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2010-2011
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
SENATE
SOCIAL SECURITY AND OTHER LEGISLATION
AMENDMENT (MISCELLANEOUS MEASURES) BILL
2011
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Tertiary Education, Skills, Jobs and
Workplace Relations, Senator the Honourable Chris Evans)
SOCIAL SECURITY AND OTHER LEGISLATION
AMENDMENT (MISCELLANEOUS MEASURES) BILL 2011
OUTLINE
The Bill amends the Social Security (Administration) Act 1999 to insert a standalone obligation
for a person to inform the Department of events or changes of circumstances that might affect
the payment of a social security payment to the person or the person's qualification for a
concession card. This obligation will operate both prospectively, and retrospectively to 20 March
2000.
The Bill makes technical amendments to the Family Assistance and Other Legislation
Amendment (Child Care and Other Measures) Act 2011 and to the Family Assistance Legislation
Amendment (Child Care Rebate) Act 2011 to correct drafting oversights.
The Bill also includes an application provision to provide that the requirements of subsection
6A(1) of the Social Security (Administration) Act 1999 are taken to have been complied with in
relation to decisions made under the social security law by the operation of a computer program
for the period 12 June 2001 to the date of Royal Assent.
FINANCIAL IMPACT
No direct financial impact will result from the Bill.
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SOCIAL SECURITY LEGISLATION AMENDMENT
(MISCELLANEOUS MEASURES) BILL 2011
NOTES ON CLAUSES
Clause 1 - Short title
Provides for the Act to be cited as the Social Security and Other Legislation Amendment
(Miscellaneous Measures) Act 2011.
Clause 2 - Commencement
Sections 1 to 3 of the Bill will commence on the day the Bill receives the Royal Assent.
Schedule 1 to the Bill will commence on 20 March 2000.
Item 1 of Schedule 2 to the Bill will commence immediately after the commencement of item 8
of Schedule 1 to the Family Assistance and Other Legislation Amendment (Child Care and
Other Measures) Act 2011.
Item 2 of Schedule 2 to the Bill will commence immediately after the commencement of section
2 of the Family Assistance Legislation Amendment (Child Care Rebate) Act 2011 (section 2
commenced on 21 April 2011).
Schedule 3 to the Bill will commence on the day the Bill receives the Royal Assent.
Clause 3 - Schedule(s)
Provides that each Act that is specified in a Schedule is amended or repealed as set out in the
applicable items in the Schedule and that any other item in a Schedule has effect according to its
terms.
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Schedule 1 -- Notification of change of circumstances etc.
Summary
This Schedule amends the Social Security (Administration) Act 1999 (Administration Act) to
provide that certain persons must inform the Department within 14 days of an event or change of
circumstances that might affect the payment of a social security payment or qualification for a
concession card.
The amendment has been designed to avoid requiring a person to inform the department twice of
the same event or change of circumstances: first, to comply with the above requirement; and
second, to comply with the requirements of the notices Centrelink gives in relation to every
social security payment and concession card. That is, the amendment provides that a person who
complies with the requirements of a notice issued by Centrelink to inform the Department of an
event or change of circumstances will be taken to have complied with the requirement in the
amendment to inform the Department.
Background
For many years the Commonwealth Director of Public Prosecutions (CDPP) has prosecuted
cases involving social security fraud under various sections of the Criminal Code, particularly
section 135.2 `Obtaining a financial advantage'. These offence provisions involve, for the
physical element of the offence, proving that the defendant engaged in conduct, where the
relevant conduct is an omission - namely, failing to inform the Department of an event or change
of circumstances that might affect the person's social security payment or qualification for a
concession card.
Section 4.1 of the Criminal Code provides that engaging in conduct includes an omission to
perform an act. Section 4.3 provides that an omission to perform an act can only be a physical
element of an offence if (a) the law creating the offence makes it so; or (b) the law creating the
offence impliedly provides that the offence is committed by an omission to perform an act that
by law there is a duty to perform.
