A means test is a determination of whether an individual or family is eligible for government assistance or

welfare Welfare, or commonly social welfare, is a type of government support intended to ensure that members of a society can meet basic human needs such as food and shelter. Social security may either be synonymous with welfare, or refer specificall ...

, based upon whether the individual or family possesses the means to do without that help.

Canada

In Canada, means tests are used for student finance (for

post-secondary education Tertiary education, also referred to as third-level, third-stage or post-secondary education, is the educational level following the completion of secondary education. The World Bank, for example, defines tertiary education as including univers ...

legal aid Legal aid is the provision of assistance to people who are unable to afford legal representation and access to the court system. Legal aid is regarded as central in providing access to justice by ensuring equality before the law, the right to co ...

, and "

" (direct

transfer payments In macroeconomics and finance, a transfer payment (also called a government transfer or simply transfer) is a redistribution of income and wealth by means of the government making a payment, without goods or services being received in return. Th ...

to individuals to combat poverty). They are not generally used for primary and secondary education which are tax-funded. Means tests for

public health insurance Publicly funded healthcare is a form of health care financing designed to meet the cost of all or most healthcare needs from a publicly managed fund. Usually this is under some form of democratic accountability, the right of access to which are se ...

were once common but are now illegal, as the

Canada Health Act The ''Canada Health Act'' (CHA; ''french: Loi canadienne sur la santé'') is a statute of the Parliament of Canada, adopted in 1984, which establishes the framework for federal financial contributions to the provincial and territorial health in ...

of 1984 requires that all the provinces provide

universal healthcare Universal health care (also called universal health coverage, universal coverage, or universal care) is a health care system in which all residents of a particular country or region are assured access to health care. It is generally organized ar ...

coverage to be eligible for subsidies from the federal government. Means tests are also not used for pensions and seniors' benefits, but there is a

clawback The term clawback or claw back refers to any money or benefits that have been given out, but are required to be returned (clawed back) due to special circumstances or events, such as the monies having been received as the result of a financial crim ...

Old Age Security The Old Age Security (OAS) (SV; french: Sécurité de la vieillesse) program is a universal retirement pension available to most residents and citizens of Canada who have reached 65 years old. This pension is supplemented by the Guaranteed Income ...

payments for people making over $69,562 (in 2012). The

Last Post Fund The Last Post Fund is a Canadian non-profit organization and registered charity which was founded in 1909. The Last Post Fund’s mission is to ensure that "no Veteran is denied a dignified funeral and burial, as well as a military gravestone, due ...

uses a means test on a deceased veteran's estate and surviving widow to determine whether they are eligible for federal funding to subsidize their funeral.

United Kingdom

Resentment over a means test was among the factors giving rise to the

National Unemployed Workers' Movement The National Unemployed Workers' Movement was a British organisation set up in 1921 by members of the Communist Party of Great Britain. It aimed to draw attention to the plight of unemployed workers during the post First World War slump, the 1926 ...

in the

United Kingdom The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Europe, off the north-western coast of the continental mainland. It comprises England, Scotland, Wales and North ...

. Today, means-tested benefits—meaning that entitlement is affected by the amount of income, savings, capital and assets— is a central feature of the benefit system. Means testing is also part of the determination of

in a

magistrates court A magistrates' court is a lower court where, in several jurisdictions, all criminal proceedings start. Also some civil matters may be dealt with here, such as family proceedings. Courts * Magistrates' court (England and Wales) * Magistrate's Cou ...

and for the higher

Crown Court The Crown Court is the court of first instance of England and Wales responsible for hearing all Indictable offence, indictable offences, some Hybrid offence, either way offences and appeals lied to it by the Magistrates' court, magistrates' court ...

. The means test is based on income, family circumstances and essential living costs. The

Beveridge Report The Beveridge Report, officially entitled ''Social Insurance and Allied Services'' ( Cmd. 6404), is a government report, published in November 1942, influential in the founding of the welfare state in the United Kingdom. It was drafted by the Libe ...

of 1942 proposed a system of contributory benefits which would leave only a residual role for means-tested benefits which were then called

National Assistance National Assistance was the main means-tested benefit in the United Kingdom from 1948 to 1966. It was established by the National Assistance Act 1948 and abolished by the Ministry of Social Security Act 1966, which established the Supplementary Be ...

