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13059 Cat. No. 97 2650 0 ISBN 0644 51695X
1996-97-98
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
SOCIAL SECURITY LEGISLATION AMENDMENT (YOUTH ALLOWANCE CONSEQUENTIAL AND RELATED MEASURES) BILL 1998
EXPLANATORY MEMORANDUM
(Circulated by the authority of the Minister for Social
Security,
Senator the Hon Jocelyn Newman)
SOCIAL SECURITY LEGISLATION
AMENDMENT (YOUTH ALLOWANCE CONSEQUENTIAL AND RELATED MEASURES) BILL 1998
OUTLINE AND FINANCIAL IMPACT STATEMENT
This Bill completes the legislation package commenced with the Social
Security Legislation Amendment (Youth Allowance) Bill 1997. That Bill gives
legislative effect to the new social security payment, youth allowance. Youth
allowance will be an integrated income support payment for young people which
will be available regardless of whether a person is in education, in training,
unemployed or sick.
The primary purpose of this new Bill is to provide
the consequential amendments for youth allowance. However, it also incorporates
some significant related measures flowing from the establishment of youth
allowance. These related measures largely comprise the transfer of program
elements for older students from the portfolio of the Minister for Employment,
Education, Training and Youth Affairs to the portfolio of the Minister for
Social Security.
This is to be done primarily by setting up a new
payment, austudy payment, in the Social Security Act for over 25 year old
students. There will also be new provisions in the Social Security Act for the
pensioner education supplement, for fares allowance and for the Student
Financial Supplement Scheme. Current arrangements will continue to apply for
ABSTUDY pensioner education supplement, student financial supplement and fares
allowance, and for the Assistance for Isolated Children Scheme.
This Bill
provides the consequential amendments for the transfer of these elements as well
as for youth allowance itself. It also provides: the transitional arrangements
for the package; the flow through to youth allowance of certain Budget measures
contained in the Social Security Legislation Amendment (Parenting and
Other Measures) Act 1997 and the Social Security and Veterans' Affairs
Legislation Amendment (Budget and Other Measures) Bill 1997 that were not
drafted in time to be included in the original youth allowance legislation; and
certain policy and technical refinements to youth allowance.
The Acts to
be amended are the Social Security Act 1991, the
Data-Matching Program (Assistance and Tax) Act 1990, the
Student and Youth Assistance Act 1973, the Income Tax
Assessment Act 1936, the Income Tax Assessment Act 1997,
the Taxation (Interest on Overpayments and Early Payments) Act
1983, the Veterans' Entitlements Act 1986, the Farm
Household Support Act 1992, the Health Insurance Act 1973,
the National Health Act 1953, the Disability Services Act
1986, the Child Care Payments Act 1997, the Aged
Care Act 1997, the Bankruptcy Act 1966, the
Registration of Deaths Abroad Act 1984 and the
Telecommunications Act 1997.
Date of effect: 1 July
1998
Financial impact: Whole initiative
(program
costs) (running
costs)
1997-98 $14.00m. nil.
1998-99 $53.77m. $22.52m.
1999-00 $34.49m. $14.28m.
This
Bill alone
(program costs) (running
costs)
1997-98 $14.00m. nil.
1998-99 $1.44m. nil.
1999-00 $0.97m. nil.
PRELIMINARY
Clause 1 of the Social Security Legislation Amendment
(Youth Allowance Consequential and Related Measures) Bill 1998 sets out how the
amending Act is to be cited.
Clause 2 specifies that the amending
Act commences on 1 July 1998, subject to the subclauses (2) to
(10).
Clause 3 says that each Act that is specified in a Schedule
to the Social Security Legislation Amendment (Youth Allowance Consequential and
Related Measures) Bill 1998 is amended or repealed in accordance with the
applicable items in those Schedules.
The abbreviations to be used in this
Explanatory Memorandum are set out below:
- the Social Security Act
1991 (the Social Security Act)
- the Student and Youth
Assistance Act 1973 (the Student and Youth Assistance Act)
- the
Student Assistance Act 1973 (the Student Assistance
Act)
- the Social Security Legislation Amendment (Parenting and
Other Measures) Act 1997 (the Parenting Act)
- the Social
Security and Veterans Affairs Legislation Amendment (Budget and Other Measures)
Bill 1997 (the Budget Measures Bill)
Schedule 1 - Amendment of the Social Security Act 1991 relating to austudy payment
1. Summary of proposed changes
This Schedule amends the Social Security Act to insert new
Part 2.11A which introduces austudy payment with a commencement date of 1
July 1998. Austudy payment replaces the AUSTUDY living allowance for over
25 year old students under the AUSTUDY scheme.
The rationale for the
introduction of austudy payment is that income support should continue to be
available to students aged 25 and over after the introduction of
youth allowance. To avoid complexity and duplication, the payment for
older students has been brought into the Social Security Act and basic rates and
conditions have been aligned with those for youth allowance. Apart from this
simplification measure, the payment will provide income support to this group on
much the same basis as current arrangements.
This Schedule also inserts a
new Part 3.5A into the Social Security Act, containing the rate calculator for
the new austudy payment.
2. Background
Austudy payment will replace the AUSTUDY living allowance currently
available under the Student Assistance Act.
Generally speaking, the new
austudy payment will incorporate many of the rules that apply currently for the
AUSTUDY living allowance. However, in many instances the rules will be
simplified and modified to bring the new payment into line with other payment
types in the Social Security Act. Examples of some of the changes that result
from the restructuring include:
entitlement for austudy payment will be
on a daily basis, and paid fortnightly;
all austudy payment recipients
will be subject to an activity test which can only be satisfied by undertaking
either full-time or concessional study;
• activity test penalties,
that currently apply to youth training allowance and newstart recipients (and
will apply to youth allowees) who breach the activity test, will also apply to
austudy payment;
certain entitlements that are not currently available
to AUSTUDY living allowance recipients (for example, bereavement payments and
advances of payment) but which apply to social security recipients will be
extended to austudy allowance recipients;
similar waiting and
deferment periods, where appropriate, will apply to austudy payment recipients
as will apply to youth allowance. There will be no ordinary waiting period for
austudy payment.
The new Austudy Payment Rate Calculator will appear in
the Social Security Act in new Part 3.5A. It is based on the structure and
contents of the Youth Allowance Rate Calculator to be inserted by the Youth
Allowance Bill. However, there will be certain differences: there will be no
concept of independence or otherwise since all austudy payment recipients will
be aged 25 or over and therefore independent in youth allowance terms; payment
of the away from home rate will not be restricted to a person who is "required
to live away from home"; there will be no parental means test, ie, no parental
income test, no family assets test and no family actual means test; and there
will be no rent assistance, consistent with current arrangements for over 25
year old students.
3. Clauses and Schedule involved in the changes
Clause 2: provides the commencement rules for this
Schedule.
Clause 3: provides that each Act that is specified in
this Schedule is amended as set out in the Schedule.
Schedule 1 - Amendment of the Social Security Act 1991 relating to austudy payment
Items 1 to 3: make new entries in the index of definitions in
section 3.
Item 4: amends subsection 23(1) to insert a
definition of "higher education institution".
Item 5: amends
subsection 23(1) to insert a definition of "TAFE
institution".
Item 6: inserts new Part 2.11A - Austudy
payment.
Item 7: inserts new Part 3.5A, consisting of the Austudy
Payment Rate Calculator and its preliminary sections.
4. Explanation of the changes
Items 1 to 3 amend several entries in the index of definitions in
section 3 to reflect new austudy payment definitions and Austudy Payment Rate
Calculator provisions.
Items 4 and 5 insert two new definitions
into subsection 23(1) of the Social Security Act, the general definitions
section, and section 3, the index of definitions, that are necessary for
new Part 2.11A. The two new definitions are "higher education institution",
which is defined to mean an institution that is a higher education institution
within the meaning of the Student Assistance Act and "TAFE
institution", which is defined to mean an institution that is a technical and
further education institution for the purposes of the
Student Assistance Act. These new definitions allow greater
flexibility in deciding what courses can be approved for payment
purposes.
Item 6 inserts new Part 2.11A dealing with austudy
payment.
New Part 2.11A - Austudy payment
New Division 1 - Qualification for austudy payment
New Subdivision A - Basic qualifications
The qualification requirements for austudy payment are based heavily
on those for the AUSTUDY living allowance. The only new requirement is that a
person satisfy the activity test, which can be achieved by "undertaking
qualifying study". The rules for undertaking qualifying study, however,
predominantly reflect the existing AUSTUDY living allowance rules.
New section 568 - Qualification for austudy payment - general rule
Section 568 sets out the basic qualification criteria for austudy
payment, which will determine a person's eligibility for austudy
payment.
Subject to Subdivision A, a person qualifies for austudy payment
in respect of a period, if throughout the period the person:
satisfies
the activity test (detailed in Subdivision B); and
the person is of
austudy age (detailed in Subdivision C); and
the person satisfies the
residency requirements that apply to the person (detailed in
Subdivision D).
A note refers the reader to Division 2 which
sets out situations where, even though the person may be qualified for austudy
payment, an austudy payment is not payable.
New Section 568A - Qualification for austudy payment - transferee from social security pension
Section 568A provides for the continuity of receipt of income where
a person receives a social security pension and becomes qualified for an
austudy payment within 14 days after the last instalment of
pension.
New Subdivision B - Activity test
New section 569 - Activity test
Subsection 569 provides that a person satisfies the activity test in
respect of a period if the person undertakes qualifying study (defined in
section 569A). Subsection 569(2) provides for two situations where a
person cannot be taken to satisfy the activity test. The first situation is
where a person is employed on a full-time basis as an apprentice or trainee
under an industrial instrument and has a training agreement with a training
authority. This exclusion is consistent with current government initiatives for
apprentices. The second situation is where a person has completed a degree of
Master or Doctor at either an Australian educational institution, or at a
foreign institution that is, in the Secretary’s opinion, of the same
standing as that of an Australian educational institution. This latter
preclusion applies currently under the AUSTUDY scheme and reiterates the
intention that AUSTUDY is intended to assist students to complete their
secondary education and an initial tertiary qualification.
Subsection 569(3) provides a definition of "industrial instrument" for the
purposes of subsection 569(2).
New section 569A - Undertaking qualifying study
Section 569A provides that a person is undertaking qualifying study,
and therefore satisfying the activity test, if the person satisfies four
requirements as detailed below. These requirements apply currently under the
AUSTUDY scheme.
First, the person must be enrolled, or intend to enrol,
in an approved course of education at an educational institution
(paragraph 569A(a) refers). The intention to re-enrol element reflects the
problem that, in practice, a person can be required to enrol at an educational
institution several times (characteristically each year in the case of tertiary
studies) during the course of the one course of study. If actual enrolment were
the only relevant factor in determining whether a person is a qualifying
student, there would be periods when a person who intends to continue in
full-time studies, or who is part way through a course of study, would no longer
fall within the definition. It would mean that qualifying students would not be
able to satisfy the activity test during these periods (for example, vacation
times) despite their intention to remain in education.
Subparagraph 569A(a)(iii) extends the person's intention to re-enrol to
situations where the person intends to enrol in another course after he or she
completes the course in which he or she is studying currently. This treatment
is necessary to ensure that where a person intends to move from say secondary to
tertiary study, the person can still meet the definition of undertaking
qualifying study, and so still qualify for austudy payment.
Second,
paragraph 569A(b) provides that the course of education in which the person
enrols, or intends to enrol, must be an approved course of education or study
(as detailed in new section 569B).
Third, the person must be either
a full-time or a concessional study-load student (as detailed in new
sections 569C and 569D).
Finally, the person must satisfy the
progress rules for study in new sections 569G and 569H.
New section 569B - Approved course of education or study
For the purposes of new paragraph 569A(a), an approved course of
education or study is one that the Employment Minister has determined under
section 5D of the Student Assistance Act to be a secondary or
tertiary course for the purposes of that Act.
New section 569C - Full-time students
Section 569C provides that a person is a full-time student in
respect of a course if he or she is undertaking (or in the case of a continuing
student, intending to undertake), at least three-quarters of the normal amount
of full-time study in respect of the course. Section 569E details what is
meant by a normal amount of full-time study.
New section 569D - Concessional study-load students
Subsection 569D(1) provides that there are two types of concessional
study-load students. First, a 25% concessional study-load student
(subsection 569D(2) refers). This student is one who is only required to
undertake a minimum of 25% of a normal full-time study load for a particular
corse of education. Subsection 569D(4) specifies which students qualify
for this concession and reflects current AUSTUDY rules. Such students include
those who have a substantial physical, psychiatric or intellectual disability,
which precludes them from studying at the normal full-time study load. Second,
a 66% concessional study-load student (subsection 569D(3) refers). This
student is one who is entitled to undertake a minimum of 66% of the normal
full-time study-load for a particular course of education, for a maximum of
6 months and is available to students who:
• cannot undertake
full-time study due to the educational institution’s requirements for the
course (for example, timetable clashes, subject cancelled or over-enrolled,
reduced workload needed to complete the course); or
• a specific
direction in writing from the academic registrar or equivalent officer;
or
• a recommendation in writing from the academic registrar or
equivalent officer for academic or vocational reasons. The institution does not
have to specify the reasons on which the recommendation was based, however,
study-load requirements cannot be reduced for vocational or academic reasons for
more than half of the academic year.
The 66% concession does not alter
time limits on study at any one level (see
subsection 569H(3)).
These concessions are included in
austudy payment because the activity test does not otherwise allow students
to qualify unless they are undertaking full-time study. Under
youth allowance, the flexible activity test means there is no need for
these specific provisions.
New section 569E - Normal amount of full-time study
Section 569E provides that the normal amount of full-time study for
a student is:
where the course is a designated course of study within
the meaning of Chapter 4 of the Higher Education Funding Act 1988
(that is, it attracts the Higher Education Contribution Scheme (HECS)) then the
standard student load is the amount determined by the institution for the
purposes of HECS; or
where the course is not such a designated course,
and the educational institution sets out the amount of full-time study that a
full-time student should typically undertake, then it is that amount;
or
• the amount of full-time study equivalent to the average amount
of full-time study that a person would have to undertake for the duration of the
course in order to complete the course in the minimum amount of time needed to
complete it. This criteria allows for some fluctuation in study-load for those
who do not meet either of the previous criteria; or
otherwise it is an
average of 20 contact hours per week in respect of a course.
New section 569F - First fortnight of classes
Section 569F gives a period of grace of up to 2 weeks while the student
arranges his or her studies for the particular study period in which he or she
is enrolled (for example, a semester). If the student studies either full-time
or at a concessional study-load (as the case may be) on at least one day in
those 2 weeks, then he or she satisfies the relevant study-load requirements
from the beginning of the study period.
New section 569G - Progress rules - secondary students
Subsection 569G(1) states that, with the exception of
subsection 569G(2), a secondary student satisfies the progress rules for
the purposes of paragraph 569A(d) (undertaking qualifying study) if in the
Secretary’s opinion the person is making satisfactory progress towards
completing the course. Subsection 569G(2) provides that, unless an
exception applies, a person does not satisfy the progress rules if he or she is
enrolled in a course at a year 12 level and the person has previously been
a full-time student in respect of a course at that level in 2 previous years.
The exceptions that may apply are where a person’s failure in a previous
course was due to an illness that had not been diagnosed prior to commencing the
course, circumstances beyond the person’s control or English not being the
person’s native language. This rule will also not apply where a
person’s failure was more than 10 years ago or the person completed
or discontinued a previous course within 6 months after the relevant
academic year started.
Subsections 569G(4) provides that a course is
at the level of year 12 if the institution offering it considers it to be
at that level. This provision caters for people who are undertaking a mix of
secondary level and other subjects but who, for all intents and purposes, are
secondary students. Subsection 569G(5) states that a secondary course is one
that is specified to be a secondary course for the purposes of the
Student Assistance Act.
New section 569H - Progress rules - tertiary students
A full-time or concessional study load tertiary student satisfies the
progress rules if on the day on which the person enrols (or the day on which
enrolments are next accepted) the time already spent by the student on the
course (or on one or more other tertiary courses at the same level) does not
exceed the allowable study time for that course. Subsection 569H(3)
provides that the allowable study time for a full-time or 66% concessional
study-load student is:
• if the minimum amount of time needed to
complete the course is one year or less - that minimum amount of time;
or
• if the minimum amount of time needed to complete the course as
a full-time student is more than one year and the student enrols (or intends to
enrol) in a yearlong subject, or the student's further progress in the course
depends on passing a whole year's work in the course - the minimum amount of
time plus one year; or
• in any other case - the minimum amount of
time needed to complete the year as a full-time student plus half an academic
year.
Subsection 569H(4) provides that the allowable study-time for a 25%
concessional study load student is twice the minimum period in which it is
possible to complete the course as a full-time student.
Subsection
569H(5) provides that if a person has studied part-time for a course over a
particular period, then the time spent by the person on the course is taken to
be the amount of study undertaken part-time divided by the normal amount of
full-time study for the course. This ensures the consistent application of the
allowable study time rules for students who change from part-time to full-time
or vice versa.
Subsection 569H(7) provides that certain factors can be
disregarded in determining whether a person has exceeded the allowable
study-time; including:
• time spent completing a course that is a
pre-requisite to admission to the course in which the person is enrolled or
intends to enrol;
• a failed year, or part thereof, of study due to
illness or other circumstances beyond the person's control;
• time
spent undertaking a course that has been discontinued due to illness or other
circumstances beyond the person's control;
• time spent undertaking
a course leading to a trade or profession in which the person cannot now work
due to illness;
• time spent undertaking a TAFE course with a
normal duration of less than 12 months;
• time spent
undertaking study more than 10 years ago, unless the course has since been
completed;
• time spent undertaking a course after 1973 if the
course was not approved for the purposes of TEAS, AUSTUDY or paragraph
541B(1)(c), 569A(b) or 1061PB(1)(b) of the Social Security
Act;
• time spent undertaking a course at a foreign
institution;
• time spent undertaking a course if the student
withdrew from the course and the institution offering the course did not record
the withdrawal as a failure;
• any time spent undertaking a course
during which the person was not able to receive AUSTUDY, TEAS,
youth allowance or austudy payment because of the application of
academic progress rules.
Subsection 569H(6) makes it clear that if a
person was a concessional study-load student in respect of a course, then the
time that the person has taken to complete the course (or part of the course)
should be taken to be no more than the minimum amount of time that should be
taken to complete the course (or part of the course).
Subsections 569H(8)
to (12) set out the four levels of tertiary courses.
New Subdivision C - Austudy age
New section 570 - Austudy age
Subsection 570(1) provides that a person is of austudy age if the person
is at least 25 years old. The youth allowance provisions provide that a
full-time student in receipt of youth allowance who turns 25 years of age will
continue to receive youth allowance until the person completes or abandons his
or her current course of education. Subsection 570(2) re-iterates this
rule.
New Subdivision D - Residency
Residence rules that will apply to full-time students receiving youth
allowance will apply generally also to austudy payment, and are consistent with
the rules under the AUSTUDY scheme.
New section 571 - Requirements relating to residency
Section 571 provides the general rule that to satisfy the residency
requirements for austudy payment in respect of a period, a person must be
an Australian resident, and, subject to this Subdivision, in Australia for the
period.
New section 571A - Absence overseas of persons undertaking qualifying study
Subsection 571A(1) provides that a person who is undertaking qualifying
study is not required to satisfy the "in Australia" requirement in paragraph
571(b), providing that the person is outside Australia for the purpose of
undertaking part of his or her studies, or is absent for any other reason for
not more than 26 weeks. If the person returns to Australia, however, after
having been outside the country for more than 13 weeks, and leaves Australia
within 13 weeks after returning, the person is taken to have continued to be
absent from Australia (subsection 571A(2) refers). These provisions enable a
student to complete components of his or her course overseas and, in other
cases, to spend short periods outside Australia during, for example, vacation
periods.
New Division 2 - Situations in which austudy payment is not payable
Division 2 sets out the situations in which austudy payment is not
payable, and is based heavily on existing youth training allowance, newstart
allowance, the proposed youth allowance and AUSTUDY living allowance
rules.
New Subdivision A - The basic rules
New subsection 572 - Situations in which austudy payment is not payable
Subsection 572 details the circumstances which prevent austudy payment
from being payable to a person who is otherwise qualified for austudy payment.
These are:
• if the value of the person’s assets exceeds the
person’s assets value limit (dealt with in
Subdivision B);
before the person's provisional commencement day
(dealt with in Subdivision C);
while the person is subject to a waiting
period (dealt with in Subdivision D);
while an activity test non-payment
period applies to the person (dealt with in Subdivision E);
while
the person is subject to an administrative exclusion period (dealt with in
Subdivision F);
while the person is subject to an multiple
entitlement exclusion (dealt with in Subdivision G);
while the
person's austudy payment rate would be nil.
A note at the end of the
section alerts the reader to the fact that austudy payment is not payable
under Part 3.13 if a person is in gaol or is undergoing psychiatric confinement
after having been charged with an offence. Another note states that austudy
payment is not payable where a person is subject to a compensation preclusion
period under Part 3.14 of the Social Security Act.
New Subdivision B - Assets test
New section 573
The austudy payment assets test is broadly the standard social security
benefit assets test - as provided by new section 573, if the person is not
excluded from the application of the assets test and if the value of his or her
assets exceeds the relevant assets value limit, then austudy payment is not
payable to the person.
New section 573A
This new section excludes a person from the application of the austudy
payment assets test if he or she has a partner who is receiving one of a
specified range of income support type payments. In such a case, the couple
will already have been subject to an assets test and therefore need not be
tested again. Otherwise, the assets test will apply to the person.
New section 573B
This new section lays down the various assets value limits, one of which
will apply to the person. The limits vary considerably, depending on whether
the person is a member of a couple (in which case his or her partner’s
assets are taken into account and a limit set accordingly) or not a member of a
couple (in which case only the person’s own assets are taken into account
and a lower limit set to reflect this). In each case, the assets value limits
are further varied between homeowners and non-homeowners.
Since the
assets value limits specified in the new section are due to be indexed on
1 July 1998 (ie, on the commencement of the provisions), there is special
provision in new subsection (2) for the Secretary to determine a higher amount
in substitution for any of the amounts specified to reflect the effect of
indexation. New subsection (3) provides for this rule to be repealed at the end
of 1998, since it is designed to be used only once (if necessary) and will be
redundant after that.
New section 573C
New section 573C specifies that the value of a person's assets is the sum
of the value of his or her own assets and those of his or her partner if a
member of a couple. The remaining sections in the Subdivision apply to
determine the value of a person’s, or partner's, assets, in conjunction
with the general rules governing the assets test (ie, the relevant
interpretation provisions in Chapter 1 of the Social Security Act and
Part 3.12).
New section 573D
Under this new section, a person’s assets are taken to include any
assets of a trust in which the person benefits. Also included are any benefit
to which the person is entitled from trust assets and any interest in trust
assets assigned to someone else but controlled by the person.
New section 573E
If a person is covered by an exceptional circumstances certificate under
the Farm Household Support Act 1992, this new section excludes
from the assets test any asset of the person that is an exempt asset within the
meaning of that Act.
New Subdivision C- Provisional commencement day
The provisions relating to a person's provisional commencement day for
austudy payment are basically the same as those that will apply for youth
allowance except that an austudy payment claimant cannot claim DSP or have
a temporary incapacity exemption. An austudy payment recipient who becomes
incapacitated or unable to study for health reasons will need to apply for
sickness allowance to continue to receive income support.
New section 574 - Provisional commencement day - basic rule
New section 574 provides that a person's provisional commencement day is
the day on which the person claims austudy payment.
New section 574A - Provisional commencement day - initial incorrect or inappropriate claim followed by a claim for austudy payment
Section 574A provides that, subject to section 574B, if:
a
person, or someone on the person's behalf, makes a claim (the "initial claim")
for:
- a social security pension, a social security benefit or a service
pension; or
- a pension, benefit or allowance or other payment under
another Act that is similar in character to austudy payment, or a program
administered by the Commonwealth, that is similar in character to austudy
payment; and
the claimant was qualified for austudy payment when the
initial claim was made; and
the claimant subsequently lodges a claim for
austudy payment; and
the Secretary considers it reasonable for this
provision to apply;
then the person's provisional commencement day is the
day on which the person made the initial claim.
New section 574B - Provisional commencement day - transferee to austudy payment
Section 574B provides that the provisional commencement day for a person
who is a "transferee" to austudy payment, and who claims austudy payment within
14 days of his or her transfer day, is the person's transfer day.
A note
at the end of section 574B signposts the definitions of transferee and transfer
day in subsections 23(6) and (7).
New section 574C - Provisional commencement day - application of section 577C or reduction of rate to nil
Section 574C deals with a person's provisional commencement day where an
austudy payment recipient is subject to an administrative exclusion or an
administrative breach rate reduction, and as a result the person's
austudy payment is cancelled or automatically terminated. In that
situation, if the person claims austudy within 14 days after the cancellation or
termination, then the person's provisional commencement day is the day after the
date of effect of the cancellation or termination.
New section 574D - Provisional commencement day - claim resulting from a major disaster
New section 574D provides that a provisional commencement day of a person
who:
claims and qualifies for a disaster relief payment; and
as
a result of the major disaster to which the disaster relief payment relates
claims austudy payment within 14 days of claiming the disaster relief
payment;
is the day on which the person was affected by the
disaster.
New Subdivision D - Waiting periods
New section 575 - Waiting periods
Section 575 provides that a person may be subject to either a liquid
assets test waiting period or a newly arrived resident's waiting period. The
latter waiting period applies generally to social security payments as well as
under the AUSTUDY scheme. The liquid assets test waiting period does not apply
under the AUSTUDY scheme, however, it has been modified to ensure that students
who have liquid assets can use those to pay for educational expenses (including
HECS) before they are assessed for the waiting period. The application of the
liquid assets test waiting period to students ensures that people claiming
income support are treated equally.
New section 575A - Liquid assets test waiting period
Section 575A provides that a person who is not a transferee to
austudy payment who has a certain amount of liquid assets (as defined in
section 14A, which is being amended to ensure that funds for educational
expenses that need to be met are not included in an assessment of a
person’s liquid assets - see Schedule 9) must serve a liquid assets
test waiting period (LATWP) before austudy payment becomes payable to the
person. There are several exceptions to this rule, as follow:
if a
person has already been subject to a LATWP (under either this Act or Part 8
of the Student Assistance Act as in force immediately before the
commencement of this section) in the 12 months prior to either becoming
qualified for, or claiming, austudy payment, then the LATWP does not apply
to the person (subsection 575A(2) refers); or
if the Secretary is
satisfied that subjecting the person to the LATWP would cause undue long term
disadvantage or significant hardship to the person (subsection 575A(3)
refers); or
if the person is a transferee to austudy payment and
the person claims austudy payment within 14 days of the transfer day
(subsection 575A(4) refers).
New section 575B - Start of liquid assets test waiting period
This section provides that the start of the LATWP is the day on which the
person became qualified for austudy payment.
New section 575C - Length of liquid assets test waiting period
Section 575C sets out the formula to be used to determine if a
person is subject to the LATWP, and if so, the length of the period that
applies. Under the formula a person's maximum reserve amount (see
subsection 14A(1)) is subtracted from his or her liquid assets and then
divided by either $500, if the person is not a member of a couple and does not
have a dependent child, or $1,000 in any other case. The result of that
calculation, rounded down where a fraction results, gives the number of weeks
that a claimant must serve as the LATWP. The minimum number of weeks that can
apply is 1 and the maximum number is 13 weeks.
New section 575D - Newly arrived resident's waiting period
Subsection 575D(1) operates to subject a person to a newly arrived
resident's waiting period if he or she has not been an Australian resident and
in Australia for a period of, or periods totalling, 104 weeks. A note
refers the reader to subsection 7(2) for the meaning of "Australian
resident".
Subsection 575D(2) exempts a person from
subsection 575D(1) if the person has a qualifying residence exemption (a
note refers to subsection 7(6) which defines this term).
Subsection 575D(3) exempts a person from the waiting period if the person
has already served a newly arrived resident's waiting period under this Part
(and the period has ended), or under another Part of the Social Security Act, or
under the Student Assistance Act. Furthermore, subsection (4)
exempts a person from the waiting period if, had he or she actually applied for
a social security payment (other than youth allowance or
youth training allowance) he or she would have been subject to the
waiting period and the period would have ended. Finally, the person is exempt
from the waiting period if, in the case of an AUSTUDY recipient, he or she was
not subject to such a waiting period (subsection (5) refers).
New section 575E - Length of newly arrived resident's waiting period
Section 575E provides that the newly arrived resident's waiting
period starts on the day on which a person first entered Australia, and ends
after the person has been physically in Australia, while an Australian resident,
for 104 weeks. A note refers the reader to subsection 7(2) which defines
an Australian resident.
New section 575F - Effect of being subject to more than one waiting period
Section 575F makes it clear that if a person is subject to more than one
waiting period under this Subdivision, then austudy payment is not payable
to the person until all of those waiting periods have ended.
New Subdivision E - Activity test non-payment periods
Subdivision E replicates the existing proposed youth allowance
rules for persons undertaking full-time study where a non-payment period results
from an activity test breach, and the breach is a third or subsequent
one.
New section 576 - Third and subsequent activity test breaches lead to activity test non-payment period
Section 576 provides that an activity test non-payment period
applies to a person if the person commits an activity test breach which is the
person's third or subsequent breach in the last 2 years.
A note
signposts that if the latest breach is the first or second activity test breach
in the 2 years before the latest breach, an activity test rate reduction
period applies to the person and refers to Subdivision B of
Division 5.
New section 576A - Activity test breaches
Section 576A sets out the situations which will result in a person
committing an activity test breach. They are:
if the person fails to
satisfy the activity test;
if the person refuses or fails, without
reasonable excuse, to provide information in relation to the person’s
income from remunerative work when required to do so;
if the person
knowingly or recklessly provides false or misleading information regarding his
or her income from work.
A note provides that an activity test breach may
also arise under other sections of the Social Security Act or of the
Student Assistance Act as in force immediately before the commencement
of section 576A.
New section 576B - Length of activity test non-payment period
Section 576B states that the length of an activity test non-payment
period is 8 weeks. If, however, when that period commences the person is
already subject to an activity test non-payment period, then the existing period
is taken to end immediately before the new period commences
(subsection 576B(2) refers). That is, the first penalty will be superseded
by the second.
New section 576C - Start of activity test non-payment period
The Secretary must give a notice to a person who is subject to an
activity test non-payment period (subsection 576C(1) refers), and the
non-payment period starts on the day on which the notice is given to the person,
unless either subsection (3), or section 576E applies
(subsection 576C(2) refers).
Subsection 576C(3) provides that
(subject to section 576E) if, immediately before a person's non-payment period
would start, austudy payment is not payable for a reason other than the
activity test non-payment period, then the period starts on the day on which
austudy payment ceases to be payable.
New section 576D - Interaction with activity test breach rate reduction periods
This section applies where a person is subject to an activity test
non-payment period and during that period is also subject to an activity test
breach rate reduction period. (A note informs the reader that the person may
also be subject to an administrative breach rate reduction period.) If both
periods apply to the person, they are to run concurrently, but only the
non-payment restriction is to apply to the person during the period when they
both apply. If, however, when the activity test non-payment period starts, the
person is already subject to an activity test breach rate reduction period (the
pre-existing reduction period), then the pre-existing reduction period is taken
to end immediately before the commencement of the activity test non-payment
period.
New section 576E - Interaction with waiting periods
Section 576E provides that if an activity test non-payment period applies
to a person and during that period a waiting period also applies to the person,
then the two periods are to run concurrently during the time that they overlap.
Only the restriction on payment relating to the waiting period is to apply to
the person during the overlap period, however.
New section 576F - Effect of sections 576C, 576D and 576E
Section 576F makes it clear that despite sections 576C, 576D
and 576E, austudy payment can cease to be payable for a reason other than
an activity test non-payment period.
New section 576G - Where one event may give rise to both an activity test penalty and an administrative breach rate reduction period
Section 576G provides that if an event would result in both an
activity test penalty period and an administrative breach rate reduction period
applying to a person then only the provision imposing the activity test penalty
period is to apply to the person.
New Subdivision F - Administrative exclusions
Subdivision F is based on the existing provisions in
youth training allowance and newstart allowance, and proposed
youth allowance, that impose non-payment periods where a person does not
comply with an administrative request, such as providing details about the bank
account into which payment of an entitlement is to be paid or not giving
relevant information to the Department when requested to do so.
New section 577 - Administrative exclusions
Section 577 states that a person is subject to an administrative
exclusion while one or more of sections 577A to 577D apply to the person.
A note tells the reader that these sections apply because the person fails to do
certain things, and that it is open to the person to end the administrative
exclusion by doing those things.
New section 577A - Failure to comply with request to provide a person's tax file number
Subsection 577A(1) provides that a person is subject to an
administrative exclusion if the person is requested by the Secretary to provide
a statement of the person's tax file number, or to apply for a tax file number
and give the Secretary a written statement of the number once it has been
issued, and the person has not, after 28 days, satisfied the request, or given
the Secretary an employment declaration.
Subsections 577A(2) and (3)
detail the situations in which a person is taken to satisfy the above
request.
Subsection 577A(2) covers the situation where:
the
employment declaration states that the person has a tax file number but does not
know what the number is and has asked the Commissioner of Taxation (the
Commissioner) to advise him or her of the number; and
the person
authorises the Commissioner to tell the Secretary whether the person has a tax
file number and, if so, what that tax file number is; and
the
Commissioner has not told the Secretary that the person does not have a tax file
number.
Subsection 577A(3) covers the situation where:
the
person completes a declaration that states that an application for a tax file
number has been made; and
the person authorises the Commissioner to tell
the Secretary the person's tax file number or that the application has been
refused or withdrawn; and
the Commissioner has not told the Secretary
that the person's application for a tax file number has been refused;
and
the application for the tax file number has not been
withdrawn.
New section 577B - Failure to comply with request to provide partner’s tax file number
Section 577B provides that a person is subject to an administrative
exclusion if the person is requested to provide a written statement of his or
her partner's tax file number and, at the end of 28 days after the request, the
person fails to provide the statement or declaration required under
subsection 577B(2)
or (3).
Subsections 577B(2) and (3) detail the
situations in which a person is taken to have provided his or her
partner’s person's tax file number.
Subsection 577B(2) covers
the situation where:
the person's partner completes a declaration
stating that the other person has a tax file number but does not know what the
number is and has asked the Commissioner of Taxation (the Commissioner) to
advise the number; and
the person's partner authorises the Commissioner
to tell the Secretary whether the other person has a tax file number and, if so,
what that tax file number is; and
the Commissioner has not told the
Secretary that the partner does not have a tax file
number.
Subsection 577B(3) covers the situation where:
the
person's partner completes a declaration that states that an application for a
tax file number is pending; and
the person's partner authorises the
Commissioner to tell the Secretary his or her tax file number or that the
application has been refused or withdrawn; and
the Commissioner has not
told the Secretary that the partner's application for a tax file number has been
refused; and
the application for the tax file number has not been
withdrawn.
Subsection 577B(4) enables the Secretary to waive the
requirement that a person provide a statement of his or her partner's tax file
number. This requirement may be waived if the Secretary is satisfied that
the person does not know the partner's tax file number and cannot obtain either
the partner's tax file number, a statement of the partner's tax file number or a
declaration by the partner in a form approved by the Secretary.
New section 577C - Failure to attend the Department etc - person required to satisfy the activity test
Section 577C provides that an austudy payment recipient or
claimant is subject to an administrative exclusion if the person is notified
that he or she is required to attend or contact the Department, or to give
information to the Secretary, and the person fails to do so without reasonable
excuse.
New section 577D - Failure to nominate bank account etc
Subsection 577D(1) provides that a person is subject to an
administrative exclusion if the person has not nominated an account, for the
purposes of section 584E (payment into bank account), within 28 days after
austudy payment becomes payable. Subsection 577D(2) provides that if,
within the next 3 months, the person nominates an account then the person
ceases to be subject to an administrative exclusion and austudy payment is
payable to the person from the end of the initial 28 days. If the person
nominates the account after 3 months, then the person ceases to be subject
to an administrative exclusion and austudy payment is payable to the person
from the day on which the person nominates the account.
New Subdivision G - Multiple entitlement exclusion
Subdivision G replicates provisions throughout the
Social Security Act which make a payment not payable where a person
has other specified means of financial support available.