In Poniatowska v DPP (Cth) (2010) 271 ALR 610; [2010] SASCFC 19 (Poniatowska), the full
court of the Supreme Court of South Australia (majority decision) held that `section 135.2 does
not define any duty or obligation relevant to an offence committed by way of omission' (that is,
paragraph 4.3(a) of the Criminal Code did not apply). It further noted that the CDPP had not
relied on any notice issued to the defendant to establish such a duty (i.e. to inform the
Department of an event or change of circumstances) and that the Administration Act did `not
create a separate "stand alone" obligation (that is, paragraph 4.3(b) of the Criminal Code did not
apply). Accordingly, the court held that the defendant `could not, in law, have been convicted of
the offences charged' and set aside the convictions which had been recorded against the
defendant.
The Commonwealth has appealed the Poniatowska decision to the High Court, which has
reserved its decision. The current position is that a large number of past convictions are at risk of
being overturned on appeal on the basis of the decision in Poniatowska. Since the decision, the
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CDPP has adjourned or discontinued a large number of matters of this kind before the courts.
The CDPP is also not commencing new proceedings of this kind, pending the determination of
the appeal before the High Court.]
The CDPP did not, in past prosecutions, rely on the notices given to the person by Centrelink to
establish the person was under a duty to inform Centrelink as it was understood that this was not
required. It is not possible to defend past convictions appealed on the basis of the reasoning in
Poniatowska by seeking to introduce such notices into evidence to establish the duty. In addition,
it has become apparent that it may not be able to be proved beyond reasonable doubt that such
notices have complied with the requirements of section 6A of the Administration Act during the
relevant period of time.
Explanation of the changes
Social Security (Administration) Act 1999
Item 1 - Before section 67
Item 1 inserts a new section 66A which imposes an obligation on certain persons to inform the
Department of the occurrence of an event or change of circumstances that might affect the
payment to the person of a social security payment or the person's qualification for a concession
card.
The persons to whom this obligation applies are those:
· who have made a claim for a social security payment or a concession card (new
subsection 66A(1));
· to whom a social security payment is being paid or who hold a concession card (new
subsection 66A(2)); and
· who are not receiving a social security payment but to whom a social security payment
has at any time been paid or who do not hold a concession card but who have at any time
held a concession card (new subsection 66A(3)). This only applies to events and changes
of circumstances which might have affected the person's previous receipt of a social
security payment or qualification for a concession card.
Unless new subsection 66A(4) applies, a person to whom this obligation applies must inform the
Department within 14 days after the day on which the event or change of circumstances occurs.
Every person who receives a social security payment or a concession card is sent notices by
Centrelink, pursuant to Division 6 of Part 3 of the Administration Act. These notices require the
person to inform the Department of events or changes of circumstances which might affect the
person's social security payment or qualification for a concession card. It is not the intention of
this amendment to add to a person's obligations to inform the Department of such events and
changes of circumstances.
Accordingly, new subsection 66A(4) provides that if a person is given such a notice and the
person complies with the notice, the person is taken to have complied with the obligation to
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inform the Department which applies to the person by virtue of new subsection 66A(1), (2) or
(3), whichever applies. This means that if the relevant notice provides for a longer period than 14
days in which the person must inform the Department of the event or change of circumstances,
and the person provides the information within that longer period, the person is taken to have
satisfied the obligation to inform within 14 days in new subsections 66A(1), (2) and (3).
Further, new paragraph 66A(4)(b) does not require that the notice that is given to a person be a
notice which satisfies all the requirements of the Administration Act. This means that if a person
complies with a notice purportedly given in accordance with Administration Act, and informs
the Department of an event or change of circumstances in accordance with the requirements of
that notice, the person will have complied with obligation to inform imposed by new subsections
66A(1), (2) or (3), whichever applies, even if the notice does not in fact comply with all the
requirements for a notice imposed by the Administration Act.
Further, new subsection 66A(5) in conjuction with new subsection 66A(4) has the effect that a
person will be taken to have complied with whichever of new subsections 66A(1), (2), or (3)
applies, if the person complies with the requirements to inform the Department in accordance
with a notice which is given to the person at any time before the expiry of 14 days after the day
on which the event or change of circumstances occurs.