. The income limits are specified in relation to the needs of a household and for savings there are upper limits for some of the benefits. A couple who are not married may be treated as living together as a married couple. The main means-tested benefits in 2019 were: *

Income Support Income Support is an income-related benefit in the United Kingdom for some people who are on a low income, but have a reason for not actively seeking work. Claimants of Income Support may be entitled to certain other benefits, for example, Housi ...

* Income-based Jobseeker's Allowance * Income-related

Employment and Support Allowance Employment is a relationship between two parties regulating the provision of paid labour services. Usually based on a contract, one party, the employer, which might be a corporation A corporation is an organization—usually a group o ...

Pension Credit Pension Credit is the principal element of the UK welfare system for people of pension age. It is intended to supplement the UK State Pension, or to replace it (for example, if the claimant did not meet the conditions to claim a State Pension). I ...

Universal Credit Universal Credit is a United Kingdom social security payment. It is means-tested and is replacing and combining six benefits for working-age households with a low income: income-related Employment and Support Allowance, income-based Jobseeker's ...

Housing Benefit Housing Benefit is a means-tested social security benefit in the United Kingdom that is intended to help meet housing costs for rented accommodation. It is the second biggest item in the Department for Work and Pensions' budget after the state ...

Working Tax Credit Working Tax Credit (WTC) is a state benefit in the United Kingdom made to people who work and have a low income. It was introduced in April 2003 and is a means-tested benefit. Despite their name, tax credits are not to be confused with tax cred ...

Child Tax Credit A child tax credit (CTC) is a tax credit for parents with dependent children given by various countries. The credit is often linked to the number of dependent children a taxpayer has and sometimes the taxpayer's income level. For example, in t ...

Receipt of such benefits other than

and tax credits is a passport to other non-cash help such as

free school meals A school meal or school lunch (also known as hot lunch, a school dinner, or school breakfast) is a meal provided to students and sometimes teachers at a school, typically in the middle or beginning of the school day. Countries around the world ...

, free

prescription charges Charges for prescriptions for medicines and some medical appliances are payable by adults in England under the age of 60. However, people may be exempt from charges in various exemption categories. Charges were abolished by NHS Wales in 2007, Hea ...

Legal Aid Legal aid is the provision of assistance to people who are unable to afford legal representation and access to the court system. Legal aid is regarded as central in providing access to justice by ensuring equality before the law, the right to co ...

cold weather payment Cold weather payments are paid by the United Kingdom government to recipients of certain state benefits in the event of particularly cold weather in the winter. The Social Fund Cold Weather Payments (General) Regulations 1988 govern the system u ...

. The claimant, their partner and dependent children are covered. The rules for free

NHS dentistry Dentistry provided by the National Health Service in the United Kingdom is supposed to ensure that dental treatment is available to the whole population. Most dentistry is provided by private practitioners, most of whom also provide, on a commerci ...

and optical charges have become more complex since the introduction of

and have led to many people facing financial penalties, often wrongly. People who are not entitled to any of the qualifying benefits may be able to qualify for help with health charges by a separate means test, the

NHS Low Income Scheme The NHS Low Income Scheme is intended to reduce the cost of NHS prescription charges, NHS dentistry, sight tests, glasses and contact lenses, necessary costs of travel to receive NHS treatment, NHS wigs and fabric supports, i.e. spinal or abdom ...

. Defunct benefits include: *

Supplementary Benefit Supplementary Benefit was a means-tested benefit in the United Kingdom, paid to people on low incomes, whether or not they were classed as unemployed, such as pensioners, the sick and single parents. Introduced in November 1966, it replaced the ear ...

* Family Credit *

Family Income Supplement Family Income Supplement was a means-tested benefit for working people with children introduced in Britain in 1970 by the Conservative government of Edward Heath, effective from August 1971. It was not intended to be a permanent feature of the socia ...

