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2010-2011-2012
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
SOCIAL SECURITY AND OTHER LEGISLATION AMENDMENT
(DISABILITY SUPPORT PENSION PARTICIPATION REFORMS) BILL 2012
EXPLANATORY MEMORANDUM
(Circulated by the authority of the
Minister for Families, Community Services and Indigenous Affairs,
Minister for Disability Reform, the Hon Jenny Macklin MP)
SOCIAL SECURITY AND OTHER LEGISLATION AMENDMENT
(DISABILITY SUPPORT PENSION PARTICIPATION REFORMS) BILL 2012
OUTLINE
The Bill contains the measures set out below.
Work rule for disability support pension
This measure from the 2011-12 Budget package, Building Australia's Future
Workforce, allows all disability support pensioners to work up to 30 hours a
week without having their payment suspended or cancelled. This extends the
`30 hour rule' to people granted disability support pension since the
introduction of the Welfare to Work changes (that is, on or after 11 May 2005),
who currently have their pension suspended or cancelled once they work
more than 15 hours a week.
Participation requirements for disability support pension
This is a further measure from the Building Australia's Future Workforce
package. It introduces a requirement for certain disability support pensioners
under age 35 with a work capacity of at least eight hours a week to engage
with Centrelink through an initial participation interview and development of a
participation plan, tailored to their individual circumstances, to help build their
work capacity.
Portability of disability support pension
This measure introduces more generous rules, for disability support
pensioners with a severe impairment that is likely to continue for at least five
years and result in the person having no future work capacity, allowing them
to retain access to their disability support pension if they travel overseas for
more than 13 weeks.
Average weekly earnings and other amendments
The Bill also contains minor amendments - changing references in the child
support legislation to Average Weekly Earnings data derived from an
Australian Bureau of Statistics publication because of a change in the
frequency of that publication, and making minor corrections to veterans'
entitlements and social security legislation.
1
Financial impact statement
Work rule for disability support pension
This measure will cost $7.6 million over the four years from 1 July 2011.
Participation requirements for disability support pension
This measure will cost $92.8 million over the four years from 1 July 2011.
Portability of disability support pension
These changes deliver a net saving of $19.0 million over the four years from
1 July 2011.
Average weekly earnings and other amendments
There is no financial impact from these amendments.
STATEMENTS OF COMPATIBILITY WITH HUMAN RIGHTS
The statements of compatibility with human rights appear at the end of this
explanatory memorandum.
2
SOCIAL SECURITY AND OTHER LEGISLATION AMENDMENT
(DISABILITY SUPPORT PENSION PARTICIPATION REFORMS) BILL 2012
NOTES ON CLAUSES
Abbreviations used in this explanatory memorandum
· Legislative Instruments Act means the Legislative Instruments
Act 2003
· Social Security Act means the Social Security Act 1991
· Social Security Administration Act means the Social Security
(Administration) Act 1999
Clause 1 sets out how the new Act is to be cited, that is, as the Social
Security and Other Legislation Amendment (Disability Support Pension
Participation Reforms) Act 2012.
Clause 2 provides a table that sets out the commencement dates of the
various sections in, and Schedules to, the new Act.
Clause 3 provides that each Act that is specified in a Schedule is amended or
repealed as set out in that Schedule.
1
Schedule 1 - Work rule for disability support pension
Summary
This measure from the 2011-12 Budget package, Building Australia's Future
Workforce, allows all disability support pensioners to work up to 30 hours a
week without having their payment suspended or cancelled. This extends the
`30 hour rule' to people granted disability support pension since the
introduction of the Welfare to Work changes (that is, on or after 11 May 2005),
who currently have their pension suspended or cancelled once they work
more than 15 hours a week.
Background
Disability support pension provides income support to people who, because of
an ongoing physical, intellectual or psychiatric impairment, are prevented from
working or from being re-trained to work. The current qualification criteria for
disability support pension require that a person, amongst other things, has a
continuing inability to work, where work is defined to be work of at least
15 hours per week in open employment.
Prior to the commencement of the Employment and Workplace Relations
Legislation Amendment (Welfare to Work and Other Measures) Act 2005, the
definition of work was work of at least 30 hours per week. Recipients of
disability support pension whose claims were granted before 11 May 2005
continue to be assessed under the previous qualification criteria.
The Government believes long-term dependence on disability support
pension is not the best option for people who have skills and capacity to
participate in the workforce. The measure in this Schedule is focused on
ensuring that people who wish to test their capacity to increase the number of
hours they work may do so without affecting their ongoing qualification for
disability support pension. The measure therefore provides an incentive for
workforce participation while acknowledging that disability support recipients
may not be able to maintain an increased work capacity and providing
disability support pension as a safety net.
The amendments made by this Schedule commence on 1 July 2012.
Explanation of the changes
Amendments to the Social Security Act
Item 1 inserts new section 96 into the Social Security Act. Section 96 allows
for the continuation of a person's qualification for disability support pension if
the person obtains paid work of at least 15 hours but less than 30 hours per
week.
Schedule 1 - Work rule for disability support pension
Subsection 96(1) sets out that section 96 applies to a person who is receiving
disability support pension and who would (if not for the new provision) lose
qualification for the pension because of obtaining paid work of at least
15 hours per week but less than 30 hours per week.
Subsection 96(2) specifies that people to whom section 96 applies continue to
be qualified for disability support pension. This means that disability support
pension recipients who participate in paid work for between 15 and 30 hours
per week can do so without affecting their qualification for disability support
pension despite the increased number of hours worked.