New section 578 - Multiple entitlement exclusion
Section 578 provides that a person is subject to a multiple entitlement
exclusion if:
• the person is receiving austudy payment and another
social security benefit, social security pension or service pension becomes
payable to the person; or
• a payment under a scheme referred to in
section 578A has been or may be made to the person; or
• an
assurance of support applies to the person (see section 578B);
or
• the person has received, or may receive, income that is paid
by a community or group from funds provided under a Commonwealth funded
employment program (stated by a note to be defined in
subsection 23(1)).
New section 578A - Person receiving payment under certain schemes
Subsection 578A(1) provides that, subject to subsection 578A(2), the
schemes for the purposes of paragraph 578(b) are: payment under a
prescribed educational scheme program (a note states this is defined in
section 5) other than the ABSTUDY tertiary scheme; a LEAP program (a note
states this is defined in subsection 23(1)); and the schemes to provide
allowances known as Maintenance Allowance for Refugees, the Adult Migrant
Education Program Living Allowance, and the English as a Second Language
Allowance scheme.
Subsection 578A(2) provides that where a person is
undertaking full-time study in respect of a course that is likely to last for
6 months or more, and an application has been made by the person for
payment under the ABSTUDY Schooling Scheme or ABSTUDY Tertiary Scheme, the
Secretary may decide that austudy payment is payable until the application
is determined or until 3 weeks after the course commences (whichever occurs
first).
New section 578B - Assurance of support
Section 578B states that an assurance of support applies to a person
if:
an assurance of support is in force in respect of the person (the
assuree) for the period; and
throughout the period the person who gave
the assurance of support is willing and able to provide an adequate level of
support to the assuree; and
throughout the period it would be reasonable
for the assuree to accept that support.
A note signposts the definition
of the "assurance of support" in subsection 23(1).
New Division 3 - Claim for austudy payment
Division 3 deals with a claim for austudy payment, and is based on a
similar type of provisions within all payment types in the
Social Security Act.
New section 579 - Need for a claim
Subsection 579(1) provides that a person who wants to be granted
austudy payment must make a proper claim for the payment.
Note 1 to
this provision signposts new sections 579A, 579B, 579C and 579D which outline
the requirements of a proper claim. These provisions relate to the form of the
claim, where the claim needs to be lodged, telephone and facsimile claims, and
requirements relating to residency and physical presence in
Australia.
Subsection 579(2) provides that if, at the time a person
(or someone on his or her behalf) makes a claim for austudy payment, the person
is not qualified for that payment and so the claim cannot be granted, then the
claim will be taken not to have been made.
New section 579A - Form of claim
Section 579A provides that a claim for austudy payment must be in
writing and in accordance with a form approved by the Secretary.
New section 579B - Lodgment of claim
Section 579B provides that a claim for austudy payment must be lodged at
an office of the Department or at a place, or with a person, approved by the
Secretary. The Secretary is not able to approve a place, or a person, for
lodgment of claims unless the place or person is in Australia.
New section 579C - Claims by telephone, facsimile or computer
Section 579C deems a person to have lodged a claim in accordance with
section 579B, on the day on which the person contacted the Department by
telephone, facsimile or computer, inquiring about making a claim for austudy
payment, disability support pension, sickness allowance or newstart allowance,
providing a number of conditions are fulfilled. Those conditions include that
the person must be qualified for austudy payment on the day he or she contacted
the Department, and the Secretary must have given the person a written
acknowledgment of the contact. Furthermore, the person must lodge a claim for
austudy payment within 14 days of contacting the Department and the
written acknowledgment from the Secretary must be either presented to the
Department when making the actual claim or the Department must have a written
record that such a notice was sent. The Secretary does have a discretion,
however, under subsection (3) to extend the period within which the person
must lodge a claim.
Subsection 579C(4) provides that, if the section
applies to a person, then the person is taken to have contacted the Department
when the message is received in the Department.
New section 579D - Claimant must be Australian resident and in Australia
Section 579D provides that a person claiming austudy payment must be an
Australian resident and in Australia on the day on which the claim is
lodged.
A note directs the reader to the definition of "Australian
resident" in section 7.
New section 579E - Claim may be withdrawn
Section 579E provides that a claim for austudy payment can be withdrawn
(by either the austudy payment claimant or a person on his or her behalf) at any
time before the claim is determined. The withdrawal can be made orally or in
writing. A claim that is withdrawn is taken to have not been made.
New section 579F - Secretary may request claimant to give statement of claimant's tax file number
As with other social security payment types, subsection 579F(1)
provides that a claimant for austudy payment may be requested but not compelled
by the Secretary to provide a written statement of the person's tax file number
or, if the claimant does not have a tax file number, to apply to the
Commissioner of Taxation for a tax file number and provide a written statement
of the number once it is issued.
Subsection 579F(2) states that
austudy payment is not payable to a claimant if he or she has failed to satisfy
the request within 28 days, and the Secretary has not exempted the claimant
from having to satisfy the request.
New section 579G - Secretary may request claimant to give statement of partner's tax file number
As with other social security payment types subsection 579G(1)
provides that if a claimant for austudy payment is a member of a couple and his
or her partner is in Australia, the Secretary may request, but not compel, the
claimant to provide a written statement of his or her partner’s tax file
number.
Subsection 579G(2) states that austudy payment is not
payable to a claimant if he or she has failed to satisfy the request within
28 days, and the Secretary has not exempted the claimant from having to
satisfy the request.
Note 1 indicates that in order to satisfy the
request it may be possible for the claimant to provide a declaration by the
person's partner about the partner's tax file number and an authority to the
Commissioner of Taxation authorising the Commissioner to provide information
about the tax file number to the Secretary. This is provided for in
new subsections 577B(2) and (3).
Note 2 directs the reader to
new subsection 577B(4) which allows the Secretary to waive the
requirement to provide the partner’s tax file number in certain
circumstances.
New Division 4 - Determination of claim
Division 4 mirrors standard provisions in the Social Security
Act which deal with the determination of a claim.
New section 580 - Secretary to determine claim
Section 580 provides that the Secretary must determine, in accordance
with Part 2.11A, a claim for austudy payment.
New section 580A - Grant of claim
New section 580A provides that the Secretary must determine that a claim
for austudy payment is to be granted if the Secretary is satisfied that the
person is qualified, or is expected to be qualified, for austudy payment and the
payment would be payable but for a waiting period, an activity test non-payment
period, where the payment is not payable because the person's rate would be nil,
or due to an income maintenance period.
New section 580B - Date of effect of determination
Subsection 580B(1) specifies the date of effect of a determination under
new section 580A, except where new subsection 580B(2), (3) or (4) apply.
The determination takes effect on the day on which the determination is made or
on such later or earlier day as is specified in the
determination.
Subsections 580B(2), (3) and (4) specify the date of
effect of a determination granting a claim that results from a person asking for
a review of an original decision rejecting the claim.
Subsection 580B(2)
deals with the situation where an applicant for austudy payment:
is
notified in writing of a decision to reject the person's claim;
and
applies to the Secretary under section 1240, within 3 months after
written notification of the decision is given, for a review of that decision;
and
is granted austudy payment as a result of the review.
The
determination to grant the claim takes effect on the day on which the original
decision to reject it took effect. This enables arrears to be paid back to that
date.
Subsection 580B(3) deals with the situation where an applicant for
austudy payment:
is notified in writing of a decision to reject the
person's claim; and
applies to the Secretary under section 1240, more
than 3 months after the written notification of the decision is given, for a
review of the decision; and
is granted austudy payment as a result of
the review.
In this case, the determination to grant the claim takes
effect on the day on which the person sought the review.
Subsection
580B(4) deals with the situation where an applicant for austudy
payment:
is not notified in writing of a decision to reject the person's
claim; and
applies to the Secretary under section 1240 at any time for a
review of the decision; and
is granted austudy payment as a result of
the review.
In this case, the determination to grant the claim takes
effect on the day on which the original decision rejecting the claim took
effect. As is the case with new subsection 580B(2), this enables arrears
to be paid back to the date of the original decision.
New Division 5 - Rate of austudy payment
New Subdivision A - Rate of austudy payment
New section 581 - How to work out a person’s austudy payment rate
Section 581 provides that, subject to subsections (2), (3) and (4),
the rate of austudy payment is to be calculated according to the Austudy Payment
Rate Calculator in section 1067L.
Subsection 581(2) states that if
an activity test breach rate reduction period applies to the person, the
person's rate of austudy payment for that period is to be worked out under
Subdivision B. If, however, both an activity test breach rate reduction
period, and an administrative breach rate reduction period applies, the rate is
to be worked out under Subdivisions B and C (subsection 581(4)
refers). If an administrative breach rate reduction period only applies, then
the rate is to be worked out in accordance with Subdivision C
(subsection 581(3) refers).
New Subdivision B - Activity test breach reductions in the rate of austudy payment
Subdivision B replicates the provisions in
youth training allowance, newstart allowance and proposed
youth allowance, which deal with rate reductions where a person commits his
or her first or second activity test breach.
New section 582 - Activity test breach rate reduction period
Section 582 provides that an activity test breach rate reduction
period applies to a person who commits an activity test breach referred to in
section 576A and that breach is the person's first or second activity test
breach in the 2 years immediately before the breach.
A note informs
the reader that if the breach is the person's third or subsequent breach in the
2 year period, then an activity test non-payment period applies to the
person.
New section 582A - Length of activity test breach rate reduction period
Section 582A provides that the length of an activity test breach rate
reduction period is 26 weeks. If, however, when the activity test breach
rate reduction period commences the person is already subject to an activity
test breach rate reduction period, then the pre-existing rate reduction period
is taken to end immediately before the commencement of the new activity test
breach rate reduction period.
New section 582B - Start of activity test breach rate reduction period
The general proposition is that an activity test breach rate reduction
period commences on the day on which a person is given a notice informing him or
her of the commencement of the rate reduction period (subsections 582A(1)
and (2) refer). Subsection 582B(3) provides that where
austudy payment ceases to be payable to a person before the day on which an
activity test breach rate reduction period would commence, then the activity
test breach rate reduction period commences on the day on which austudy payment
ceases to be payable to the person.
New section 582C - Interaction with waiting periods
Section 582C provides that in situations where waiting periods and
activity test breach rate reduction periods overlap, they will be served
concurrently with the waiting period applying during the period of overlap. Any
remaining activity test breach rate reduction period will then resume after the
period of overlap.
New section 582D - Rate of austudy payment where activity test breach rate reduction period applies
Section 582D sets out how to work out a person's rate of austudy
payment for the activity test breach rate reduction period.
Under
step 1 of the new method statement, the person's maximum basic rate of
austudy payment is worked out by reference to Module B of the
Austudy Payment Rate Calculator in section 1076L (called the maximum
payment rate).
Under step 2, the person's rate reduction amount is
calculated in one of two ways. If the activity test breach is the person's
first breach in a 2 year period immediately before the breach then the rate
reduction amount is worked out by multiplying the maximum payment rate by 0.18.
If the activity test breach is the person's second breach in a 2 year
period, then the rate reduction is the amount worked out by multiplying the
maximum payment rate by 0.24.
Under step 3, the person's activity test
breach reduced rate is the rate of austudy payment worked out under the
relevant rate calculator applicable to the person minus the rate reduction
amount.
New Subdivision C - Administrative breach reductions in the rate of austudy payment
Subdivision C replicates the provisions in
youth training allowance, newstart allowance and proposed
youth allowance, which deal with rate reductions where a person commits an
administrative breach.
New section 583 - Administrative breach rate reduction period
Section 583 provides that an administrative breach rate reduction period
applies to a person if the person is subject to an administrative exclusion and
austudy payment later becomes payable to the person, or if the person
fails, without reasonable excuse, to comply with a requirement made under
section 586A, 586B, 586C or 1304. Subsection 583(2), however, states
that the administrative breach rate reduction period does not apply if a
person's payment of austudy payment would become not payable due to the rate
reduction (that is, the rate would be nil) and so is cancelled or automatically
terminated, and the person claims austudy payment more than 14 days after
the date of effect of the cancellation or termination.
New section 583A - Length of administrative breach rate reduction period
Subsection 583A(1) provides that if an administrative breach rate
reduction period applies to a person, then its length is 13 weeks. If, however,
when the administrative breach rate reduction period commences the person is
already subject to an administrative breach rate reduction period, then the
pre-existing rate reduction period is taken to end immediately before the
commencement of the new administrative breach rate reduction period
(subsection 583A(2) refers).
New section 583B - Start of administrative breach rate reduction period
Section 583B provides for the commencement of an administrative
breach rate reduction period, which will commence on the day on which a person
is given a notice informing the person of the commencement of the rate reduction
period. If on the day on which a person's rate reduction period would have
commenced, austudy payment ceases to be payable for a reason other than the
application of an administrative breach rate reduction period, then the
administrative breach rate reduction period starts on the day on which
austudy payment ceases to be payable to the person (subsection 583B(3)
refers).
New section 583C - Interaction with activity test non-payment periods
Section 583C provides that if, during an administrative breach rate
reduction period that applies to a person, an activity test non-payment period
also applies to the person, then the two periods are to run concurrently during
the overlap period, with the non-payment penalty being the one that applies
during the overlap period.
New section 583D - Interaction with activity test breach rate reduction periods
Section 583D provides that if, during an administrative breach rate
reduction period that applies to a person, an activity test breach rate
reduction period also applies to the person, then the periods are to run
concurrently. Subsection 583D(3) provides that, subject to sections 576D,
582C and 582D the only rate reduction amount that is to apply to the person is
the rate reduction that is of the highest amount.
New section 583E - Interaction with waiting periods
Section 583E deals with the interaction of administrative breach rate
reduction periods and waiting periods, such that where they overlap, they will
be served concurrently with the waiting period only applying during the period
of overlap. Any remaining activity test breach rate reduction will then resume
after the period of overlap.
New section 583F - Effect of sections 583C, 583D and 583E
Section 583F provides that, for the avoidance of doubt,
sections 583C, 583D and 583E do not prevent austudy payment ceasing to be
payable in circumstances that do not involve the application of an
administrative breach rate reduction period.
New 583G - Rate of austudy payment where administrative breach rate reduction applies
Subsection 583G provides that if an administrative breach rate reduction
period applies to a person, then the person's rate of austudy payment is
determined in accordance with a new method statement.
Under step 1 of the
new method statement, the "maximum payment rate" is worked out by reference to
the Austudy Payment Rate Calculator.
Under step 2, the "rate reduction
amount" is worked out by multiplying the "maximum payment rate" (worked out
under step 1) by 0.16.
Under step 3, the person's administrative breach
reduced rate is the rate of austudy payment worked out under the
Austudy Payment Rate Calculator minus the rate reduction amount.
New Division 6 - Payment of austudy payment
Division 6 replicates similar provisions in the
Social Security Act which deal with the payment of a social security
benefit.
New section 584 - Payment of austudy payment
New section 584 provides that austudy payment becomes payable to a
person on the first day on which the person is qualified for the allowance and
there is no provision in the Social Security Act that makes austudy payment
not payable.
Note 1 directs the reader to the qualification provisions
for austudy payment.
Note 2 directs the reader to new section 572
which describes the circumstances in which austudy payment is not
payable.
New section 584A - Instalments
This section provides that austudy payment is to be paid by instalments,
for periods and at times determined by the Secretary.
New section 584B - Instalments for period less than a fortnight
Section 584B specifies the formula for working out the instalment of
austudy payment if it is for a period of less than a fortnight (the short
period), or if the period consists of a number of whole fortnights plus the
short period. Austudy payment is multiplied by the number of week days in the
short period and divided by 10. Any instalments representing whole
fortnights are then added.
New section 584C - Rounding off instalment
Subsection 584C(1) specifies that an instalment is to be increased
or decreased to the nearest whole cent if it would otherwise contain a part of a
cent, and if the part of such a cent is 0.5, it is to be increased to the
next whole cent rather than decreased.
Subsections 584C(2) and
584C(3) ensure that if an amount of pharmaceutical allowance is to be added to a
person's maximum basic rate in working out the amount of an instalment of
austudy payment, then the minimum amount that the person can receive is the
fortnightly amount of pharmaceutical allowance.
Subsection 584C(4)
provides that in any event, if the amount of an instalment would be less
than $1.00, the amount is to be increased to $1.00.
New section 584D - Austudy payment or advance to be paid to person or nominee
Section 584D replicates a similar rule in other social security
payment types and provides that austudy payment instalments should be paid
to the person, although the Secretary may direct that the whole or a part of an
instalment may be paid to someone else on behalf of the person. Where the
Secretary so directs, payments are to be made accordingly.
New section 584E - Payment into bank account etc
Subsections 584E(1), (2) and (3) provide that payments of austudy
payment are to be made by direct deposit into an account with a bank, credit
union or building society nominated and maintained by the person either alone or
jointly or in common with another person.
The Secretary may decide in the
circumstances of a particular case that some other manner of payment is
appropriate and that payment of all or some of austudy payment should be paid in
that other way. This would normally be done in the case of persons with no
reasonable access to banking or similar facilities (subsections 584E(4)
and (5) refer).
New section 584F - If allowance payday would fall on public holiday etc
Section 584F provides a discretion to the Secretary to direct the
earlier payment of austudy payment if it cannot be paid on the normal day,
for example, because of a public or bank holiday.
New section 584G - Payment of austudy payment after death
If a person to whom austudy payment is payable dies and an amount of the
payment is outstanding at the date of death, new subsection 584G(1) allows
the Secretary to pay the outstanding amount to another person who, in the
Secretary's opinion, is best entitled to receive it. That person must apply to
receive the amount within 6 months of the death or within a further period
allowed by the Secretary in special
circumstances.
Subsection 584G(2) makes it clear that once a payment
has been made under new subsection 584G(1), the Commonwealth has no
liability to any other person in respect of that amount.
New Division 7 - Protection of austudy payment
Consistent with all other payment types in the Social Security Act, this
Division deals with protecting payment of austudy payment.
New section 585 - Austudy payment to be absolutely inalienable
Subsection 585(1) provides that, except when new subsections 585(2) or
(3) or section 1359 applies, a person's austudy payment is to be absolutely
inalienable, whether by way of, or in consequence of, sale, assignment, charge,
execution, bankruptcy or otherwise.
Subsection 585(2) and section 1359
enable the Secretary to make deductions from a person's austudy payment
instalments for taxation purposes. The first is a discretionary provision that
flows from the recipient asking the Secretary to make the deductions and pay
them to the Commissioner of Taxation. The other provision is mandatory and
flows from a request from the Commissioner of Taxation to the Secretary to make
deductions to the Commissioner under subsection 218(6B) of the Income Tax
Assessment Act 1936.
A note directs the reader to
section 1359 and requires the Secretary to make deductions from a person's
social security payment if requested by the Commissioner of
Taxation.
Subsection 585(3) enables the Secretary to make deductions
from a person's austudy payment instalments when the person consents under
section 1234A of the Social Security Act.
A note indicates
that section 1234A allows the Secretary to recover a debt from a person
other than the debtor if the person is receiving a social security
payment.
New section 585A - Effect of garnishee or attachment order
Section 585A protects a "saved amount" of austudy payment in a
recipient's bank account from garnishment by third party creditors. The "saved
amount" is calculated by working out the amount of the instalments of
austudy payment credited to the person's account in the 4 week period
immediately before the court order came into force and deducting from that
amount the total amount withdrawn from the account during the same
period.
The bank account may be maintained by the person alone or jointly
or in common with another person.
New Division 8 - Obligations of recipients
This Division outlines the obligations placed on recipients of austudy
payment, which closely follow those currently placed on other
social security payment recipients.
New section 586 - Secretary may request recipient to give
statement
of recipient's tax file number
Subsection 586 provides that a recipient of austudy payment may be
requested but not compelled by the Secretary to:
provide a written
statement of his or her tax file number if the person has one; or
if the
person does not have a tax file number, apply for one and give the Secretary a
written statement of his or her tax file number after the Commissioner of
Taxation has issued it.
Subsection 586(2) provides that
austudy payment is not payable if, at the end of 28 days after the
request has been made, the person does not satisfy the request and the Secretary
has not exempted the recipient from having to satisfy the request.
New section 586A - Secretary may request recipient to give statement of partner's tax file number
Subsection 586A(1) provides that a recipient of austudy payment may be
requested by the Secretary, but not compelled, to provide a written statement of
his or her partner's tax file number if the income of the partner is required to
be taken into account for the purpose of working out the rate of the recipient's
austudy payment. The request may only be made if the other person is in
Australia.
Subsection 586A(2) provides that austudy payment is not
payable to a person if, at the end of 28 days after the request has been made,
the person does not satisfy the request and the Secretary has not exempted the
person from having to satisfy the request.
Note 1 indicates that in order
to satisfy this requirement it may be possible for the person to provide a
declaration by the partner about the partner's tax file number and an authority
to the Commissioner of Taxation authorising the Commissioner to provide
information about the tax file number to the Secretary. This is provided
for in subsections 577B(2) and (3).
Note 2 directs the reader to
new subsection 577B(4) that allows the Secretary to waive the person's
requirement to provide the partner's tax file number in certain
circumstances.
New section 586B - Secretary may require from recipient notice of the happening of an event or change in circumstances
Subsections 586B(1) and (2) enable the Secretary to give a person
receiving austudy payment a notice requiring the person to notify the
Department if a specified event or change in circumstances occurs or is likely
to occur that might affect payment.
Subsection 586B(3) requires the
notice to:
be in writing; and
be given personally or by post;
and
specify how the information is to be given to the Department;
and
specify the period within which the information must be given;
and
give the authority for the notice and describe itself as a
"recipient notification notice".
Subsection 586B(4) provides that
the notice is not invalid merely because it fails to specify how the notice is
to be given to the Department or it fails to specify the authority for the
notice.
Subsection 586B(5) provides that the period specified in the
notice must end 7 or more days after the day on which the event or change
in circumstances occurs or after the day on which the person becomes aware that
the event or change in circumstances is likely to
occur.
Subsection 586B(6) provides that if a person is required by a
notice to inform the Department of any proposal by the person to leave
Australia, the 7 day period under subsection 586B(5) does not apply to
that requirement.
Subsection 586B(7) provides that, if a notice
requires information about receipt of compensation, the period specified in the
notice must end at least 7 days after the day on which the person becomes
aware that she or he has received, or is about to receive, a compensation
payment.
Subsection 586B(8) sets out the compliance conditions for
new subsection 586B(1) and the penalties for contravening the conditions.
If a person receiving austudy payment is capable of complying with the notice
but fails or refuses to do so, the person may be fined or sent to gaol or
both.
A note refers the reader to sections of the Crimes Act
1914 that allow a court to impose an appropriate fine instead of, or in
addition to, a term of imprisonment.
Subsection 586B(9) allows section
586B to operate outside Australia. It extends to acts, omissions, matters and
things outside Australia, whether or not in a foreign country. It also extends
to all persons to whom it would normally apply, regardless of their nationality
or citizenship.
New section 586C - Secretary may require recipient to give particular information relevant to payment of austudy payment
Subsection 586C(1) provides for the Secretary to give a person to whom
austudy payment is being paid (whether the payment is actually being paid
to the recipient or to his or her parent or to another person on his or her
behalf) a notice requiring the person to give the Department a written statement
in an approved form about a matter that might affect payment of austudy
payment.
Subsection 586C(2) requires the notice to:
be in
writing; and
be given personally or by post; and
specify how the
information is to be given to the Department; and
specify the period
within which the statement must be given; and
give the authority for the
notice and specify that the notice is a recipient statement notice given under
the Social Security Act.
Subsection 586C(3) provides that a
notice is not invalid merely because it fails to state how the information is to
be given to the Department or what the authority for the notice
is.
Subsection 586C(4) provides that the period specified in the notice
must end 7 or more days after the notice is given to the
person.
Subsection 586C(5) provides that a statement given in response to
a request under subsection 586C(1) must be in writing and in a form
approved by the Secretary.
Subsection 586C(6) sets out the compliance
conditions for subsection 586C(1) and the penalties for contravening those
conditions. If a person receiving austudy payment is capable of complying with
a notice under subsection 586C(1) but refuses to do so, then the person may be
fined or sent to gaol or both.
A note refers the reader to the sections
of the Crimes Act 1914 that allow a court to impose an appropriate
fine, instead of, or in addition to, a term of imprisonment.
Subsection
586C(7) allows section 586C to operate outside Australia. It extends to acts,
omissions, matters and things outside Australia, whether or not in a foreign
country. It also extends to all persons to whom it would normally apply,
regardless of their nationality or citizenship.
New Division 9 - Continuation, variation and termination
This Division replicates standard social security provisions dealing with
continuation, variation and termination of payment.
New Subdivision A - General
New section 587 - Continuing effect of determination
Subsection 587(1) provides for the continuity of a decision regarding the
granting or payability of austudy payment until:
it stops being
payable under new section 588, 588A, 588B, 588C or 588D; or
a
further determination in relation to austudy payment under section 590B or
590C has taken effect.
Notes signpost the provisions that give effect to
these decisions and the provision dealing with changes to the payment by
computer.
Note 1 refers the reader to section 580A which provides
for a determination granting a claim for austudy payment.
Note 2
directs the reader to section 590E which allows the Secretary to rescind a
cancellation or suspension determination if the Secretary is satisfied that
austudy payment was payable to the person for some or all of the period for
which the person was cancelled or suspended.
Note 3 directs the reader to
section 590D which provides that changes to payments made by computer are
to be taken to be decisions made by the Secretary.
Subsection 587(2)
states that a determination about the rate of austudy payment continues in
effect until:
it becomes payable at a lower rate under section 589,
589A or 589B; or
a further determination under section 590 or 590A
has taken effect.
New Subdivision B - Automatic termination
New section 588 - Automatic termination - transfer to social security pension or benefit etc
Section 588 provides for the automatic termination of a person's
austudy payment if another social security pension or benefit, or a service
pension or ABSTUDY (other than the ABSTUDY tertiary scheme to the extent that it
applies to part-time students) becomes payable to the person. In this case,
austudy payment stops being payable immediately before the day on which the
new payment becomes payable. This is one of the provisions referred to in
subsection 587(1) as bringing to an end a determination regarding the
granting or payability of austudy payment.
New section 588A - Automatic termination - compliance with section 568B notification obligations
Section 588A provides that, when a recipient of austudy payment
complies with a section 568B notice by informing the Department of the
occurrence of an event or a change in circumstances within a specified
notification period and, as a result of the event or change:
the person
stops being qualified for austudy payment; or
austudy payment
would, except as provided in this new section, stop being payable to the person;
and
the allowance is not cancelled before the end of the notification
period;
then austudy payment continues to be payable until the end
of the notification period and then stops being payable, bringing the
entitlement determination to an end.
New section 588B - Automatic termination - non-compliance with section 586B notification obligations
Under section 588B, if a recipient of austudy payment fails to
comply with a section 586B notice by failing to inform the Department of
the occurrence of an event or change in circumstances within a specified
notification period and, as a result of the event or change:
the person
stops being qualified for austudy payment; and
austudy payment
stops being payable to the person;
then it stops being payable
immediately after the day on which the event or change in circumstances occurs
and thus brings the entitlement determination to an end.
New section 588C - Automatic termination - failure to provide section 586C statement
Subsection 588C(1) applies in the situation where a person in
receipt of austudy payment is required to give the Department a statement
under section 586C relating to the payment of austudy payment in
respect of a specified period and the person fails to comply with the notice.
If this occurs, austudy payment ceases to be payable to the person as from
the first day in that period.
Subsection 588C(2) states that the
Secretary may determine in writing that subsection 588C(1) does not apply
to a person from a day specified in the determination (that may be before or
after the making of the determination - subsection 588C(3) refers) if
satisfied that, in the special circumstances of the case, it is appropriate to
make such a determination.
New section 588D - Changes to payments by computer following automatic termination
Section 588D provides that, if austudy payment is being paid to
a person based upon information held in a computer and the allowance is
automatically terminated through the operation of a computer program approved by
the Secretary, then the Secretary is taken to have decided that the automatic
termination applies to the person's payment.
A note points out that a
determination to change a payment under the new section is reviewable by the
Secretary and by the Social Security Appeals Tribunal.
New Subdivision C - Automatic rate reduction
New section 589 - Automatic rate reduction - partner starting to receive benefit, pension or allowance
Section 589 provides that if an austudy payment recipient's partner
starts to receive an income support payment and, as a result of that, the
person's austudy payment rate is reduced, then austudy payment becomes
payable to the person at a reduced rate on the day on which the partner starts
to receive the income support payment.
New section 589A - Automatic rate reduction - compliance with section 586B obligations
Section 589A provides that, when a recipient of austudy payment does
comply with a section 586B notice by informing the Department of the
occurrence of an event or change in circumstances within a specified
notification period and, as a result of the event or change, the person's
payment rate is to be reduced, then the reduced rate becomes payable immediately
after end of the notification period.
New section 589B - Automatic rate reduction - non-compliance with section 586B notification obligations
Section 589B provides that, when a recipient of austudy payment
fails to comply with a section 586B notice by failing to inform the
Department of the occurrence of an event or change in circumstances within a
specified notification period and, as a result of the event or change, the
person's payment rate is to be reduced, then the reduced rate becomes payable on
the day immediately after the day on which the event or change occurs.
New section 589C - Changes to payments by computer following automatic rate reduction
This new section provides that, if austudy payment is being paid to a
person based upon information held in a computer and the rate is automatically
reduced through the operation of a computer program approved by the Secretary,
then the Secretary is taken to have decided that the automatic rate reduction
applies to the person's payment.
A note points out that a determination
to change a payment under the new section is reviewable by the Secretary and by
the Social Security Appeals Tribunal.
New Subdivision D - Determinations
New section 590 - Rate increase determination
Section 590 gives the Secretary the power to decide to increase the rate
of austudy payment paid to a person if the Secretary is satisfied that the
rate being paid to the person is less that the rate the person is entitled to
under the Social Security Act.
A note signposts section 591 which sets
out the date of effect of a decision under this new section.
New section 590A - Rate reduction determination
Section 590A gives the Secretary the power to decide to reduce the rate
of austudy payment paid to a person if the Secretary is satisfied that the
rate being paid to the person is more than the rate the person is entitled to
under the Social Security Act.
Note 1 points out that this provision does
not apply if an automatic rate reduction provision applies.
Note 2
signposts section 591A which sets out the date of effect of a decision
under this new section.
New section 590B - Cancellation or suspension determination
Section 590B gives the Secretary the power to suspend or cancel payment
of austudy payment to a person if the Secretary is satisfied that the
person is not, or was not, entitled to the payment.
Note 1 points out
that this provision does not apply if an automatic termination provision
applies.
Note 2 signposts the provision that sets out the date of effect
of a decision under this new section.
New section 590C - Cancellation or suspension for failure to comply with section 586C, 1304 or 1305 notice
This section provides a specific cancellation or suspension power if a
person who is receiving austudy payment fails to comply with a notice given
to the person under section 586C, 1304 or 1305.
Note 1 points out
that this provision does not apply in a case where sections 588B or 590B
apply.
Note 2 signposts section 591A which sets out the date of
effect of a decision under this new section.
New section 590D - Changes to payments by computer
This section provides that, if austudy payment is being paid to a
person based upon information held in a computer and that payment is increased,
decreased, cancelled or suspended through the operation of a computer program
approved by the Secretary, then the increase, decrease, cancellation or
suspension is taken to have been made through a decision by the
Secretary.
This provides a legal mechanism for cancelling, suspending or
varying the rate of payment through the use of computers. However, the effect
is limited to areas of decision making where there is no discretionary element.
In these cases, a computer program operating under the new section could validly
cancel, suspend or vary the rate of austudy payment.
A note points
out that a determination to change a payment under the new section is reviewable
by the Secretary and by the Social Security Appeals Tribunal.
New section 590E - Resumption of payment after cancellation or suspension
Subsection 590E(1) provides for the Secretary to make a decision
that austudy payment is to be reinstated if it was stopped
incorrectly.
Subsection 590E(2) allows the decision that gave rise
to the payments being stopped to be reconsidered following either a formal
application to the Secretary for review under section 1240 of the
Social Security Act or at the Secretary's instigation.
A note
signposts the relevant date of effect provision.
New Subdivision E - Date of effect of determination
New section 591 - Date of effect of favourable determination
Subsection 591(1) provides that this section governs the date of effect
of a favourable determination (that is, a determination made under
section 590 or 590E).
Subsection 591(2) provides that if a
recipient of austudy payment appeals against an adverse decision within
3 months of being notified of the decision and a favourable decision
results, then it takes effect on the date on which the adverse decision took
effect. This enables arrears to be paid from the date of the adverse
determination.
Subsection 591(3) provides that if a recipient
appeals against an adverse decision more than 3 months after being notified
of the decision and a favourable decision results, then it takes effect on the
day that the person appealed.
Subsection 591(4) provides that if a
recipient appeals against an adverse decision about which the person was not
notified and a favourable decision results, then it takes effect on the date on
which the adverse decision took effect. This enables full arrears to be
paid.
Subsection 591(5) provides that if a favourable decision results
from a recipient informing the Department of a change in circumstances, then it
takes effect on the date on which the Department received the information or the
date on which the changes occurred, whichever is the later. Therefore, arrears
are paid back to the later of those dates.
Subsection 591(6)
provides that in any other case, a favourable determination takes effect on the
determination date or on such later or earlier date as is specified in the
determination (not being more than 3 months before the determination
date).
New section 591A - Date of effect of adverse determination
Subsection 591A(1) provides that this section sets down the date of
effect of an adverse determination (that is, a determination under new sections
590A, 590B or 590C).
A note signposts the provisions in Chapter 6 of
the Social Security Act that allow the Secretary to continue payment
pending the outcome of a review if the adverse determination under review
depends on a discretion or opinion.
Subsection 591A(2) sets the date of
effect of an adverse determination as the date on which it is made or another
date specified in the determination.
Subsection 591A(3) ensures that if
the date of effect of an adverse determination is specified but is not the day
of the determination, it must be a later date unless subsection (4), (5),
(6), (7) or (8) applies.
Subsections 591A(4), (5) and (6) address
those situations in which the date of effect of an adverse determination can be
before the date of the determination. The situations are when the adverse
decision results from:
an austudy payment recipient contravening a
provision of the Social Security Act (except sections 586C, 1304, 1305,
1306 or 1307) - subsection 591A(4) refers; or
any person making either a
false statement or misrepresentation if this causes austudy payment to be
paid when it should not have been paid - see subsection 591A(5);
or
any person making either a false statement or a misrepresentation if
this causes austudy payment to be paid at a higher rate than it should have
been paid - see subsection 591A(6).
Subsections 591A(7) and (8) provide
that where a person receives a payment of arrears of periodic compensation
payments (the person being in receipt of austudy payment at the time of the
event which gave rise to the compensation) and the person has been overpaid as a
result of receiving the arrears payment, the day from which the person has been
overpaid can be earlier than the day the decision is taken that the person has
been overpaid.
Subsection 591A(9) provides that the determination takes
effect on the day on which the matter arose, if the adverse determination is
made as a result of a person having given the Department a statement about a
matter in accordance with section 586C.
New Division 10 - Bereavement payments on death of partner
This Division replicates provisions dealing with bereavement payments
which are common to all payment types in the Social Security Act. This
entitlement was not previously extended to AUSTUDY recipients.
New section 592 - Qualification for payments under this Division
Subsection 592(1) lists the qualification criteria for bereavement
payments under Division 10 (that is, payments that represent the deceased
partner's entitlements) to cover the "bereavement period" (a term defined in
Part 1.2 of the Social Security Act as the period of 14 weeks
from the date of death). Subsection 592(1) provides that a surviving partner
qualifies for bereavement payments during the bereavement period only if
immediately before the death of the partner:
the surviving partner was a
long-term social security recipient; and
on the person's payday
immediately before the first available bereavement adjustment payday, the amount
that would be payable to the person if the person was not qualified for payments
under this Subdivision would be less than the sum of the person's continued rate
under section 592C and the rate of continued payment of partner's pension or
benefit under section 592A; and
the deceased partner:
- was a
long-term social security recipient; or
- was receiving a social security
pension or a service pension (regardless of the duration of receipt of those
payments).
"Long-term social security recipient" is defined in subsection
23(1) of the Social Security Act as a person who has been receiving a
social security pension, benefit, youth training allowance or service pension
continuously for the past 52 weeks.
Notes 1 and 2 refer to the two
different forms that bereavement payments take:
Under section 592A, the
surviving partner is paid pension or allowance instalments that would have been
payable to the deceased partner up to the "first available bereavement
adjustment payday" if the partner had not died (that is, the continued payment
of the deceased partner's entitlement). "First available bereavement adjustment
payday" is defined in section 21 of the Social Security Act as being
the first payday after the Secretary becomes aware of the death and for which it
is practicable to terminate or adjust payments to take account of the
death.
