals without having to pay extra

No

a single student living in a university hall of residence who has to pay extra for meals

Yes

a student at a boarding school

No