Items 2, 3 and 4 are consequential to the insertion of new section 96 of the
Social Security Act by item 1. Item 2 omits from paragraph 1035A(4)(b) the
number 15 and substitutes the number 30. Item 3 omits from
subparagraph 1035A(4)(e)(i) the number 15 and substitutes the number 30.
Item 4 omits from paragraph 1061ZD(2)(b) the number 15 and substitutes the
number 30.
The substitution of the number 30 for the number 15 by items 2, 3 and 4
amends provisions of the Social Security Act relating to extended qualification
for the pensioner concession card and qualification for mobility allowance.
Amendments to the Social Security Administration Act
Items 5, 6 and 7 are consequential to the insertion of new section 96 of the
Social Security Act by item 1. Item 5 omits from paragraph 96(1)(a) of the
Social Security Administration Act the number 15 and substitutes the
number 30. Item 6 omits from paragraph 97(1)(a) of the Social Security
Administration Act the number 15 and substitutes the number 30. Item 7
omits from paragraph 97A(2)(b) of the Social Security Administration Act the
number 15 and substitutes the number 30.
The substitution of the number 30 for the number 15 by items 5, 6 and 7
amends provisions of the Social Security Administration Act relating to
suspension instead of cancellation for disability support pension. These
amendments reflect the ability of recipients of disability support pension to
work for up to 30 hours per week without affecting their qualification.
Item 8 contains the transitional provisions.
Subitems 8(a) and 8(b) set out the people to whom the transitional provisions
apply. The transitional provisions apply to a person if the Secretary
suspended that person's disability support pension before the commencement
of item 1, because the person obtained paid work of between 15 and
30 hours per week, and the suspension is in effect immediately before the
commencement of item 1.
3
Schedule 1 - Work rule for disability support pension
Subitems 8(c) and 8(d) provide that the Secretary must reconsider the
suspension for the purposes of section 85 of the Social Security
Administration Act as soon as practicable after 1 July 2012 and, if the
Secretary is satisfied that disability support pension is payable to the person,
the Secretary must determine under section 85 that the disability support
pension is payable to the person.
Subitem 8(e) provides that section 114 of the Social Security Administration
Act applies to any determination made by the Secretary in accordance with
item 8.
4
Schedule 2 - Participation requirements for disability support pension
Summary
This Schedule contains a further measure from the Building Australia's Future
Workforce package. It introduces a requirement for certain disability support
pensioners under age 35 with a work capacity of at least eight hours a week
to engage with Centrelink through an initial participation interview and
development of a participation plan, tailored to their individual circumstances,
to help build their work capacity.
Background
The measure in this Schedule is aimed at improving support for Australians
with disability, to help them into work where possible, while continuing to
provide an essential safety net for those who are unable to support
themselves fully through work.
Working helps boost people's self-esteem, improves social contact, provides
more income, and leads to improved health and financial security. The
Government is committed to ensuring people with disability can access these
opportunities wherever they are able.
Many people with disability want to work if they can, but they may need extra
support.
This measure is targeted specifically at disability support pension recipients
under the age of 35 years because this group is considered to be at the
greatest risk of spending extended periods of time dependent on income
support. Further, this group of people is considered to be more likely to have
had a recent connection with the paid workforce, education or training, and is
considered to have the greatest potential to benefit from additional support
and services to build their capacity.
Under the measure, the disability support pension recipients affected will be
required to maintain regular contact with Centrelink to ensure that they are
able to be informed about vocational and non-vocational supports and
services to help them overcome barriers and build their capacity. This will be
done through regular participation interviews and an agreed participation plan.
The amendments made by this Schedule commence on 1 July 2012.
Schedule 2 - Participation requirements for disability support pension
Explanation of the changes
Amendments to the Social Security Act
Item 1 inserts new paragraph 94(1)(da). New paragraph 94(1)(da) has the
effect that, in order to qualify and to continue to qualify for disability support
pension, a person who is aged under 35, whose youngest dependent child is
aged six or over, and who the Secretary is satisfied is able to work at least
eight hours per week on wages at or above the relevant minimum wage,
must, in addition to satisfying the existing qualification provisions in section 94
of the Social Security Act, meet any participation requirements that apply to
the person.
Item 2 inserts new sections 94A, 94B, 94C, 94D, 94E and 94F into the Social
Security Act.
Participation requirements
New section 94A sets out the participation requirements that will apply to
those people to whom new paragraph 94(1)(da) applies. New
paragraph 94A(1)(a) provides that the person to whom new
paragraph 94(1)(da) applies must enter into a participation plan when required
to do so by the Secretary.
New paragraph 94A(1)(b) provides that, where a person has already entered
into a participation plan, the Secretary may require the person to enter into a
new participation plan. A new plan will be required where a participation plan
is amended, updated or replaced, to reflect changes in the person's
circumstances or to include further voluntary activities that may be suitable for
the person.
New paragraph 94A(1)(c) clarifies that, while a participation plan is in force,
the person must comply with the requirements of the plan.
New subsection 94A(2) provides that new section 94A will not apply where a
participation exemption under new section 94C (illness or accident),
section 94D (pre-natal and post-natal relief), section 94E (supported
employment) or section 94F (special circumstances) applies to the person.
Participation plans
New section 94B sets out the requirements of a participation plan. New
subsection 94B(1) provides that the Secretary may require a person to enter
into a participation plan where that person does not presently have a
participation plan in force.