Under new section 592B, the surviving partner is paid a lump sum
representing the balance of the pension or allowance instalments that would have
been payable to the deceased partner from the first available bereavement
adjustment payday up to the end of the bereavement period had the partner not
died.
Subsection 592(2) allows a surviving partner to choose not to
receive the bereavement payments.
Subsection 592(3) makes it clear that
an election under subsection 592(2) must be in writing. It may be made after
one or more payments under this Division have been made, and cannot be withdrawn
once the Department has completed action to put the election into
effect.
Subsection 592(4) provides that if a person is qualified for
payments under this Division in relation to the partner's death, the rate at
which austudy payment is payable during the bereavement period is governed
by section 592C (unless the person has made a choice under
subsection 592(2)).
New section 592A - Continued payment of partner's pension or entitlement
This section provides that a person who is qualified for payments under
this Division, would receive, on each of the paydays in the bereavement rate
continuation period, the benefit that would have been payable to the person's
partner. The "bereavement rate continuation period" is defined in section 21 of
the Social Security Act. It begins at the beginning of the
bereavement period and ends either on the day before the first available
bereavement adjustment payday or at the end of the bereavement period, whichever
is earlier.
New section 592B - Lump sum payable in some circumstances
This section provides for the payment to a surviving partner of a lump
sum amount representing the balance of pension or allowance instalments that
would have been payable to the deceased partner from the first available
bereavement adjustment payday up to the end of the bereavement period if the
partner had not died. The lump sum is payable where the first available
bereavement adjustment payday occurs before the end of the bereavement period.
Where it occurs after the end of the bereavement period, the full bereavement
entitlement would have already been paid under the provisions of new
section 592A.
The lump sum is worked out in accordance with the
following steps:
Step 1 involves adding up the amount that would be
payable to both the surviving partner and the deceased partner if the deceased
partner had not died. The result is call the "combined rate";
Step
2 produces the "individual rate" by working out the austudy payment that
would be payable to the surviving partner on the surviving partner's payday
immediately before the first available bereavement adjustment payday if
austudy payment had been payable to the surviving partner on that payday at
the rate applicable to a single person;
Step 3 involves the deduction of
the "individual rate" from the "combined rate" to get the "partner's instalment
component";
Step 4 requires ascertaining the number of paydays in the
bereavement lump sum period;
Step 5 involves multiplying the "deceased
partner's instalment component" by the number of paydays arrived at in Step
4.
New section 592C - Adjustment of person’s austudy payment rate
This section provides for a person who is qualified for payment under
this Division (and who does not elect not to receive payments under
subsection 592(2)) to receive a rate of austudy payment as
follows:
austudy payment equal to the rate which would have been
payable if the person's partner had not died - to be paid for the bereavement
rate continuation period;
austudy payment equal to the rate which
would be payable to the person apart from this Division - to be paid during the
bereavement lump sum period.
New section 592D - Effect of death of person entitled to payments under this Division
This section allows bereavement payments to be converted to a lump sum
and paid to such person as the Secretary thinks appropriate where:
a
person is qualified for partner bereavement payments under this Division;
and
the person dies within the bereavement period; and
the
Secretary becomes aware of the partner's death only after the person's
death.
The lump sum is worked out using the lump sum calculator at the
end of this section, and involves the following steps:
Step 1 involves
adding up the amount that would be payable to the person if neither the person
nor the person's partner had died, and the amount that, if neither died, would
have been payable to the person's partner on the partner's payday immediately
after the day on which the person died. This produces the "combined
rate";
Step 2 produces "person's individual rate" by working out the
austudy payment rate that, apart from section 592C, would be payable
to the person on the person's payday immediately after the day on which the
person died if the person had not died.
Step 3 involves deducting the
"person's individual rate" away from the "combined rate" to get the "partner's
instalment component";
Step 4 requires ascertaining the number of the
paydays of the partner in the period that commences on the day after the person
dies and ends on the day on which the bereavement period ends;
Step
5 involves multiplying the "partner's instalment component" by the number of
paydays arrived at in Step 4. The result is the amount of the lump sum payable
under this section.
New section 592E - Matters affecting payments under this Division
Section 592E allows the Department to recover amounts already paid by way
of continuation payments if they exceed the total amount payable to a person
under this Division. It also ensures that such continuation payments are not
paid again under this Division.
Subsection 592E(1) applies to a person
qualified under this Division where, after his or her partner's death, an amount
in respect of the partner under the Social Security Act or under Part
III of the Veteran's Entitlements Act has been paid, and the Secretary is not
satisfied that the person has not had the benefit of that amount (that is, the
Secretary believes that the person has received the amount and it would be for
the person or another information source to convince the Secretary otherwise).
In this case, the amount is not recoverable by the Department except to the
extent (if any) that it exceeds the amount payable under this Division, but it
is treated as a deduction from the amount payable under this Division (that is,
so it is not received twice).
Subsection 592E(2) deals with the situation
where an amount in respect of a person's deceased partner is paid under the
Social Security Act or under Part III of the Veterans' Entitlements
Act, within the bereavement period, into an account with a bank, credit union or
building society (called the "financial institution"). If the person is
qualified for payments under this Division and if the financial institution pays
any of the amount to the person from the account, then the financial institution
is not liable to any action, claim or demand by the Commonwealth, the
representative of the partner or any other party in respect of that
money.
Item 7 inserts new Part 3.5A, containing the Austudy
Payment Rate Calculator.
New Part 3.5A – Austudy Payment Rate Calculator
The preliminary sections in Part 3.5A set up the various interpretational
rules used by the Austudy Payment Rate Calculator.
New section 1067H
Section 1067H records the two specially defined terms used in Part 3.5A
and that they are defined in the following two sections.
New section 1067J
Section 1067J addresses when a person is taken to "live at home". This
will be so if the person lives at the home of either or both of his or her
parents. This is relevant in setting the person's maximum basic rate.
New section 1067K
Section 1067K provides the meaning of the term "long term income
support student". This is relevant in setting the person's maximum basic rate,
since he or she will receive a special rate to ease the transition to austudy
payment. A person is a long term income support student if he or she is not a
member of a couple (as provided by section 4), does not have a dependent child
(as provided by subsections 5(2) to (9)), is undertaking full-time study in a
course started after he or she turned 21, and has received one or more of a
specified range of current or former income support type payments for 26 out of
the preceding 39 weeks. A person also falls within this term if he or she is
not a member of a couple, does not have a dependent child and is undertaking an
approved course in English as a second language.
New section 1067L
Subsection 1067L(1) clarifies that the Austudy Payment Rate Calculator is
to be used to calculate the rate of austudy payment for most austudy payment
recipients - only those subject to either or both an activity test breach rate
reduction period or an administrative breach rate reduction period will have
another primary source for their rate calculation, ie, Subdivision B or C of
Division 5 of Part 2.11A.
Subsection 1067L(2) provides a special
rule to limit the rate of austudy payment payable to a person who is in an under
age relationship and therefore not a member of a couple. The rate is limited to
the rate that would be payable if the other party to the relationship were the
austudy payment recipient's partner.
New Austudy Payment Rate
Calculator
New Module A - Overall rate calculation
process
New point 1067L-A1
Point 1067L-A1 provides the Method statement for calculating a person's
fortnightly rate of austudy payment. It follows a similar course to other
overall rate calculation process Method statements in the Social Security Act,
including establishing the maximum basic rate, to which is added pharmaceutical
allowance to arrive at the maximum payment rate. Then, a benefits model income
test is applied and any ordinary income reduction deducted to reach the
provisional payment rate. From this is deducted any amount recoverable under
the existing advance payment provisions that have been extended to austudy
payment, and any remote area allowance added.
New Module B - Maximum basic rate
New
point 1067L-B1
This Module lays down the starting point for the rate calculation process,
the person's maximum basic rate. This is established on the basis of the
person's individual circumstances. Point 1067L-B1 directs the reader to
whichever of two separate Tables applies. Table BA applies if the person is not
a long term income support student (as provided by section 1067K). Table
BB applies if the person is a long term income support student.
New point 1067L-B2
Point 1067L-B2 accommodates Table BA, applying to a person who is not a
long term income support student. Such a person who does not have a dependent
child and lives at home (as provided by section 1067J) will be paid the
maximum basic rate of $174.80 pf (the "at home" rate). A person who does not
have a dependent child and does not live at home will be paid the maximum basic
rate of $265.50 pf (the "away from home" rate). A person who has a
dependent child and is not a member of a couple will be paid $347.80 pf. If the
person has a dependent child and is a member of a couple, the rate will be
$291.60 pf. These rates will not vary before austudy payment commences on 1
July 1998.
New point 1067L-B3
Point 1067L-B3 contains Table BB, applying to a person who is a long term
income support student. Such a person who lives at home will be paid $214.60
pf. If such a person does not live at home, the rate will be $322.40 pf. These
rates will not vary before austudy payment commences on 1 July
1998.
New Module C - Pharmaceutical
allowance
New point 1067L-C1
Pharmaceutical allowance may be added to a person's maximum basic rate at
Step 2 of the overall rate calculation process Method statement in point
1067L-A1. Point 1067L-C1 provides for pharmaceutical allowance to be added
if the austudy payment recipient is in Australia, has turned 60 and has been
receiving income support payments for at least 9 months continuously. These
criteria are similar to those currently applying under parenting
allowance.
New point 1067L-C2
However, point 1067L-C2 precludes the payment of pharmaceutical allowance
if the person has a partner who is not a service pensioner but who is receiving
pharmaceutical allowance under the Veterans' Entitlements Act.
New point 1067L-C3
Point 1067L-C3 lays down the rates of pharmaceutical allowance. $2.70 pf
will generally be paid to partnered people, and $5.40 pf to single people or
those not able to live with their partners in the circumstances specified.
Pharmaceutical allowance is indexed or adjusted annually.
New Module D - Income test
New point
1067L-D1
Point 1067L-D1 provides a Method statement for working out the effect of
a person's, and partner's, ordinary income on austudy payment rate.
The
Method statement starts with working out the amount of the person's ordinary
income for the fortnight (which may be reduced under the student income bank
provisions of Module E). Then, if the person is a member of a couple, the
partner income free area is worked out, and whether the person has a partner
income excess. If there is such an excess, the person’s partner income
reduction is calculated. Then the person's ordinary income is compared with his
or her ordinary income free area to establish the person’s ordinary income
excess and the consequent ordinary income reduction. The person's partner
income reduction and ordinary income reduction are added to reach the person's
income reduction. This then forms part of the person's overall rate calculation
process in the Method statement in point 1067L-A1.
New point 1067L-D2
Point 1067L-D2 reproduces a standard rule relating to the ordinary income
of a member of a couple whose partner is receiving a social security or service
pension or rehabilitation allowance. In that case, the income is taken to be
half of the combined incomes of the two people.
New points 1067L-D3 to 1067L-D16
Point 1067L-D3 applies if a person is entitled on termination of
employment to a lump sum payment from the former employer, so that the lump sum
is taken to have been received on the day the employment was
terminated.
This is subject to rules contained in points 1067L-D4 to -D16
which are identical to amendments introduced by Part 1 of Schedule 7 to the
Social Security Legislation Amendment (Budget and Other Measures) Act
1997. These rules replaced the former annual leave waiting period
provisions with provisions relating to an "income maintenance period". They
provide for leave payments (including accumulated leave payments such as long
service leave and sick leave, and leave payments that arise as a condition of
service such as maternity leave) to be treated as income from the date of
payment over a period equal to that for which the leave is calculated. These
rules do not apply when eligible termination payments (which may include a lump
sum leave payment) are rolled over in an approved deposit fund, a deferred
annuity or a superannuation fund, as defined in subsection 9(1).
New points 1067L-D17 and 1067L-D18
These points make it clear that a person's ordinary income is to include
a periodical payment or benefit by way of gift or allowance from one of the
specified immediate relatives of the person. However, a payment to the person
from such a relative for board or lodging is not included in ordinary
income.
New point 1067L-D19
Point 1067L-D19 provides that ordinary income is taken into account in
the fortnight in which it is first earned, derived or received, unless point
1067L-D20, 1067L-D21, 1067L-D23 or 1067L-D24 or section 1073 applies.
New points 1067L-D20 to 1067L-D22
These points are identical to points introduced into other rate
calculators by Schedule 2 to the Budget Measures Bill. The purpose of them
is to ensure that lump sum payments received by austudy payment recipients are
treated consistently as either income over 12 months or as deemed assets. This
is done by aligning the treatment of lump sums under the benefits ordinary
income test with the pensions ordinary income test.
New point 1067L-D23
Point 1067L-D23 (which, like point 1067L-D3, is subject to
points 1067L-D4 to 1067L-D16) deals with the situation of a person
receiving a number of ordinary income payments, each in respect of a work period
of more than a fortnight, there being reasonable predictability as to the timing
and quantum of the payments. In this case, the income is apportioned over the
work period.
New point 1067L-D24
Point 1067L-D24 similarly apportions a person's payment of arrears of
periodic compensation over the "periodic payments period" (as provided by
section 17) and takes the amount received into account accordingly.
New points 1067L-D25, -D26 and -D27
These points establish the effect of an austudy payment recipient's
partner's income under the ordinary income test. The partner income free area
is set out in point 1067L-D25. In respect of a partner who is not
receiving a social security benefit and is aged under 21, it is that amount of
income of the partner that would, if the partner were qualified for youth
allowance and were not undertaking full-time study, cause the partner's youth
allowance to stop being payable. If the partner is not receiving a social
security benefit and is 21 or more, the free area is that amount of income that
would, if the partner were qualified for newstart allowance, cause the partner's
newstart allowance to stop being payable. Lastly, if the partner is receiving a
social security benefit, the free area is that amount that would stop the
benefit from being payable to the partner.
Under point 1067L-D26, a
person has a partner income excess if the person's partner (who must not be
receiving a social security or service pension or rehabilitation allowance) has
ordinary income in excess of the partner income free area. Under
point 1067L-D27, a person with such a partner income excess will incur a
partner income reduction of 70% of the excess.
New points 1067L-D28, -D29 and -D30
These points provide comparable rules to those above, but in relation to
the person's own ordinary income. The ordinary income free area provided by
point 1067L-D28 is a flat rate of $230.
Under point 1067L-D29, the person
has an ordinary income excess if ordinary income exceeds the free area, the
difference between the two being the ordinary income excess. Point 1067L-D30
provides that the person’s ordinary income reduction is the sum of the
lower and upper range reductions provided by the following points.
New points 1067L-D31 and -D32
Point 1067L-D31 provides that the person's lower range component of the
ordinary income reduction is 50% of that part of the person's ordinary income
that exceeds the free area by up to $80.
Point 1067L-D32 provides that
the person's upper range reduction is 70% of any ordinary income beyond that
level.
Therefore, a person will lose 50% of income over $230 and not
exceeding $310, and 70% of income beyond $310.
New Module E - Student income bank
The income bank provided by this Module is for all austudy payment
recipients and mirrors the new arrangements for student youth allowance
recipients. Students will be able to preserve each fortnight unused portions of
their $230 ordinary income free area to be offset against future income. The
scheme is based on the fact that students' income earning tends to be
concentrated during vacations and the income bank will enable a more even
pattern of income support.
New point 1067L-E1
This point describes by way of a flow chart how to work out whether a
person's ordinary income is reduced for the fortnight under the income bank and,
if so, by how much. Essentially, if the person would otherwise have excess
income for the fortnight, and if the person has an income bank credit (all
worked out using the specified points), then the person's ordinary income for
the fortnight is reduced by the amount of the income excess, up to the amount of
the income bank credit.
New point 1067L-E2
This point provides a Method statement for working out a person's income
bank credit for a particular income bank fortnight. This is basically done by
starting at nil and adding each applicable fortnight's income credit under
point 1067L-E3. However, the total income bank credit may not exceed
$6,000. On the other hand, the income bank credit is to be reduced by any
amount drawn for any applicable fortnight from the credit under
point 1067L-E4, although the balance will never fall below nil. This is
how the person's income bank credit is reached for the income bank fortnight in
question.
New point 1067L-E3
This point provides that a person has an income credit for an "income
bank fortnight" if he or she has ordinary income in the fortnight of anything
less than $230 (including nil). The income credit is $230 (if he or she has no
ordinary income) or the difference between $230 and the ordinary income that he
or she does have. It is the sum of these individual income credits, minus any
amounts drawn under point 1067L-E4, that result in the person's income bank
credit for an income bank fortnight.
New point 1067L-E4
Point 1067L-E4 provides that a person is taken to have drawn from his or
her income bank credit for an income bank fortnight if he or she has ordinary
income in that fortnight of more than $230. The amount drawn is the difference
between that income and $230.
New point 1067L-E5
This point sets up the term "income bank fortnight" for the use of the
relevant provisions in this Module. It means any fortnight for which austudy
payment may be payable to the person.
New Module F - Remote area
allowance
New point 1067L-F1
This point provides for an amount by way of remote area allowance (RAA)
to be added to a person's austudy payment rate if that rate would otherwise be
more than nil and the person usually lives in, and is physically present in, a
remote area.
New point 1067L-F2
The way to work out a person's rate of RAA is provided by Table F in this
point. There is a basic allowance which depends on the person's family
situation, and an additional amount for each child of the person to whom point
1067L-F8 applies.
New points 1067L-F3 and -F4
These points clarify that, in the Table in point 1067L-F2, RAA means an
amount added to the person's austudy payment rate by way of RAA and that, for
the purposes of that Table, a person is in the remote area if that is his or her
usual place of residence and he or she is physically present in the remote
area.
New point 1067L-F5
This point stipulates that an additional allowance for a child is not to
be included in the person's RAA unless the child is physically present in
Australia.
New points 1067L-F6 and -F7
Point 1067L-F6 provides a standard rule that effectively allows the
additional child allowance to be paid to a person if a child to whom point
1067L-F8 applies is the person’s partner’s child but the partner is
not receiving a social security pension or benefit.
Point 1067L-F7 is a
complementary rule that allows the additional child allowance to be paid to a
person if a child to whom point 1067L-F8 applies is the person's partner's child
but the partner is not receiving additional allowance for the child.
New point 1067L-F8
This point clarifies that a child to whom this point applies is a
dependent child in respect of whom family allowance is payable at a rate
exceeding the minimum family allowance rate.
5. Commencement
This Schedule will commence on 1 July 1998.
Schedule 2 – Amendment of the Social Security Act 1991 relating to youth allowance
1. Summary of proposed changes
This Schedule makes certain policy and technical refinements to youth
allowance.
2. Background
The basic structure for youth allowance was set up by the Youth Allowance
Bill. This Schedule builds on that structure by refining certain aspects of the
policy and technical operation to ensure that the new payment fulfils the
Government’s intentions. Since youth allowance is a payment that has
evolved from two separate origins, this refinement is partly to correctly
reflect those aspects of the former AUSTUDY structure that need to be preserved
and partly to set youth allowance up as a fully functional part of the social
security payment structure.
In addition, Schedule 2 includes
amendments to ensure that recent amendments in the Parenting Act are also made
to the youth allowance regime. In particular, Schedule 2 amends the
Social Security Act to ensure that the hardship rules (which
provide for waiver of waiting periods) for the liquid assets waiting period will
be standardised with those of other similar social security payments, such as
newstart allowance, with a requirement that the person be in severe financial
hardship. The definition of "severe financial hardship" for these waiting
periods will be if a person has less than the equivalent of two weeks' allowance
at the appropriate rate (commonly known as the short term available funds test)
in liquid assets. In addition, the proposal introduces a requirement that the
expenditure that caused the severe financial hardship must have been both
unavoidable and reasonable. If the person is in severe financial hardship, in
circumstances where it was unavoidable and reasonable, then the remainder of the
waiting periods may be waived in full or in part.
The amendments in
Schedule 2 will also ensure the consistent treatment of lump sum
payments, and replicates amendments made in Schedule 2 to the Budget Measures
Bill. Thus, lump sum payments received by youth allowance recipients will be
consistently treated as either income over 12 months or a deemed asset by
aligning the treatment of lump sums under the youth allowance ordinary income
test with the pensions ordinary income test.
3. Clauses and Schedule involved in the changes
Clause 2: provides the commencement rules for this
Schedule.
Clause 3: provides that each Act that is specified in
this Schedule is amended as set out in the Schedule.
Schedule 2 – Amendment of the Social Security Act 1991 relating to youth allowance
Item 1: inserts a new entry in the index of definitions in section
3 for the definition of "study".
Item 2: repeals new subsection
4(6A), inserted by item 3 of Schedule 2 to the Youth Allowance Bill, and
substitutes a new subsection (6A).
Item 3: inserts a new
subsection (2A) into section 13 dealing with rent assistance
definitions.
Item 4: amends subsection 23(1) to insert a
definition of "study".
Items 5 to 8: amend
subsection 541(3).
Item 9: amends
paragraph 541B(1)(b).
Item 10: amends
subsection 541B(4).
Item 11: amends
subsection 541B(5).
Items 12 and 14: insert a new paragraph
547(aa), and a new Subdivision AB, relating to the youth allowance assets test,
in Division 2 of Part 2.11.
Item 13: amends
paragraph 547(e).
Item 15: amends paragraph
548C(2)(a).
Item 16: amends subparagraph
548E(b)(ii).
Item 17: repeals subsection 549A(3) and replaces it
with a new provision which ensures the hardship rules for the youth allowance
liquid assets test mirror those for sickness allowance and newstart
allowance.
Item 18: amends paragraph 549D(1)(a).
Item
19: amends subparagraph 549D(3)(a)(ii).
Item 20: inserts
new subsections 549D(4) and (5).
Item 21: amends paragraph
549E(a).
Item 22: amends Subdivision F of Division 2 of
Part 2.11 (heading).
Item 23: amends section
552.
Item 24: amends subsection 552A(2).
Item
25: inserts a new paragraph 1067F(1)(ba) to clarify that, for a person to be
a "long term income support student", the person must not have a dependent
child, in keeping with the effect under the former AUSTUDY.
Item
26: inserts new subparagraphs 1067F(1)(d)(xii) and (xiii) in the definition
of "long term income support student". The new subparagraphs add benefit
parenting allowance and benefit PP (partnered) to the list of payment types that
may attract the operation of this definition and therefore a more beneficial
maximum basic rate.
Item 27: repeals steps 5 to 7 in the overall
rate calculation process method statement in point 1067G-A1.
Item
28: makes technical amendments to paragraph 1067G-D1(h).
Item
29: repeals Module E of the Youth Allowance Rate Calculator.
Item
30: amends paragraph 1067G-F3(c).
Items 31 and 32: provide for
the insertion of new paragraph 1067G-F7(aa).
Item 33: omits from
paragraph 1067G-F10(d) a reference to "net rental property loss" and substitutes
a reference to "net passive business loss".
Item 34: repeals note
5 to paragraph 1067G-F10 and substitutes a new one.
Item
35: substitutes a new version of subpoint 1067G-F11(4).
Item
36: inserts new point 1067G-F19A.
Item 37: substitutes a new
version of paragraph 1067G-F24(b).
Item 38: makes a minor
grammatical correction to paragraph 1067G-F24(d).
Item
39: amends point 1067G-G1.
Item 40: inserts a new step 1A into
the method statement in point 1067G-G1.
Item 41: amends step
2 of the method statement in point 1067G-G1.
Item 42: inserts a
new step 2A into the method statement in point 1067G-G1.
Item
43: amends step 3 of the method statement in point 1067G-G1.
Items
44 and 45: insert new points 1067G-G2A and 1067G-G3A.
Item
46: amends point 1067G-G4.
Items 47 and 48: repeal points
1067G-H11 to -H14 and -H18 and substitute new points.
Item
49: makes consequential amendments to point 1067G-H23, necessary as a result
of item 50.
Item 50: inserts new points 1067G-H23A,
1067G-H23B and 1067G-H23C into the Youth Allowance Rate Calculator, thereby
ensuring the consistent treatment of lump sums between payment
types.
Item 51: repeals point 1067G-H26 and substitutes a new
version.
Item 52: amends point 1067G-K8.
Item
53: amends point 1067G-K8 (note 2).
Item 54: repeals two
redundant items in the table in Module L of the Youth Allowance Rate
Calculator.
4. Explanation of the changes
This Schedule makes certain policy and technical refinements to youth
allowance.
The new subsection 4(6A), substituted by item 2,
strengthens the modification made by the Youth Allowance Bill to the meaning of
"member of a couple" for non-independent youth allowance recipients and their
partners. That modification was to operate to the effect that a person who is
the partner of a youth allowance recipient who is not independent, while still a
member of a couple for most purposes in the Act, is not a member of a couple in
a range of specified provisions relating to the income and assets tests.
Furthermore, the non-independent youth allowance recipient himself or herself is
also not a member of a couple in the youth allowance income and assets test and
related provisions, nor would be any other person who has claimed youth
allowance and is not independent.
Thus, if two people are in a
marriage-like relationship which has lasted for less than two years, and one of
them is a youth allowance recipient who is not independent on any other ground,
then the relationship is (if all the usual member of a couple criteria are met)
recognised for most purposes for each of their payments, including setting
maximum basic rate, pharmaceutical allowance, rent assistance, etc (to the
extent that it is relevant). However, the relationship is effectively
disregarded for all purposes relating to the income or assets tests. This is
largely a beneficial measure. The rationale for it is that the youth allowance
recipient, being not independent, is subject to the parental means test and
therefore should not also be subject to the partner income and assets tests. As
a matter of consistency, if the partner's income and assets are not to be taken
into account for the youth allowance recipient, nor should the youth allowance
recipient's for the partner.
This refinement of the modifying rule is
mainly to make sure that it applies, not only in the income and assets test
provisions listed, but also in any other provision that applies for the purposes
of such a provision, ie, in provisions that provide definitions and general
rules for the listed provisions. The new version of subsection 4(6A) also
corrects the references in the listed provisions and adds austudy payment
references. It also extends the application of the rule to the liquid assets
test provisions and compensation recovery provisions.
Item 3 adds
to the range of definitions relating to rent assistance to provide that, for a
person to whom youth allowance is payable, who is not independent, who is
required to live away from home and who is attending boarding school while so
required, the boarding school is taken to be the person's principal home and
fees are taken to be payable by the person. This will enable the terms "rent"
and "principal home" to operate to allow rent assistance to be available to the
person. This application of the provisions, not previously necessary in the
social security system, is to preserve a particular rent assistance entitlement
formerly available under AUSTUDY.
Item 4 inserts a
definition of "study" into subsection 23(1) of the Social Security Act, the
general definitions section, to make it clear that the term study includes
vocational training. Item 1 lists this new defined term in the
index of definitions in section 3.
Proposed subsection 541(3)
provides that a person who is employed on a full-time basis or who is working
substantial hours in what is, in the opinion of the Secretary, a family business
cannot be taken to satisfy the activity test. Items 5 to 8 amend
subsection 541(3) to exempt a person from this rule if he or she is
satisfying the activity test by undertaking full-time study. This change
enables a full-time student to work full-time during vacation
periods.
Paragraph 541B(1)(b) provides that a person is "undertaking
full-time study" if the person is enrolled in, or intending to enrol in, and
undertaking at least three-quarters of the normal amount of full-time study in
respect of his or her course of education. Item 9 amends this
paragraph to make it clear that the person must undertake three-quarters of the
full-time study in respect of the study period in which he or she is currently
enrolled. That is, the requirement that a person undertake at least
three-quarters of a study load in respect of a course is not referable to the
entire length of the course, but to the particular study period in which the
person is currently enrolled, or intends to be
enrolled.
Subsection 541B(4) gives a period of grace of up to
2 weeks to a person who is undertaking full-time study in order to arrange
his or her studies for the semester. Item 10 amends this subsection
to make it clear that this period of 2 weeks is available to all
youth allowance recipients who are undertaking full-time study, including
those who are enrolling for a period that is not a semester. Consequently, the
term "semester" has been replaced with a reference to "the study
period".
Item 11 substitutes a reference to a provision in
the Student and Youth Assistance Act with a reference to the
corresponding provision in the Student Assistance Act.
Item
14 inserts a new Subdivision into the payability Division of the youth
allowance payment module dealing with the assets test. The Youth Allowance Bill
as introduced included provisions for the youth allowance assets test at Module
E of the Rate Calculator, in line with the models set by youth training
allowance and sickness allowance for under 18 year olds. However, other social
security benefit assets tests are accommodated in the relevant payability
provisions in the payment module (eg, the newstart allowance assets test
provisions at sections 611 and 612).
This moving of the youth allowance
assets test provisions is to bring it structurally into line with other social
security benefit assets test provisions. In related amendments, item 12
includes reference to the assets test as making youth allowance not payable to a
person who is qualified for it, item 29 repeals the assets test Module in
the Youth Allowance Rate Calculator and item 27 removes the reference to
the assets test as a factor in the overall rate calculation
process.
Items 13, 22, 23 and 24 amend paragraph 547(e),
the heading to Subdivision F of Division 2 of Part 2.11,
section 552 and subsection 552A(2) respectively, to change a reference
to "alternative support" to "multiple entitlement" to maintain consistency of
terminology with other provisions in the
Social Security Act.
Items 15, 52 and 53 amend
paragraph 548C(2)(a) and point 1067-K8 (including the note) to change a
reference to family payment to a reference to family allowance, reflecting the
recent change of name of this payment.
Item 16 makes a minor
technical amendment to subparagraph 548E(b)(ii).
The amendments in
Schedule 4 to the Parenting Act involved simplifying the rules that apply in
relation to waiting periods and hardship. Item 17 extends that
initiative to the youth allowance regime. In the first instance, a "severe
financial hardship" test will be implemented. Severe financial hardship will be
demonstrated by the fact that the available funds of the person are less than
two weeks allowance. The remainder of the waiting period may be waived if the
person satisfies the severe financial hardship test and if the cause of the
hardship is due to "unavoidable and reasonable expenditure".
In addition,
the current youth allowance liquid assets test provisions provide that the
Secretary is only able to waive the entire liquid assets waiting period.
They do not allow waiver of part of the period.
Accordingly, the
amendments in Schedule 2 will also ensure that part of a liquid assets
waiting period may be waived if the person is in severe financial
hardship.
Two notes to the section signpost the provisions dealing with
"in severe financial hardship" and "unavoidable or reasonable
expenditure".
Items 18 to 21 amend the proposed provisions dealing
with the newly arrived resident's waiting period. Item 18 amends
paragraph 549D(1)(a) to substitute a reference to 1 January 1993
with a reference to 4 March 1997. This amendment makes it clear that
a person will only be subject to the two year newly arrived resident's waiting
period if he or she entered Australia on or after the commencement date of that
waiting period (that is, 4 March 1997).
Item 19 makes a
minor amendment to paragraph 549D(3)(a)(ii) to make it clear that the
reference made to the Student and Youth Assistance Act is as
it was in force immediately before the commencement of
section 549D.
Item 20 inserts new subsections 549D(4)
and (5).
Subsection 549D(4) states that the newly arrived resident's
waiting period does not apply to those persons who:
had they actually
applied for a social security payment (other than youth allowance or
youth training allowance), would have been subject to the waiting
period and the period would have ended; or
have had a qualifying
residence exemption for newstart allowance or sickness allowance under the
Social Security Act, or for youth training allowance under
the Student Assistance Act; or
in the case of AUSTUDY
recipients, were not subject to such a waiting
period.
Subsection 549D(5) provides that the waiting period does not
apply to a New Zealand citizen if the person became an Australian resident
before 1 July 1998 and one of the following applies to the
person:
when the person first claimed youth allowance the person had
been either an Australian resident for the immediately preceding 12 months
or had been continuously present in Australia for the immediately preceding
6 months; or
immediately before 1 July 1998, the person
was qualified for sickness allowance or youth training allowance; or
the person has previously received sickness allowance or youth training
allowance.
These provisions are required to ensure that young people who
would have qualified for newstart allowance, sickness allowance or
youth training allowance prior to 1 July 1998 can qualify
for youth allowance on the basis of residence. This is necessary to avoid
disadvantaging young people who entered Australia prior to the implementation of
youth allowance and who may have been self supporting up to this
time.
Item 28 makes technical amendments to paragraph 1067G-D1(h)
to ensure the terminology in that point is consistent with the new family
allowance regime.
Item 30 omits from paragraph 1067G-F3(c) for
youth allowance three references to the former AUSTUDY which will now be
obsolete.
Items 31 and 32 operate to add a criterion to the youth
allowance parental income test provision allowing a change to the person’s
appropriate tax year at his or her own request. This will now apply only if the
person's combined parental income for the tax year following the usual base tax
year is substantially less than in the latter year and likely to continue to be
so for two years. This is to preserve the effect of a former AUSTUDY
rule.
Items 33 to 36 substitute rules relating to a net passive
business loss in place of the current rules relating to a net rental property
loss in the youth allowance parental income test. These new rules, which target
more broadly negatively geared income (and include it as a component of parental
income) than do the current rules, were introduced to the former AUSTUDY regime
after the Youth Allowance Bill was drafted.
Item 37 operates to
identify more accurately a student child of a person's parent who will attract a
higher additional amount of parental income free area for the person. The
current version of paragraph 1067G-F24(b) applies only to university
students, whereas the intention from the former AUSTUDY rules is that the
paragraph apply to students in all forms of post-secondary
education.
Items 39 to 46 are to refine the structure of the youth
allowance family actual means test (the FAMT) provisions in Module G of the
Youth Allowance Rate Calculator. The original provisions, which were based on
the AUSTUDY actual means test and which enable the making of regulations for the
detailed operation of the test, were drafted at a time when the AUSTUDY actual
means test was subject to change and so need to be refined. In particular, they
require minor amendment to reflect more closely the operation of the FAMT as a
sliding scale test (rather than one causing payment to cut out above a set
threshold) and a test that is very similar in structure to the parental income
test contained in Module F of the Youth Allowance Rate Calculator (the
PIT).
The structure of the FAMT might be best understood as a direct
alternative to the PIT. The only real difference between the two tests is in
what is measured (actual means on the one hand, and conventional taxable income
on the other). The treatment of each of these elements is the same under both
tests, ie, the correct year is identified, the total amount is established, it
is compared to a free area identical in both cases, the excess is subject to the
same 25% reduction rule and, for youth allowance, the result converted from an
annual amount to a fortnightly one.
Therefore, the refinements made now
to the FAMT are basically to recast certain aspects of the provisions along the
lines of the PIT. This comprises inserting two new steps in the method
statement, two new points to identify the appropriate tax year and the family
actual means free area, and minor consequential text changes. Regulations will
then fill in the details for the operation of the test.
Items 47 and
48 repeal certain points in the youth allowance income test provisions and
substitute new points that correctly apply the new income maintenance period
rules inserted by the Parenting Act, mirroring other amendments made by that Act
(see, for example, items 89ZX and 89ZY of Schedule 1).
The amendments in
items 49 and 50 of Schedule 2 will ensure that lump sum payments received
by social security recipients will be consistently treated as either income over
12 months or a deemed asset by aligning the treatment of lump sums under the
youth allowance ordinary income test with the pensions ordinary income
test.
Item 49 makes amendments to point 1067B-H23, which are
necessary as a consequence of the amendments in item 50. Point 1067G-H23
specifies that ordinary income is normally taken into account in the fortnight
in which it is earned derived or received. These amendments make it clear that
this general provision is also subject to a number of specific provisions.
These include the provisions relating to:
the apportionment of lump sum
amounts for remunerative work (new points 1067G-H23A and 1067G-H23B);
and
ordinary income when it is received at intervals longer than one
fortnight (current point 1067G-H24); and
the payment of arrears of
periodic compensation payments (point 1067G-H25); and
section 1073,
which specifies how certain lump sum amounts are to be apportioned.
New
points 1067G-H23A, 1067G-H23B and 1067G-H23C are inserted by item 49.
New point 1067G-H23A relates to lump sum amounts that are paid to a person who
has made a claim for youth allowance. The use of the phrases "whose claim for
youth allowance has been granted" and "after that claim has been granted"
extends the application of the provision to both claimants and recipients, and
ensures the provision covers lump sum payments received after the person has
made a claim for payment.
In order to come within the ambit of this
provision, the lump sum payment must have the following
characteristics:
the lump sum is paid in relation to remunerative work;
and
it is not a payment to which point 1067G-H24 applies (ie, ordinary
income received at intervals longer than one fortnight); and
it must not
be an exempt lump sum (which is defined in subsection 8(11)).
If the lump
sum payment meets these requirements, it may be apportioned over 12 months,
commencing on the day on which the person became entitled to receive the amount,
and the person is taken to receive an equal proportion of that amount each week
of the 12 month period.
