In a significant update for millions of Australians, Centrelink (Services Australia) has issued a critical reminder regarding upcoming changes to the Carer Payment and Carer Allowance systems. These adjustments, set to fully take effect as we move into 2025, represent some of the most substantial reforms to carer support in over a decade. The government’s focus is on providing greater flexibility for those balancing intensive caregiving duties with the desire to participate in the workforce or further their education.
The Shift from the 25-Hour Rule to 100-Hour Flexibility
For years, the “25-hour rule” has been a point of contention for Australian carers. Under the old regulations, any recipient who worked, studied, or volunteered for more than 25 hours in a single week—including travel time—risked losing their payment immediately. This rigid structure often discouraged carers from taking on extra shifts or pursuing short-term courses.
Starting in early 2025, specifically from March 20, this system will be replaced by a more generous “100 hours over four weeks” model. This shift allows for “spiky” work patterns, where a carer might work 40 hours one week and only 10 hours the next, without losing their eligibility. Crucially, travel time, volunteering, and education will no longer count toward this 100-hour limit, freeing up carers to focus on personal development and community contribution without financial penalty.
Indexation and Cost of Living Increases
In addition to structural changes, Centrelink has confirmed that payment rates will continue to be indexed to keep pace with the rising cost of living. Millions of Australians receiving the Carer Allowance and Carer Payment will see their fortnightly deposits increase as part of the standard indexation cycle. These boosts are designed to provide a safety net against inflation, particularly for those on fixed incomes who are managing the additional expenses associated with disability and elderly care.
Below is a summary of the expected adjustments and thresholds for 2025:
| Payment Type | Key Change/Requirement | New Flexibility/Rate |
| Carer Payment | Participation Limit | 100 hours per 4-week period |
| Carer Allowance | Regular Indexation | Increased to approx. $162.60 per fortnight |
| Work/Study Limit | Travel & Volunteering | Now excluded from the hourly cap |
| Suspension Rule | Exceeding Limits | 6-month suspension instead of cancellation |
| Income Test | Reporting Requirement | Must still meet the standard income test |
New Suspension Provisions for Greater Security
One of the most reassuring parts of the reminder sent to Aussies is the introduction of a “grace period” or suspension mechanism. Previously, if a carer exceeded their work hours, their payment was often cancelled entirely, requiring a lengthy and stressful re-application process once their hours decreased.
Under the new rules, if a recipient goes over the 100-hour limit or earns above the income threshold temporarily, their payment will be suspended for up to six months rather than cancelled. This means that if their circumstances change—for instance, if a contract job ends or the person they care for requires more attention—the payment can be reactivated quickly without the need for a brand-new claim.
Holiday Payment Schedules and Reporting Reminders
As we reach the end of 2025, Services Australia is also reminding millions of recipients about the adjusted payment schedules for the Christmas and New Year period. Because of bank closures and public holidays, many payments are being brought forward. Carers are encouraged to check their MyGov accounts to see their specific “earlier” reporting dates.
It is vital to note that while getting paid early can help with holiday expenses, it is not an “extra” payment. It is simply your regular fortnightly support arriving sooner. Failing to report on the revised dates could result in a delay in receiving funds, so keeping a close eye on the Centrelink app is essential during this busy month.
Impact on Rural and Regional Carers
The removal of “travel time” from the participation limit is a massive win for those living in rural and regional Australia. Previously, a carer in a remote area might spend three hours commuting to a part-time job; those three hours would count toward their 25-hour limit, effectively slashing their actual working capacity. By removing commute time from the equation, the government is leveling the playing field for regional Australians, allowing them to seek employment opportunities that were previously mathematically impossible to maintain while keeping their Carer Payment.
Preparation for 2026 and Beyond
Looking further ahead, the government has signaled that these changes are just the beginning of a broader National Carers Strategy. There are ongoing discussions regarding the inclusion of superannuation for those on Carer Payments to ensure that long-term caregiving does not lead to poverty in retirement. While not yet law, the 2025 reforms lay the groundwork for a system that recognizes caregiving as a valuable contribution to society rather than a barrier to economic participation.
FAQs
Q1. Do I need to re-apply for my payment when the new 100-hour rule starts?
No. If you are already receiving the Carer Payment, the new 100-hour flexibility will be applied automatically to your account starting from March 20, 2025. You should continue to report your hours and income as usual.
Q2. Is the Carer Allowance also subject to the 100-hour work limit?
The 100-hour participation limit specifically applies to the Carer Payment (the income support payment). The Carer Allowance is a supplementary payment and has different, generally more flexible, rules regarding work.
Q3. Will my payment be cancelled if I work 30 hours in a single week?
Not necessarily. Under the new 100-hour per four-week rule, you can work 30 hours in one week as long as your total hours over the entire four-week period do not exceed 100. Even if you do exceed it, your payment may be suspended for up to six months rather than cancelled.
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