New subsection 94B(2) provides that, where the person currently has a
participation plan in force, the Secretary may nevertheless require the person
to enter into a new participation plan, that is, an amended or revised plan.
6
Schedule 2 - Participation requirements for disability support pension
New subsection 94B(3) provides that, where the Secretary has determined
that a person must enter into a participation plan, the Secretary is to give that
person notice of both the requirement to enter into a participation plan and
details of the place and time at which the participation plan is to be entered
into.
New subsection 94B(4) provides that a participation plan that is in force must
contain one or more terms that the person is required to comply with and that
the Secretary regards as suitable for the person. The only compulsory
requirement in a participation plan will be attendance at further interviews.
New subsection 94B(5) provides that the Secretary must approve all the
requirements inserted in a participation plan.
New subsection 94B(6) provides that a participation plan may include one or
more terms that a person may comply with but is not required to. It is
anticipated that the majority of terms within a participation plan will set out
activities which the person may undertake. The purpose of the measure is to
ensure that the relevant disability support pension recipients are made aware
of employment and vocational and non-vocational supports and services
which may build their capacity and assist them to engage with the workforce.
New subsection 94B(7) provides that a participation plan must be in a form
approved by the Secretary. Note that the Secretary may change the structure
of the form from time to time.
Exemptions from entering into a participation plan
New subsections 94C, 94D, 94E and 94F set out the exemptions to entering
into a participation plan.
There are four exemptions:
· illness or accident;
· pre-natal and post-natal relief;
· supported employment; and
· special circumstances.
New section 94C provides for an exemption from participation where a person
is temporarily affected by an illness or accident. New subsection 94C(1)
provides that a person is covered by a participation exemption and is
therefore not required to enter into a participation plan, or, if a plan has
already been entered into, to fulfil the requirements of the participation plan, if
that person satisfies the Secretary that he or she is suffering from an illness or
has been involved in an accident. The Secretary is to determine the period
that the person is covered by a participation exemption (new
subsection 94C(2)).
7
Schedule 2 - Participation requirements for disability support pension
New subsection 94C(5) clarifies that a determination made under new
subsection 94C(2) is not a legislative instrument within the meaning of
section 5 of the Legislative Instruments Act. Subsection 94C(5) is inserted to
assist readers and is merely declaratory of the law.
When determining that a person is exempt from participation, the Secretary
may request that the person provide a certificate from a medical practitioner.
New subsection 94C(4) provides that nothing in new subsection 94C(3) limits
new subsection 94C(1).
New section 94D sets out pre-natal and post-natal exemptions from
participation. New subsection 94D(1) provides that a pregnant woman is
covered by a participation exemption and is therefore not required to enter
into a participation plan, or, if a plan has already been entered into, to fulfil the
requirements of the participation plan, for the period starting six weeks prior to
the expected date of confinement and ending on the day she gives birth.
New subsection 94D(2) provides that, if a woman gives birth, the woman is
covered by a participation exemption and is therefore not required to enter
into a participation plan, or, if a plan has already been entered into, to fulfil the
requirements of the participation plan, for the period that starts on the day she
gives birth and ends six weeks after that date.
This exemption applies whether or not the child is born alive.
New section 94E provides for an exemption from participation where the
person is in supported employment. New subsection 94E(1) provides that a
person who is employed and is receiving wages set in accordance with the
program known as the supported wage system is covered by a participation
exemption and is therefore not required to enter into a participation plan, or, if
a plan has already been entered into, to fulfil the requirements of the
participation plan.
New subsection 94E(2) provides that a person who is in employment that is
supported by a supported employment service within the meaning of section 7
of the Disability Services Act 1986 is covered by a participation exemption
and is therefore not required to enter into a participation plan, or, if a plan has
already been entered into, to fulfil the requirements of the participation plan.
These supported employment services are currently known as Australian
Disability Enterprises.
New subsection 94F provides an exemption from participation where there
are special circumstances. It is not practical to provide an exhaustive list of
what may constitute special circumstances. However, subsection 94F(1)
provides that the circumstances (which must actually exist as a matter of fact)
that the person is relying upon not to participate in a participation plan must
be beyond the person's control, and satisfy the Secretary that it would be
unreasonable to expect the person to comply with their participation plan as a
result of those special circumstances for a period of time.
8
Schedule 2 - Participation requirements for disability support pension
New subsection 94F(2) provides that any single period of exemption from
participation determined under subsection 94F(1) is not to exceed 13 weeks.
New subsection 94F(3) clarifies that any determination made under
subsection 94F(1) is not a legislative instrument. Any determination made
under subsection 94F(1) is not a legislative instrument within the meaning of
section 5 of the Legislative Instruments Act. This provision is inserted to
assist readers and is merely declaratory of the law.
Item 3 is an application provision, which provides that the amendments made
by this Schedule apply for the purposes of establishing or continuing a
person's qualification for disability support pension in respect of any time on
or after 1 July 2012.
9
Schedule 3 - Portability of disability support pension
Summary
This Schedule introduces more generous rules, for disability support
pensioners with a severe impairment that is likely to continue for at least five
years and result in the person having no future work capacity, allowing them
to retain access to their disability support pension if they travel overseas for
more than 13 weeks.
Background
Currently, Division 2 of Part 4.2 of Chapter 4 of the Social Security Act sets
out the length of time that social security payments can be paid to a person
while that person is outside of Australia. Payment of a social security pension
or benefit to a person while they are overseas is referred to as portability.