New subsection 66A(6) provides that new section 66A does not limit the power of the Secretary
to give a person a notice.
New section 66A does not affect the operation of the notice provisions in Division 6 of Part 3 of
the Administration Act, nor does it affect the operation of the determination provisions in
Divisions 7 and 8 of Part 3 of the Administration Act (these include determinations to increase or
to reduce the rate at which a social security payment is being paid and determinations in relation
to the suspension or cancellation of a social security payment and determinations in relation to
cancellation of concession cards). New subsection 66A also does not affect the operation of the
date of effect of determination provisions in Division 9 of Part 3 of the Administration Act, nor
the provisions relating to overpayment and debt recovery in Chapter 5 of the Social Security Act
1991. For these reasons, new section 66A does not relieve Centrelink the need to give notices to
persons requiring them to inform the Department of events and changes of circumstances that
might affect their social security payment or qualification for a concession card.
New section 66A has both prospective and retrospective effect.
New section 66A applies retrospectively to 20 March 2000, which is the date the Administration
Act commenced. The purpose of applying this provision with retrospective effect is to ensure
that certain criminal convictions in relation to social security fraud already made under sections
of Criminal Code (such as section 135.2 of the Criminal Code) cannot be overturned on the basis
that the physical element of the offence, being an omission, was not established. That is, for the
purposes of section 4.3 of the Criminal Code, which provides for when an omission to perform
an act can be a physical element of an offence, new section 66A provides (with retrospective
effect to 20 March 2000) that a person had an obligation to inform the Department of an event or
circumstance that might affect the person's social security payment or qualification for a
concession card, as set out in new subsections 66A(1), (2) and (3).
This would satisfy the requirement in paragraph 4.3(b) of the Criminal Code, by imposing
retrospectively by law a legal duty to perform an act (that is, to inform the Department of an
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event or circumstance that might affect the person's social security payment or qualification for a
concession card). The omission by the defendant of performance of that act which by law there is
a duty to perform is sufficient to establish the physical element of the offence in, for example
paragraph 135.2(1)(a) of the Criminal Code: `the person engages in conduct' (that conduct being
the omission to perform the act of informing the Department of an event or circumstance that
might affect the person's social security payment or qualification for a concession card, as set
out in new subsections 66A(1), (2) and (3)).
The Government does not lightly pursue retrospective legislation. However, in this case there are
exceptional circumstances justifying retrospectivity, namely that it would not be appropriate for
a significant number of prosecutions conducted from 2000 for social security fraud to be
overturned on a previously unidentified legal technicality.
One of the criticisms that can be directed at retrospective legislation in relation to criminal
offences is that people will be unaware that their conduct is an offence. In this case, however, the
convicted persons would all have been aware that they should have informed the Department of
the specified events and changes of circumstances listed in the notices given to them by
Centrelink in relation to their social security payment or concession card.
In addition, the effect of the retrospective application of this provision is to confirm convictions
already made. A failure to comply with the new provision is not itself an offence - it only
provides a basis for establishing the physical element of certain offences under the Criminal
Code. Further, the Criminal Code offences in question are not strict liability offences and include
fault elements which the prosecution must prove beyond reasonable doubt.
A further consideration is that there is no circumstance in which social security fraud could be
considered a legitimate activity for a person to engage in.
For all these reasons, the retrospective application of these amendments is not considered to
contravene fundamental principles of fairness or due process.
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Schedule 2 -- Technical amendments
Summary
This Schedule makes technical amendments to the Family Assistance and Other Legislation
Amendment (Child Care and Other Measures) Act 2011 (Child Care and Other Measures Act)
and to the Family Assistance Legislation Amendment (Child Care Rebate) Act 2011 (Child Care
Rebate Act) to correct drafting oversights.
Background
The Child Care Rebate Act received Royal Assent on 21 April 2011. It contains, in its
Schedule 3, amendments to the A New Tax System (Family Assistance)(Administration) Act 1999
(Family Assistance Administration Act) contingent on the commencement of the Child Care and
Other Measures Act before the Child Care Rebate Act. As the Child Care and Other Measures
Act has not commenced before the commencement of Child Care Rebate Act (the Bill for the
Child Care and Other Measures Act has not passed yet through the Parliament), the
commencement provisions relating to Schedule 3 of the Child Care Rebate Act are inadequately
described and require amendment to make it clear that they do not commence (Item 2).