A similar provision operates to extend the
application of the measure to lump sum payments received by the partner of a
claimant or recipient. New point 1067G-H23B provides similar rules to those
imposed by new section 1067G-H23A. That is, provided the lump sum payment is
similar to the type of lump sum specified in new point 1067G-H23A, the lump sum
amount paid to the partner is to be apportioned over 12 months, and the partner
is taken to receive an equal proportion of that amount each week of the 12 month
period.
New point 1067G-H23C makes it clear that the above-mentioned
provisions operate, even though the person may not actually be in receipt of the
youth allowance at the time the person becomes entitled to receive the lump
sum.
For instance, if the person claimed the allowance, but the Secretary
determined that a liquid assets waiting period should apply (because the
person's liquid assets were above the liquid assets threshold) then the person
would not be qualified for the youth allowance for the liquid assets waiting
period.
However, new point 1067G-H23C makes it clear that, if the person
became entitled to receive a lump sum amount that falls within the ambit of new
point 1067G-H23A during the person's liquid asset test waiting period, then
point 1067G-H23A still operates to apportion that lump sum amount. This
interpretation also applies if the person's youth allowance is not payable, for
instance, because of the imposition of an income maintenance period or a
seasonal work preclusion period.
Item 51 provides a new version of
point 1067G-H26, relating to a person's partner income free area. This is
necessary to reflect the youth allowance income cut out point as a determinant
of the partner income free area for a person whose partner is under 21, as well
as referring to the equivalent newstart allowance cut out point for a person
whose partner is 21 or older. The current reference is maintained to the cut
out point that applies in the case of the relevant social security benefit,
should the partner be receiving a benefit.
5. Commencement
This Schedule will commence on 1 July 1998.
Schedule 3 – Amendment of the Social Security Act
1991 relating to youth allowance and austudy payment
provisions
1. Summary of proposed changes
This Schedule makes amendments to, and relating to, the new payments
youth allowance and austudy payment to incorporate contemporary legislative
initiatives that could not be included in the original drafting of the
provisions.
2. Background
The purpose of this Schedule is to make amendments to, and relating to,
the new payments youth allowance and austudy payment, mainly to ensure that
amendments made in the Budget Measures Bill, which could not be reflected in the
legislation at the time of introduction, flow through consistently to encompass
the new payment structure. For complex technical reasons relating to the volume
of legislation from different sources that needs to be taken into account for
these amendments, there is a variety of commencement rules, distinguished in the
discrete Parts of this Schedule. The significance of these is merely to ensure
that the various amendments flow through correctly and on dates consistent with
the original measures.
3. Clauses and Schedule involved in the changes
Clause 2: provides the commencement rules for this
Schedule.
Clause 3: provides that each Act that is specified in
this Schedule is amended as set out in the Schedule.
Schedule 3 – Amendment of the Social Security Act 1991 relating to youth allowance and austudy payment provisions
Item 1: omits a now redundant reference to youth training
allowance in subparagraph (b)(ii) of the definition of "independent young
person" in subsection 5(1).
Item 2: amends paragraph
8(11)(b).
Item 4: inserts a new paragraph 544B(1)(ia).
Item
5: inserts a new paragraph 544B(5)(d).
Item 6: inserts a new
subparagraph 549A(5)(a)(ia).
Item 7: substitutes a new paragraph
550B(3)(b) for the existing paragraph (b).
Item 8: amends
paragraph 552A(1)(d).
Item 9: repeals paragraph
552A(1)(e).
Item 10: repeals note 2 to subsection
552A.
Item 11: inserts a new subparagraph
553B(2)(a)(ia).
Item 12: inserts a new subparagraph
553C(2)(a)(ia).
Item 13: repeals subsection 557A(3) and
substitutes a new version.
Item 14: repeals subsection 558A(3) and
substitutes a new version.
Item 15: amends austudy payment
paragraph 578A(1)(d).
Item 16: repeals austudy payment paragraph
578A(1)(e).
Item 17: repeals note 2 to austudy payment subsection
578A(1).
Item 18: amends note 1 to subsection 19C(1).
Items 19
and 20: amend subsection 19C(2).
Item 21: amends subsection
19C(3).
Item 22: repeals paragraph 19C(8)(c) and substitutes new
paragraphs (c) and (ca).
Item 23: repeals subsection
19C(9).
Item 24: repeals paragraph (d) of note 2 to point 1067G-H1 and
substitutes a new version.
Item 25: amends note 1 to subsection 19C(1).
Item
26: amends note 3 to subsection 19C(1).
Item 27: amends
subsection 19C(2).
Item 28: amends subsection
19C(3).
Item 29: repeals point 1067G-H16 and substitutes a new
version.
Item 30: repeals austudy payment point 1067L-D12 and
substitutes a new version.
4. Explanation of the changes
Item 2 amends paragraph 8(11)(b) of the Social Security Act, to be
inserted by Schedule 2 to the Budget Measures Bill, to omit references to
provisions relating to the meaning of a leave payment in Benefit Rate Calculator
A and the Sickness Allowance Rate Calculator (which are both to be repealed as a
consequence of this package) and to substitute equivalent references to the
Youth Allowance Rate Calculator and Austudy Payment Rate Calculator provisions.
The paragraph is for the purposes of the provisions relating to the consistent
treatment of lump sums.
Item 4 inserts a new paragraph 544B(1)(ia) to provide that a Youth
Allowance Activity Agreement may be based on an activity approved by the
Secretary under the CSP.
Item 5 inserts a new paragraph 544B(5)(d)
to make it clear that a Youth Allowance Activity Agreement may be cancelled by
the Secretary after a review.
Item 6 inserts a new subparagraph
549A(5)(a)(ia) relating to an exemption from the youth allowance liquid assets
test waiting period. The new paragraph provides such an exemption if a person
has started an activity approved by the Secretary under the CSP. Items 11
and 12 make identical amendments relating to an exemption from an employment
related exclusion under paragraph 553B(2)(a) in relation to a move to an area of
lower employment prospects and under paragraph 553C(2)(a) in relation to
seasonal or intermittent work.
Item 7 substitutes a new subsection
(3) for existing subsection 550B(3) to provide that a person's activity test
non-payment period stops applying if the person starts a program, course or
activity mentioned in paragraph 541(2)(b) or (c) (the latter as amended by
item 3). Items 13 and 14 make identical amendments to
subsection 557A(3) in relation to a person's activity test breach rate
reduction period and to subsection 558A(3) in relation to a person's
administrative breach rate reduction period.
Items 8, 9 and 10
operate to repeal a paragraph and a complementary note referring to the no
longer operational LEAP program in subsection 552A(1) relating to multiple
entitlement exclusions. Items 15, 16 and 17 make the same amendments for
austudy payment.
Items 18 to 22 amend provisions themselves amended by Schedule 4
to the Budget Measures Bill. They are to reflect correctly in the relevant
interpretation provisions relating to the consistent hardship rules the
inclusion or otherwise of the new payments, youth allowance and austudy payment.
This is relevant for the liquid assets waiting period for the two new payments.
It is not relevant for an ordinary waiting period because there is no such
waiting period for the two new payments. Furthermore, because there is no
seasonal work preclusion period for austudy payment, the application of these
consistent hardship rules with regard to that preclusion period is only for
youth allowance.
Item 23 is to repeal a point in those provisions
that relates to the meaning of the maximum payment rate of youth allowance.
This was relevant only for the purposes of transition to that new payment and
will not be necessary in the longer term. The rule as it will apply in the
longer term has now been incorporated into these provisions by
item 8.
Item 24 makes an amendment to a note located in the youth
allowance income test Module in the rate calculator. It inserts a directory
reference to the relevant income streams provisions located elsewhere in the
Social Security Act. This mirrors amendments made to other rate calculators by
Schedule 3 to the Budget Measures Bill.
Items 25 to 28 are to reflect correctly in the relevant
interpretation provisions relating to the consistent hardship rules as they will
apply after 1 July 1999 (Schedule 5 to the Budget Measures Bill refers), the
inclusion or otherwise of the new payments, youth allowance and austudy payment.
This will be relevant for the liquid assets waiting period and the income
maintenance period for the two new payments (but not for an ordinary waiting
period for either payment, nor for a seasonal work preclusion period for austudy
payment, as discussed under items 18 to 22 above). Item 29, by
repealing and substituting the relevant point in the Rate Calculator, makes sure
that the application after that date of those rules to income maintenance
periods will apply to youth allowance as to other payments. Item 30 does
the same for austudy payment.
5. Commencement
The commencement of the various Parts of this Schedule is dependent on
the commencement of the various pieces of source legislation that are being
replicated by this Schedule, as indicated by the heading to each Part. Parts 1
and 2 should commence on or around 1 July 1998. Part 3 should commence on 20
September 1998. Part 4 should commence on 1 July 1999.
Schedule 4 - Amendment of the Social Security Act 1991 relating to pensioner education supplement
1. Summary of proposed changes
This Schedule transfers the rules relating to the pensioner education
supplement under the AUSTUDY scheme to the Social Security Act.
2. Background
Students who receive social security or veterans' affairs income support
payments because they are disabled, sole parents or carers cannot get AUSTUDY
living allowance. They can, however, get the AUSTUDY pensioner education
supplement while studying. Pensioner education supplement is currently
administered by the Department of Employment, Education, Training and Youth
Affairs. However, it has been decided that portfolio responsibility for
pensioner education supplement is to be transferred to social security and the
rules for the supplement housed in the Social Security Act.
Pensioner
education supplement is not subject to the income or assets tests, as an
applicant will usually have met the social security or veterans' affairs income
and assets test in order to receive his or her qualifying pension or benefit.
Payment of pensioner education supplement, however, is subject to the normal
conditions set out in Chapters 1 and 2 of the AUSTUDY Regulations.
Consequently, pensioner education supplement is subject to other AUSTUDY
requirements for general eligibility such as age, residence, approved study,
study load and progress rules for completing a course.
Pensioner
education supplement can be paid for study at either secondary or tertiary
level, and for study at either a full-time or a concessional load. Although
part-time students can receive pensioner education supplement, they can only
receive this payment for up to twice the length of time it would normally take a
full-time student to complete the course. Pensioner education supplement is
paid at the rate of $60 per fortnight.
Generally speaking, the new
pensioner education supplement under the Social Security Act will incorporate
most of the rules that apply currently to the supplement under the AUSTUDY
scheme. However, in many instances the rules will be simplified and modified to
the bring the new payment into line with other payment types in the Social
Security Act.
3. Clauses and Schedule involved in the changes
Clause 2: provides the commencement rules for this
Schedule.
Clause 3: provides that each Act that is specified in
this Schedule is amended as set out in the Schedule.
Schedule 4 - Amendment of the Social Security Act 1991 relating to pensioner education supplement
Item 1: makes new entries in the index of definitions in section 3
to reflect the several newly defined terms inserted by these
amendments.
Item 2: amends subsection 7(6).
Item
3: amends subsection 23(1) to insert a number of
definitions.
Item 4: inserts new subsections 23(10C), (10D),
(10E) and (10F).
Item 5: inserts new Part 2.24A - Pensioner
education supplement.
Item 6: inserts new Division 4 at the end of
Part 3.13.
4. Explanation of the changes
Items 1, 3 and 4 insert new definitions into section 23 of
the Social Security Act, the general definitions section, and section 3, the
index of definitions, that are necessary for new Part 2.24A. Three of the new
definitions are "short course", "full year course" and "late starting course"
(see new sections 10C to 10F). These defined terms are necessary to ensure that
the new rules reflect properly the existing scheme. For example, these terms
are necessary to ensure that pensioner education supplement can be backdated to
1 January in certain circumstances. The remaining defined term is "pensioner
education supplement payday" which indicates the day on which the supplement
will be paid.
Item 2 amends subsection 7(6) by inserting a
reference to a pensioner education supplement into the definition of qualifying
residence exemption.
Item 5 inserts new Part 2.24A dealing with
pensioner education supplement.
Part 2.24A - Pensioner education supplement
New Division 1 - Qualification for pensioner education supplement
New Subdivision A - Basic qualifications
New section 1061PA - Qualification for pensioner education supplement - general rule
Section 1061PA sets out the basic qualification criteria for pensioner
education supplement, which will determine a person's eligibility for pensioner
education supplement.
Subject to Subdivision A, a person qualifies for
pensioner education supplement in respect of a period, if throughout the period
the person:
• is undertaking qualifying study (detailed in
Subdivision B); and
• is receiving a payment that attracts
pensioner education supplement (see Division C); and
• is of
pensioner education supplement age (detailed in Subdivision D);
and
• satisfies the residency requirements that apply to the person
(detailed in Subdivision E).
A note refers the reader to Division 2
which sets out situations where, even though the person may be qualified for
pensioner education supplement, an pensioner education supplement is not
payable.
New Subdivision B - Undertaking qualifying study
New section 1061PB - Undertaking qualifying study
Section 1061PB provides that a person is undertaking qualifying study if
the person satisfies four requirements as detailed below, and these requirements
are based heavily on existing rules that apply for the AUSTUDY
scheme.
First, the person must be enrolled, or intend to enrol, in an
approved course of education at an educational institution (paragraph 1061PB(a)
refers). The intention to re-enrol aspect reflects the problem that, in
practice, a person can be required to enrol at an educational institution
several times (characteristically each year in the case of tertiary studies)
during the course of the one course of study. If actual enrolment were the only
relevant factor in determining whether a person is a qualifying student, there
would be periods when a person who intends to continue in full-time studies, or
who is part way through a course of study, would no longer fall within the
definition. It would mean that qualifying students would not be exempt from the
activity test during these periods (for example, vacation times) despite their
intention to remain in education. Subparagraph 1061PB(a)(iii) extends the
person's intention to re-enrol to situations where the person intends to enrol
in another course after he or she completes the course in which he or she is
studying currently. This treatment is necessary to ensure that where a person
intends to move from say secondary to tertiary study, the person can still meet
the definition of undertaking qualifying study, and so still qualify for
pensioner education supplement.
Second, paragraph 1061PB(b) provides that
the course of education in which the person enrols, or intends to enrol, must be
an approved course of education or study (as detailed in new section
1061PC).
Third, the person must be either a full-time or a concessional
study-load student (as detailed in new sections 1061PD and
1061PE).
Finally, the person must satisfy the progress rules for study in
new sections 1061PH and 1061PI.
Subsections 1061PB(2) and (3) provide for
two situations where a person is taken to not be undertaking qualifying study.
The first situation is where a person is employed on a full-time basis as an
apprentice or trainee under an industrial instrument and has a training
agreement with a training authority. The second situation is where a person has
completed a degree of Master or Doctor at either an Australian educational
institution, or at a foreign institution that is, in the Secretary's opinion, of
the same standing as that of an Australian educational
institution.
Subsection 1061PB(3) enables a person enrolled in a full
year course starting before 1 April in a particular year to have taken to
be undertaking qualifying study from 1 January in that year if the person
discontinued study for a period of:
• a semester or less in the
immediately preceding semester (excluding vacations); or
• more
than a semester and the Secretary is satisfied that the discontinuance was due
to illness or other circumstances beyond the person's control.
Subsection
1061PB(4) provides for a similar rule where a person is enrolled in a full-year
course starting on or after 1 July.
Subsection 1061PB(5) deems a person
to be taken to be undertaking qualifying study under 31 December in a particular
study year if the person completes his or her course of education after 15
September in that particular year and the course is a late starting course or a
full year course.
The deeming rules in subsections 1061PB(3) to (5)
reflect similar rules that apply under the AUSTUDY scheme.
New section 1061PC - Approved course of education or study
For the purposes of new paragraph 1061PB(1)(b), an approved course of
education or study is one that the Employment Minister has determined under
section 5D of the Student Assistance Act to be a secondary or tertiary course
for the purposes of that Act.
New section 1061PD - Full-time students
Section 1061PD provides that a person is a full-time student in respect
of a course if he or she is undertaking (or in the case of a continuing student,
intending to undertake), at least three-quarters of the normal amount of
full-time study in respect of the course. A note refers the reader to section
1061PI which details what is meant by a normal amount of full-time
study.
New section 1061PE - Concessional study-load students
Subsection 1061PE(1) provides that there are two types of concessional
study-load students. First, a 25% concessional study-load student (subsection
1061PE(2) refers). This student is one who is only required to undertake a
minimum of 25% of a normal full-time study load for a particular course of
education. Subsection 1061PE(4) specifies which students qualify for this
concession and reflects current AUSTUDY rules. Such students
include:
• those who have a substantial physical, psychiatric or
intellectual disability, which precludes them from studying at the normal
full-time study load;
• those who are receiving a disability
support pension, a carer payment or a pension PP (single) under the Social
Security Act;
• those who are receiving an invalidity service
pension or a carer pension under the Veterans' Entitlements Act
1986;
• those who have a dependent child and are in receipt
of a payment listed in paragraph 1061PE(4)(e).
The second type of
concessional student is a 66% concessional study-load student
(subsection 1061PE(3) refers). This student is one who is entitled to
undertake a minimum of two thirds of the normal full-time study-load for a
particular course of education, for a maximum of half an academic
and is available to students who:
• cannot undertake
full-time study due to the educational institution’s requirements for the
course (for example, timetable clashes, subject cancelled or over-enrolled,
reduced workload needed to complete the course); or
• a specific
direction in writing from the academic registrar or equivalent officer;
or
• a recommendation in writing from the academic registrar or
equivalent officer for academic or vocational reasons. The institution does not
have to specify the reasons on which the recommendation was based, however,
study-load requirements cannot be reduced for vocational or academic reasons for
more than half of the academic year.
The 66% concession does not alter
time limits on study at any one level (see subsection 1061PI(3)).
New section 1061PF - Normal amount of full-time study
Section 1061PF provides that the normal amount of full-time study for a
student is:
where the course is a designated course of study within the
meaning of Chapter 4 of the Higher Education Funding Act
1988 (that is, it attracts the Higher Education Contribution
Scheme (HECS)) then the standard student load is the amount determined by the
institution for the purposes of HECS; or
where the course is not such a
designated course, and the educational institution sets out the amount of
full-time study that a full-time student should typically undertake, then it is
that amount; or
• the amount of full-time study equivalent to the
average amount of full-time study that a person would have to undertake for the
duration of the course in order to complete the course in the minimum amount of
time needed to complete it. This criteria allows for some fluctuation in
study-load for those who do not meet either of the previous
criteria.
otherwise it is an average of 20 contact hours per week in
respect of a course.
New section 1061PG - First fortnight of classes
Section 1061PG gives a period of grace of up to 2 weeks while the student
arranges his or her studies for the particular study period in which he or she
is enrolled (for example, a semester). If the student studies a full-time or
concessional basis (as the case may be) at any time during those 2 weeks, then
he or she satisfies the relevant study workload requirements from the beginning
of the study period.
New section 1061PH - Progress rules - secondary students
Subsection 1061PH(1) states that, with the exception of subsection (2), a
secondary student satisfies the progress rules for the purposes of paragraph
1061PB(1)(d) (undertaking qualifying study) if in the Secretary's opinion the
person is making satisfactory progress towards completing the course.
Subsection (2) provides that, unless an exception applies, a person does not
satisfy the progress rules if he or she is enrolled in a course at a year 12
level and the person has previously been a full-time student in respect of a
course at that level in 2 previous years. The exceptions that may apply are
where a person's failure in a previous course was due to an illness that had not
been diagnosed prior to commencing the course, circumstances beyond the
person’s control or English not being the person's native language. This
rule will also not apply where a person’s failure was more than 10 years
ago or the person the person completed or discontinued a previous course within
6 months after the relevant academic year started. This provision caters for
people who are undertaking a mix of secondary level and other subjects but who,
for all intents and purposes, are secondary students. This ensures the
consistent application of the allowable study time rules for students who change
from part-time to full-time or vice versa.
Subsection 1061PH(3) provides
that a course is at the level of year 12 if the institution offering it
considers it to be at year 12 level. Subsection (3) provides that the overall
level of a secondary course is at year 12 level if the institution offering the
course regards at least 50% of the course to be at that level. Subsection (5)
states that a secondary course is one that is specified to be a secondary course
for the purposes of the Student Assistance Act.
New section 1061PI - Progress rules - tertiary students
Section 1061PI provides that a full-time or concessional study load
tertiary student satisfies the progress rules if on the day on which the person
enrols (or the day on which enrolments are next accepted) the time already spent
by the student on the course (or on one or more other tertiary courses at the
same level) does not exceed the allowable study time for that course.
Subsection 1061PI(3) provides that the allowable study time for a full-time or
66% concessional study-load student is:
• if the minimum
amount of time needed to complete the course is one year or less - that minimum
amount of time; or
• if the minimum amount of time needed to
complete the course as a full-time student is more than one year and the student
enrols (or intends to enrol) in a year long subject, or the student’s
further progress in the course depends on passing a whole year’s work in
the course - the minium amount of time plus one year; or
• in any
other case - the minimum amount of time needed to complete the year as a
full-time student plus half an academic year.
Subsection 1061PI(4)
provides that the allowable study-time for a 25% concessional study load student
is twice the minimum period in which it is possible to complete the course as a
full-time student.
Subsection 1061PI(5) provides that if a person has
studied part-time for a course over a particular period, then the time spent by
the person on the course is taken to be the amount of study undertaken part-time
divided by the normal amount of full-time study for the
course.
Subsection 1061PI(7) provides that certain factors can be
disregarded in determining whether a person has exceeded the allowable
study-time; including
• time spent completing a course that is a
pre-requisite to admission to the course in which the person is enrolled or
intends to enrol;
• a failed year, or part thereof, of study due to
illness or other circumstances beyond the person’s
control;
• time spend undertaking a course that has been
discontinued due to illness or other circumstances beyond the person’s
control;
• time spent undertaking a course leading to a trade or
profession in which the person can not now work due to
illness;
• time spent undertaking a TAFE course with a normal
duration of one year or less;
• time spent undertaking study more
than 10 years ago, unless the course has since been
completed;
• time spent undertaking a course after 1973 if the
course was not approved for the purposes of TEAS, AUSTUDY or paragraph
541B(1)(c), 569A(b) or 1061PC of the Social Security Act;
• time
spent undertaking a course at a foreign institution;
• time spent
undertaking a course if the student withdrew from the course and the institution
offering the course did not record the withdrawal as a
failure;
• any time spent undertaking a course during which the
person was not able to receive AUSTUDY, TEAS, youth allowance or austudy payment
because of the application of academic progress rules.
Subsection
1061PI(6) makes it clear that if a person was a concessional study-load student
in respect of a course, then the time that the person has taken to complete the
course (or part of the course) should be taken to be no more than the minimum
amount of time that should be taken to complete the course (or part of the
course)
Subsections 1061PI(8) to (12) set out the four levels of tertiary
courses.
New Subdivision C - Payments attracting pensioner education supplement
New section 1061PJ - Payments attracting pensioner education supplement
Section 1061PJ lists the social security and veterans’ entitlement
payments that a person must be receiving in order to qualify for a pensioner
education supplement, and are the same as those for which pensioner education
supplement is paid currently under the AUSTUDY scheme.
New Subdivision E - Pensioner education supplement age
New section 1061PK - Pensioner education supplement age
Section 1061PK reflects the current age requirements for a person to
attract pensioner education supplement under the AUSTUDY scheme, that is, the
person must be at least 16 years old or be independent and have reached the
minimum school leaving age in his or her State or Territory. A person is taken
to be independent if he or she has a dependent child, is an orphan, a refugee,
in State care, or has parents who are unable to exercise parental
responsibilities or who is a person for whom it is unreasonable to live at home.
These independence criteria mirror those that apply currently under the AUSTUDY
scheme.
New Subdivision D - Residency
Residence rules that will apply to full-time students receiving youth
allowance and austudy payment will apply generally also to pensioner education
supplement.
New section 1061PM - Residency requirements
Section 1061PM provides the general rule that to satisfy the residency
requirements for pensioner education supplement in respect of a period, a person
must be an Australian resident, and, subject to this Subdivision, in Australia
for the period.
New section 1061PO - Absence of persons overseas
Subsection 1061PO(1) provides that a person who is undertaking qualifying
study is not required to satisfy the "in Australia" requirement in paragraph
1061PM(b), providing that the person is outside Australia for the purpose of
undertaking part of his or her studies, or is absent for any other reason for
not more than 26 weeks. If the person returns to Australia, however, after
having been outside the country for more than 13 weeks, and leaves Australia
within 13 weeks after returning, the person is taken to have continued to be
absent from Australia (subsection 1061PO(2) refers).
New Division 2 - Situations in which pensioner education supplement is not payable
Division 2 sets out the situations in which pensioner education
supplement is not payable, and mirrors relevant standard provisions in the
Social Security Act.
New Subdivision A - The basic rules
New subsection 1061PO - Pensioner education supplement not payable in some circumstances
Subsection 1061PO details the circumstances which prevent pensioner
education supplement from being payable to a person who is otherwise qualified
for pensioner education supplement. These are:
where the supplement has
not commenced to be payable (dealt with in Subdivision B);
while
the person is subject to a newly arrived resident’s waiting period (dealt
with in Subdivision C);
while the person is subject to a multiple
entitlement exclusion (dealt with in Subdivision D).
A note at the
end of the section alerts the reader to the fact that pensioner education
supplement is not payable under Part 3.13 of the Social Security Act if a person
is in gaol or is undergoing psychiatric confinement after having been charged
with an offence.
New Subdivision B- Provisional commencement day
New section 1061PP - Pensioner education supplement generally not payable before claim
Section 1061PP provides that pensioner education supplement is not
payable to a person before a person's provisional commencement day.
New section 1061PQ - Provisional commencement day - basic rule
Section 1061PQ provides that, subject to this Subdivision, a person's
provisional commencement day is the day on which the person claims pensioner
education supplement.
New section 1061PR - Claim made within 4 weeks of becoming qualified
This section provides that, subject to new section 1061PS, if a person
makes a claim for pensioner education supplement within four weeks after
becoming qualified for the supplement, then the person's provisional
commencement day is the day on which he or she became qualified.
New section 1061PS - Claims made before closing dates
Section 1061PS provides that a person's provisional commencement day is 1
January in a particular year if the person claims a pensioner education
supplement, and commences a full-year course, prior to 1 April in that year.
Similarly, a person's provisional commencement day is 1 July in a particular
year if the person claims the supplement, and commences a full-year course,
prior to 1 August in that year This provision thereby enables the backdating
of the supplement to either 1 January or 1 July where a person satisfies
the conditions in 1061PB(3) or (4) (as the case may be).
New Subdivision C - Newly arrived resident's waiting period
New section 1061PT - Pensioner education supplement not payable during newly arrived resident's waiting period
Section 1061PT provides that a pensioner education supplement is not
payable to a person while the person is subject to a newly arrived
resident’s waiting period.
New section 1061PU - Newly arrived resident's waiting period
Subsection 1061PU(1) operates to subject a person to a newly arrived
resident's waiting period if he or she has not been an Australian resident and
in Australia for a period of, or periods totalling 104 weeks. A note refers the
reader to subsection 7(2) for the meaning of "Australian resident". Subsection
(2) exempts a person from the rule in subsection (1) if the person has a
qualifying residence exemption (a note refers to subsection 7(6) which defines
this term). Subsection (3) exempts a person from the waiting period if the
person has already served a newly arrived resident's waiting period under this
Part (and the period has ended), or under another Part of the Social Security
Act, or under the Student Assistance Act.
Subsection 1061PU(4) states
that the waiting period does not apply to those persons who:
• had
they actually applied for a social security payment (other than youth allowance
or youth training allowance) would have been subject to the waiting period and
the period would have ended; or
• have had a qualifying residence
exemption for newstart allowance or sickness allowance under the Social Security
Act, or for youth training allowance under the Student Assistance Act;
or
• in the case of AUSTUDY recipients, were not subject to such a
waiting period.
New section 1061PV- Length of newly arrived resident's waiting period
Section 1061PV provides that the newly arrived resident's waiting period
starts on the day on which a person first entered Australia, and ends after the
person has been physically in Australia, while an Australian resident, for 104
weeks. A note refers the reader to subsection 7(2) which defines an Australian
resident.
New Subdivision D - Multiple entitlement exclusion
New section 1061PW - Meaning of multiple entitlement exclusion
Section 1061PW provides that a person is subject to multiple entitlement
exclusion if the person is receiving a pensioner education supplement under the
ABSTUDY scheme.
New section 1061PX - Multiple entitlement exclusion
Section 1061PY states that a pensioner education supplement is not
payable to a person who is subject to a multiple entitlement exclusion.
New Division 3 - Claim for pensioner education supplement
Division 3 deals with a claim for pensioner education supplement, and is
based on a similar type of provisions within all payment types in the Social
Security Act.
New section 1061PY - Need for a claim
Subsection 1061PY(1) provides that a person who wants to be granted
pensioner education supplement must make a proper claim for the allowance. A
note signposts those new sections which outline the requirements of a proper
claim. These provisions relate to the form of the claim, where the claim needs
to be lodged and requirements relating to residency and physical presence in
Australia.
Subsection (2) provides that if, at the time a person (or
someone on his or her behalf) makes a claim for pensioner education supplement,
the person is not qualified for that payment and so the claim cannot be granted,
then the claim will be taken not to have been made.
New section 1061PZ - Form of claim
Section 1067PZ provides that a claim for pensioner education supplement
must be in writing and in accordance with a form approved by the
Secretary.
New section 1061PZA - Lodgment of claim
Section 1067PZA provides that a claim for pensioner education supplement
must be lodged at an office of the Department or at a place, or with a person,
approved by the Secretary. The Secretary is not able to approve a place,
or a person, for lodgment of claims unless the place or person is in
Australia.
New section 1061PZB - Claimant must be Australian resident and in Australia
Section 1061PZB provides that a person claiming pensioner education
supplement must be an Australian resident and in Australia on the day on which
the claim is lodged.
A note directs the reader to the definition of
"Australian resident" in section 7.
New section 1061PZC - Claim may be withdrawn
Section 1061PZC provides that a claim for pensioner education supplement
can be withdrawn (by either the pensioner education supplement claimant or a
person on his or her behalf) at any time before the claim is determined. The
withdrawal can be made orally or in writing. A claim that is withdrawn is taken
to have not been made.
New Division 4 - Determination of claim
Division 4 replicates, as appropriate, standard provisions in the Social
Security Act.
New section 1061PZD - Secretary to determine claim
Section 1061PZD provides that the Secretary must determine, in accordance
with Part 2.24A, a claim for pensioner education supplement.
New section 1061PZE - Grant of claim
New section 1061PZE provides that the Secretary must determine that a
claim for pensioner education supplement is to be granted if the Secretary is
satisfied that the person is qualified for pensioner education supplement and
the supplement is payable.
New section 1061PZF - Date of effect of determination
Subsection 1061PZF(1) specifies that, subject to this section, the date
of effect of a determination under new section 1061PZE is the day on which the
determination is made or on such later or earlier day as is specified in the
determination. Subsections (2), (3) and (4) specify the date of effect of
a determination granting a claim that results from a person asking for a review
of an original decision rejecting the claim. Subsection (2) deals with the
situation where an applicant for pensioner education supplement:
is
notified in writing of a decision to rejects the person's claim;
and
applies to the Secretary under section 1240, within 3 months after
written notification of the decision is given, for a review of that decision;
and
is granted pensioner education supplement as a result of the
review.
The determination to grant the claim takes effect on the day on
which the original decision to reject it took effect. This enables arrears to
be paid back to that date.
Subsection (3) deals with the situation where
an applicant for pensioner education supplement:
is notified in writing
of a decision to reject the person's claim; and
applies to the Secretary
under section 1240, more than 3 months after the written notification of the
decision is given, for a review of the decision; and
is granted
pensioner education supplement as a result of the review.
In this case,
the determination to grant the claim takes effect on the day on which the person
sought the review.
Subsection (4) deals with the situation where an
applicant for pensioner education supplement:
is not notified in writing
of a decision to reject the person's claim; and
applies to the Secretary
under section 1240 at any time for a review of the decision; and
is
granted pensioner education supplement as a result of the review.
In this
case, the determination to grant the claim takes effect on the day on which the
original decision rejecting the claim took effect. This enables arrears to be
paid back to the date of the original decision.
New Division 5 - Rate of pensioner education supplement
New section 1061PZG - Rate of pensioner education supplement
Section 1061PZG provides that the rate of pensioner education supplement
is $60.00 per fortnight, as is currently the rate under the AUSTUDY
scheme.
New Division 6 - Payment of pensioner education supplement
Division 6 replicates similar provisions in the
Social Security Act which deal with the payment of a social security
benefit.
New section 1061PZH - Start of pensioner education supplement
New section 1061PZH provides that pensioner education supplement becomes
payable to a person on the first day on which the person is qualified for the
supplement and there is no provision in the Social Security Act that makes the
supplement not payable.
Note 1 directs the reader to the qualification
provisions for pensioner education supplement.
Note 2 directs the reader
to new section 1061PO which describes the circumstances in which the supplement
is not payable.
New section 1061PZI - Payments by instalments
Subsection 1061PZI(1) provides that a full instalment of pensioner
education supplement is payable to a person on each pensioner education
supplement payday on which the person is qualified for the supplement and the
supplement is payable to the person. This provision mirrors a similar type of
provision that applies generally to pension payments in the Social Security
Act.
Subsection (2) states that if the person is outside Australia the
person's instalments are to be paid on such supplement paydays as determined by
the Secretary.
New section 1061PZJ - Effect on instalment of backdating claim
Section 1061PZJ is a standard provision in the Social Security Act that
operates to make arrears of pension that are payable to a person payable on the
pensioner education supplement payday following grant.
New section 1061PZK - Instalment to be paid to person or nominee
Section 1061PZK replicates a similar rule in other social security
payment types and provides that pensioner education supplement instalments
should be paid to the person, although the Secretary may direct that the whole
or a part of an instalment may be paid to someone else on behalf of the person.
Where the Secretary so directs, payments are to be made accordingly.
New section 1061PZL - Payment into bank account etc
Subsections 1061PZL(1), (2) and (3) provide that payments of pensioner
education supplement are to be made by direct deposit into an account with a
bank, credit union or building society nominated and maintained by the person
either alone or jointly or in common with another person - as is provided for
with other social security payments. The Secretary may decide in the
circumstances of a particular case that some other manner of payment is
appropriate and that payment of all or some of the supplement should be paid in
that other way. This would normally be done in the case of persons with no
reasonable access to banking or similar facilities ((4) and (5) refer).
New section 1061PZM - If supplement payday would fall on public holiday etc
As happens with other social security payment types, section 1061PZM
provides a discretion to the Secretary to direct the earlier payment of
pensioner education supplement if it cannot be paid on the normal day, for
example, because of a public or bank holiday.
New section 1061PZN - Payment supplement after death
If a person to whom pensioner education supplement is payable dies and an
amount of the payment is outstanding at the date of death, subsection 1061PZN(1)
allows the Secretary to pay the outstanding amount to another person who, in the
Secretary's opinion, is best entitled to receive it. That person must apply to
receive the amount within 6 months of the death or within a further period
allowed by the Secretary in special circumstances. Subsection (2) makes it
clear that once a payment has been made under new subsection (1), the
Commonwealth has no liability to any other person in respect of that amount.
This provision is standard to other social security payment types.
New Division 7 - Protection of pensioner education supplement
Consistent with all other payment types in the Social Security Act, this
Division deals with protecting payment of pensioner education
supplement.
New section 1061PZO - pensioner education supplement to be absolutely inalienable
Subsection 1061PZO(1) provides that, except when subsections (2) or (3)
or section 1359 applies, a person's pensioner education supplement is to be
absolutely inalienable, whether by way of, or in consequence of, sale,
assignment, charge, execution, bankruptcy or otherwise.
Subsection (2)
and section 1359 enable the Secretary to make deductions from a person's
pensioner education supplement instalments for taxation purposes. The first is
a discretionary provision that flows from the recipient asking the Secretary to
make the deductions and pay them to the Commissioner of Taxation. The other
provision is mandatory and flows from a request from the Commissioner of
Taxation to the Secretary to make deductions to the Commissioner under
subsection 218(6B) of the Income Tax Assessment Act 1936.
A
note directs the reader to section 1359 and requires the Secretary to make
deductions from a person's social security payment if requested by the
Commissioner of Taxation.
Subsection 1061PZO(3) enables the Secretary to
make deductions from a person's pensioner education supplement instalments when
the person consents under section 1234A of the Social Security
Act.
A note indicates that section 1234A allows the Secretary to recover
a debt from a person other than the debtor if the person is receiving a social
security payment.
New section 1061PZP - Effect of garnishee or attachment order
Section 1061PZP protects a "saved amount" of pensioner education
supplement in a recipient's bank account from garnishment by third party
creditors. The "saved amount" is calculated by working out the amount of the
instalments of pensioner education supplement credited to the person's account
in the 4 week period immediately before the court order came into force and
deducting from that amount the total amount withdrawn from the account during
the same period.