Generally, disability support pension can only be paid to a person for
13 weeks after they leave Australia. However, there are some existing
exceptions to the general portability rule.
Existing section 1218AA of the Social Security Act enables the Secretary to
determine that a disability support pensioner's maximum portability period is
unlimited if a person has a severe disability, has a terminal illness and returns
to their country of origin or moves overseas to be near family.
The amendments made by this Schedule establish a new category of people
who can access an unlimited portability period that is similar to the existing
section 1218AA. The Secretary will be able to determine that a person who
has a severe impairment that is likely to continue for at least five years and
who, as a result of the impairment, is not able to undertake any work, has an
unlimited portability period. This will mean that a person who meets the
criteria can live outside Australia indefinitely and continue to be paid disability
support pension.
The amendments made by this Schedule commence on 1 July 2012.
Explanation of the changes
Items 1 to 6 make technical amendments to the qualification criteria for
disability support pension in sections 94 and 95 of the Social Security Act.
The effect of these items is to ensure that a person continues to qualify for
disability support pension even after the person ceases to be an Australian
resident. A severely impaired disability support pensioner, as determined
in accordance with new section 1218AAA of the Social Security Act (inserted
by item 10 below), can live outside Australia and continue to be paid disability
support pension.
Schedule 3 - Portability of disability support pension
Item 7 inserts a definition of a severely impaired disability support pensioner
into section 1212 of the Act. The term severely impaired overseas disability
support pensioner is defined by reference to the new section 1218AAA,
inserted by item 10 below.
Item 8 makes a technical amendment to item 2 in the table at the end of
section 1217 of the Act. The table sets out the maximum length of time that a
particular social security payment can be paid to a person who is overseas,
known as the maximum portability period. The amendment made by this
item establishes that a person who is a severely impaired overseas disability
support pensioner will have an exception to the general 13-week maximum
portability period for disability support pension.
Item 9 provides for the amendment of the table at the end of section 1217, by
inserting a new table item 2A to provide that the maximum portability period
for a severely impaired overseas disability support pensioner is unlimited.
Item 10 inserts a new section 1218AAA into the Social Security Act at the
start of Subdivision B of Division 2 of Part 4.2.
New subsection 1218AAA(1) provides that the Secretary may determine that
a person is a severely impaired disability support pensioner if:
(a) they are in receipt of disability support pension; and
(b) they have a severe impairment as defined in subsection 94(3B) of the
Social Security Act; and
(c) the severe impairment is expected to last for at least five years; and
(d) they have no capacity to work independently of a program of
support (as defined in subsection 94(4) of the Social Security Act) as a
result of their severe impairment.
It is generally intended that, before the Secretary makes a determination
under new section 1218AAA, the disability support pensioner would be
required to undergo an assessment in Australia to determine whether they
meet the criteria for a severely impaired overseas disability support pensioner.
However, in relation to a person who is outside Australia, new
subsection 1218AAA(2) prevents the Secretary from making a determination
unless satisfied that the person is unable to return to Australia because the
person has had a serious accident, or has been hospitalised, before the end
of the person's portability period.
New subsection 1218AAA(3) allows the Secretary to revoke a determination
made under new subsection 1218AAA(1) if the Secretary becomes aware that
a severely impaired overseas disability support pensioner no longer meets the
criteria set out in new subsection 1218AAA(1).
11
Schedule 3 - Portability of disability support pension
A determination by the Secretary that a person is a severely impaired
overseas disability support pensioner is not a legislative instrument, as noted
in new subsection 1218AAA(4). This provision is inserted to assist readers
and is merely declaratory of the law. The determination of the Secretary
under new section 1218AAA is not a legislative instrument within the meaning
of the Legislative Instruments Act.
New subsection 1218AAA(5) inserts a definition of work for the purposes of
this new section. For the purposes of new section 1218AAA, work means
employment that is available in Australia for a wage that is at or above the
appropriate minimum wage. This includes work that is in a location away from
where the person ordinarily lives.
Item 11 repeals the heading to section 1218AA and substitutes a new
heading to the provision to take account of the amendments made in this
Schedule. The amendments in this Schedule provide for a new category of
people who can have an unlimited portability period for disability support
pension. The new heading for the existing unlimited portability period in
section 1218AA distinguishes the provision from new section 1218AAA.
Item 12 amends subsection 1220B(1) to provide that the Pension Portability
Rate Calculator at the end of section 1221 of the Social Security Act applies
to a person who has an unlimited portability period as a result of new
section 1218AAA.
Item 13 is an application provision, which provides that the amendments
made by this Schedule will only apply to qualification for disability support
pension, and absences from Australia, on or after 1 July 2012.
12
Schedule 4 - Average weekly earnings and other amendments
Summary
This Schedule contains minor amendments - changing references in the
child support legislation to Average Weekly Earnings data derived from an
Australian Bureau of Statistics publication because of a change in the
frequency of that publication, and making minor corrections to veterans'
entitlements and social security legislation.
Background
Average weekly earnings
Part 5 of the Child Support (Assessment) Act 1989 (Child Support
Assessment Act) provides for the administrative assessment of child support
and includes formulas for assessing the rate of child support payable by a
parent for a child for a day in a child support period. The formulas take into
account each parent's child support income and the costs of the child. The
annualised Male Total Average Weekly Earnings (MTAWE) figure for the
relevant September quarter is used in calculating a parent's self-support
amount, which is taken into account in working out their child support income.
