Redundancy pay no bar to benefit

Redundant workers no longer have to use up their redundancy pay before qualifying for the dole.

Wellington beneficiary advocate Kay Brereton says, "The qualifications for the dole are age, redundancy and income. It has nothing to do with people still having assets. You might have $1 million of assets all tied up and not have any income so you need money. That's why we are not asset-tested on benefits."

She said the only effect of redundancy pay in most cases would be to push someone out from one week to the maximum two-week initial stand-down after lodging an application before the benefit starts.

The law provides for a one-week stand-down for anyone earning less than the average wage, now $926.63 a week, averaged over either the previous six or 12 months, whichever produces the shortest stand-down.

Ms Brereton said redundancy pay could affect entitlement to the accommodation supplement, which is asset-tested. But a new regulation, which took effect on January 1 under the Government's "ReStart" package, exempts redundancy payments up to $25,000 from being counted as assets for the supplement. The package also increased the supplement by $100.