The bank account may be maintained by the person alone
or jointly or in common with another person.
New Division 8 - Obligations of recipients
This Division outlines the obligations placed on recipients of pensioner
education supplement, which closely follow those currently placed on other
social security recipients.
New section 1061PZQ - Secretary may require from recipient notice of the happening of an event or change in circumstances
Subsections 1061PZQ(1) and (2) enable the Secretary to give a person
receiving pensioner education supplement a notice requiring the person to notify
the Department if a specified event or change in circumstances occurs or is
likely to occur that might affect payment.
Subsection (3) requires the
notice to:
be in writing; and
be given personally or by post;
and
specify how the information is to be given to the Department;
and
specify the period within which the information must be given;
and
give the authority for the notice and describe itself as a
"recipient notification notice".
Subsection (4) provides that the notice
is not invalid merely because it fails to specify how the notice is to be given
to the Department or it fails to specify the authority for the notice.
Subsection (5) provides that the period specified in the notice must end 14 or
more days after the day on which the event or change in circumstances occurs or
after the day on which the person becomes aware that the event or change in
circumstances is likely to occur.
Subsection 1061PZQ(6) provides that if
a person is required by a notice to inform the Department of any proposal by the
person to leave Australia, the 14 day period under subsection (5) does not apply
to that requirement. Subsection (7) sets out the compliance conditions for new
subsection (1) and the penalties for contravening the conditions. If a person
receiving pensioner education supplement is capable of complying with the notice
but fails or refuses to do so, the person may be fined or sent to gaol or
both.
A note refers the reader to sections of the Crimes Act
1914 that allows a court to impose an appropriate fine instead of, or in
addition to, a term of imprisonment.
Subsection 1061PZU(9) allows this
section to operate outside Australia. It extends to acts, omissions, matters
and things outside Australia, whether or not in a foreign country. It also
extends to all persons to whom it would normally apply, regardless of their
nationality or citizenship.
New section 1061PZR - Secretary may require recipient to give particular information relevant to payment of pensioner education supplement
Subsection 1061PZR(1) provides for the Secretary to give a person to whom
pensioner education supplement is being paid (whether the payment is actually
being paid to the recipient or to his or her parent or to another person on his
or her behalf) a notice requiring the person to give the Department a written
statement in an approved form about a matter that might affect payment of
pensioner education supplement. Subsection (2) requires the notice
to:
be in writing; and
be given personally or by post;
and
specify how the information is to be given to the Department;
and
specify the period within which the statement must be given;
and
give the authority for the notice and specify that the notice is a
recipient statement notice given under the Social Security
Act.
Subsection (3) provides that a notice is not invalid merely because
it fails to state how the information is to be given to the Department or what
the authority for the notice is. Subsection (4) provides that the period
specified in the notice must end 14 or more days after the notice is given to
the person. Subsection (5) provides that a statement given in response to a
request under subsection (1) must be in writing and in a form approved by the
Secretary. Subsection (6) sets out the compliance conditions for subsection (1)
and the penalties for contravening those conditions. If a person receiving
pensioner education supplement is capable of complying with a notice under
subsection (1) but refuses to do so, then the person may be fined or sent to
gaol or both.
A note refers the reader to the sections of the
Crimes Act 1914 that allow a court to impose an appropriate fine,
instead of, or in addition to, a term of imprisonment.
Subsection
1061PZR(7) allows this section to operate outside Australia. It extends to
acts, omissions, matters and things outside Australia, whether or not in a
foreign country. It also extends to all persons to whom it would normally
apply, regardless of their nationality or citizenship.
New Division 9 - Continuation, variation and termination
This Division replicates standard provisions dealing with continuation,
variation and termination of social security payments.
New Subdivision A - General
New section 1061PZS - Continuing effect of entitlement determination
Subsection 1061PZS(1) provides for the continuity of a decision regarding
the granting or payability of pensioner education supplement until:
it
stops being payable under new section 1061PZT, 1061PZU or 1061PZV; or
a
further determination in relation to pensioner education supplement under
section 1061PZX or 1061PZY has taken effect.
Notes signpost the
provisions that give effect to these decisions and the provision dealing with
changes to the payment by computer.
New Subdivision B - Automatic termination
New section 1061PZT - Automatic termination - compliance with section 1061PZQ notification obligations
Section 1061PZT provides that, when a recipient of pensioner education
supplement complies with a section 1061PZQ notice by informing the Department of
the occurrence of an event or a change in circumstances within a specified
notification period and, as a result of the event or change:
the person
stops being qualified for pensioner education supplement; or
pensioner
education supplement would, except as provided in this new section, stop being
payable to the person; and
the supplement is not cancelled before the
end of the notification period;
then pensioner education supplement
continues to be payable until the end of the notification period and then stops
being payable, bringing the entitlement determination to an end.
New section 1061PZU - Automatic termination - non-compliance with section 1061PZQ notification obligations
Under section 1061PZQ, if a recipient of pensioner education supplement
fails to comply with a section 1061PZU notice by failing to inform the
Department of the occurrence of an event or change in circumstances within a
specified notification period and, as a result of the event or
change:
the person stops being qualified for pensioner education
supplement; and
pensioner education supplement stops being payable to
the person;
then it stops being payable immediately before the day on
which the event or change in circumstances occurs and thus brings the
entitlement determination to an end.
New section 1061PZV - Automatic termination - failure to provide section 1061PZR statement
Subsection 1061PZR(1) applies in the situation where a person in receipt
of pensioner education supplement is required to give the Department a statement
under section 1061PZR relating to the payment of pensioner education
supplement in respect of a specified period and the person fails to comply with
the notice. If this occurs, pensioner education supplement ceases to be payable
to the person as from the first day in that period. Subsection (2) states,
however, that the Secretary may determine in writing that subsection (1)
does not apply to a person from a day specified in the determination (that may
be before or after the making of the determination - subsection (3) refers)
if satisfied that, in the special circumstances of the case, it is appropriate
to make such a determination.
New section 1061PZW - Changes to payments by computer following automatic termination
Section 1061PZW provides that, if pensioner education supplement is being
paid to a person based upon information held in a computer and the allowance is
automatically terminated through the operation of a computer program approved by
the Secretary, then the Secretary is taken to have decided that the automatic
termination applies to the person's payment.
A note points out that a
determination to change a payment under the new section is reviewable by the
Secretary and by the Social Security Appeals Tribunal.
New Subdivision C - Determinations
New section 1061PZX - Cancellation or suspension determination
Section 1061PZX gives the Secretary the power to suspend or cancel
payment of pensioner education supplement to a person if the Secretary is
satisfied that the person is not, or was not, entitled to the
payment.
Note 1 points out that this provision does not apply if an
automatic termination provision applies.
Note 2 signposts the provision
that sets out the date of effect of a decision under this new section.
New section 1061PZY - Cancellation or suspension for failure to comply with section 1061PZR, 1304 or 1305 notice
This section provides a specific cancellation or suspension power if a
person who is receiving pensioner education supplement fails to comply with a
notice given to the person under section 1061PZR, 1304 or 1305.
Note 1
points out that this provision does not apply in a case where sections 1061PZT
or 1061PZX apply.
Note 2 signposts section 1061PZZC which sets out the
date of effect of a decision under this new section.
New section 1061PZZ - Changes to payments by computer
This section provides that, if pensioner education supplement is being
paid to a person based upon information held in a computer and that payment is
increased, decreased, cancelled or suspended through the operation of a computer
program approved by the Secretary, then the increase, decrease, cancellation or
suspension is taken to have been made through a decision by the
Secretary.
This provides a legal mechanism for cancelling, suspending or
varying the rate of payment through the use of computers. However, the effect
is limited to areas of decision making where there is no discretionary element.
In these cases, a computer program operating under the new section could validly
cancel, suspend or vary the rate of pensioner education supplement.
A
note points out that a determination to change a payment under the new section
is reviewable by the Secretary and by the Social Security Appeals
Tribunal.
New section 1061PZZA - Resumption of payment after cancellation or suspension
Subsection 1061PZZA(1) provides for the Secretary to make a decision that
pensioner education supplement is to be reinstated if it was stopped
incorrectly.
Subsection 1061PZZA(2) allows the decision that gave rise to
the payments being stopped to be reconsidered following either a formal
application to the Secretary for review under section 1240 of the Social
Security Act or at the Secretary's instigation.
A note signposts the
relevant date of effect provision.
New Subdivision E - Date of effect of determination
New section 1061PZZB - Date of effect of favourable determination
Subsection 1061PZZB(1) provides that this section governs the date of
effect of a favourable determination (that is, a determination made under
section 1061PZZA). Subsection (2) provides that if a recipient of pensioner
education supplement appeals against an adverse decision within 3 months of
being notified of the decision and a favourable decision results, then it takes
effect on the date on which the adverse decision took effect. This enables
arrears to be paid from the date of the adverse determination.
Subsection
(3) provides that if a recipient appeals against an adverse decision more than 3
months after being notified of the decision and a favourable decision results,
then it takes effect on the day that the person appealed. Subsection (4)
provides that if a recipient appeals against an adverse decision about which the
person was not notified and a favourable decision results, then it takes effect
on the date on which the adverse decision took effect. This enables full
arrears to be paid.
Subsection 1061PZZB(5) provides that if a favourable
decision results from a recipient informing the Department of a change in
circumstances, then it takes effect on the date on which the Department received
the information or the date on which the changes occurred, whichever is the
later. Therefore, arrears are paid back to the later of those
dates.
Subsection (6) provides that in any other case, a favourable
determination takes effect on the determination date or on such later or earlier
date as is specified in the determination (not being more than 3 months
before the determination date).
New section 1061PZZC - Date of effect of adverse determination
Subsection 1061PZZC(1) provides that this section sets down the date of
effect of an adverse determination (that is, a determination under new section
1061PZX or 1061PZY).
A note signposts the provisions in Chapter 6 of the
Social Security Act that allow the Secretary to continue payment pending the
outcome of a review if the adverse determination under review depends on a
discretion or opinion.
Subsection (2) sets the date of effect of an
adverse determination as the date on which it is made or another date specified
in the determination.
Subsection (3) ensures that if the date of effect
of an adverse determination is specified but is not the day of the
determination, it must be a later date unless subsection (4) or (5)
applies.
Subsections (4) and (5) address those situations in which the
date of effect of an adverse determination can be before the date of the
determination. The situations are when the adverse decision results
from:
a pensioner education supplement recipient contravening a
provision of the Social Security Act (except sections 1061PZR, 1304, 1305, 1306
or 1307); or
any person making either a false statement or
misrepresentation if this causes pensioner education supplement to be paid when
it should not have been paid.
Subsection 1061PZZC(6) provides that if an
adverse determination takes effect on the day on which the matter arose, if the
adverse determination is made as a result of a person having given the
Department a statement about a matter in accordance with section
1061PZR.
Item 6 inserts new Division 4 of Part 3.13, which
contains new section 1162A. That section provides that a pensioner education
supplement is not payable to a person while the person is in gaol or undergoing
psychiatric confinement because the person has been charged with committing an
offence. This provision is consistent with a similar rule that applies for
pensioner education supplement under the AUSTUDY scheme.
5. Commencement
The amendments in Schedule 4 will commence on 1 July 1998.
Schedule 5 – Amendments relating to the Student Financial Supplement Scheme
1. Summary of proposed changes
This Schedule is to set up a Student Financial Supplement Scheme in the
Social Security Act. Such a scheme currently exists in the Student and Youth
Assistance Act (to be renamed the Student Assistance Act) (in Part 4A). Since
the majority of the student population using the scheme is moving to the social
security portfolio, the scheme is also moving for those students. However, the
former scheme will continue to operate for ABSTUDY customers. Thus, after 1
July 1998, there will be two similarly structured schemes with the same name in
operation in two separate portfolios. The Social Security Act scheme will be
based in that Act but will be dealt with in detail by a disallowable instrument.
Therefore, this Schedule is primarily to set up provisions in the Social
Security Act that will enable the making of that instrument, and also to make
consequential legislative amendments.
2. Background
The Student Financial Supplement Scheme currently in operation under the
Student and Youth Assistance Act is essentially a loan scheme that gives
tertiary students the option of borrowing money to help cover their living
expenses while studying. Financial supplement is paid in instalments by a
participating financial corporation (ie, one acting under an agreement with the
Commonwealth) to an eligible student. (Under the new scheme, the student will
have to be a person to whom youth allowance, austudy payment or pensioner
education supplement is payable, or to whom youth allowance would be payable if
not for the parental income test.)
The instalments are paid on the basis
of a contract between the student and the corporation. The student is not
liable to the corporation for interest, but the Commonwealth pays to the
corporation a subsidy that includes an amount for interest. At the end of the
contract period, the Commonwealth pays to the corporation any amount outstanding
under the contract and is assigned the further rights. Repayments will
eventually be made to the Commonwealth. The amount of supplement that will
eventually have to be repaid is indexed each 1 June and the increase flowing
from the indexation will be added to the student’s debt to the
Commonwealth.
Repayments of financial supplement are not required until
at least five years after the contract was entered into. Even so, the loan
repayment actually commences only when the student's taxable income exceeds
average earnings, at which point recovery through the tax system commences
(along the lines of the Higher Education Contribution Scheme). However, the
student may choose to make repayments earlier, whether within the period of the
contract, or after that period but before repayments must commence. If the
financial supplement is repaid in full within the period of the contract, the
student has to pay only 85% of the amount.
For the new scheme, many of
the above details will be provided in the disallowable instrument rather than in
the Social Security Act itself. However, the overall scheme, while differing
from the current scheme structurally and in drafting style, will not differ in
effect from its companion scheme. The rights and obligations of students under
the scheme will be preserved in the transition between portfolios, although a
student's new financial supplement entitlement may change because his or her
rate of payment of youth allowance or austudy payment may potentially change
under the new payment structure.
3. Clauses and Schedule involved in the changes
Clause 2: provides the commencement rules for this
Schedule.
Clause 3: provides that each Act that is specified in
this Schedule is amended as set out in the Schedule.
Part 1 - Amendment of the Social Security Act 1991
Item 1: inserts in the index of definitions in section 3 the new
definition of "financial supplement" inserted by item
4.
Items 2 and 3: make minor amendments to correctly reflect
the new definition of "Student Financial Supplement Scheme" inserted by item
6. The reference to the scheme in the definition of "prescribed educational
scheme" in subsection 5(1) and in paragraph 8(8)(zfa) relating to
exclusions from the definition of "income" will encompass both
schemes.
Item 4: inserts a new definition of "financial
supplement" in subsection 23(1). It will mean financial supplement under
the scheme established under new Chapter 2B. This term will be used in
provisions in which it is necessary to identify only the Social Security Act
scheme.
Item 5: amends the definition of "student assistance
benefit decision" to make it clear that the reference to the scheme in that
definition (for the purposes of section 1274 relating to certain Social Security
Appeals Tribunal procedural matters) is only to the Student Assistance Act
scheme.
Item 6: substitutes a new definition of Student Financial
Supplement Scheme in subsection 23(1). This term is and will be used in
provisions in which it is necessary to encompass both schemes.
Items 7
and 9: make minor amendments to correctly reflect the new definition of
"Student Financial Supplement Scheme" inserted by item 6. The reference
to the scheme in paragraph 500V(2)(c), subparagraph 660XCO(1)(a)(iii),
subparagraph 771HA(1)(c)(ii) and paragraph 771HJ(c) will encompass both
schemes.
Item 8: makes a minor amendment to correctly reflect the
reference to the scheme in each of paragraphs 665A(b), 665E(b) 665I(b), 665M(c)
and 665ZFA(b) (relating to education entry payments). In these provisions, the
use of the new term "financial supplement" will ensure that only the Social
Security Act scheme is identified as this is the only one that will apply to
recipients of a PES within the scope of the provision.
Item
10: inserts the new Chapter 2B enabling the establishing by the Minister by
disallowable instrument of the new Social Security Act version of the Student
Financial Supplement Scheme.
Items 11 to 20: make consequential
amendments to extend the full range of Social Security Act information gathering
powers to recipients of, and applicants for, financial
supplement.
Items 21 to 26: make consequential amendments to
extend appropriate Social Security Act offence provisions to recipients of, and
applicants for, financial supplement.
Item 27: amends the Social
Security Act appropriation power (subsection 1363(1)) to make it clear that
it now extends to payments to financial corporations under the new Student
Financial Supplement Scheme in the same way as it applies to social security
payments.
Part 2 - Consequential amendments of other Acts
Items 28 and 29: amend the definition of "personal assistance" in
subsection 3(1) of the Data-Matching Program (Assistance and Tax) Act
1990 to ensure that that Act correctly reflects the two separate Student
Financial Supplement Schemes and their legislative bases, for the purposes of
that Act. That Act currently applies to the Student and Youth Assistance Act
scheme – it will now apply to both schemes.
Item 30: amends
paragraph 118AA(c) of the Veterans’ Entitlements Act 1986 to
make it clear that the reference in that provision to the Student Financial
Supplement Scheme now encompasses both schemes.
It should be noted that
amendments to taxation legislation and to the Student Assistance Act that are
consequential on the new scheme are included with amendments to such legislation
arising from other elements of the youth allowance package (see Schedules 11 and
12).
4. Explanation of the changes
Item 10 inserts into the Social Security Act new Chapter 2B
enabling the establishing by the Minister by disallowable instrument of the new
version of the Student Financial Supplement Scheme. Due to the complexity of
the scheme, the enabling provisions are quite extensive.
New section
1061ZW sets down the object of the new Chapter, ie, to enable the Minister to
establish a Student Financial Supplement Scheme that allows certain tertiary
students to obtain a repayable financial supplement on the basis of a contract
with a participating financial corporation.
New section 1061ZX provides
the enabling power for the Minister's instrument. The scheme would apply to
certain tertiary students to whom youth allowance, austudy payment or pensioner
education supplement is payable, or to whom youth allowance would be payable if
not for the parental income test. The scheme, once established by instrument,
may be varied or revoked by instrument. The scheme must contain provisions of a
kind described in new section 1061ZY. The instrument will have effect according
to its own terms, regardless of any legislative provisions that would normally
operate to contrary effect (such as those that would normally determine a
student's rate of payment of youth allowance, austudy payment or pensioner
education supplement, which rate the student may choose to reduce in order to
receive financial supplement). The instrument will be a disallowable instrument
under section 46A of the Acts Interpretation Act 1901.
New
section 1061ZY lays down the matters that must be dealt with in the Minister's
instrument. There must be provision to reduce the rate of a student's rate of
payment of youth allowance, austudy payment or pensioner education supplement if
the student obtains financial supplement. It must be specified that the amount
of supplement available to a student will depend on the rate of payment that he
or she chooses to receive. It must also be provided that a student may repay
some or all of the youth allowance, austudy payment or pensioner education
supplement already received, or choose to receive a lower rate, in order to
receive a higher amount of supplement.
It must be provided that the
student is not liable to pay interest to the financial corporation. However,
the Commonwealth must pay to the corporation a subsidy that includes an amount
for interest.
The instrument must provide for the amount of financial
supplement that has to be repaid under a contract to be indexed on each 1 June.
The increase in the debt because of this indexation is to be owed by the student
to the Commonwealth rather than to the corporation. A student must be able, if
he or she so desires, to make certain early repayments during the period of the
contract. Such repayments must attract a discount.
There must be
provision for the outstanding amount not repaid in full by the end of the
contract period to be assigned to the Commonwealth, and for the indexed amount
to be repayable by the student to the Commonwealth through the tax system once
the student’s income reaches a stipulated level.
New section 1061ZZ
lays down other matters that may be dealt with in the instrument, although none
of the matters described are to be taken to limit the Minister's power to make
an instrument under new section 1061ZX. Matters encompassed by this new
section would generally be matters of detail to enable administration of the
scheme. Such matters may include: which tertiary students are eligible; the
circumstances in which youth allowance, austudy payment or pensioner education
supplement is taken to be payable, and at what rate, for purposes of the scheme;
issues relating to applications and payment; the amount of financial supplement
that a student can obtain and how this will affect his or her rate of youth
allowance, austudy payment or pensioner education supplement; rights and
obligations; when payments of financial supplement must stop; early repayment;
recovery after the end of the contract period; the application of the
Bankruptcy Act 1966; the exemption from State and Territory taxes;
review of decisions; delegation of powers; and transitional matters.
New
sections 1061ZZA and 1061ZZB enable the Secretary to request, but not require,
the tax file number of a person who is obtaining financial supplement or that of
his or her parent. These provisions will be necessary for those students who
will be eligible for financial supplement on the basis of youth allowance not
being payable to them because of the parental income test (these students will
be known as category 2 students). For all other students who will be obtaining
financial supplement, there will already be tax file number request provisions
in force for their substantive payment, ie, youth allowance, austudy payment or
pensioner education supplement.
It is necessary to request a student's
tax file number to assist in monitoring the student's continuing eligibility for
financial supplement. It is necessary to request the tax file number of the
student's parent also for eligibility checking purposes since parental income,
even for a category 2 student, will be a vital element in that
eligibility.
These tax file number request provisions are to be located
in new Chapter 2B, rather than in the disallowable instrument along with the
other detailed provisions, to satisfy the Privacy Commissioner's Tax File Number
Guidelines which require tax file number requests to be based on sections in a
relevant Act or in regulations.
The amendments made by items 11 to
20 are to allow the full range of Social Security Act information gathering
powers to apply to recipients of, and applicants for, financial supplement, in
the normal way that would apply for other social security programs. The
provisions are section 1304 (relating to the requirement on a person to
supply relevant information or a relevant document), section 1305 (relating to
the requirement on a person who owes a specified debt to the Commonwealth to
supply relevant information or a relevant document), section 1306 (relating to
the requirement on a person other than a debtor to supply relevant information
or a relevant document) and section 1307 (relating to the requirement on a
person to give relevant information about a class of persons).
Since
financial supplement will not fall within the definition of "social security
payment", on the basis of which term these information gathering provisions
normally operate, reference to the supplement needs to be specifically
incorporated into these provisions for them to apply correctly. The information
gathering powers will be applied for financial supplement, as for other social
security programs, to protect the public revenue and the integrity of the social
security system.
On a similar basis, items 21 to 26 make
amendments to extend appropriate Social Security Act offence provisions to
recipients of, and applicants for, financial supplement. These provisions would
not otherwise apply because of financial supplement not being a "social security
payment". However, the essential nature of the scheme is such that it should
come within the usual range of offence provisions. The provisions being amended
in this way are section 1343 (the general application provision for the offence
provisions), section 1344 (relating to false statements in connection with
claims and hardship requests), section 1345 (relating to false statements with
an intent to deceive or affect the rate of payment), section 1348 (relating to
payment knowingly obtained through fraud, etc) and section 1351 (relating to the
repayment of pension, benefit or allowance on conviction of an
offence).
5. Commencement
The amendments in this Schedule will commence on 1 July 1998.
Schedule 6 – Amendment of the Social Security Act 1991 in relation to fares allowance
1. Summary of proposed changes
This Schedule is to set up enabling provisions in the Social Security Act
for a disallowable instrument that will provide for fares allowance for certain
tertiary students. Such an allowance is currently provided by the AUSTUDY
Regulations. Since the majority of the student population for whom the
allowance is intended is moving to the social security portfolio, the allowance
is also moving for those students. Therefore, this Schedule is primarily to set
up provisions in the Social Security Act that will enable the making of an
instrument, and also to make certain consequential legislative
amendments.
2. Background
The fares allowance currently provided by Chapter 6 of the AUSTUDY
Regulations is essentially a payment to assist with the travel costs incurred by
certain tertiary students in undertaking their study. It is a payment made, not
on a regular basis, but on occasion, up to a certain number of times during an
academic year. The new enabling provisions in the Social Security Act will set
up the basic framework for the allowance and the details will be provided by the
Minister's disallowable instrument.
The general scheme for fares
allowance authorised under the Social Security Act will be essentially the same
as it has been under the AUSTUDY Regulations. While the structural details will
be different to accommodate the new payment arrangements, the entitlement will
be basically the same.
3. Clauses and Schedule involved in the changes
Clause 2: provides the commencement rules for this
Schedule.
Clause 3: provides that each Act that is specified in
this Schedule is amended as set out in the Schedule.
Schedule 6 – Amendment of the Social Security Act 1991 in relation to fares allowance
Item 1: inserts in the index of definitions in section 3 the new
definition of "fares allowance" inserted by item 2.
Item
2: inserts a new definition of "fares allowance" in subsection 23(1).
It will mean fares allowance under an instrument in force under new section
1061ZAAA.
Item 3: inserts new Part 2.26 for fares
allowance.
Items 4 to 11: make consequential amendments to extend
the full range of Social Security Act information gathering powers to people who
have been paid, or who have claimed, fares allowance.
Items 12 to
19: make consequential amendments to extend Social Security Act offence
provisions .
Item 20: amends the Social Security Act appropriation
power (subsection 1363(1)) to make it clear that it now extends to payments
of fares allowance in the same way as it applies to social security
payments.
4. Explanation of the changes
Item 3 inserts into the Social Security Act new Part 2.26,
enabling the Minister to provide, by disallowable instrument, for fares
allowance for certain tertiary students.
New section 1061ZAAA provides
the enabling power for the Minister's instrument. The instrument, once made,
may be varied or revoked by a further instrument. The instrument will have
effect according to its own terms. The instrument will be a disallowable
instrument under section 46A of the Acts Interpretation Act
1901.
New section 1061ZAAB lays down certain matters that may be
dealt with in the instrument, although none of the matters described are to be
taken to limit the Minister's power to make an instrument under new
section 1061ZAAA. Matters encompassed by this new section would generally
be matters of detail to enable administration of the allowance. Such matters
may include: which tertiary students are eligible; issues relating to claims
and determination of claims; the kinds of journeys for which, and the
circumstances in which, fares allowance may be paid; the amount of fares
allowance that a student may be paid and how this is to be calculated; issues
relating to the payment of the allowance; rights and obligations; review of
decisions; delegation of powers; recovery of overpayments; and transitional
matters.
The amendments made by items 4 to 11 are to allow the
full range of Social Security Act information gathering powers to apply to
recipients of, and claimants for, fares allowance, in the normal way that would
apply for other social security programs. The provisions are section 1304
(relating to the requirement on a person to supply relevant information or a
relevant document), section 1305 (relating to the requirement on a person who
owes a specified debt to the Commonwealth to supply relevant information or a
relevant document), section 1306 (relating to the requirement on a person other
than a debtor to supply relevant information or a relevant document) and section
1307 (relating to the requirement on a person to give relevant information about
a class of persons).
The information gathering powers will be applied for
fares allowance, as for other social security programs, to protect the public
revenue and the integrity of the social security system.
On a similar
basis, items 12 to 19 make amendments to extend appropriate Social
Security Act offence provisions to recipients of, and claimants for, fares
allowance. The essential nature of the allowance is such that it should come
within the usual range of offence provisions. The provisions being amended in
this way are section 1343 (the general application provision for the
offence provisions), section 1344 (relating to false statements in
connection with claims and hardship requests), section 1345 (relating to false
statements with an intent to deceive or affect the rate of payment), section
1347 (relating to payment knowingly obtained where not payable), section 1348
(relating to payment knowingly obtained through fraud, etc) and section 1351
(relating to the repayment of pension, benefit or allowance on conviction of an
offence).
5. Commencement
The amendments in this Schedule will commence on 1 July 1998.
Schedule 7 - Amendment of the Social Security Act 1991 relating to indexation
1. Summary of proposed changes
The introduction of youth allowance and austudy payment into the Social
Security Act at new Parts 2.11 and 2.11A, respectively, requires amendment to
the indexation provisions in Part 3.16 of the Act. This will ensure that all
amounts are indexed in accordance with CPI movements. The indexation of each
amount would depend on the indexation day, reference quarter and base quarter
for the amount and would be rounded to the nearest multiple of the rounding
amount. Those amounts which contain two indexation days would be indexed every
6 months. Those amounts with one indexation date would be indexed annually.
This process of indexation is consistent with the manner of indexing other
amounts.
2. Background
All social security payments are subject to indexation. The amendments
proposed to be made by Schedule 7 will remove redundant indexation
references and where appropriate insert the correct new references so as to
ensure that the new social security payments of youth allowance and austudy
payment are indexed.
3. Clauses and Schedule involved in the changes
Clause 2: provides that the amendments made by Schedule 7
commence on 1 July 1998.
Clause 3: provides that each Act that is
specified in this Schedule is amended as set out in the Schedule.
Schedule 7 - Amendment of the Social Security Act 1991 relating to indexation
Items 1, 2, 4, 7, 8, 19,
20, 21, 22, and 23: omit
redundant references from items 2, 3, 18, 18A, 45, 47, 49, 49B and 49D of
section 1190.
Item 3: repeals item 3A of section 1190 and inserts
new items 3A and 3B.
Item 5: repeals item 18AA of section 1190 and
substitutes new item 18AA.
Item 6: omits a redundant
reference from item 18A of section 1190 and substitutes a new
reference.
Item 9: repeals item 18B of section 1190 and
substitutes new item 18B.
Items 10, 11,
12 and
13: inserts new references in items 28, 29, 30 and 31 of
section 1190.
Item 14: inserts new item 33A in section
1190.
Item 15: amends the heading immediately before item 41 of
section 1190.
Item 16: amends item 41 of section 1190 to
reflect the new heading made by the amendment at item 15.
Item
17: omits a redundant reference in item 41 of section 1190 and substitutes a
new reference.
Item 18: repeals item 42 of section
1190.
Item 24: repeals items 49E to 49J of section 1190 and
substitutes new items 49E to 49J.
Item 25: omits a redundant
expression from items 3, 18, 45, 47, 49, 49B and 49D of section
1190.
Item 26: omits a redundant expression from items 18A and 28
to 33 of section 1190.
Item 27: repeals item 3A of subsection
1191(1) and substitutes new items 3A and 3B.
Items 28, 29,
30
and 32: repeal items 12AA, 12B, 24 and 33A of subsection
1191(1) and substitutes new items 12AA, 12B, 24 and 33A.
Item
31: omits a redundant heading before item 30 of subsection 1191(1) and
substitutes a new heading.
Item 33: omits a redundant expression
in section 1198A.
Items 34 and 35: repeal items 1 to 4 and 9 to 12
in section 1198A.
Item 36: omits a redundant expression in section
1198B.
Items 37 and 38: repeal items 1 to 4 and 9 to 12 in section
1198B.
Item 39: repeals subsection 1206A(4) and substitutes a new
subsection 1206A(4).
4. Explanation of the changes
Items 1, 2, 4, 7, 8, 19, 20, 21, 22 and 23 omit redundant
references from items 2, 3, 18, 18A, 45, 47, 49, 49B and 49D of section 1190 of
the Act because of the repeal and substitution of Part 3.5.
The repeal
and substitution of Parts 3.5 and 3.5A of the Act with new Parts 3.5 and 3.5A
set out the respective Rate Calculators for youth allowance and austudy payment.
Item 3 repeals item 3A of section 1190 of the Act and substitutes new
items 3A and 3B that provides for the indexation of the maximum basic rates of
youth allowance and austudy payment.
The indexation of the rate of rent
assistance for youth allowance is provided by item 5 which repeals
existing item 18AA of section 1190 of the Act (the maximum rent assistance for
sickness allowance payable to a person referred to in subsection 709(3) under
Part 3.5A which is to be repealed) and substitutes a new item 18AA in its
place.
Item 6 omits a redundant reference to "sickness benefit" in
item 18A of section 1190 and substitutes a correct reference to "sickness
allowance".
The indexation of the rent threshold rate for youth allowance
is provided by item 9 which repeals existing item 18B of section 1190 of
the Act (the rent threshold rate for social security benefit (other than
sickness benefit (sic) payable to a person referred to in subsection 709(3)
under Part 3.5 which is to be repealed) and substitutes a new item 18B in
its place.
Items 10, 11, 12 and 13, respectively, insert new
references in items 28, 29, 30 and 31 of section 1190 that provide for the
indexation of assets value limits in relation to youth allowance and austudy
payment depending upon the home ownership or not and whether the person is
single or partnered. Item 14 inserts a new item 33A that provides for
the indexation of assets value limit for a person receiving a youth allowance
who is not independent.
Item 15 omits the Heading before item 41
of section 1190 of the Act and substitutes a new Heading. Item 16 amends
item 41 to take account of the new Heading made by item
15.
Item 17 omits a redundant reference in item 41 of section
1190 because of the repeal and substitution of Part 3.5 and inserts a new
reference in that item.
Item 18 repeals item 42 of section 1190
because of the repeal of the existing Part 3.5.
Currently, items 49E to
49J of section 1190 of the Act provide for the indexation of pharmaceutical
allowance under the existing Part 3.5. Item 24 will repeal these items
and substitute new items that will reflect the indexation arrangements for
pharmaceutical allowance for youth allowance and austudy payment.
Item
25 omits a redundant expression from items 3, 18, 45, 47, 49, 49B and 49D of
section 1190. Item 26 omits a redundant expression from items 18A and 28
to 33 of section 1190.
Item 27 repeals item 3A of subsection
1191(1) of the Act and substitutes new items 3A and 3B that specifies the
indexation day, reference quarter and base quarter and rounding base for the
maximum basic rates of youth allowance and austudy payment.
Item
28 repeals item 12AA of subsection 1191(1) of the Act and substitutes new
item 12AA that specifies the indexation days, reference quarters and base
quarters and rounding base for the rate of rent assistance for youth
allowance.
Item 29 repeals item 12B of subsection 1191(1) of the
Act and substitutes new item 12B that specifies the indexation days,
reference quarters and base quarters and rounding base for the rent threshold
for youth allowance.
Item 30 repeals item 24 of subsection 1191(1)
of the Act and substitutes new item 24 that specifies the indexation days,
reference quarters and base quarters and rounding base for the non-independent
asset value limit for youth allowance.
Item 31 omits the Heading
before item 30 of subsection 1191(1) of the Act and substitutes a new
Heading.
Item 32 repeals item 33A of subsection 1191(1) and
substitutes new item 33A that specifies the indexation day, reference quarter
and base quarter and rounding base for pharmaceutical allowance for youth
allowance and austudy payment.
Items 34 and 35 repeal items 1 to 4
and 9 to 12 in section 1198A of the Act because of the repeal of existing Part
3.5. Redundant expressions in section 1198A are also omitted by item 33
because of these amendments.
Items 37 and 38 repeal items 1 to 4
and 9 to 12 in section 1198B of the Act because of the repeal of existing Part
3.5. Redundant expressions in section 1198B are also omitted by item 36
because of these amendments.
Finally, item 39 repeals subsection
1206A(4) of the Act and substitutes a new subsection. Existing subsection
1206A(4) provides that the current PA(SA) single rate, PA(SA) (item 49G) and
PA(SA) (item 49J) (items 49E, 49G and 49H of section 1190) is, on 1 January
each year, to be 2 times the current PA(SA) partnered rate) (item 49F of section
1190). All of those items in section 1190 are to be repealed (item 24
refers). The new subsection 1206A(4) provides that the indexation rule for
pharmaceutical allowance reflects the new arrangements for pharmaceutical
allowance for youth allowance and austudy payment.
5. Commencement
The amendments in this Schedule will commence on 1 July 1998.
Schedule 8 – Amendments of the Social Security Act
1991 relating to rate calculators
1. Summary of
proposed changes
This Schedule makes a number of policy and technical refinements to
various rate calculator provisions in the Social Security Act flowing from the
youth allowance changes and the repeal of youth training allowance, Benefit Rate
Calculator A and the Sickness Allowance Rate Calculator.
2. Background
Among the amendments included in this Schedule are amendments to ensure
that youth allowance recipients are included in the calculations for working out
a person's income free area for the purposes of the ordinary income test for
particular pension rate calculators. In addition, the Schedule will make
refinements to provisions relating to a person's partner income free area.
These are being made to reflect the new youth allowance age provisions. The
latter are consistent with the new arrangements for youth allowance and austudy
payment themselves.
3. Clauses and Schedule involved in the
changes
Clause 2: provides the commencement rules for this
Schedule.
Clause 3: provides that each Act that is specified in
this Schedule is amended as set out in the Schedule.
Schedule 8 – Amendments of the Social Security Act 1991 relating to rate calculators
Item 1: amends subparagraph 38B(6)(a)(iii).
Item
2: repeals subparagraph 38B(6)(a)(iv).
Item 3: amends
paragraph 38B(6)(b).
Item 4: amends paragraphs 408PB(7)a) and
(8)(a).
Item 5: amends subparagraph 607A(1)(b)(ii).
Item
6: repeals subsection 607A(2).