The Costs of the Children Table in Schedule 1 of the Child Support
Assessment Act, which provides for the costs of the children, identifies
amounts based on the parents' combined child support income (or, in some
cases, the parent's child support income), and is also updated each year in
accordance with the annualised MTAWE figure for the relevant September
quarter.
The Average Weekly Earnings (AWE) amount for a September quarter of a
year of income is defined in subsection 58AA(1) and is used in working out
the ATI indexation factor. The ATI indexation factor is relevant to the
determination of a parent's adjusted taxable income for the last relevant year
of income in relation to a child support period, under section 58 if relevant tax
assessments are not available.
Both the annualised MTAWE figure for a relevant September quarter and the
AWE amount for a September quarter of a year of income are defined by
reference to amounts published for the reference period in the quarter by the
Australian Statistician in the document, Average Weekly Earnings, Australia.
The frequency of this publication will change in 2012 from quarterly to
biannually. Publications will be for the April-June and October-December
quarters. This means that amounts for the July-September quarter for 2012
and for subsequent years will no longer be published. In response to the
change in the frequency of this publication, amendments will be made to
change references to the September quarter to references to the June quarter
with respect to the annualised MTAWE figure, and references to the
September quarter to references to the December quarter in respect of the
AWE amount.
Schedule 4 - Average weekly earnings and other amendments
The amendments made by Division 1 of this Part will commence on Royal
Assent. The amendments made by Division 2 of this Part will commence on
1 January 2013, and the amendments made by Division 3 will commence on
1 July 2013.
Other amendments
Social Security Act
Currently, the pension loan scheme debt recovery provisions in Division 4 of
Part 3.12 of the Social Security Act provide that, in certain circumstances, a
debt that is payable to the Commonwealth is not recoverable.
Subparagraph 1139(2)(b)(iv) of the Social Security Act provides that one of
the exceptions to the Commonwealth being entitled to recover a debt until
after the person's death is if the person's partner has reached pension age.
Sub-subparagraphs 1139(2)(b)(iv)(A) and (B) refer to pension age for women
as 60 years and 65 years for a man. These ages are incorrect.
This Schedule will remove these incorrect and currently redundant references
to particular ages. The note following subparagraph 1139(2)(b)(iv) correctly
refers to pension age as being defined in subsections 23(5A), (5B), (5C)
and (5D). The pension age for women and men is determined by referring to
the date of birth of the person, as set out in the tables under these
subsections.
Therefore, the Commonwealth will not be entitled to recover a section 1135
debt until the conditions in subsection 1139(2) are met. For the purposes of
subparagraph 1139(2)(b), the Commonwealth would not be entitled to recover
a debt until after the person and their partner had died, provided all the
conditions of paragraph 1139(2)(b) are met.
By making the amendment, the reference to pension age would then link to
the definition referred to in the note.
This amendment commences on Royal Assent.
Veterans' Entitlements Act 1986
Lastly, an amendment will be made to align the rules in the Veterans'
Entitlements Act 1986 (Veterans' Entitlements Act) for working out the
minimum instalment for a service pensioner who is receiving either or both
pension supplement and clean energy supplement with corresponding rules
for pensioners under the Social Security Act.
This amendment commences immediately after the commencement of
item 15 in Schedule 3 to the Clean Energy (Household Assistance
Amendments) Act 2011.
14
Schedule 4 - Average weekly earnings and other amendments
Explanation of the changes
Part 1 - Average weekly earnings
Amendments to the Child Support Assessment Act
Division 1 - Amendments commencing on Royal Assent
Item 1 repeals subsection 155(2A) of the Child Support Assessment Act.
Subsection 155(2A) requires that, before the end of the calendar year, the
Secretary must publish in the Gazette the AWE amount (within the meaning of
subsection 58AA(1)) for the quarter ending 30 September of that year. As
there will no longer be a publication, Average Weekly Earnings, Australia for
the September quarter, this provision is repealed, meaning that the Secretary
will not be required to publish the AWE amount for the quarter ending 30
September 2012 before the end of the 2012 calendar year. Item 17 of
Division 2 of this Part inserts a new subsection 155(2A), which commences
on 1 January 2013 and sets out the new publication requirements for the
Secretary in relation to the AWE amount.
Item 2 is a transitional provision for the publication of the annualised MTAWE
figure by the Secretary in the calendar year ending 31 December 2012, in the
transition from the use of an annualised MTAWE figure for the relevant
September quarter to the figure for the relevant June quarter. Currently,
subsection 155(2) requires that, before the end of each calendar year, the
Secretary must publish in the Gazette for all child support periods starting in
the next calendar year, the annualised MTAWE figure for the relevant
September quarter, and the Costs of the Children Table incorporating this
figure.
From 1 January 2013, the annualised MTAWE figure will be defined by
reference to a relevant June quarter. This will apply in relation to child
support periods starting on or after 1 January 2013. Amendments will be
made by Division 2 of this Part to give effect to this, and to require the
Secretary, before the end of the calendar year for all child support periods
starting in the next calendar year, to publish in the Gazette the annualised
MTAWE figure for the relevant June quarter (and the Costs of the Children
Table incorporating this figure). These amendments will not commence until
1 January 2013.
This transitional provision provides that, in the 2012 calendar year,
subsection 155(2) applies as if the amendments made by Division 2 of this
Part of Schedule 4 to this new Act apply to sections 5 and 5A as if
subsection 155(2) had already commenced. The effect of this is that, before
the end of the 2012 calendar year, the Secretary will be required to publish in
the Gazette, for all child support periods starting in the 2013 calendar year,
the annualised MTAWE figure for the relevant June quarter (that is, the
quarter ending on 30 June 2012) and the Costs of the Children Table
incorporating this figure.