The Child Care and Other Measures Act contains in its Item 8 of Schedule 1 an amendment to
subsection 82(2) of the Family Assistance Administration Act. The insertion of a new paragraph
82(2)(aa) by the Child Care Rebate Act made the description of the amendment incorrect. A
technical amendment to the heading is therefore required (Item 1).
Explanation of the changes
Family Assistance and Other Legislation Amendment (Child Care and
Other Measures) Act 2011
Item 1 - Item 8 of Schedule 1 (heading)
Item 1 replaces a reference in item 8 of Schedule 1 to the Child Care and Other Measures Act.
The reference in the item heading to "paragraphs 82(2)(a) and (b)" of the Family Assistance
Administration Act has been changed to "paragraphs 82(2)(a) to (b)". This corrects a reference
made incorrect by the insertion of paragraph (aa) in section 82 by item 35 of Schedule 1 to the
Child Care Rebate Act.
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Family Assistance and Legislation Amendment (Child Care Rebate) Act 2011
Item 2 - Subsection 2(1) (table item 28)
The Child Care Rebate Act contains 2 Schedules of amendments that are contingent on whether
that Act passes before or after the passage of the Child Care and Other Measures Act. Schedule 3
to the Child Care Rebate Act is to commence only if the Child Care and Other Measures Act
passes before the Child Care Rebate Act. Item 28 of the commencement table in subsection 2(1)
of the Child Care Rebate Act did not provide that Schedule 3 does not commence in the event
that the Child Care and Other Measures Act passes after the Child Care Rebate Act. Item 2 of
Schedule 2 to the Bill clarifies that Schedule 3 does not commence in that event.
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Schedule 3 --Decisions made by computer programs
Summary
The application provision in this Schedule provides that for the period 12 June 2001 to the date
of Royal Assent, a decision of the Secretary made under the social security law by operation of a
computer program satisfies the requirements of subsection 6A(1) of the Social Security
(Administration) Act 1999 (Administration Act). Among other things, this will ensure that past
decisions made in this manner which affect payment of a social security payment or the
qualification for a concession card, including decisions made in relation to overpayments and
recovery of debts under the social security law, cannot be overturned on the basis that it may not
be possible to prove to the requisite standard that the requirements in subsection 6A(1) of the
Administration Act have been met in relation to the Secretary having arranged for the use, under
the Secretary's control, of the computer program(s) to make the relevant decision(s).
Background
In the course of considering issues in relation to the matter of Poniatowska v DPP (Cth) (2010)
271 ALR 610; [2010] SASCFC 19 (Poniatowska), it has become apparent that Centrelink may
not have sufficient records to prove that, for the relevant period, decisions made under the social
security law by the operation of a computer program satisfied the requirements in subsection
6A(1) of the Administration Act that the Secretary arranged for the use, under the Secretary's
control, of the computer program(s) to make the relevant decision(s). Centrelink has reviewed its
processes to ensure that in future necessary evidence of compliance with these requirements will
be available. For this reason, the application of this provision is limited to the period from 12
June 2001 (the date section 6A of the Administration Act commenced) to the date of Royal
Assent.
Explanation of the changes
Item 1 - Decisions made by computer programs
Subitem 1(1) provides that Item 1 applies to a decision made under the social security law on or
after 12 June 2001 (the date section 6A of the Administration Act commenced) but before Royal
Assent and that decision was made by the operation of a computer program.
Subitems 1(2) and (3) provide that the requirements of subsection 6A(1) of the Administration
Act are taken to have been satisfied in relation to the making of the decision referred to in
subitem 1(1).
Subitem 1(4) defines three terms for the purposes of the item. Administration Act means the
Social Security (Administration) Act 1999; Secretary means the Secretary who is taken to have
made the decision under subsection 6A(1) of the Administration Act; and social security law has
the same meaning as in the Administration Act.
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