Item 7: amends paragraph
607B(2)(b).
Items 8 and 9: repeal subsection 607B(3) and section
644A respectively.
Item 10: repeals and substitutes step 1 in the
method statement in section 644H.
Item 11: amends step 3 in
the method statement in section 644H.
Item 12: amends paragraphs
660L(7)(a), 660L(8)(a), 660YJR(7)(a), 660YJR(8)(a), 728R(7)(a), 728R(8)(a),
771NS(7)(a) and 771NS(8)(a).
Item 13: amends subsection
1061EE(6).
Item 14: amends note 2 at the end of point
1064-E4.
Item 15: inserts new point 1064-E12 in Pension Rate
Calculator A.
Item 16: amends note 1 at the end of point
1066-E4.
Item 17: inserts new point 1066-E10 in Pension Rate
Calculator C.
Item 18: amends note 2 at the end of point
1066A-F3.
Item 19: inserts new point 1066A-F11 in Pension Rate
Calculator D.
Item 20: repeals point 1068-G9 and substitutes a new
version.
Item 21: amends note 1 in point 1068A-E14.
Item
22: inserts new point 1068A-E21 in Pension PP (Single) Rate
Calculator.
Item 23: repeals point 1068B-D22 and substitutes a new
version.
Items 24, 27 and 28: remove references to youth training
allowance in various rate calculator provisions: subparagraphs 1068B-F5(b)(i)
and (iii) and paragraphs 1064-H5(b), 1065-E4(b), 1066-H4(b), 1066A-I4(b),
1066B-F4(b), 1068-B1A(c), 1068-F14(b) and 1068-J7(b). The existing references
to a social security benefit will encompass the new payments with no further
amendment needed.
Item 25: removes references in subparagraph
1068B-F5(b)(ii) of the PP (Partnered) Rate Calculator to the two rate
calculators that are being repealed as part of this package and replaces them
with references to the two new rate calculators for youth allowance and austudy
payment.
Item 26: amends subparagraph
1068B-F5(b)(ii).
Item 29: amends subsection
1131(1A).
Item 30: amends the note to subsection
1132(2).
Item 31: amends paragraph 1132(6)(b).
Item
32: amends note 2 to subsection 1157A(1).
Item 33: repeals a
row and substitutes two rows in the table in
subsection 1207(2).
Item 34: repeals paragraph 41(3)(f) of
Schedule 1A to the Social Security Act.
Item 35: repeals clause 47
of Schedule 1A to the Social Security Act.
4. Explanation of the changes
Pension Rate Calculators - Ordinary income test
Point 1064-E4 provides that a person's ordinary income free area is
worked out using Table E-1. The point also directs the reader to work out which
family situation in Table E-1 applies to the person. The ordinary income free
area is the corresponding amount in column 3 plus an additional corresponding
amount in column 5 for each dependent child of the person. It is proposed to
count youth allowance recipients as dependent children for the purposes of this
calculation.
Current point 1069-H30 of the Family Payment Rate Calculator
provides an example of how a child, who is not an FP child for the purposes of
FP, is included in calculations to determine the FP income free area. In
effect, this point deems the child to be an "FP child", but only for the
purposes of that particular point. Item 15 of this Schedule achieves the
same effect by including a provision along these lines in Module E of Pension
Rate Calculator A. Thus, new point 1064-E12 deems a youth allowance
recipient child to be a dependent child of the pension recipient, but only for
the purposes of Module E of this Rate Calculator. Items 17, 19 and 22
make similar amendments to Module E of Pension Rate Calculator C, Module F of
Pension Rate Calculator D and Module E of the Pension PP (Single) Rate
Calculator.
Note 2 immediately after point 1064-E4 signposts the
definition of "dependent child". As a consequence of the amendments in item
15, this note has been amended by item 14 to alert the reader to
the fact that new point 1064-E12 also helps determine what is a dependent child
for the purposes of this Rate Calculator. Items 16, 18 and 21 make
similar amendments to Points 1066-E3, 1066A-F3 and 1068A-E14.
Items 20
and 23 repeal points 1068-G9 and 1068B-D22 which provide for the partner
income free area for Benefit Rate Calculator B and the PP (Partnered) Rate
Calculator respectively and substitute new points that recognise the new youth
allowance structure. This is necessary to reflect the youth allowance income
cut out point as a determinant of the partner income free area for a person
whose partner is under 21, as well as to reflect the equivalent newstart
allowance cut out point for a person whose partner is 21 or older. Identical
provisions appear in the Youth Allowance and Austudy Payment Rate
Calculators.
Other amendments
All of the remaining items in this Schedule are to make simple
consequential amendments to various provisions in the Social Security Act to
omit references to provisions repealed as part of the youth allowance package,
eg, Benefit Rate Calculator A for under 18 year old newstart allowance
recipients and the Youth Training Allowance Rate Calculator in the Student and
Youth Assistance Act. In some cases, it is necessary to substitute a reference
to an equivalent youth allowance or austudy payment provision; in others, it is
appropriate only to omit the superseded reference.
5. Commencement
The amendments in this Schedule commence on 1 July 1998.
Schedule 9 - Consequential amendments of the Social Security Act 1991
1. Summary of proposed changes
This Schedule makes extensive consequential amendments to the Social
Security Act to accommodate the new payments, youth allowance, austudy payment
and pensioner education supplement, and to reflect the repeal of youth training
allowance, the former AUSTUDY, Benefit Rate Calculator A and the Sickness
Allowance Rate Calculator.
In particular, the repeal of Part 8 (youth
training allowance) of the Student and Youth Assistance Act (to be renamed the
Student Assistance Act from 1 July 1998) and the introduction of youth allowance
requires consequential amendments to the Social Security Act relating to
overpayment and debt recovery. The main purpose of the amendments in Part 20
of Schedule 9 is to transfer youth training allowance debts, that is, debt's
under Part 8 of the Student and Youth Assistance Act to the debt recovery
provisions within Part 5.2 of the Social Security Act so that the full extent of
all recovery options (deductions, legal proceedings and garnishee) can be
undertaken. In addition amendments relating to waiver of recovery of debts
where the debtor or the debtor's partner would have been entitled to receive an
allowance will be made.
2. Background
Consequential amendments to various provisions in the Social Security Act
are necessary to reflect the new payment structure. Redundant references to
repealed payment types, and similar, are to be removed to clarify the operation
of those provisions. In other instances, references to the new payments are to
be inserted into existing provisions to ensure that those provisions continue to
apply with the scope intended when those provisions were formulated.
Part
8 of the Student and Youth Assistance Act provides for overpayments and debt
recovery of youth training allowance where that payment has been paid in excess
of entitlement to be recovered by deductions from a person's current
entitlement, legal proceedings or garnishee. Similar provisions to recover
social security payments that have been paid in excess of entitlement are
currently in Part 5.2 of the Social Security Act and these consequential
amendments because of the repeal of Part 8 of the Student and Youth Assistance
Act.
3. Clauses and Schedule involved in the changes
Clause 2: provides the commencement rules for this
Schedule.
Clause 3: provides that each Act that is specified in
this Schedule is amended as set out in the Schedule.
Schedule 9 – Consequential amendments of the Social Security Act 1991
Part 1 – Amendments relating to definitions
Item 1: amends the index of definitions to omit redundant
references to "automatic deferment provision" and "education leavers waiting
period".
Item 2: repeals subparagraphs 4(11)(b)(iia) and
(c)(iia) which referred to youth training allowance (which is being
repealed).
Item 3: amends paragraph 4(11)(e) to omit a now
redundant reference to youth training allowance.
Item 4: amends
subsection 5(1) by repealing the now redundant note after the
definition of parent.
Item 5: amends subsection 5(1) by
repealing paragraph (a) of the definition of prescribed education scheme as
it refers to the AUSTUDY Scheme, which is being repealed.
Item
6: repeals paragraphs 5(6)(ba) and (9A)(ca) which refer to
youth training allowance and are now redundant.
Item
7: repeals subsection 5(10) as it deals with the education leavers
waiting period which is being repealed.
Item 8: amends subsection
5A(6) to repeal a redundant paragraph.
Item 9 to 12: amend
subsections 7(6) and (6AA) and paragraphs 8(8)(s) and (z) to omit now redundant
references to youth training allowance.
Item 13: amends paragraph
8(8)(zf) to reflect the fact that pensioner education supplement is now dealt
with under the Social Security Act.
Item 14: amends subparagraph
8(8)(zm)(i) to omit a now redundant reference to youth training
allowance.
Item 15: amends subsection 10A(2) to omit a reference
to Benefit Rate Calculator A which is being repealed, and to insert a reference
to the Youth Allowance Rate Calculator.
Item 16: amends
subsections 14A(1) and (2) to insert references to the new Parts which deal with
youth allowance and austudy payment.
Items 17 to 21: amend
subsection 14A to include references, as required, to youth allowance and
austudy payment.
Item 22: amends subsection 17(1) to
insert a reference to youth training allowance.
Items 23 and
24: amend subsections 19C(1) and (2) to omit an unnecessary reference
to youth allowance and to insert a reference to
austudy payment.
Item 25: amends section 22 to change a
reference to the Student and Youth Assistance Act to the
Student Assistance Act.
Items 26 to 29: amend
subsection 23(1) where it deals with activity test breach definitions to
insert references to youth allowance and
austudy payment.
Item 30: amends subsection 23(1) by
inserting a reference to youth allowance in the definition of "approved
program of work supplement".
Item 31: amends subsection 23(1)
by amending the definition of AUSTUDY allowance to indicate that it is no longer
a current scheme.
Items 32: repeals the redundant definition of
"automatic deferment provision" in subsection 23(1).
Item
33: repeals the now redundant definition of
"education leavers waiting period" in
subsection 23(1).
Item 34: repeals the existing definition of
"family member" in subsection 23(1) (replacement definitions are to be
inserted by item 51).
Item 35: amends subsection 23(1)
by inserting references to youth allowance and austudy payment in the
definition of "income maintenance period".
Items 36 to 38: amend
subsection 23(1) by inserting references to youth allowance,
austudy payment and pensioner education supplement into the definitions of
"newly arrived resident’s waiting period", "recipient notification notice"
and "recipient statement notice".
Item 39: amends section 22
to change a reference to the Student and Youth Assistance Act to the
Student Assistance Act.
Items 40 and 41: amend
subsection 23(1) by inserting references to youth allowance and
austudy payment into the definitions of "social security benefit" and
"social security entitlement".
Item 42: amends subsection 23(1) by
omitting a redundant reference to job search allowance and inserting references
to youth allowance and austudy payment in the definition of "social
security recipient status".
Item 43: amends subsection 23(1)
by omitting a redundant reference to job search allowance in the definition of
"social security recipient status".
Item 44: amends
subsection 23(1) by repealing paragraphs (c), (fd) and (i) of the
definition of "waiting period" as they deal with the now repealed education
leavers waiting period.
Item 45: amends the definition of "youth
training allowance" in subsection 23(1) to indicate that it is no longer a
current payment type.
Item 46: amends subsection 23(4A) to
insert a reference to new Part 2.11 (youth allowance).
Items
47: amends subparagraph 23(6)(b)(ii) by omitting a now redundant reference
to youth training allowance.
Item 48: repeals sub-subparagraph
23(7)(b)(ii)(B) as it refers to youth training allowance and is now
redundant.
Item 49: repeals subsection 23(10AA) which is now
redundant given that it deals with youth training allowance.
Item
50: amends subsection 23(10B), which lists the various liquid assets
test waiting period provisions, by inserting references to the youth allowance
and austudy payment liquid assets test waiting period provisions.
Item
51: inserts two new subsections (14) and (15) in section 23, providing for
the meaning of "family member".
Part 2 - Amendments relating to newstart allowance
Items 52 and 53: amend subparagraphs 593(1)(g)(i) and
(2)(g)(i) by changing the age reference to 21 years.
Item
54: amends paragraph 593(1)(i) by omitting a reference to youth
training allowance and inserting a reference to youth allowance.
Items
55 and 56: amend note 12 following subsection 593(1) by omitting references
to youth training allowance and inserting references to youth
allowance.
Item 57: amends subparagraphs 593(1B)(b)(i) by
changing the age reference to 21 years.
Items 58 to 61: amend
paragraphs 593(1B)(c) and (2)(i) and the note at the end of subsection 593(2) by
omitting redundant references to youth training allowance and inserting
appropriate references to youth allowance.
Item 62: repeals
subsection 593(2B) which is now redundant as it deals with payment of newstart
allowance to persons under 18 years old.
Item 63: amends
subparagraph 603A(3)(a)(ii) by repealing a reference to youth training allowance
and inserting the appropriate reference to youth allowance.
Item
64: repeals subsection 604(1B) which is now redundant as it deals with
payment of newstart allowance to persons under 18 years old.
Item
65: amends paragraph 604(2)(b) by replacing a reference to a
Youth Training Allowance Activity Agreement with a reference to a
Youth Allowance Activity Agreement.
Item 66: repeals subparagraph
607A(1)(a)(i) which is redundant as it deals with
job search allowance.
Item 67: amends subparagraph
607A(1)(a)(iii) by omitting a reference to youth training allowance and
inserting a reference to youth allowance.
Item 68: repeals
subparagraph 607B(1)(a)(i) which is redundant as it deals with
job search allowance.
Item 69: amends subparagraph
607B(1)(a)(iii) by omitting a reference to youth training allowance and
inserting a reference to youth allowance.
Item 70: repeals
subparagraph 607B(2)(a)(i) which is redundant as it deals with
job search allowance.
Item 71: amends subparagraph
607B(2)(a)(iii) by omitting a reference to youth training allowance and
inserting a reference to youth allowance.
Item 72: repeals
subsection 611(1A) which is now redundant as it deals with payment of newstart
allowance to persons under 18 years old.
Item 73: amends
paragraph 615(1)(aa) by omitting a reference to youth training allowance and
inserting a reference to youth allowance.
Item 74: amends
subparagraph 620(1)(j)(ii) by omitting a now redundant reference to youth
training allowance.
Item 75: repeals subsection 621(5), which
deals with the ordinary waiting period for youth training allowance claimants,
as it is redundant.
Item 76: amends paragraphs 621(7)(a) and (c)
to insert references to “study”.
Item 77: amends
paragraph 635(3)(a) by omitting a redundant reference to youth training
allowance and inserting a reference to youth allowance.
Item
78: amends section 643 by omitting reference to under 18 year olds and
Benefit Rate Calculator A which itself is being
repealed.
Item 79: repeals section 644A as it refers to
Benefit Rate Calculator A which is being repealed.
Part 3 - Amendments relating to sickness allowance
Item 80: amends paragraph 666(1)(a) to insert a reference to
study.
Items 81 and 82: amend paragraph 666(1)(ca) to omit a
reference to the former AUSTUDY scheme.
Item 83: inserts new
subparagraph 666(1)(ca)(iii).
Item 84: amends
paragraph 666(1)(e) to change the age reference in the paragraph to
21 years.
Item 85: repeals subsections 666(1A) and (1B) which
are redundant given that they deal with qualification for certain 15 year
olds.
Item 86: amends paragraph 667(4)(a) by replacing a reference
to age 16 with a reference to age 21.
Item 87: repeals subsection
667(4A) which is redundant given that it deals with 15 year
olds.
Item 88: amends paragraph 676(1)(a).
Item
89: repeals note 3 to subsection 676(1).
Item 90: adds a note
to subsection 676(2).
Item 91: repeals subsection 676(3) and
substitutes new subsections (3), (3A), (3B) and (3C).
Items 92 to
95: amend subsection 676(4) and paragraphs 676(4A)(a) and 676(4A)(c) to
insert references to "study".
Item 96: repeals subsection 676(5)
and inserts a new subsection (5).
Items 97 and 98: repeal
subsections 680(2) and 694(7).
Item 99: repeals section 709 and
substitutes a new version.
Item 100: repeals sections 713 and
714.
Part 4 - Amendments relating to family allowance
Item 101: amends paragraph 838(1A)(a).
Item
102: inserts new subsection 843(4).
Item 103: inserts new
paragraph 894(1)(c) and new subsection 894(2).
Item
104: substitutes a new amount in item 3 of the Table in
point 1069-B2.
Item 105: adds new paragraph (c) to point
1069-H30.
Item 106: amends point 1070-E1 (definition of
ordinary income)
Part 5 - Amendments relating to family tax payments
Item 107: inserts new subsection 900AA(1A), which provides a new
subgroup of FTP children.
Item 108: makes consequential amendments
to subsection 900AA(3), necessary as a result of item 107.
Item
109: inserts two new subsections (3A and 3B) into current section 900AD
to ensure that current recipients of family tax payment are not disadvantaged by
the introduction of youth allowance.
Part 6 - Amendments relating to education leaver's waiting period
Item 110: repeals paragraph 608(1)(h).
Item
111: repeals subsection 615(7).
Item 112: repeals paragraph
(c) of note 2 following subsection 616(2).
Item 113: repeals
note 4 following subsection 616(2).
Item 114: repeals paragraph
(c) of note 1 following subsection 616A(2).
Items 115 and
116: repeal note 2 following each of subsections 616A(3) and
616A(5).
Item 117: repeals subsections 622, 623 and
623AA.
Item 118: repeals paragraph 677(1)(i).
Item
119: repeals subsection 687(3).
Item 120: repeals paragraph
(c) of note 1 following subsection 688(2).
Items 121 and
122: repeals note 2 following each of subsections 688(3) and
688(6).
Item 123: repeals note 2 following subsection
694(1).
Item 124: repeals sections 695, 696 and 696A.
Part 7 - Amendments relating to education entry payments and employment entry payments
Item 125: changes the age qualification for employment entry
payments from 18 years to 21 years by amending paragraph
661(1)(a).
Item 126: removes a reference to job search allowance
from subparagraph 661(1)(c)(i).
Item 127: repeals sections
663 and 664.
Item 128: removes a reference to section 663 from
subsection 665(1).
Items 129 to 131: repeal paragraphs 665A(b) and
(ba), 665E(b) and (c), 665I(b) and (c).
Item 132: repeals
paragraphs 665M(c) and (d).
Item 133: changes the heading of
Division 6 of Part 2.13A.
Item 134: removes the reference to the
AUSTUDY scheme from subparagraph 665U(1)(a)(i).
Item
135: removes a reference to a youth training allowance from
subparagraph 665U(1)(b)(i).
Item 136: removes a reference to
a youth training allowance from subparagraph 665U(1)(c)(i).
Item
137: omits a reference to the AUSTUDY scheme from
subparagraphs 665U(1)(c)(ii) and (iii).
Item 138: repeals
subparagraph 665U(1)(c)(iv).
Item 139: omits references to AUSTUDY
from subparagraph 665Y(a)(i).
Item 140: omits a reference to the
AUSTUDY scheme from subparagraph 665ZC(a)(i).
Item
141: replaces paragraph 665ZFA(b) and removes
paragraph 665ZFA(c).
Item 142: removes references to the
AUSTUDY scheme from subparagraphs 665ZG(a)(i), 665ZL(a)(i) and
665ZQ(a)(i).
Part 8 - Amendments relating to incorrect or inappropriate claims
Items 143 to 158: repeal subparagraphs 46(2)(a)(ia),
100(2)(a)(ia), 150(2)(a)(ia), 201(2)(a)(ia), 318(2)(a)(ia), 366(2)(a)(ia),
415(2)(a)(ia), 500K(3)(a)(ia), 615(2)(a)(ia), 660XCC(2)(a)(ia),
660XCK(2)(a)(ia), 660YCC(2)(a)(ii), 689(a)(ia). 731(2)(a)(ia), 771HN(2)(a)(ia)
and 784(2)(a)(ia).
Part 9 - Amendments relating to claims made by telephone, facsimile or computer
Item 159: repeals subparagraph 100A(1)(a)(iv) and replaces it with
two new subparagraphs.
Item 160: inserts a reference to sections
554C and 579C in paragraph 500M(1)(a).
Item 161: repeals
subparagraph 615A(1)(a)(iv) and replaces it with two new
subparagraphs.
Item 162: repeals subparagraph 687A(1)(a)(iv) and
replaces it with two new subparagraphs.
Part 10 - Amendments relating to multiple entitlement exclusion provisions
Item 163: amends paragraphs 103(2)(b), 202(2)(b), 321(2)(b) and
500S(3)(b).
Item 164: amends paragraph 500T(2)(b).
Item
165: repeals note 3 to subsection 500T(2).
Item 166: amends
paragraph 614(2)(b).
Item 167: amends subsection
686(1).
Item 168: amends paragraphs 686(2)(b) and
771HI(2)(b).
Part 11 - Amendments relating to automatic termination provisions
Item 169: amends paragraphs 136(b), 175B(b), 225A(b), 225B(c),
344A(b), 392A(b) and 508(2)(b).
Item 170: amends paragraphs
660A(b), 660XJB(b), 660XJC(b), 728D(b), 762A(b) and 771NB(b).
Item
171: amends sections 175B, 225A, 225B, 344A, 392A, 508, 660A, 66XJB, 660XJC,
728D, 762A and 771NB.
Item 172: amends paragraph
508A(2)(b).
Item 173: amends subsection 508A(2).
Part 12 - Amendments relating to automatic rate reduction provisions
Items 174 to 177: repeal subparagraphs 73A(b)(ia), 141(b)(ia),
227A(b)(ia) and 509A(b)(ii).
Item 178: amends paragraph
509A(c).
Item 179: amends section 509A.
Items 180 and
181: repeal subparagraphs 660E(b)(ia) and 660XJF(b)(ia).
Item
182: amends paragraph 660XJF(c).
Item 183: amends section
660XJF.
Item 184: amends paragraph 728G(b).
Item
185: amends paragraph 728G(c).
Item 186: amends section
728G.
Item 187: amends paragraph 771NH(b).
Item
188: amends paragraph 771NH(c).
Item 189: amends section
771NH.
Part 13 - Amendments relating to mobility allowance
Item 190: amends subparagraph 1035(ba)(ii).
Item
191: repeals subparagraph 1058(1)(b)(ii) and substitutes new subparagraphs
(ii) and (iii).
Part 14 - Amendments relating to special benefit
Item 192: repeals paragraph 729(2)(ba).
Item
193: removes a reference to "solely" from paragraph
729(2)(c).
Item 194: substitutes the phrase "because of" for the
phrase "solely by" from paragraph 729(2)(d).
Item 195: repeals
paragraphs 729(2)(da) and (db) and replaces them with new paragraphs 729(2)(da),
(db), (dc) and (dd).
Item 196: replaces a reference to youth
training allowance with a reference to youth allowance.
Item
197: amends subsection 729(4A).
Item 198: changes an age
reference from 16 to 18 years in paragraphs 737(1)(a) and
738(1)(a).
Item 199: removes any references in subsection 746(2)
to youth training allowance and substitutes a reference to youth allowance or
austudy payment.
Part 15 - Amendments relating to exclusion from assets test
Item 200: repeals subsections 611(1) and (1A) and substitutes a
new subsection 611(1).
Item 201: repeals subsections 680(1) and
(2) and substitutes a new subsection 680(1).
Item 202: repeals
paragraphs 733(2)(b) to (e) and substitutes a new paragraph (b).
Part 16 - Amendments relating to the value of the assets of members of couples
Items 203 and 204: repeal subparagraph
612(1)(b)(iii).
Items 205 and 206: repeal subparagraph
612(2)(b)(iii).
Items 207 and 208: amend
subparagraphs 681(1)(b)(ii) and (2)(b)(ii) and 734(1)(b)(ii) and
(2)(b)(ii).
Part 17 - Amendments relating to partner allowance.
Item 209: amends subparagraph 771HA(1)(c)(i).
Item
210: omits a reference to AUSTUDY allowance in
subparagraph 771HA(1)(c)(ii).
Item 211: deems the receipt of
youth allowance and austudy payment in certain circumstances by amending section
771HA.
Item 212: changes a reference from youth training allowance
to youth allowance and austudy payment in subsection 771HA(3).
Item
213: repeals paragraph 771HA(3)(b) and substitutes new
paragraphs 771HA(3)(b) and (c).
Item 214: Adds a new note to
subsection 771HA(3).
Item 215: amends references to the Student
and Youth Assistance Act.
Item 216: amends references to the
Student and Youth Assistance Act.
Item 217: changes all references
from youth training allowance to youth allowance and austudy payment in
subsection 771KE(2).
Item 218: repeals paragraph
771NU(3)(a).
Item 219: changes a reference from youth training
allowance to youth allowance and austudy payment in paragraph
771NU(3)(aa).
Item 220: changes a reference from youth training
allowance to youth allowance and austudy payment in
subparagraph 771NU(3)(aa)(i).
Item 221: repeals subsection
771NX(2).
Item 222: changes the first two references from youth
training allowance to youth allowance and austudy payment in
subsection 771NX(2A).
Item 223: changes a reference from
youth training allowance to youth allowance and austudy payment in paragraph
771NX(2A)(a).
Part 18 - Amendments relating to parenting payment
Item 224: amends paragraph 500I(1)(i).
Item
225: repeals subparagraph 500K(3)(a)(ia).
Items 226 and
227: amend paragraph 500M(1)(a).
Item 228: amends paragraph
500S(3)(b).
Items 229 and 230: amend paragraph 500T(2)(b) and
repeal Note 3 to the subsection.
Item 231: repeals paragraph
500V(2)(a).
Item 232: repeals paragraphs 500Y(2)(c) and (d) and
substitutes new paragraphs (c), (d), (e), (f) and (g).
Items 233 and
234: amend subsection 508(2).
Items 235 and 236: amend
subsection 508A.
Items 237 and 238: amend sections 508B and
509E.
Item 239: amends paragraph 1068A-E17(d).
Item
240: amends paragraph 1068B-B2(c).
Part 19 - Amendments relating to advance
payments
Items 241 and 242: amend section 1061A, including to add a new
subsection (2).
Items 243 and 244: amend section 1061EE.
Part 20 - Amendments relating to overpayment and debt recovery
Item 245: inserts a new entry in Note 1 at subsection
1222(1).
Item 246: inserts a new item in the Table of subsection
1222(2).
Item 247: amends subparagraph
1223(7)(b)(iv).
Item 248: substitutes the Note at the end of
subsection 1223(7) with a new Note.
Item 249: amends
paragraph 1223AA(1)(b).
Item 250: amends paragraph
1224AA(1)(a).
Item 251: inserts new section 1227B.
Item
252: amends subparagraph 1228(2)(c)(i).
Item 253: amends
paragraph 1228(2)(ca).
Item 254: amends section
1230B.
Item 255: amends paragraph (a) of the definition of
debt in subsection 1230C(2).
Item 256: amends
paragraph 1234A(1)(a).
Item 257: inserts new subsection
1237AAC(1A).
Item 258: inserts new subsection
1237AAC(2).
Item 259: amends subsection 1237AAC(3).
Part 21 - Amendments relating to compensation recovery
Items 260 to 262: amend several provisions of section
1166.
Items 263 to 265: amend several provisions of section
1168.
Items 266 to 268: amend several provisions of section
1170.
Items 269 to 271: amend several provisions of sections 1174
and 1179.
Part 22 - Amendments relating to the review of decisions
Items 272 and 273: include references to youth allowance and
austudy payment in the note to subsection 1239(1).
Item
274: inserts a new section 1242B to allow for the payment of youth allowance
pending a review of a decision to issue a notice to the person. A notice is
issued for the failure of a person to agree to the terms of a Youth Allowance
Activity Agreement and results in disqualification from youth
allowance.
Item 275: inserts new subparagraph 1245(1)(a)(ia) to
allow decisions made under section 544B to be reviewed by the
SSAT.
Item 276: inserts new subsection 1248(1) to allow an appeal
regarding a decision made under section 544B to be reviewed by the SSAT only
where there is an express application for review.
Item
277: includes references to the equivalent youth allowance provisions in the
list in paragraph 1250(1)(d) of decisions that are not reviewable by the
SSAT.
Item 278: inserts new section 1252B to allow for the payment
of youth allowance pending a review of a decision to issue a notice to the
person by the SSAT. A notice is issued for the failure of a person to agree to
the terms of a Youth Allowance Activity Agreement and results in
disqualification from youth allowance.
Item 279: amends section
1254A to include decisions made under section 544B that relate to the terms
of a Youth Allowance Activity Agreement in the review powers of the SSAT, so
that the SSAT may either affirm that decision, or set it aside and send the
matter back to the Secretary or CEO for reconsideration.
Item
280: inserts new paragraph 1255(6)(ab) to exclude decisions made under
section 544B insofar as they relate to the terms of a Youth Allowance Activity
Agreement from the general rule relating to the date of effect of SSAT
decisions.
Item 281: includes decisions made under section 544B
insofar as they relate to the terms of a Youth Allowance Activity Agreement in
the application of section 1256A.
Item 282: changes the name of
the Student and Youth Assistance Act to the Student Assistance Act for the
purposes of subsections 1260(1), 1261(1A) 1263(1), 1269(1) and paragraphs
1264(2)(b), 1273 (2)(b), 1273(2)(c), 1273(1)(a) and 1279(5)(aa).
Item
283: changes a reference to the Student and Youth Assistance Act to the
Student Assistance Act in subsection 1261(1) and allows for the lodgement of an
application for a review by the SSAT with the Agency, rather than an office of
the Department or the CES.
Part 23 - Miscellaneous amendments
Item 284: repeals subparagraph 82(5)(b)(iib).
Item
285: amends subsections 94(6) and 95(2).
Item 286: amends
paragraph 98(1)(f).
Item 287: repeals subparagraph
146F(5)(b)(iib).
Item 288: amends paragraph
148(1)(d).
Item 289: repeals sub-subparagraph
236A(1)(d)(ii)(BA).
Item 290: amends subsections 316(1)(c) and
364(1)(c).
Item 291: repeals subparagraph
408CF(6)(c)(i).
Item 292: amends paragraph
500I(1)(i).
Item 293: repeals subparagraph
660XCO(1)(a)(i).
Item 294: repeals subparagraph
660XKA(6)(b)(iib).
Item 295: amends paragraph
660XKA(7)(a).
Item 296: repeals subparagraph
660YCG(3)(c)(i).
Item 297: amends subsection
666(9).
Item 298: amends subsection 667(5).
Item
299: repeals subparagraph 738(3)(b)(i).
Item 300: amends
paragraph 771HC(1)(c).
Item 301: repeals paragraph
771HJ(a).
Item 302: repeals subparagraph
822(5)(b)(iib).
Item 303: repeals paragraph
831A(3)(aa).
Item 304: amends Notes 1 and 2 to subsection
1061P(2).
Item 305: amends paragraph 1064-E8(d).
Item
306: amends paragraph 1066-E6(d).
Item 307: amends paragraph
1066A-F7(d).
Item 308: amends point 1069-H1 and paragraph
1069-K2(a).
Item 309: amends section 1073.
Item
310: amends paragraph 1131(2)(b).
Item 311: amends paragraph
1161(1)(b).
Item 312: amends paragraph 1224B(1)(b).
Item
313: repeals paragraph 1307(2)(j) and substitutes a new
version.
Item 314: amends subsection 1312(1), paragraph
1312(1A)(d), subparagraph 1312A(b)(i), section 1312A (note 2),
paragraph 1312B(b), section 1313, paragraph 1314(1)(a) and subsection
1318(3).
Item 315: amends paragraphs 1336(3)(c) and (d),
subsections 1336(5) and (7) and section 1337.
Item 316: repeals
subsection 1363(3).
4. Explanation of the changes
This Schedule makes extensive consequential amendments to the Social
Security Act to accommodate the new payments, youth allowance, austudy payment
and pensioner education supplement, and to reflect the repeal of youth training
allowance, the former AUSTUDY, Benefit Rate Calculator A and the Sickness
Allowance Rate Calculator. The aim of the consequential amendments is generally
to extend, or modify, the application of various provisions in the Social
Security Act to the new payments consistent with the treatment given to the
superseded payment structure. Also, the new payments need to be reflected in
certain provisions that have general application to other payments.
Some
of the amendments are necessary to reflect the new qualifying age arrangements
for youth allowance and austudy payment (ie, youth allowance is generally
available up to age 21 for unemployed people and up to age 25 for students). In
some cases, references in the relevant provisions to job search allowance that
no longer have any application are being repealed to clarify the operation of
the provisions.
Part 1 – Amendments relating to definitions
Part 1 of this Schedule makes amendments to Part 1.2 of the
Social Security Act, which deals with definitions. Items 1 to
16 and items 18 to 50 ensure that:
• references to
youth allowance, austudy payment and pensioner education supplement
are inserted into various definitions, as required, and the definitions are
modified to accommodate these new payment types;
• various
references throughout Part 1 that are now redundant as a result of this
initiative, for example to youth training allowance, job search allowance and
education leaver's waiting period, are repealed.
Item 17 amends
the definition of liquid assets in subsection 14A(1) to provide that
certain amounts to cover a person's immediate study costs will not be considered
to be a part of the person's liquid assets for the purposes of the liquid assets
test waiting period. This modification of the definition of liquid assets only
applies to youth allowance recipients who are undertaking full-time study
and austudy payment recipients, and is restricted to reasonable expenses
likely to be incurred for the period of enrolment in the study. A note at the
end of subsection 14A(1) gives examples of the types of expense that will
be exempt from the definition of liquid assets and includes up front course
fees, HECS payments, union fees, cost of text-books and expenses directly
related to field trips that are a necessary part of a person's
course.
The new definitions of "family member" put in place by items
34 and 51 are necessary to keep the term in line with the meaning currently
in place under the former AUSTUDY structure for students transferring to youth
allowance. The current Social Security Act definition is to be
relocated to new subsection 23(14) and will continue to operate for most
purposes of the Act.
The new definition in new subsection 23(15) is
specifically for the purposes of the youth allowance family assets test in
Part 2.11 and the youth allowance family actual means test in the Youth
Allowance Rate Calculator. This new definition is drafted to suit the new
payment structure and the general effect is in line with the effect that
formerly applied under AUSTUDY. A person would be a family member of the
"relevant person" if he or she is a "parent" of the relevant person (as provided
by paragraph (b) of that definition inserted into subsection 5(1) by item 5 of
Schedule 2 to the Youth Allowance Bill and therefore consistent with the meaning
applied in the youth allowance parental income test) or a specified child of one
of the relevant person's parents (which, in turn, is consistent with the range
of children who will provide an additional amount of parental income free area
under point 1067G-F23 of the youth allowance parental income test).
Part 2 - Amendments relating to newstart allowance
Part 2 of this Schedule amends Part 2.12
(newstart allowance) of the Social Security Act to ensure
that:
• the newstart allowance provisions reflect properly the fact
that the minimum age for newstart allowance is now
21 years;
• references to youth training allowance,
where appropriate, are replaced with references to
youth allowance;
• redundant references to
youth training allowance and Benefit Rate Calculator A
are removed;
• redundant references to
job search allowance are removed.
Part 3 - Amendments relating to sickness allowance
Part 3 makes amendments relating to sickness allowance. The
reasons for the amendments are set out below:
• The new age
criteria for the relevant payments need to be reflected (ie, young people up to
age 21 will now generally receive youth allowance rather than sickness
allowance).
• The sickness benefit qualification criteria are being
amended by item 96 to reflect the inclusion of study in the
new payment structure. Subsection 666(1) of the Social Security Act
provides that a person is qualified for sickness allowance if the person is
incapacitated for work or for full-time education. Throughout the rest of the
provision, however, reference is made only to "work", not study, suggesting that
qualification on the basis of incapacity for full-time education is not
available. To remedy this situation, the relevant provisions are being amended
to make it clear that full-time students who become incapacitated for study are
able to receive sickness allowance if they intend to resume full-time study once
recovered.
• The redundant subsection 676(5) is to be repealed by
item 96. In its place will be a provision that better targets the start
of the sickness allowance liquid assets test waiting period for students.
Rather than being linked to the date of becoming unemployed, as per the old
subsection, the new provision will be linked to the date that the person becomes
qualified for austudy payment.
• Items 89 and 90 relocate a
note to the appropriate location within the sickness allowance
provisions.
• Item 91 amends the sickness allowance
provisions in relation to the liquid assets test waiting period (LATWP) to align
them with the newstart allowance LATWP provisions and the new
youth allowance and austudy payment LATWP provisions.
Item 91 repeals subsection 676(3) and replaces it with new
subsections 676(3), (3A), (3B) and (3C). Subsection 676(3) provides
that the liquid assets test waiting period in relation to a claim for sickness
allowance is to be worked out under subsections 676(3A), (3B) and (3C)
which set out the formula to be used to determine whether a person is subject to
the LATWP and, if so, the length of the period that applies. Under the formula
in subsection 676(3A), a person's maximum reserve amount (as defined in
subsection 14A) is subtracted from his or her liquid assets and then
divided by either $500, if the person is not a member of a couple and does not
have a dependent child, or $1,000 in any other case. The result of that
calculation (disregarding any fractions) gives the number of weeks that a
claimant must serve as the LATWP. The minimum number of weeks that can apply to
a person is 1 week and the maximum number is 13 weeks.