15
Schedule 4 - Average weekly earnings and other amendments
Item 3 is also a transitional provision. The Registrar may make or amend an
administrative assessment for a child support period before that period starts.
This allows a person to be notified of their new assessment before their child
support period starts. This transitional provision enables the annualised
MTAWE figure for the relevant June quarter (which is the figure that will apply
for child support periods starting on or after 1 January 2013) to be used in the
making or amending, before 1 January 2013, of an administrative assessment
for a child support period that starts on or after 1 January 2013. Under this
provision, the Child Support Assessment Act applies in relation to the making
or amending, before 1 January 2013, of an administrative assessment for a
child support period starting on or after 1 January 2013, as if the amendments
made by Division 2 of this Part of Schedule 4 to this new Act had already
commenced.
Division 2 - Amendments commencing on 1 January 2013
Items 4 and 5 amend subsection 5(1) to insert a definition of relevant June
quarter and to repeal the definition of relevant September quarter
respectively. Relevant June quarter is defined to have the meaning given by
subsection 5A(2). As the annualised MTAWE figure will be defined by
reference to a relevant June quarter from 1 January 2013, the definition of
relevant September quarter will be redundant, and is therefore repealed.
Items 6, 7 and 8 amend section 5A, which defines the annualised MTAWE
figure, so that the annualised MTAWE figure will be defined by reference to
the relevant June quarter, rather than a relevant September quarter.
Subsection 5A(1) provides a definition for the annualised MTAWE figure for a
relevant September quarter. Item 6 omits the reference to `September' in
subsection 5A(1) and substitutes `June'.
Item 7 repeals subsection 5A(2), and substitutes a definition of the relevant
June quarter in relation to a child support period. The relevant June quarter
in relation to a child support period, means the quarter ending on 30 June of
the last calendar year ending before the child support period begins. Item 8
omits the reference to `September' in paragraph 5A(5)(a) and substitutes
`June'.
Item 9 repeals and substitutes section 45 of the Child Support Assessment
Act. Section 45 provides a method for working out a parent's self-support
amount for a day in a child support period. New section 45 substitutes a
method for calculation of the self-support amount based on the annualised
MTAWE figure for the relevant June quarter. Under new section 45, a
parent's self-support amount is one third of the annualised MTAWE figure for
the relevant June quarter. The note to new section 45 notifies the reader that
a parent's self-support amount can be varied by a determination or order
under section 98S or 118.
16
Schedule 4 - Average weekly earnings and other amendments
Items 10 and 11 amend section 58 of the Child Support Assessment Act.
Both paragraph 58(4)(d) and subsection 58(5) contain a reference to the
annualised MTAWE figure for the relevant September quarter in relation to a
child support period. These items amend paragraph 58(4)(d) and
subsection 58(5) respectively, by omitting `September' and substituting `June'.
Item 12 similarly amends subsection 58D(2), which also contains a reference
to an amount that is at least two-thirds of the annualised MTAWE figure for
the relevant September quarter. `September' is omitted and `June' is
substituted.
Items 13 and 14 amend subparagraphs 98S(1)(e)(i) and 118(1)(e)(i)
respectively. Both of these provisions currently contain a reference to the
annualised MTAWE figure for the relevant September quarter. `September' is
omitted and substituted with `June'.
Items 15, 16 and 17 make various amendments to section 155. Item 15
omits the reference to `September' in paragraph 155(2)(a) and substitutes it
with `June', and item 16 makes the same substitution for
subparagraph 155(2)(b)(i). The effect is that, by the end of each calendar
year, the Secretary must publish in the Gazette for all child support periods
starting in the following calendar year, the annualised MTAWE figure for the
relevant June quarter, and the Costs of the Children Table incorporating this
figure, rather than the annualised MTAWE figure for the relevant September
quarter. As these amendments commence on 1 January 2013, item 2 in
Division 1 of this Part provides for a transitional provision to address the
publication of the relevant annualised MTAWE figure in the 2012 calendar
year for child support periods starting in the next calendar year.
Item 17 inserts new subsection 155(2A). Currently, subsection 155(2A)
requires that, before the end of each calendar year, the Secretary must
publish in the Gazette the AWE amount (within the meaning of
subsection 58AA(1)) for the quarter ending 30 September of that year. This
provision is repealed by item 1A of Division 1 of this Part, from Royal Assent,
to remove the requirement to publish the September figure in 2012, which will
be irrelevant from 2013. New subsection 155(2A) instead requires the
Secretary to publish in the Gazette, before the end of each financial year, the
AWE amount (within the meaning of subsection 58AA(1)) for the quarter
ending 31 December of that year. Item 22 of Division 3 of this Part will
amend subsection 58AA(1) so that, from 1 July 2013, AWE amount will be
defined by reference to a December quarter of a year of income.