* Social Fund (UK)

United States

Means testing is used to test for eligibility to Medicaid, Temporary Assistance for Needy Families, Section 8 housing,

Supplemental Nutrition Assistance Program In the United States, the Supplemental Nutrition Assistance Program (SNAP), formerly known as the Food Stamp Program, is a federal program that provides food-purchasing assistance for low- and no-income people. It is a federal aid program, ad ...

, Pell Grant,

Federal Supplemental Educational Opportunity Grant The Federal Supplemental Educational Opportunity Grant, more commonly known by its acronym SEOG, is a federal assistance grant reserved for college students with the greatest need for financial aid to attend school. To be eligible for this grant, ...

Federal Work-Study Program The Federal Work-Study program originally called the College Work-Study Programhttp://www.ed.gov/programs/fws/index.html The Department of Education : Federal Work Study and in the United States frequently referred to as just "Work-study", is a ...

, direct subsidized student loans, as well as the eligibility for relief for debtors who have sufficient financial ''means'' to pay a portion of their debts. The means test is perhaps best recognized in the United States as the test used by courts to determine eligibility for Title 11 of the United States Code

Chapter 7 Chapter 7 may refer to: Albums * ''Chapter Seven'' (album), a 2013 album by Damien Leith. *''Chapter VII'', a 1973 album by drummer Buddy Miles George Allen "Buddy" Miles Jr. (September 5, 1947February 26, 2008) was an American composer, drum ...

Chapter 13 bankruptcy Title 11 of the United States Code sets forth the statutes governing the various types of relief for bankruptcy in the United States. Chapter 13 of the United States Bankruptcy Code provides an individual with the opportunity to propose a plan o ...

. During the

Great Depression The Great Depression (19291939) was an economic shock that impacted most countries across the world. It was a period of economic depression that became evident after a major fall in stock prices in the United States. The economic contagio ...

in the 1930s, the test was used to screen applicants for such programs as Home Relief, and starting in the 1960s, for benefits such as those provided by Medicaid and the Food Stamp Program. In 1992, third-party Presidential candidate

Ross Perot Henry Ross Perot (; June 27, 1930 – July 9, 2019) was an American business magnate, billionaire, politician and philanthropist. He was the founder and chief executive officer of Electronic Data Systems and Perot Systems. He ran an inde ...

proposed that future Social Security benefits be subjected to a means test; though this was hailed by some as a potential solution to a purported impending crisis in funding the program, few other political candidates since Perot have publicly made the same suggestion, which would require costly investigations and might associate accepting those benefits with social stigma. In 2005, the US substantially changed its bankruptcy laws, adding a means test to prevent wealthy debtors from filing for Chapter 7 Bankruptcy. The most noteworthy change brought by the 2005 BAPCPA amendments occurred within . The amendments effectively subject most debtors who make an income, as calculated by the Code, above the median income of the debtor's state to an income-based test. This is referred to as the "means test". The means test provides for a finding of abuse if the debtor's income is higher than a specified portion of their debts. If a presumption of abuse is found under the means test, it may be rebutted only in the case of "special circumstances". Debtors whose income is below the state's median income are not subject to the means test. Notably, the Code-calculated income may be higher or lower than the debtor's actual income at the time of filing for bankruptcy. This has led some commentators to refer to the bankruptcy code's "current monthly income" as "presumed income". If the debtor's debt is not primarily consumer debt, then the means test is inapplicable. Thus, the means test is a formula designed to keep filers with higher incomes from filing for Chapter 7 bankruptcy. These filers may use Chapter 13 bankruptcy to repay a portion of their debts, but may not use Chapter 7 to wipe out their debts altogether. The bankruptcy means test is complex and the terms that govern many parts of it – including those terms that control whether it applies at all – are of unsettled definition.

Other examples

Other examples of means testing include Medifund in SingaporeMeans Testing for Medical Subsidies
/ref> and Medical Cards in Ireland. Both are used in the healthcare sector. Australia uses a means test for its Age Pension.

References

External links