Part 4 - Amendments relating to family allowance
Exemption from assets test
Paragraph 838(1)(d) of the
Social Security Act imposes an assets test for the purposes of family allowance.
Amendments in the Parenting Act repealed subsection 838(1A) of the Social
Security Act and replaces it with a new subsection. The new subsection provides
an exemption from the assets test to a person or their partner who is receiving
a social security pension, a social security benefit, a youth training allowance
or a service pension or a person who has a determination made under
subsection 1132A(1A), (1B) or (1C) of the Social Security Act (ie, the
assets test hardship provisions).
As the new youth allowance is to be
included within the ambit of the term "social security benefit" and youth
training allowance is to be repealed, item 101 amends subsection 838(1A)
to remove references to youth training allowance. The use of the term "social
security benefit" will encompass the new youth allowance.
Provisional
commencement day
The Youth Allowance Bill includes a provision (at
new subsection 548C(2)) to cater for situations where a person has made a
claim for family allowance (referred to in the provision as the initial claim)
but later wishes to claim youth allowance. In such a case, the provisional
commencement date for youth allowance is the date of the initial claim. The
amendments at item 102 provide for the reverse situation, where a person
makes a claim for youth allowance, but would subsequently like that claim to be
taken to be a claim for family allowance.
Current section 843 specifies
what day will be the provisional commencement day for family allowance. Item
102 amends this section, by inserting new subsection 843(4). This
subsection would apply when the person has claimed youth allowance, and at the
time the person claimed the youth allowance, another person was also qualified
for family allowance in respect of the youth allowance claimant. If the person
subsequently claims family allowance, and the Secretary is satisfied that it is
reasonable to do so, then the provisional commencement day for family allowance
would be the day on which the initial youth allowance claim was
made.
Bereavement payments
At present, Division 10 of Part
2.17 of the Social Security Act provides for family allowance bereavement
payments to be made on the death of a child. In particular, sections 892 and
893 provide for qualification for family allowance to continue for the
bereavement period (which is defined in section 21 as being 14
weeks).
These provisions specify that the family allowance is to be paid
as if the child had not died. However, if the child had not died, then, upon
turning 16, the child could only be paid new lower standard family allowance
rate. Under the former regime, a higher standard family allowance rate would
have been paid in respect of the child.
Item 103 amends section
894 of the Social Security Act to ensure that, where a child dies, and the child
would have turned 16 during the bereavement period, the child's age is taken to
be the age of the child when he or she died. This will ensure that the family
will continue to receive the higher rate of family allowance during the
bereavement period.
Item 103 also inserts new subsection 894(2) to
cover the situation where a child who is 12 years old dies. In this case, the
amendments in new paragraph 894(1)(c) do not apply. This is because the
standard family allowance rate increases on the 13th birthday of a child and
family allowance is payable during the bereavement period as if the child had
not died. Thus, if the child would have turned 13 during the bereavement
period, then the family allowance would have been payable at the higher rate
from the next family allowance payday after that date, for the remainder of the
bereavement period.
Thus, new subsection 894(2) ensures that the
family will receive the higher standard family allowance rate for the remainder
of the bereavement as in the current regime.
Rate of family allowance
for children aged over 16
The amendments in item 104 limit the
rate of family allowance paid in respect of those children who are over the age
of 16. A child may attract family allowance because he or she does not qualify
for youth allowance or the rate of youth allowance payable may be less than the
rate of family allowance that the child attracts. This may occur if, for
instance, the actual means test precludes payment to the child or the rate that
would be payable as a result of the actual means test is less than the rate of
family allowance that may be paid to a child who is 16 years or older. (There
is no actual means test in the family allowance regime.)
In order to
achieve this effect, item 104 amends the Table of standard family
allowance rates immediately after point 1069-B2.
Point 1069-B2 specifies
how a person's standard family allowance rate is worked out. To do so, the
reader must select one of 3 "FA child rates". The third rate, (ie, item 3)
relates to a FA child who has reached 16, but is under 19, years of age.
Item 104 amends the rate of family allowance payable in respect of
children who are FA children, who are between 16 and 18 years of age, and who do
not receive youth allowance, by substituting a new amount in item 3 of the
Table.
Dependent child for income test purposes
Where a
child is in receipt of youth allowance, the child will be counted in the
calculations for determining the threshold for the family allowance income free
area, despite the child attracting payment in its own right.
At present,
points 1069-H27 and 1069-H28 include tables which specify how the family
allowance income ceiling and the family allowance income free area are worked
out. In both of these points, the threshold is worked out with reference to the
amount specified in column 1 plus an additional amount in column 2 for each FA
child of the person (after the first).
Current point 1069-H30 provides an
example of how children, who are not an FA child for the purposes of family
allowance, are included in these calculations. In effect, this point deems the
child to be an FA child, but only for the purposes of point 1069-H28. For
instance, at present, this point includes a particular type of student child in
the calculations, although such a child would not be a family allowance child
for any other purposes.
Item 105 amends point 1069-H30 to include
a new group of children within the calculations of the threshold. Thus, new
paragraph 1069-H30(c) provides that youth allowance recipient children are
included in the calculations for the family allowance income free
area.
Youth allowance recipient children will not be counted for any
other family allowance purposes. That is, they will not attract any additional
rent assistance, be counted in relation to maintenance income thresholds and so
on.
Prescribed educational scheme - definition
In section 5
"prescribed educational scheme" is defined as:
(a) the AUSTUDY Scheme;
or
(b) the ABSTUDY Schooling Scheme; or
(c) the ABSTUDY Tertiary
Scheme; or
(ca) the Student Financial Supplement Scheme;
or
(e) the Veterans' Children Education Scheme; or
(f) the
Post-Graduate Awards Scheme.
With the introduction of the austudy
payment, the former AUSTUDY Scheme will be repealed and so paragraph (a) of
this definition has been repealed. The references throughout the Social
Security Act to prescribed educational scheme will not be affected by the repeal
of paragraph (a), except for point 1070-E1 which states that a
person's ordinary income does not include payments under a prescribed
educational scheme. Item 45 amends this point to provide that ordinary
income does not include payments under either a prescribed educational scheme or
the pensioner educational supplement.
Part 5 - Amendments relating to family tax payments
In order to qualify for family tax payment, a person must have an FTP
child. Subsection 900AA specifies that, in general, any dependent child of the
person is an FTP child. However, subsection 900AA(3) and (4) provide that a
child over the age of 16 years cannot be an FTP child unless the child is
undertaking secondary studies on a full-time basis and, if so, only until the
child turns 18.
In addition, section 900AD of the Social Security Act
ties qualification for FTP to receipt of family allowance at a rate exceeding
the minimum family allowance rate. Subsections 900AD(2) and (3) provide a
qualification to the general rule, by specifying that family tax payment may be
paid to a person who does not receive family allowance at a rate in excess of
the minimum family allowance rate because of the operation of the "excluding
provisions". The excluding provisions are defined in subsection 6AA(1) and
provide exceptions to a number of family allowance rules, including those
relating to the family allowance assets test, the impact of income components
other than taxable income and so on.
Because of the introduction of the
new youth allowance regime, a group of children that may have attracted family
tax payment under the former regime, would otherwise lose qualification for
family tax payment. This is due to the fact that the rate of family allowance
payable in respect of children aged over 16 years has been limited to $23.50,
which corresponds to the minimum family allowance rate. Thus, if a family
allowance recipient has only one child aged 17 years, then that person could not
receive family tax payment under the current rules, as the family allowance is
not paid at a rate in excess of the minimum family allowance rate. In addition,
because youth allowance recipients cannot be FA children (because they cannot be
a dependent child), then they will also be unable to attract family tax
payment.
Accordingly, it is necessary to amend the family tax payment
provisions to set out a new set of qualification rules which apply in relation
to those children.
There are 3 basic scenarios where a child, who is over
the age of 16 years, will be able to attract family tax payment. These
scenarios are as follow:
1. Where the child is a recipient of youth
allowance (and therefore cannot attract family allowance).
2. Where the
child is qualified for youth allowance, and could receive it, but the rate that
the youth allowance would be payable at is less than the rate of family
allowance payable in respect of the child. In this case the person would
receive family allowance.
This situation is most likely to occur when
the various youth allowance means tests (ie, the actual means test or the
ordinary income test) reduce the rate of youth allowance payable to the child
below the rate set for family allowance.
3. The final scenario is where
the child does not qualify for youth allowance at all, because of the impact of
the actual means test, but does attract family allowance.
This group
would include families that have a low taxable income (and thus qualify for
family allowance) but whose "actual means", as measured by the actual means
test, are quite high. (It should be noted that family allowance is not subject
to an actual means test.)
It is proposed to amend the Social Security
Act to provide that, if the family would have qualified for the
higher rate of family allowance (ie, family allowance paid at more than the
minimum family allowance rate) under the former regime, then the child would
attract family tax payment under the new regime. It is also proposed to freeze
the "notional standard of family allowance rate" payable in respect of children
aged over 16 for the purposes of these calculations at the rate payable
immediately prior to the implementation of youth allowance. This rate is
currently $60.20 per fortnight.
The first change necessary to ensure this
effect is to amend the definition of FTP child in current subsection 900AA(1).
Accordingly, Item 45 inserts new subsection 900AA(1A) into the
Social Security Act. This subsection specifies that a young person who is
receiving youth allowance is taken to be a dependent child for the purposes of
family tax payment provided the person would be a dependent child apart from the
operation of paragraph 5(6)(b).
Paragraph 5(6)(b) specifies that a person
that is receiving a social security benefit is not a dependent chid for the
purposes of the Social Security Act. Item 40 of Part 1 of Schedule 9
specifies that a youth allowance is a social security benefit. Thus, a youth
allowance recipient is generally not taken to be a dependent child of another
person.
Accordingly, new paragraph 900AA(1A)(a) overrides the rule in
paragraph 5(6)(b). In addition, new subsection 900AA(1A) specifies that the
young person must not be considered to be "independent" for the purposes of
youth allowance. Section 1067A of the Youth Allowance Bill specifies when a
person is regarded as being independent.
Finally, the young person must
be under 18 years of age and undertaking full-time secondary
study.
Provided the young person meets the above requirements, then, for
the purposes of family tax payment, a youth allowance recipient may be a
dependent child.
Current 900AA(3) specifies that a child that has turned
16 cannot be an FTP child. This rule is expressed to be subject to current
subsection 900AA(4), which provides an exception to this rule if the child is
under 18 and undertaking full-time secondary studies. The amendments in item
108 ensure that the rule in subsection 900AA(3) is also subject to new
subsection 900A(1A), which has been discussed above.
Item 109
inserts the new qualification requirements to ensure that the current
qualification rules for family tax payment, so far as they pertain to children
aged over 16, have the same effect under the new regime.
Thus, new
subsection 900AA(3A) provides that a person will be qualified for family tax
payment provided the person has at least one FTP child who is classed as a
dependent child because of the operation of subsection 900AA(1A). In
addition, the child must be under 18 and in full-time secondary studies (ie, a
child referred to in subsection 900AA(4)), and the person must have a family
allowance excess.
The meaning of family allowance excess is laid down in
new subsection 900AA(3B). The concept of family allowance excess has been
designed to ensure that the family tax payment will be paid to those people who
are most closely aligned with those that currently attract family tax payment.
That is, the payment will be directed towards those who would have received
family allowance at a rate in excess of the minimum family allowance rate, had
the amendments in the youth allowance regime not taken effect.
New
subsection 900AA(3B) includes a method statement which is designed to work out
the family allowance excess. The reader is directed to work out several family
allowance rates, using the Family Allowance Rate Calculator as if each FTP child
is taken to be an FA child for the purposes of these calculations.
The
first step is to work out the rate of family allowance that would be paid, if
the rate of family allowance paid in respect of children aged over 16 was not
limited to the new lower standard family allowance rate (ie, as inserted by
item 104 of this Schedule). The next step is to work out the person's
minimum family allowance rate. If the rate worked out in the first step is
greater than that in the second step, then the person has a family allowance
excess. This equates to the person receiving family allowance at a rate in
excess of the minimum family allowance rate.
Part 6 - Amendments relating to education leaver's waiting period
Consequential upon the introduction of youth allowance the education
leaver's waiting period will no longer apply to any social security
beneficiaries. Consequently, this Part repeals the provisions dealing with this
waiting period and all associated references. The abolition of the education
leaver's waiting period is a vital element of youth allowance as it allows young
people to move easily from one activity type to another without interruption to
their income support arrangements.
Part 7 - Amendments relating to education entry payments and employment entry payments
Part 7 makes amendments relating to education entry payments and
employment entry payments. Subsection 661(1) sets out the qualification
criteria for employment entry payments. Currently, a person will be eligible
for such a payment if they have turned 18, commence employment that is likely to
continue for more than 4 weeks, have not received a payment under Part 2.13 in
the last 12 months, immediately before the person commenced the employment they
had been receiving job search allowance or newstart allowance, and had received
income support payments in respect of a continuous period of at least 12
months.
Items 125 and 126 amend these qualification provisions.
Item 125 changes the age of a beneficiary for the purposes of this
payment from 18 years to 21 years. This reflects the changed age of
qualification for newstart allowance. Item 126 removes the redundant
reference to job search allowance in subparagraph 661(1)(c)(i). Job search
allowance was repealed from 20 September 1996.
Item 127 repeals
sections 663 and 664. Section 663 sets out the qualification provisions for
employment entry payments for people who have not yet turned 18, and section 664
states that the amount payable under section 663 is $50. Item 128
removes the reference to section 663 in subsection 665(1). Section 665(1)
states that a person is not qualified for an employment entry payment unless
they have lodged a claim for that payment.
Sections 665A, 665E and 665I
deal with education entry payments paid to people in receipt of either sole
parent pension, disability support pension or widow B pension. Items 129 to
131 make amendments to these sections by repealing the paragraphs that
include references to AUSTUDY, and substituting the requirement that a pensioner
education supplement is payable to the person. Items 129 to 131 also add
a Note to each section, that provides clarification regarding the payability of
the pensioner education supplement.
Item 132 amends section 665M.
That section outlines the qualification provisions for payment of an education
entry payment to a person in receipt of special benefit. Like items 129 to
131, item 132 repeals references to AUSTUDY and replaces
paragraphs 665M(c) and (d) with one provision regarding a pensioner
education supplement. A pensioner education supplement is payable to a person
even if a person's whole payment has been traded in or traded back under the
Student Financial Supplement Scheme.
Item 133 repeals the heading
to Division 6 of Part 2.13A and replaces it with "Division 6 - Former job
search or newstart allowance recipients".
Items 134 to 138 amend
subsection 665U(1) by removing any references to the repealed AUSTUDY scheme and
youth training allowance from the qualification provisions for education entry
payments. A reference to youth allowance is unnecessary as that allowance will
not attract education entry payments.
Section 665Y allows the payment of
an education entry payment to a person in receipt of mature age allowance.
Item 139 omits the reference to AUSTUDY in subsection 665Y(a)(i).
This amendment effectively limits the scope of section 665Y to those people who
have enrolled, or intend to enrol in an approved course under the ABSTUDY
scheme.
Item 140 removes any reference to the AUSTUDY scheme from
the provisions outlining the qualifications for education entry payment for a
woman receiving widow allowance.
Item 141 repeals paragraphs
665ZFA(b) and (c), which refer to the AUSTUDY scheme. A new paragraph 665ZFA(b)
is substituted, which allows an education entry payment to be payable to a
person to whom a pensioner education supplement is payable. A Note to the
section clarifies those situations in which a pensioner education supplement is
payable to the person.
Item 142 removes references to the AUSTUDY
scheme from subparagraphs 665ZG(a)(i), 665ZL(a)(i) and 665ZQ(a)(i).
Section 665AG outlines the qualification provisions for an education entry
payment, when the person is receiving mature age partner allowance. Section
665ZL states that a woman is qualified for an education entry payment under this
section where the Secretary is satisfied that she has enrolled or intends to
enrol in an approved course under the AUSTUDY or ABSTUDY schemes, has not
received a payment under Part 2.13A in the last 12 months and is in receipt of a
wife pension. The amendment made by item 142 removes the reference
to the AUSTUDY scheme from this section. Section 665ZQ allows the payment
of a education entry payment to a person receiving partner allowance. Item
142 similarly removes any reference to the AUSTUDY scheme from this
provision.
Part 8 - Amendments relating to incorrect or inappropriate claims
Part 8 makes amendments relating to incorrect or inappropriate
claims. Items 143 to 158 repeal references to youth training allowance
from provisions which deal with an initial incorrect or inappropriate claim for
youth training allowance in each part of the Social Security Act dealing with a
payment type. For example, subsection 46(2) discusses an incorrect or
inappropriate claim, followed by a claim for age pension. If the person was
qualified for age pension on the day that they made the initial incorrect claim,
and they subsequently make a claim for age pension, the Secretary has the
discretion to decide that the person's provisional commencement day is the day
on which the initial claim was made. Youth training allowance is listed among
the initial claims that a person may make, that will allow the backdating of the
claim for age pension. Youth training allowance will be repealed from 1 July
1998, therefore the references to youth training allowance claims in the above
provisions must be repealed.
Part 9 - Amendments relating to claims made by telephone, facsimile or computer
Part 9 makes amendments relating to claims made by telephone,
facsimile or computer. References to youth training allowance will not be
needed in the provisions dealing with claims lodged by telephone, facsimile or
computer after 1 July 1998. Consequently, the references to youth training
allowance must be replaced with a reference to youth allowance and austudy
payment.
Sections 100A, 615A and 687A similarly provide that where a
person (or someone acting on that person's behalf) contacts the Department by
telephone, facsimile or computer, the provisional commencement date of a claim
subsequently made by that person may be backdated to the date of the initial
contact. For example, section 100A states that, if a person contacts the
Department by any of the above methods in relation to making a claim for
disability support pension, sickness allowance, newstart allowance or youth
training allowance on the day that they were actually qualified for a disability
support pension, they subsequently lodge a claim for disability support pension
within 21 days of that initial contact, and the Secretary provides them with
written acknowledgment of that contact and is satisfied that they had a medical
condition that significantly adversely affected their ability to work, then the
claim for disability support pension may be taken to have been lodged on the day
that the person made the initial contact.
Youth training allowance will
be replaced by youth allowance and austudy payment from 1 July 1998;
therefore, items 159, 161 and 162 replace references to youth training
allowance in subparagraphs 100A(1)(a)(iv), 615A(1)(a)(iv) and 687A(1)(a)(iv)
with references to youth allowance and austudy payment.
Item 160
amends paragraph 500M(1)(a) of the Act, and inserts a reference to provisions
similar to section 100A that deal with claims for youth allowance
(section 544C) and austudy (section 579C) that are made by telephone,
facsimile or computer.
Part 10 - Amendments relating to multiple entitlement exclusion provisions
Part 10 of this Schedule makes amendments to the multiple
entitlement exclusion provisions of the Social Security Act to eliminate
reference to youth training allowance. The provisions are those applying to
disability support pension, carer pension, bereavement allowance, parenting
payment, newstart allowance, sickness allowance and partner allowance. These
provisions deal with the case of a person who is receiving a particular social
security payment and to whom one of a specified range of other payments
(including a social security benefit or the outgoing youth training allowance)
becomes payable. In such a case, the existing payment is no longer payable.
The redundant reference to youth training allowance may be removed. The new
payment types will, correctly, come within the existing terms of the exclusion
because they will be "social security benefits", so no particular amendment is
needed to cover them in these provisions.
Part 11 - Amendments relating to automatic termination provisions
Part 11 amends the automatic termination provisions that apply on
transfer to a new payment type for disability support pension, wife pension,
carer pension, bereavement allowance, widow B pension, newstart allowance,
mature age allowance, sickness allowance, special benefit, partner allowance and
parenting payment. The amendments are to reflect the repeal of youth training
allowance in those provisions. Since the new payment types will, correctly,
come within the existing terms of the provisions because they will be "social
security benefits", no particular amendment is needed to cover them for these
purposes.
Part 12 - Amendments relating to automatic rate reduction provisions
The amendments made by Part 12 serve exactly the same function as
those made by Part 11, but in respect of the automatic rate reduction
provisions that apply when a person's partner starts to receive one of a
specified range of payments (including a social security benefit or the outgoing
youth training allowance), causing the person's rate to reduce. The payments
affected are age pension, disability support pension, carer payment, newstart
allowance, mature age allowance, sickness allowance, partner allowance and
parenting payment.
Part 13 - Amendments relating to mobility allowance
Part 13 makes amendments to omit reference to youth training
allowance in the mobility allowance qualification provisions and to substitute
reference to youth allowance or austudy payment. Similarly, reference to the
two new payments replaces reference to youth training allowance in the provision
relating to the termination of mobility allowance when a person ceases to be
qualified for the allowance in particular circumstances.
Part 14 - Amendments relating to special benefit
Subsection 729(2) outlines the discretion of the Secretary to make a
payment of special benefit to a person. Paragraph 729(2)(ba) states that one of
the conditions of payment of special benefit is that a youth training allowance
is not payable to the person. As youth training allowance is revoked from 1
July 1998, this obsolete reference is removed by item
192.
Paragraphs 729(2)(c) and (d) prevent people from being paid
special benefit if the sole reason that they cannot be paid either newstart
allowance or youth allowance is due to an activity test breach. This rule has
resulted in the payment of special benefit where a person does not receive
newstart allowance because of an activity test breach, as well as for another
reason (for example, the person is serving a waiting period). Items 193 and
194 remove the requirement that the sole reason for non-payment is because
of an activity test breach.
Item 195 removes paragraphs 729(2)(da)
and (db) which refer to youth training allowance. A new paragraph 729(2)(da)
provides that a person is not disqualified for youth allowance (for the purposes
of payment of special benefit) because of the operation of sections 541A or 544.
Section 541A refers to the failure of a person to satisfy the activity test, and
section 544 sets out the requirements relating to Youth Allowance Activity
Agreements. Paragraph 729(2)(db) states that a person is not disqualified for
an austudy payment because they fail to satisfy the activity test within the
meaning of section 569. Paragraph 729(2)(dc) states that the Secretary can only
pay special benefit to a person to whom youth allowance is not payable if that
result is not because of the operation of section 550, 553B or 565C of the Act.
Special benefit is not payable to a person to whom austudy payment is not
payable because of the operation of sections 576 to 588D.
Item 196
changes a reference from the repealed youth training allowance to youth
allowance in subsection 729(4A).
Item 197 inserts a new subsection
729(4B) after subsection 729(4A). The new subsection refers to the earlier
paragraph 729(2)(dd), and sets out some of the reasons that austudy allowance
will not be payable to a person. If austudy allowance is not payable to a
person (unless it is not payable as a result of the operation of section 576
and/or 588D), and if the person satisfies all the other qualification provisions
found in section 729, the Secretary may decide that special benefit is payable
to that person.
Subsection 737(1) states that special benefit is not
payable to a full-time student who has turned 16, or who has not turned 16 and
is not a SPB homeless person. Item 198 changes the age requirement in
paragraphs 737(1)(a) and (b) from 16 to 18 years.
Subsection 728(1)
provides that special benefit is not payable to a person in certain
circumstances. Item 198 changes the age requirement in paragraphs
737(1)(a) and 738(1)(a) and (b) from 16 to 18 years.
Item 199
removes any references to youth training allowance in subsection 746(2) and
replaces them with a reference to youth allowance and austudy payment.
Part 15 - Amendments relating to exclusion from assets test
The amendments made by Part 15 are basically to reflect in the
provisions relating to the exclusion from the assets test the fact that under 18
year olds will no longer receive newstart allowance or sickness allowance. The
new youth allowance arrangements for determination of a young person’s
independence are also correctly reflected for the purposes of the special
benefit assets test exclusion.
Part 16 - Amendments relating to the value of the assets of members of couples
The amendments made by Part 16 are to reflect the repeal of youth
training allowance in those provisions relating to the value of the assets of
members of couples, for newstart allowance, sickness allowance and special
benefit.
Part 17 - Amendments relating to partner allowance.
Part 17 makes amendments relating to partner
allowance.
Subsection 771HA(1) outlines the qualifications for partner
allowance. To be qualified, a person must, throughout the period:
(i) be
a member of a couple;
(ii) the person's partner must be at least 21 years
old;
(iii) the person's partner must be in receipt of one of several
listed payments;
(iv) the person must be an Australian resident in
Australia;
(v) the person must have been born on or before 1 July
1955;
(vi) the person must not be qualified for parenting allowance
during the period; and
(vi) the person must not have recent workforce
experience.
Currently, youth allowance and austudy payment are not
included in the list of payments that the person's partner may be receiving for
that person to be qualified for partner allowance. Item 209 adds
references to youth allowance and austudy payment to subparagraph
771HA(1)(c)(i), in recognition that recipients of those payments may be older
than 21 years of age (the minimum criteria for the partner of a person claiming
partner allowance).
Item 210 removes the redundant reference to
AUSTUDY in subparagraph 771HA(1)(c)(ii). AUSTUDY will be repealed from 1
July 1998.
Subsection 771HA(1B) deems that in certain circumstances, a
person's partner is in receipt of newstart allowance for the purposes of the
claimant's qualification for partner allowance. Item 211 extends this
deeming provision to those partners who would have been receiving youth
allowance except for the imposition of either a period of non-payment under
Subdivision D of Division 2 of Part 2.11 or an employment-related exclusion
under section 553A or 553B. Subsection 771HA(1BB) deems that a person's partner
is in receipt of austudy payment if that person would have been receiving
austudy payment except for the imposition of a period of non-payment under
Subdivision E of Division 2 of new Part 2.11A.
Item 212 omits a
reference to youth training allowance and substitutes a reference to youth
allowance and austudy payment in subsection 771HA(3). Item 213 removes
references to the current Student and Youth Assistance Act, and substitutes new
paragraphs 771HA(3)(b) and (c), which relate to the new youth allowance and
austudy payment included in the Social Security Act. That subsection states
that partner allowance is not payable to a person if youth allowance, austudy
payment, newstart allowance or sickness allowance is not payable to a person
because they are serving a waiting period, a period of non-payment applies to
the person under paragraph 608(1)(j), Subdivision D of Division 2 of Part
2.11 or Subdivision E of Division 2 of Part 2.11A, or the person is subject to
an employment-related exclusion for a period under section 553B or
553C.
Item 214 adds a Note to the end of subsection 771HA(3).
Note 4 explains that the new paragraph 771HA(3)(b) refers to non-payment periods
for youth allowance and austudy payment recipients in certain
circumstances.
Items 215 and 216 omit references to a youth
training allowance activity test breach rate reduction period and substitute a
reference to the equivalent youth allowance and austudy payment provisions.
People subject to an activity test breach rate reduction period or an
administrative breach rate reduction period are not qualified for partner
allowance throughout that period.
Subsection 771KE(1) states that the
Secretary has the discretion to determine the rate of partner allowance payable
to a person, where that person's partner is in receipt of special benefit.
Subject to two exceptions for major disasters and the release from gaol, the
maximum rate of partner allowance payable in these circumstances is limited by
the operation of subsection 771KE(2) to the rate at which youth training
allowance or newstart allowance would be payable to the person if they were
qualified for that payment and if that payment were payable to that person. As
youth training allowance will be repealed from 1 July 1998, item 217
removes the reference to that payment and replaces it with a reference to youth
allowance or austudy payment.
Division 9 of Part 2.15A outlines the
qualification and payability of bereavement payments to partner allowance
recipients. Section 771NX states that a lump sum is payable to the surviving
partner in accordance with the lump sum calculator found in that section.
Subsection 771NU(3) provides the rate of partner allowance during the
bereavement lump sum period. There is a separate calculation that refers to
each different payment that the deceased partner may have been receiving
immediately before he or she died. Item 218 repeals paragraph
771NU(3)(a) as this paragraph provides the calculation where the deceased
partner was in receipt of job search allowance. Job search allowance was
revoked from 20 September 1996; therefore, this paragraph is redundant.
Items 219 and 220 change references to youth training allowance in
paragraph 771NU(3)(a) and 771NU(3)(a)(i) to youth allowance or an austudy
payment as the case may be.
Step 4 of the bereavement payment lump sum
calculator, found in section 771NX, refers to the surviving partner's notional
rate. That notional rate is calculated in accordance with later subsections of
section 771NX. Subsection 771NX(2) calculates the notional rate where the
deceased partner was in receipt of job search allowance immediately before their
death. Item 221 repeals this subsection, as job search allowance has
been repealed from 20 September 1996. Subsection 771NX(2A) provides the
calculator for the notional rate where the deceased partner was in receipt of
youth training allowance immediately before their death. Items 222 and
223 change the references in subsection 771NX(2A) and paragraph 771NX(2A)(a)
from youth training allowance to youth allowance or austudy payment. Further, a
note changes the heading to subsection 771NX(2A) from "Deceased partner
receiving youth training allowance" to "Deceased partner receiving youth
allowance or austudy payment".
Part 18 - Amendments relating to parenting payment
The majority of amendments made by Part 18 are merely to remove
references to youth training allowance, its authorising legislation, and the
former AUSTUDY scheme, and to substitute as appropriate references to the new
payments, youth allowance and austudy payment.
However, items 237, 238
and 239 serve the additional function of clarifying the existing policy
under section 508B and point 1068B-B2 with regard to the ABSTUDY scheme. A
dependent spouse allowance currently can be included with a student's AUSTUDY or
ABSTUDY allowance. If a student's allowance includes a dependent spouse
allowance, parenting payment to the student's partner is limited to non-benefit
PP (partnered). The parenting payment provisions which give effect to the
above, namely, section 508B and paragraph 1068-B2(c), require clarification as
they do not currently specifically refer to ABSTUDY. On introduction of youth
allowance, AUSTUDY will cease to exist and the dependent spouse allowance will
be available only to ABSTUDY students. As such, the references to AUSTUDY in
the above provisions are to be replaced with references to ABSTUDY.
Part 19 - Amendments relating to advance payments
Part 19 contains amendments basically to extend the Social
Security Act advance payment provisions to youth allowance and austudy payment.
This has already partly been dealt with by the amendment to include the two new
payments in the definition of "social security entitlement" (the Part of this
Schedule dealing with amendments to definitions refers). However, the
amendments in this Part complete the task by including the two new payments
within the ambit of section 1061EE which governs the amount of advance payment
that can be made. Furthermore, a Secretary discretion is included in section
1061A to allow waiver, for recipients of youth allowance or austudy payment, of
the usual rule requiring a person to have been in receipt of an income support
payment for three months before an advance payment is payable to the person.
This is to help students in particular to cover costs related to their
study.
Part 20 - Amendments relating to overpayment and debt recovery
Note 1 at the end of subsection 1222(1) specifies the debts owed to the
Commonwealth under Part 5.2. Item 245 inserts a new entry that indicates
that a debt under new section 1227B (see item 251) is a debt owed to the
Commonwealth under Part 5.2.
Subsection 1222(2) sets out the methods of
recovery for various types of debts. Item 246 inserts new item 8AA
in the Table within that subsection that indicates that debts falling under the
ambit of new section 1227B (see item 251) can be recovered by means of
deductions, legal proceedings or garnishee.
Current subparagraph
1223(7)(b)(iv) deals with an overpayment of newstart allowance because a
person's rate was increased by an approved program of work supplement when it
should not have been. Item 247 amends this paragraph to cater for an
incorrect increase in a youth allowance recipient's rate where the increase was
due to an approved program of work supplement that should not have been paid.
Item 248 repeals the Note at the end of subsection 1223(7) and
substitutes it with one that refers the reader to the sections dealing with the
newstart training supplement and the approved program of work
supplement.
Item 249 inserts a reference to the recipient
statement notice provisions in youth allowance (section 561C) and austudy
payment (section 586C) into paragraph 1223AA(1A)(b).
Item 250
is a technical amendment to paragraph 1224AA(1)(a) that does not change the
intention of the law.
The repeal of Part 8 (youth training allowance) of
the Student and Youth Assistance Act and its replacement with youth allowance
necessitated that those existing youth training allowance debts would become
debts due to the Commonwealth under Part 5.2 of the Social Security Act so
that they can be recovered by means of deductions, legal proceedings or
garnishee. Item 251 inserts a new section 1227B into the Act that
provides that all debts due to the Commonwealth under Part 8 of the Student and
Youth Assistance Act, as in force before 1 July 1998, become debts due to the
Commonwealth under the Act.
Item 252 amends subparagraph
1228(2)(c)(i) by inserting a reference indicating that recovery of debts by
deductions from a person's social security payment because of an AUSTUDY Scheme
debt means the scheme under the former Part 2 of the Student and Youth
Assistance Act.
Item 253 repeals paragraph 1228(2)(ca) because
recovery of youth training allowance debts will be made under new section 1227B
(see item 251).
Items 254 and 255 insert references to new
section 1227B in section 1230B and in paragraph (a) of the definition of
debt at subsection 1230C(2) of the Social Security
Act.
Item 256 inserts a reference to a debt incurred under Part 8
of the Student Assistance Act before 1 July 1998 in paragraph 1234A(1)(a) to
ensure that deductions by consent can be made from a person's social security
payment where that person is not the debtor.
Current section 1237AAC
provides for the waiver of a debt (or part of the debt) where there was an
unclaimed entitlement to family payment or family allowance. Item 257
inserts new subsection 1237AAC(1A) which provides for a similar waiver power
where the debtor is a youth allowance recipient, and another person may have
received family allowance or family payment in respect of the child, but did not
do so.
Thus, new subsection 1237AAC(1A) applies in situations
where:
• there is a debt because a youth allowance recipient has an
overpayment;
• the youth allowance recipient would have been an FA
child of another person for the period during which the overpayment was incurred
if the young person was not a youth allowance recipient;
• family
allowance would have been payable to the other person had the person lodged the
claim and the youth allowance recipient been an FA child.
In such a case,
the Secretary must waive the debt, to the extent specified in
subsection 1237AAC(2A).
Item 258 inserts new subsection
1237AAC(2A) which specifies how much of the debt must be waived if new
subsection 1237AAC(1A) applies to a person. In such a case, an amount equal to
the amount of family allowance that would have been payable to the other person
in the 3 year period ending on the day on which the overpayment is stopped may
be waived.
Item 269 makes amendments to current subsection
1237AAC(3) which are necessary as a consequence of the amendments in items
257 and 258.
Part 21 - Amendments relating to compensation recovery
The amendments made by Part 21 relate to the compensation recovery
provisions of the Social Security Act. Since youth allowance and austudy
payment will come within the definition of "social security benefit", and
therefore within the definition of "compensation affected payment", the
compensation recovery provisions in Part 3.14 of the Social Security Act will
generally flow through to the new payments as intended. The amendments made by
this Part are merely to omit the references to youth training allowance
currently appearing in these provisions.
Part 22 - Amendments relating to the review of decisions
Note 1 to subsection 1239(1) explains that where a payment made under
Chapter 2 of the Social Security Act is stopped or varied as the result of the
operation of a computer program, there will still be a decision of an officer
for review purposes. Item 272 includes references to the automatic,
computer-generated termination and rate reduction provisions relating to youth
allowance in that Note. The Note further provides that where the Secretary
could have made a determination to suspend or cancel, or increase or reduce the
rate of a pension, benefit or allowance, then certain sections of the Act
provide that the determination is taken to have been made. Item 273
includes references to the appropriate youth allowance provisions in this part
of the Note.
Item 274 inserts a section relating to a decision to
give a notice under section 544C. Such a notice is issued because of the failure
of a person to enter into a Youth Allowance Activity Agreement and results in
that person's disqualification from youth allowance. The new section 1242B
provides that where a person applies for a review of the decision to give a
notice, under section 1240(1) or 1240(1AA) of the Act, within 14 days of being
notified of the decision, they will be paid youth allowance pending the
determination of the review as if a Youth Allowance Activity Agreement had not
been required. If the payment of the allowance had ceased for a period before
the person applied for the review, then arrears will be payable for that period
and the Act (with the exception of this Chapter) will apply as if the Youth
Allowance Activity Agreement had not been required. However, payment of youth
allowance pending the outcome of the review under subsection (2) will cease to
be paid if the application for review is withdrawn or when the review is
determined. This ensures that the person is not in financial hardship as a
result of the non-payment of youth allowance while waiting for the outcome of
the review.