17
Schedule 4 - Average weekly earnings and other amendments
Item 18 is a transitional provision addressing the Secretary's publication
requirements of the AWE amount (within the meaning of subsection 58AA(1))
in the financial year ending 30 June 2013. The amendments made by
Division 3 of this Part to substitute a new subsection 58AA(1), including a new
definition of the AWE amount for a December quarter of a year of income, will
not commence until 1 July 2013. It is intended that the Secretary publish the
AWE amount for the quarter ending 31 December 2012 by the end of the
2012-13 financial year. Therefore, this item provides that new
subsection 155(2A) of the Child Support Assessment Act applies in relation to
the financial year ending 30 June 2013 as if the amendments of section 58AA
made by Division 3 of this Part of Schedule 4 to this new Act had already
commenced.
Item 19 amends subclause 2(3) of Schedule 1 to the Child Support
Assessment Act by omitting `September' and substituting `June'. The effect of
the amendment is that the amount referred to in subclause 2(3) will be worked
out by reference to the annualised MTAWE figure for the relevant June
quarter.
Item 20 is an application provision. The amendments made by items 6 to 16
of Division 2 of this Part apply in relation to child support periods starting on or
after 1 January 2013.
Item 21 is a transitional provision. From 1 July 2013, in relation to child
support periods starting on or after that date, the AWE amount will be defined
by reference to a December quarter of a year of income. The ATI indexation
factor, which is relevant to determining a `default' adjusted taxable income for
an assessment, if applicable, is worked out using AWE amounts for a year of
income. The Registrar may make or amend an administrative assessment for
a child support period before that period starts. This allows a person to be
notified of their new assessment before their child support period starts. This
provision allows the AWE amounts that will apply in relation to working out an
ATI indexation factor (where applicable) for child support periods starting on
or after 1 July 2013, to be used in making or amending an administrative
assessment, before 1 July 2013, for a child support period that starts on or
after 1 July 2013.
Division 3 - Amendments commencing on 1 July 2013
Under the current subsection 58AA(1), the ATI indexation factor is worked out
with reference to AWE amounts for the September quarters of the last
relevant year of income and of the relevant earlier tax return year. Item 22
repeals subsection 58AA(1) and substitutes a new definition of the
ATI indexation factor. Under new subsection 58AA(1), the ATI indexation
factor is the AWE amount for the December quarter of the last relevant year of
income, divided by the AWE amount for the December quarter of the relevant
earlier tax return year. Terms used in this definition are defined in
subsection 58AA(1).
18
Schedule 4 - Average weekly earnings and other amendments
AWE amount for a December quarter of a year of income means the amount
published for the reference period in the quarter by the Australian Statistician
in a document titled Average Weekly Earnings, Australia (or, if that title
changes, in a replacement document) under the headings `Average Weekly
Earnings-Trends-Persons--All employees total earnings' (or, if any of those
headings change, under any replacement headings). December quarter of a
year of income means the quarter ending on 31 December of that year, and
reference period in a December quarter of a year of income means the
period described by the Australian Statistician as the last pay period ending
on or before the third Friday of the middle month of the quarter. The meaning
of tax return year which is also defined in new subsection 58AA(1) depends
on whether subsection 58(3) or (4) applies in the determination of the
parent's adjusted taxable income for the last relevant year of income. If
subsection 58(3) applies, tax return year means the year of income before the
last relevant year of income in relation to a child support period. If
subsection 58(4) applies, tax return year means the earlier year of income
that applies under paragraph 58(4)(c).
Item 23 omits `September' and substitutes `December' in
paragraph 58AA(3)(a).
Item 24 is an application provision. The amendments made by Division 3 of
this Part apply in relation to child support periods that start on or after
1 July 2013. For child support periods that start before this date, if
subsection 58(3) or (4) applies for the determination of a parent's adjusted
taxable income for the last relevant year of income, the ATI indexation factor
under current subsection 58AA(1) (which is worked out with reference to AWE
amounts for the September quarter of the last relevant year of income, and
the September quarter of the tax return year) will be used.
Part 2 - Other amendments
Amendment to the Social Security Act
Item 25 makes a minor technical amendment by repealing
sub-subparagraphs 1139(2)(b)(iv)(A) and (B) of the Social Security Act,
relating to recovery after death of a debt under the pensions loan scheme.
This amendment removes an incorrect and redundant reference to the
pension age for women and men. Subsection 23(1) and subsections 23(5A),
(5B), (5C) and (5D) define the pension age for men and women.
Amendment to the Veterans' Entitlement Act
Item 26 substitutes a new paragraph 58A(6)(c) of the Veterans' Entitlements
Act to clarify that the new daily rate for a minimum amount of service pension
is 1/364th of the total of:
· if more than the pension supplement basic amount is added, the
minimum pension supplement amount; and
19
Schedule 4 - Average weekly earnings and other amendments
· if added, the clean energy supplement.
This means that, if a person's rate of service pension is more than nil but less
than the minimum daily rate due to the application of the income or assets
test, the person's rate of service pension is increased to the minimum daily
rate. The amount of clean energy supplement is to be incorporated into the
minimum daily rate. This ensures that a person whose rate is reduced, but
not to nil, by the income and assets test, may receive an instalment equivalent
to the minimum pension supplement amount plus the clean energy
supplement amount.
20
STATEMENTS OF COMPATIBILITY WITH HUMAN RIGHTS
Prepared in accordance with Part 3 of the Human Rights (Parliamentary
Scrutiny) Act 2011
Social Security and Other Legislation Amendment (Disability Support
Pension Participation Requirements) Bill 2012
Schedule 1 - Work rule for disability support pension
This Schedule to the Bill is compatible with the human rights and freedoms
recognised or declared in the international instruments listed in section 3 of
the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Schedule
The Schedule will amend the Social Security Act 1991 to allow disability
support pension recipients who have been granted payment under the
15-hour work rule to work for up to 30 hours a week and, subject to the
income test, remain qualified for disability support pension.
Human rights implications
· The Schedule engages the following human rights:
- Right to Social Security
- Rights of people with disability
· The Schedule promotes these rights as it will allow people who are
granted disability support pension on after 11 May 2005 to increase
their hours of work without affecting their qualification for disability
support pension. This will treat this group the same as those qualified
prior to 11 May 2005 in regard to their allowable hours of work.
Conclusion
The Schedule is compatible with human rights because it advances the
protection of human rights.
Statements of compatibility with human rights
Schedule 2 - Participation requirements for disability support pension
This Schedule is compatible with the human rights and freedoms recognised
or declared in the international instruments listed in section 3 of the Human
Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Schedule
The Schedule will amend the Social Security Act 1991 to introduce
participation requirements for certain disability support pension recipients in
the form of attendance at participation interviews and the development of a
participation plan.
Human rights implications
· The Schedule engages the following human rights:
- Right to Social Security
- Rights of people with disability
· The Schedule promotes the rights of people with disability as it will
provide a means for people receiving disability support pension who
are under age 35 who have some work capacity to receive regular
information about supports and services available to them and, where
appropriate, referrals. This will assist to build their capacity and may
increase their chance of gaining employment.
· Certain disability support pension recipients will be required to develop
participation plans which will be individually tailored to the recipient and
will include voluntary activities that may help to connect them with
services and supports to overcome barriers to participation. Disability
support pension recipients who are manifestly eligible or have a work
capacity of zero to seven hours a week, or who are working in an
Australian Disability Enterprise, or in the Supported Wage System will
be exempt from the participation requirements.
· The aim of the measure is to ensure people on disability support
pension in the target group are provided with information about
supports and services they may use to overcome barriers to
participation, and to maintain regular contact with these people. It is
expected that some people may benefit from this regular contact by
building their capacity for work, or by gaining some paid employment or
accessing supports or services that they may not otherwise have
known about.
· The measure is specifically targeted at people who are under age 35
as they are considered to be more likely to have had a more recent
connection with work or study. This group is also considered to be
more at risk of remaining on income support for a long time. People
who are outside the age bracket or who are not in the target group for
any other reason will have the opportunity to voluntarily participate in
regular interviews with Centrelink.
Conclusion
The Schedule is compatible with human rights because it advances the
protection of human rights.
2
Statements of compatibility with human rights
Schedule 3 - Portability of disability support pension
This Schedule is compatible with the human rights and freedoms recognised
or declared in the international instruments listed in section 3 of the Human
Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Schedule
The Schedule inserts new provisions that will allow disability support pension
recipients who have a severe and permanent impairment and no future work
capacity to have their disability support pension paid overseas for greater than
13 weeks. These changes acknowledge that some disability support
pensioners who have a severe and permanent impairment and no future work
capacity should not be impacted by the portability rules applicable to the
majority of disability support pension recipients.
Human rights implications
This Schedule promotes the right to social security as it changes the
portability rules for disability support pension recipients with a severe and
permanent impairment and no future work capacity to allow them to receive
their payment overseas for greater than 13 weeks.
For the majority of disability support pension recipients the maximum time
they can receive their payment outside Australia will remain 13 weeks.
This Schedule is compatible with the human rights and freedoms recognised
or declared in the international instruments listed in section 3 of the Human
Rights (Parliamentary Scrutiny) Act 2011.
Conclusion
The Schedule is compatible with human rights because it advances the
protection of human rights.
3
Statements of compatibility with human rights
Schedule 4 - Average weekly earnings and other amendments
This Schedule is compatible with the human rights and freedoms recognised
or declared in the international instruments listed in section 3 of the Human
Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Schedule
The Australian Bureau of Statistics is changing the frequency of publication of
its Average Weekly Earnings (AWE) series from quarterly to biannually. AWE
data for the July-September quarter for 2012 and subsequent years will no
longer be published. As the Child Support (Assessment) Act 1989 refers to
the September quarter for AWE data, this bill amends that Act to change the
reference period.
The amendment to the Veterans' Entitlements Act 1986 aligns the rules for
working out the minimum instalment for a service pensioner who is receiving
either or both pension supplement and clean energy supplement with
corresponding rules for pensioners under the Social Security Act 1991.
Human rights implications
The AWE measure does not engage any of the applicable rights or freedoms.
The amendment to the Veterans' Entitlements Act 1986 engages the right to
social security.
The right to social security is contained in article 9 of the International
Covenant on Economic, Social and Cultural Rights (ICESCR).
The amendment will ensure that the rules for determining the minimum
payments of service pension instalments will correspond with those that apply
to age pensioners under the Social Security Act 1991.
The alignment of the rules that apply under both Acts will ensure the effective
administration of the Australian system of social security and ensure that
payments under the system are reasonable, proportionate and transparent.
Those aims are consistent with those expressed by the UN Committee on
Economic Social and Cultural Rights in General Comment No 19.
Conclusion
The AWE measure is compatible with human rights as it does not raise any
human rights issues.
The amendment to the Veterans' Entitlements Act 1986 is compatible with
human rights because it advances the protection of human rights.
Minister for Families, Community Services and Indigenous Affairs,
Minister for Disability Reform, the Hon Jenny Macklin MP
4