Subsection 1245(1) outlines the application of Part 6.2 which
deals with reviews by the SSAT. Item 275 specifically includes in this
Part a reference to decisions made under section 544B, to the extent to which
that decision relates to the terms of a Youth Allowance Activity
Agreement.
Currently, the SSAT may only review a decision relating to a
Job Search Activity Agreement or a Newstart Activity Agreement (under sections
525B and 606 of the Act respectively) if there is a specific application for
review of that decision. Item 276 makes a similar provision for the
review of decisions relating to a Youth Allowance Activity Agreement, insisting
that an application for review of that decision must be expressed.
The
SSAT cannot review certain decisions. Paragraph 1250(1)(d) prevents the SSAT
from reviewing decisions made under the provisions of the Act relating to the
form and place of lodgement of a claim. Item 277 adds youth allowance
for references that relate to the form and place of lodgement of a claim to the
list of decisions in subsection 1250(1) that cannot be reviewed by the
SSAT.
Item 278 inserts the new provision 1252B which relates to
the automatic payment of youth allowance pending the outcome of a review by the
SSAT. Where a decision is made to issue a notice under section 544C, and the
person in respect of whom the decision is made appeals the decision to the SSAT
within 14 days of being notified of the decision, then youth allowance will be
paid to the person pending the determination of the review as if the Youth
Allowance Activity Agreement was not required. If the payment of the allowance
had ceased for a period before the person applied for the review, then arrears
are payable to the person for that period and the Act (with the exception of
this Chapter) will apply as if the Youth Allowance Activity Agreement had not
been required. Such a payment will cease if the application for review is
withdrawn or determined. This ensures that the customer is not in financial
hardship as a result of non-payment of youth allowance while waiting for the
outcome of the review.
Section 1254A states that where a person applies
to the SSAT with respect to a Job Search or Newstart Activity Agreement, the
SSAT must affirm the decision or set the decision aside and send the matter back
to be reconsidered. Item 279 includes decisions relating to Youth
Allowance Activity Agreements in this section.
Item 280 prevents
section 1255 from applying to decisions made under section 544B to the extent
that it relates to the terms of a Youth Allowance Activity Agreement. That
section provides the general rule that a decision made by the SSAT comes into
operation immediately on the giving of the decision, or on a later date
specified in the decision.
Section 1256A provides the date of effect of
SSAT decisions that pertain to the review of Job Search or Newstart Activity
Agreements. Item 281 adds to the application of this section those
decisions made under 544B to the extent to which it relates to the terms of a
Youth Allowance Activity Agreement.
Item 282 changes various
references to the Student and Youth Assistance Act to the Student Assistance
Act.
Currently, if a request for review by the SSAT is sent to either an
office of the Department, the Agency or the CES, then the Secretary must send
that application to the National Convener as soon as possible, but no later that
7 days after the application is received. Item 283 changes the lodgement
location of the application to an office of the agency. Further amendments are
made by this item to change the Student and Youth Assistance Act to the Student
Assistance Act.
Part 23 - Miscellaneous amendments
Part 23 makes various consequential amendments that do not fit
within one of the larger subject groupings dealt with in the other Parts of this
Schedule. The amendments generally aim to preserve the correct application of
various provisions in the Social Security Act in light of the new payment
structure.
• The amendments that are to remove outdated references
to job search allowance that no longer have any application are: items 284,
287, 294, 295 and 302. In these provisions, it is necessary to retain
reference to youth training allowance for the transitional purposes of the
provisions, just as it was necessary on the transition to youth training
allowance to retain reference to job search allowance. It is now appropriate to
remove those former transitional references.
• The amendments that
are to remove reference to youth training allowance and replace it with
reference to youth allowance and austudy payment are: items 285, 292 and
310.
• The amendments that are simply to remove reference to
youth training allowance are: items 286, 288, 289, 290, 300, 303, 304, 308
and 316. In these cases, the existing references to social security
benefits or benefits will adequately cover the new payments, youth allowance and
austudy payment.
• The amendments that are simply to remove
reference to the former AUSTUDY allowance or scheme are: items 291, 293, 296,
299, 301, 305, 306 and 307.
• The amendments that are to add
reference to youth allowance and austudy in relevant provisions are: items
297, 298 and 311.
• The amendments that are to remove reference
to the Student and Youth Assistance Act in its role as the authority for youth
training allowance are: items 314 and 315.
Item 309 is
to remove from section 1073 reference to points from the two repealed Rate
Calculators and to substitute reference to the equivalent points in the Youth
Allowance and Austudy Payment Rate Calculators.
Item 312 removes
references to AUSTUDY and ABSTUDY and substitutes a general reference to a
course of study.
Item 313 repeals paragraph (j) of subsection
1307(2) (relating to the type of information about a person in a class of
persons the Secretary may require) and substitutes a new version. For
data-matching purposes, it is necessary to collect personal information about a
class of persons, rather than on an individual basis. This will be just as much
the case for the people who will claim or receive social security payments as
students as for any other recipient or claimant. However, because payments to
students have not until now been part of the social security system, the
relevant information gathering power (section 1307) is not correctly set up to
enable the necessary checking of enrolment and study progress. This checking
will match student assistance customer records with student enrolment records
held by educational institutions and will enable Centrelink staff to determine
whether claimants or recipients are properly meeting criteria such as attendance
or study load. The new paragraph (j) will state explicitly the type of
information that may be sought along these lines in relation to a person
included in a class of persons. All of these types of information are relevant
to establishing the person's entitlement to payment as a student.
5. Commencement
This Schedule will commence on 1 July 1998, except for items 89 to
91 which commence on Royal Assent.
Schedule 10 – Amendment of the Social Security Act 1991 relating to savings and transitional provisions
1. Summary of proposed changes
This Schedule makes certain amendments to the Social Security Act to
ensure a smooth transition to the youth allowance regime.
2. Background
As the new youth allowance and austudy payment regimes incorporate
several former payments made by the Commonwealth, such as newstart allowance
(under 21 years), sickness allowance (under 21 years), youth training allowance
and AUSTUDY living allowance (youth allowance age), there is a need to insert a
series of provisions in the Social Security Act to ensure that
recipients of the former payments will be transferred to youth allowance or
austudy payment, as the case may be, without the need to lodge a claim or for a
separate determination to be made to grant the new payment. The transitional
provisions included in this Schedule ensure such a transition takes place. The
provisions also ensure that pensioner education supplement recipients
under the AUSTUDY scheme are similarly transferred to pensioner education
supplement under the Social Security Act.
In addition, there
are specific provisions ensuring that several specified groups of people are
not disadvantaged by the new arrangements. These include, for instance, those
people who are in receipt of bereavement payments when the new regimes are put
in place and those who are able to attract double orphan pensions under the
current AUSTUDY rules.
Furthermore, an undertaking was given that those
persons who were under 21 and receiving newstart allowance or sickness allowance
on 17 June 1997 (when the new youth allowance regime was announced by the
Government) would not be affected by the new regime. This Schedule also
includes amendments to isolate that group from the changes.
The Schedule
also includes amendments to ensure that recipients of family allowance will not
be disadvantaged by the implementation of the youth allowance regime - without
such amendments, some recipients may miss out on a partial payment of family
allowance.
Finally, the Schedule includes several provisions relating to
the income maintenance period rules.
3. Clauses and Schedule involved in the changes
Clause 2: provides the commencement rules for this
Schedule.
Clause 3: provides that each Act that is specified in
this Schedule is amended as set out in the Schedule.
Schedule 10 – Amendment of the Social Security Act 1991 relating to savings and transitional provisions
Item 1: inserts a new application clause (clause 109) in Schedule
1A of the Social Security Act.
109. Application of liquid assets test
waiting period for sickness allowance
Item 2: inserts a series of
transitional provisions in Schedule 1A of the Social Security
Act.
110. Youth allowance in place of newstart allowance (under 21
years), sickness allowance (under 21 years), youth training allowance and
AUSTUDY living allowance (youth allowance age)
111. Austudy payment in
place of AUSTUDY living allowance
112. Pensioner education supplement
under the Social Security Act in place of pensioner education supplement under
the Austudy Regulations
113. Certain persons receiving benefit PP
(partnered) and pensioner education supplement immediately before 1 July
1998
114. Claims for newstart allowance (under 21 years) or sickness
allowance (under 21 years) made on or after 1 July 1998 in respect of periods
before that date
115. Persons under 21 receiving newstart allowance or
sickness allowance on 17 June 1997
116. Newstart allowance or sickness
allowance bereavement payments in respect of death of partner
117. Youth
training allowance bereavement payment in respect of death of
partner
118. Qualification for double orphan pension for certain young
persons who were qualified to receive payments under the AUSTUDY scheme
immediately before 1 July 1998
119. Payment of family allowance - young
person ceasing to be a FA child on becoming youth allowance
recipient
120. Application - income maintenance period rules
4. Explanation of the changes
Schedule 10 adds, at the end of Schedule 1A to the Social Security Act,
an application clause and a series of new clauses dealing with transitional
arrangements due to the introduction of youth allowance on 1 July
1998.
Item 1 inserts new clause 109. This clause is an
application clause which makes clear how item 91 of Schedule 9 operates.
Item 91 repeals subsection 676(3) of the Social Security Act and inserts
a new provision which specifies how a liquid assets test waiting period for
sickness allowance is worked out. The application in clause 109 makes it clear
that the amendments in item 91 only apply in relation to claims for
sickness allowance that are lodged on or after the commencement of the item
(which is to be the date of Royal Assent).
Item 2 inserts a series
of savings provisions to ensure a smooth transition to the new
regime.
110. Youth allowance in place of newstart allowance (under
21 years), sickness allowance (under 21 years), youth training allowance and
AUSTUDY living allowance (youth allowance age)
Generally, after
the introduction of youth allowance on 1 July 1998, persons who were under 21
and to whom newstart allowance, sickness allowance, youth training allowance or
AUSTUDY living allowance was payable on 30 June 1998 will be transferred to
youth allowance. Clause 110 provides a number of transitional provisions to
give effect to this transfer.
Continuing effect of certain
determinations
Subclause 110(1) authorises the transition to youth
allowance by providing that a determination relating to newstart allowance or
sickness allowance in force, or made with effect, immediately before 1 July 1998
continues in force on and after 1 July 1998 as if it had been made or given in
relation to youth allowance. Therefore, the newstart allowance or sickness
allowance recipients will not be required to make a claim for youth allowance
and there will be no new determinations "granting" youth allowance to those
recipients.
Subclause 110(1) also provides for the continuing effect
after 1 July 1998 of newstart allowance or sickness allowance notices and
statements (or other instruments) as if they had been made or given in relation
to youth allowance. Due to the operation of this subclause, for example,
newstart allowance or sickness allowance recipients who, in the period prior to
1 July 1998, have been requested to provide information to the Secretary (eg
under newstart allowance sections 657 or 658), and are within the compliance
period for that request as at 1 July 1998, will continue to be under an
obligation to advise the Secretary of changes in circumstances, or respond to
requests for information after 1 July 1998. The notifications/statements given
by recipients in response to the newstart allowance or sickness allowance
notices will affect, as appropriate, newstart allowance or sickness allowance
for the period before 1 July 1998 and youth allowance for the period
after 1 July 1998 (eg a prospective cancellation or rate reduction of youth
allowance).
Subclause 110(2) provides for a similar transition from youth
training allowance to youth allowance.
Person of youth allowance age
receiving AUSTUDY living allowance immediately before 1 July
1998
Subclause 110(3) provides for the transition from AUSTUDY living
allowance to youth allowance.
This subclause specifies that, if a person
was in receipt of AUSTUDY living allowance immediately prior to 1 July 1998 and
the person was:
of youth allowance age on that day; or
receiving
rent assistance under the AUSTUDY Regulations; or
a person referred to
in paragraph 68(a) or (b) of the AUSTUDY Regulations;
then the person
does not have to make a claim for youth allowance and the youth allowance is
payable to the person.
Currently, a person under 25 years of age may get
rent assistance under the AUSTUDY Scheme if he or she satisfies the criteria in
regulation 102A. In limited circumstances, a person who receives rent
assistance under paragraph 102A(1)(a) of the Regulations and who subsequently
turns 25 years of age may continue to receive rent assistance until the time
described in paragraph 102B(a) or (b). It is intended that this group of people
should not be transferred to austudy payment on 1 July 1998, but that they
should be transferred to youth allowance, and therefore eligible to receive rent
assistance. New paragraph 110(3)(b) describes such a person and empowers the
transfer.
The use of the phrase "is taken to have been payable" in
subclause 110(3) was specifically included to increase the ambit of this
subclause.
In particular, the subclause covers the situation where a
person was in receipt of AUSTUDY living allowance but it was cancelled prior to
1 July 1998. In such a case, the person would not be automatically transferred
to youth allowance. Subclause 110(3) applies in situations where the
decision to cancel was subject to a review, the decision was overturned and
arrears were payable for the period immediately preceding 1 July 1998.
In such a case, the clause would therefore allow the automatic transfer to youth
allowance.
Subclause 110(4) covers the situation where a person has had a
break in their studies. At present, a person is able to have a break from their
studies for 12 months and still receive rent assistance on resumption of
study under the AUSTUDY rules. However, this will not be the case under the
Social Security Act. People in this group can continue to receive youth
allowance until they finish the course of study they are currently undertaking.
If a person within this group discontinues his or her studies, he or she will no
longer have an entitlement to rent assistance for any future study which may be
undertaken. That is, the person will be assessed in accordance with rules that
pertain to the new austudy payment.
Subclause 110(5) makes it clear that
a person referred to in paragraph (3)(c) who is under 25 on 1 July 1998 is taken
to be independent for the purposes of the new youth allowance.
Pending
claims of youth training allowance etc.
Subclause 110(6) deals with
youth training allowance, newstart allowance, sickness allowance and AUSTUDY
living allowance claims undetermined on 1 July 1998. If a person lodged a claim
for these payments before 1 July 1998 and the claim was not determined before
that date, a determination will be made in respect of the person's entitlement
to the newstart allowance, sickness allowance, youth training allowance or
AUSTUDY living allowance, as appropriate, for the period before 1 July 1998 and
in respect of youth allowance for the period from 1 July 1998. Subclause 110(7)
provides that subclause (6) has effect subject to item 131 of the Part 2
Schedule 11 of this Bill.
111. Austudy payment in place of AUSTUDY
living allowance
Person of austudy age receiving AUSTUDY
living allowance immediately before 1 July 1998
Clause 111 provides
for the transition from AUSTUDY living allowance to austudy payment.
In
particular, this provision applies if a person was in receipt of AUSTUDY living
allowance immediately prior to 1 July 1998 and the person was
not:
receiving rent assistance under the AUSTUDY Regulations;
or
a person referred to in paragraph 68(a) or (b) of the AUSTUDY
Regulations; and
the person is of austudy age on 1 July 1998.
In
such a case, the clause provides that person does not have to make a claim for
austudy payment and the austudy payment is payable to the person from that
date.
A note to subclause 111(1) indicates that a person referred to in
subparagraph 111(1)(a)(i) and (ii) is qualified for youth allowance and not
austudy payment. The transitional arrangements for these people are laid down
in new clause 110.
As in new clause 110, the use of the phrase "is
taken to have been payable" in subclause 111(1) was specifically included
to increase the ambit of this subclause to cover the situation of a person who
has successfully sought a review of a decision to cancel the AUSTUDY living
allowance. Such a person would not have been in receipt of the AUSTUDY living
allowance on 1 July 1998 and thus, the main transitional provisions would not
apply. However, if, as a result of the review, arrears of the AUSTUDY living
allowance are payable for the period when the new youth allowance regime
commences, then new subclause 111(1) will apply to the person to ensure a smooth
transition to the new austudy payment regime.
Pending claims for
AUSTUDY living allowance
Subclause 111(2) deals with applications for
AUSTUDY living allowance that have not been dealt with on 1 July 1998. If a
person lodged an application for this payment before 1 July 1998 and the claim
was not determined before that date, the application has effect on or after that
date as if it were a claim for the new austudy
payment.
112. Pensioner education supplement under the Social
Security Act in place of pensioner education supplement under the Austudy
Regulations
Person receiving pensioner education supplement
immediately before 1 July 1998
New clause 112 applies to
people who were in receipt of pensioner education supplement under the AUSTUDY
Regulations. This clause provides that, where the supplement was payable to a
person immediately prior to 1 July 1998, then, from 1 July, the pensioner
education supplement under the Social Security Act is payable to the person, and
Part 2.24A of the Social Security Act applies to the person. This clause also
deems the person to have made a claim for the pensioner education supplement,
and also that the claim has been granted in accordance with the Social Security
Act.
Pending claims of pensioner education
supplement
Subclause 112(2) deals with applications for pensioner
education supplement under the AUSTUDY scheme that have not been dealt with
on 1 July 1998. If a person lodged an application for this payment before
1 July 1998 and the claim was not determined or dealt with before that
date, the application has effect on or after that date as if it were a claim the
pensioner education supplement under the Social Security
Act.
113. Certain persons receiving benefit PP (partnered) and
pensioner education supplement immediately before 1 July
1998
Clause 113 covers a special group of parenting payments
recipients and is necessary as a result of the introduction of parenting
payment.
Under the parenting payment regime, all partnered people will be
paid under PP (partnered) rules (ie this basically means the former parenting
allowance rules). However, the new parenting payment also includes former
recipients of sole parent pension. All sole parent pensioner (SPP) recipients
will be transferred to parenting payment at the pension PP (single) rate on 20
March 1998 except those who are members of a couple (that is, because they were
a member of an illness separated couple or their partner was in goal
(subparagraphs 249(1)(a)(ii) and (iv) refer)). Current sole parent pension
recipients who are "illness-separated" or "partner in gaol" will be transferred
to PP (partnered). There are about 400 such cases. They will no longer be
regarded as in receipt of a "social security pension", will lose general access
to pharmaceutical allowance and will be subject to the benefits income
test.
However, undertakings were given that all recipients of sole parent
pension who transfer to parenting payment will retain their pensioner education
supplement. Consequently, new clause 113 provides that pensioner education
supplement will continue to be paid to social security recipients in this
situation for the duration of the course, as if the person had made a claim for
the supplement under Part 2.24A of the Social Security Act and the claim had
been granted.
Subclause 113(2) specifies that if the person ceases the
course of study, then the pensioner education supplement ceases to be payable to
the person.
Subclause 113(3) indicates that, for the purposes of Part
2.24A, a person is taken to be receiving a payment attracting pensioner
education supplement if the person had satisfied the requirements in
subparagraph 249(1)(a)(ii) or (iv) of the Social Security Act in force
immediately prior to 20 March 1998. A note after this subclause indicates that
these subparagraphs were repealed by the Parenting Act.
Finally,
subclause 113(4) specifies that, for the purposes of Part 2.24A,
subsection 1061PE(2) is taken to apply to the person. In order to qualify
for a pensioner education supplement, a person must be in receipt of a
qualifying payment. These payments are specified in section 1061PE. Subclause
113(4) deems the payment referred to in this clause to be such a qualifying
payment.
114. Claims for newstart allowance (under 21 years) or
sickness allowance (under 21 years) made on or after 1 July 1998 in respect of
periods before that date
Clause 114 provides that if a person,
who is under the age of 21, lodges a claim for newstart allowance or sickness
allowance on or after 1 July 1998 in respect of a period before that date, a
determination will be made in respect of the person's entitlement to newstart
allowance or sickness allowance for the period before 1 July
1998.
115. Persons under 21 receiving newstart allowance or
sickness allowance on 17 June 1997
Those people who,
immediately before the announcement of the new youth allowance regime on 17 June
1997, were under 21 years of age and receiving sickness allowance or newstart
allowance, can continue to receive sickness allowance or newstart allowance
providing they are still receiving either receiving sickness allowance or
newstart allowance at 1 July 1998, and despite the fact that they would not meet
the new age qualification criterion for those payments.
An additional
requirement is that, in order to benefit from this savings provision, those
people must have been in receipt of either receiving sickness allowance or
newstart allowance during the intervening time. People who are "saved" in this
regard will continue to receiving sickness allowance or newstart allowance under
either the sickness allowance or newstart allowance rules and rates (whichever
is relevant) in force immediately prior to the commencement of youth
allowance.
Thus, clause 115 ensures that these people are not covered by
the new youth allowance regime, and the transitional provisions in clause 110,
which would otherwise automatically transfer the person to youth allowance, do
not apply in this case. In this situation, the person must satisfy the
following criteria in order to be eligible to continue to receive sickness
allowance or newstart allowance:
the person must continue to meet all
the qualification criteria for receiving sickness allowance or newstart
allowance, apart from the age requirement;
if the person's sickness
allowance or newstart allowance is cancelled for a period longer than
6 weeks then the person will no longer be "saved" and will have to apply
for youth allowance under the new rules (subclause 115(2)
refers).
However, it should be noted that a person who was receiving
sickness allowance or newstart allowance at the time of the Government’s
announcement does not necessarily have to remain on sickness allowance or
newstart allowance - that person could elect to transfer to youth allowance
(subclause 115(3) refers).
116. Newstart allowance or sickness
allowance bereavement payments in respect of death of partner
If,
immediately before 1 July 1998, a person was entitled to newstart allowance or
sickness allowance bereavement payments in respect of the death of a partner and
the bereavement period has not ended, the person remains qualified for the
newstart allowance or sickness allowance bereavement payments after 1 July 1998
until the end of the bereavement period as if the relevant bereavement
provisions were still in force. Clause 116 provides for the above arrangement
and exclude the application of subclause 110(1). This means that person will
not be automatically transferred to youth allowance on 1 July 1998. However,
paragraph 116(e) provides that, after the bereavement period expires, the person
is taken to have made a claim for youth allowance.
117. Youth
training allowance bereavement payment in respect of death of
partner
Clause 117 provisions transitional arrangements for a
person who is in receipt of youth training allowance bereavement payments at the
time of the implementation of the new youth allowance regime.
This clause
provides that, if, immediately before 1 July 1998, a person was entitled to
youth training allowance bereavement payments in respect of the death of a
partner and the bereavement period has not ended, the person remains qualified
for youth training allowance bereavement payments after 1 July 1998 until the
end of the bereavement period as if the relevant bereavement provisions were
still in force. Clause 117 also excludes the application of subclause 110(1).
This means that person will not be automatically transferred to youth allowance
on 1 July 1998. However, paragraph 117(e) provides that, after the
bereavement period expires, the person is taken to have made a claim for youth
allowance.
118. Qualification for double orphan pension for certain
young persons who were qualified to receive payments under the AUSTUDY scheme
immediately before 1 July 1998
At present, students under 22 who
receive AUSTUDY may also attract payment of double orphan pension. Income
support recipients under the Social Security Act, however, cannot attract
payment of double orphan pension if they are over 16. Under the new regime,
there will be no concurrent payment of youth allowance and double orphan
pension. However, it is proposed to "save" all current double orphan pension
recipients aged 16 to 21 who are receiving double orphan pension on 1 July 1998
for as long as they are under 22 years of age and full-time students receiving
youth allowance.
New clause 118 gives effect to this intention. Thus, if
a person or an approved care organisation qualified for double orphan pension
under section 999 of the Social Security Act, in relation to a person over the
age of 16, then qualification for the double orphan pension will continue until
the young person turns 22, ceases to be a youth allowance recipient or ceases to
study on a full-time basis.
119. Payment of family allowance -
young person ceasing to be a FA child on becoming youth allowance
recipient
Clause 119 will amend the Social Security Act to
provide a transitional provision which would ensure family allowance recipients
are not disadvantaged by the transfer to youth allowance.
Around 7,200
families whose student children transfer to the youth allowance on
1 July 1998 will receive their last full family allowance instalment
on 18 June 1998. Their next instalment of family allowance would have fallen on
2 July 1998. However, if the family continues to receive family allowance (ie,
if they continue to have an FA child after the implementation of youth
allowance), the payment on 2 July may not include payment for the young person
attracting youth allowance. Moreover, if the young person does attract family
allowance, a lower standard family allowance rate will be paid on the 2 July.
However, at that time, the young person will be entitled to only one days
payment of youth allowance.
Families will be required to wait until 16
July 1998 for their first full instalment of youth allowance to be paid. This
occurs simply because of the different payments cycles for family allowance and
youth allowance.
Clause 119 provides for a one-off, top up payment to
affected families. This payment will be equal to the amount of family allowance
the person would have received in respect of the child, on 2 July 1998 (ie, the
normal family allowance payday) as if the youth allowance had not commenced
operation.
This provision will have no ongoing operation, after the
commencement of youth allowance.
There are two situations where this
transitional provision would apply in relation to youth allowance recipients.
The first is where qualification for family allowance ceases because the child
commences to receive youth allowance, and the family allowance recipient has no
other FA children. The second situation is where the family allowance recipient
has other FA children, and thus continues on payment of family
allowance.
The transitional provision would apply where:
a person
receives an instalment of family allowance on 18 June 1998 (ie, the last family
allowance payday prior to 1 July 1998); and
the person receives family
allowance at a rate in excess of the minimum family allowance rate;
and
after 1 July 1998, a young person ceases to be an FA child of the
person and the young person becomes a youth allowance recipient prior to the
first family allowance payday after 1 July 1998.
In such a case, an
additional payment of family allowance would be paid to the family allowance
recipient equal to the amount of family allowance that the young person would
have attracted on the payday of 18 June.
120. Application - income
maintenance period rules
New clause 120 deals with the
application of youth allowance and austudy payment income maintenance period
rules. Youth allowance income maintenance period rules are specified in points
1067G-H11 (income maintenance period rules in relation to continuing employment)
and 1067G-H12 (income maintenance period in relation to terminated employment) -
item 47, Schedule 2 of this Bill refers). Austudy payment income
maintenance period rules are specified in points 1067L-D5 (income maintenance
period in relation to continuing employment) and 1067L-D6 (income maintenance
period in relation to terminated employment) - item 7, Schedule 1 of this
Bill refers.
Subclauses 120(1), (2), (3) and (4) deal with the
application of youth allowance income maintenance provisions.
Subclauses
120(1) and (2) deal with the application of youth allowance income maintenance
provision in relation to continuing employment (new point 1067G-H11). Subclause
120(1) provides that if a person claims youth allowance on or after
1 July 1998 and the person’s situation is not covered by
subclause 120(2), or if a person who is receiving youth allowance was receiving
the former AUSTUDY allowance immediately before 1 July 1998, new point 1067G-H11
applies to the person but only if the person’s leave period starts on or
after 1 July 1998.
Subclause 120(2) modifies the application of new
point 1067G-H11 to a person to whom youth allowance becomes payable on or after
1 July 1998 and who had an income maintenance period imposed in respect of the
person’s previous payment. Subclause 120(2) provides that if the
determination applying the period had effect immediately before 1 July 1998, or
is to be taken to have had effect immediately before that date, and the period
has not ended when youth allowance becomes payable to the person, point
1067G-H11 applies to the person in respect of a leave period starting on or
after 20 March 1998 (income maintenance period provisions in relation to
continuing employment were introduced by the Parenting Act with effect from
20 March 1998).
Subclauses 120(3) and (4) deal with the application
of youth allowance income maintenance provision in relation to terminated
employment (new point 1067G-H12). Subclause 120(3) provides that if a person
claims youth allowance on or after 1 July 1998 and the person’s
situation is not covered by subclause 120(4), or if a person who is receiving
youth allowance was receiving the former AUSTUDY allowance immediately before 1
July 1998, new point 1067G-H12 applies to the person in respect of any leave
payment received by the person on or after 1 July 1998.
Subclause 120(4)
modifies the application of new point 1067G-H12 to a person to whom youth
allowance becomes payable on or after 1 July 1998 and who had an income
maintenance period imposed in respect of the person’s previous payment.
Subclause 120(4) provides that if the determination applying the period had
effect immediately before 1 July 1998, or is to be taken to have had effect
immediately before that date and the period has not ended when youth allowance
becomes payable to the person, point 1067G-H12 applies to the person in respect
of any leave payment received on or after 20 September 1997 (income maintenance
period provisions in relation to terminated employment were introduced by the
Social Security Legislation Amendment (Budget and Other Measures) Act
1996 with effect from 20 September 1997).
Subclauses
120(5), (6), (7) and (8) deal with the application of austudy payment income
maintenance provisions.
Subclauses 120(5) and (6) deal with the
application of austudy payment income maintenance provision in relation to
continuing employment (new point 1067L-D5). New point 1067L-D5 is equivalent to
youth allowance income maintenance period provision in new point 1067G-H11 in
respect of continuing employment. The application rules for new point 1067L-D5
specified in subclauses 120(5) and (6) are identical to the application rules
specified in subclauses 120(1) and (2) in respect of
point 1067G-H11.
Subclauses 120(7) and (8) deal with the application
of austudy payment income maintenance provision in relation to terminated
employment (new point 1067L-D6). New point 1067L-D6 is equivalent to youth
allowance income maintenance period provision in new point 1067G-H12 in respect
of terminated employment. The application rules for new point 1067L-D6
specified in subclauses 120(7) and (8) are identical to the application rules
specified in subclauses 120(3) and (4) in respect of
point 1067G-H12.
5. Commencement
The amendments in this Schedule will commence on 1 July 1998.
Schedule 11 - Amendment of the Student and Youth Assistance Act 1973, and related transitional provisions
1. Summary of proposed changes
The amendments proposed to be made by Schedule 11 will repeal
Parts 2, 4, 4B and 8 of the Student and Youth Assistance Act and where
appropriate remove or amend references, in that Act, to the AUSTUDY scheme and
youth training allowance. Schedule 11 is structured into two Parts.
Part 1 relates to amendment of the Student and Youth Assistance Act and Part 2
relates to transitional provisions. Even though the title of the Student and
Youth Assistance Act is to be changed to the Student Assistance Act
1973, for the purposes of Schedule 11 of this explanatory
memorandum the current name will be used.
2. Background
The introduction of youth allowance and austudy payment into the Social
Security Act at new Parts 2.11 and 2.11A, respectively, requires consequential
amendments to the Student and Youth Assistance Act. Most of these consequential
amendments relate to the repeal of Part 2 (the AUSTUDY scheme) and Part 8 (youth
training allowance) of the Student and Youth Assistance Act. In addition
transitional provisions deal with those people who have lodged a claim or are
seeking review of a decision made prior to the commencement day in respect of
AUSTUDY or youth training allowance.
3. Clauses and Schedule involved in the changes
Clause 2: provides that the amendments made by Schedule 11
commence on 1 July 1998.
Clause 3: provides that each Act that is
specified in this Schedule is amended as set out in the Schedule.
Part 1 - Amendment of the Student and Youth Assistance Act 1973
Items 1 and 2: amend the title of the Student and Youth Assistance
Act.
Items 3 to 13: amend certain definitions in subsection
3(1).
Item 14: inserts new subsection 3(2A).
Item
15: repeals subsection 5(1) and substitutes a new subsection
5(1).
Item 16: inserts new section 5D.
Item
17: repeals Parts 2 and 4.
Items 18 to 20: amend section
12A.
Items 21 to 23: amend section 12C.
Item
24: amends section 12E.
Item 25: amends subsections 12H(1) and
(2).
Item 26: inserts new subsections 12X(5A) and
(5B).
Item 27: inserts new subsections 12ZF(7A) and
(7B).
Item 28: repeals Part 4B.
Item 29: amends the
heading to Part 6.
Item 30: repeals section 38.
Item
31: inserts new sections 38, 39 and 39A.
Items 32 and
33: amend section 40.
Items 34 to 38: amend section
42.
Item 39: repeals section 43 and substitutes new sections 43,
43A, 43B, 43C, 43D, 43E and 43F.
Item 40: application provision to
the amendments made by items 29 to 39.
Item 41: amends
subsection 44A(1).
Item 42: amends section 48.
Items 43
to 46: amend section 49.
Item 47: amends subsections 50(1) and
(2).
Item 48: amends paragraph 51(1)(a).
Items 49 and
50: amend section 55A.
Items 51 to 54: amend section
56.
Item 55: repeals Part 8.
Items 56 to 58: amend
section 302.
Items 59 and 60: amend section 303.
Items
61 and 62: amend section 304.
Items 63 and 64: amend section
305.
Item 65: repeals section 307.
Items 66 to
68: amend section 309.
Items 69 and 70: amend section
311.
Item 71: repeals section 312.
Item 72: repeals
section 313 and substitutes a new section 313.
Items 73 and
74: amend section 314.
Item 75: repeals section
315.
Items 76 to 81: amend section 316.
Item
82: repeals section 317.
Items 83 to 85: amend section
318.
Item 86: repeals section 319.
Item 87: repeals
subparagraph 320(1)(a)(iii).
Item 88: repeals subsection
322(2).
Items 89 to 91: amend section 323.
Item
92: repeals section 326.
Items 93 to 95: amend section
331.
Item 96: amends section 334.
Items 97 and
98: amend section 335.
Item 99: repeals section
337.
Items 100 to 102: amend section 338.
Item
103: repeals section 338A.
Items 104 and 105: amend section
339.
Items 106 and 107: amend section 341.
Item
108: repeals subsection 343(2).
Item 109: repeals subsection
344(2).
Item 110: repeals subsection 345(2).
Item
111: repeals section 346.
Items 112 to 117: amend section
347.
Item 118: amends section 348.
Item 119: repeals
section 349.
Items 120 and 121: amend section 351.
Item
122: amends Note 2 of section 352.
Item 123: amends paragraph
353(b).
Item 124: amends section 354.
Item
125: amends paragraph 355(1)(a).
Item 126: repeals Note 4 of
section 358.
Items 127 and 128: amend section 359.
Item
129: repeals Schedules 1, 2, 3 and 5.
Part 2 - Transitional provisions
Item 130: defines certain terms for the purposes of the
transitional provisions.
Item 131: provides the transitional
provisions for the payment of AUSTUDY for the period ending 3 July
1998.
Item 132: provides that in circumstances where either a
customer lodged an application for AUSTUDY but that application had not been
considered prior to the commencement day, or the person lodges a claim for youth
training allowance on or after the commencement day for a period prior to the
commencement day, or a person lodges a claim for AUSTUDY on or after the
commencement day for a period prior to the commencement day, then the
application will have effect as if the Student and Youth Assistance Act
continued in force.
Item 133: provides that where a decision is
made under the Student and Youth Assistance Act prior to the commencement day,
the Employment Secretary, the Social Security Appeals Tribunal (the SSAT) or the
Administrative Appeals Tribunal (the AAT) or an Authorised Review Officer (ARO)
will review that decision as if the Student and Youth Assistance Act immediately
before the commencement day continued in force.
Item 134: provides
that where a decision is made on or after the commencement day in relation to
the AUSTUDY scheme under Part 6 of the Student and Youth Assistance Act or the
Student and Youth Assistance Act as continued in force because of this Part, the
person in respect of whom the decision is made will have all the rights of
review that would have been available to them had the Student and Youth
Assistance Act immediately prior to the commencement day continued in
force.
Item 135: provides that where prior to the commencement day
an amount being a debt due to the Commonwealth was able to have its recovery
waived under subsection 43(2) of the Student and Youth Assistance Act as
previously in force.
4. Explanation of the changes
Part 1 - Amendment of the Student and Youth Assistance Act 1973
The repeal of Part 8 of the Student and Youth Assistance Act (see item
55) necessitates that the name of the Act be changed. Items 1 and 2
change the Title and name of the Act.
Items 3, 4, 6 and 12,
respectively, repeal the definitions of education institution,
higher education institution, secondary school and
technical and further education institution and substitute new
definitions so that these new definitions reflect the new arrangements to be put
in place following the repeal of the AUSTUDY scheme. The new definitions will
enable the Minister for Employment, Education, Training and Youth Affairs to
make determinations in respect of these definitions.
Items 5, 18 to
22, 24, 25, 41, 49, 51 to 53, 56, 66 and 89, respectively, omit redundant
references to "the AUSTUDY scheme" in the definition of prescribed
benefit in subsection 3(1), subsections 12A(1) and (2), subparagraphs
12C(1)(b)(i) and (ii), section 12E, subsections 12H(1) and (2), subsection
44A(1), paragraphs 55A(1)(a), 56(a), 56(ab), 56(e), 302(a), 309(a) and
323(a).
The definitions of student assistance and
youth training allowance overpayment in subsection 3(1) are
repealed at items 7 and 13 because both are redundant following the
repeal of Parts 2 (see item 17) and 8 (see item 55) of the Student
and Youth Assistance Act.
Item 8 is consequential on item
17, which repeals Part 2 of the Student and Youth Assistance Act (Part 2
provides for the AUSTUDY scheme).
The amendment will insert a reference
to the AUSTUDY scheme as in force before 1 July 1998, the date when
Part 2 is to be repealed. The transitional provisions in Part 2 of
Schedule 11 to this Bill will therefore apply so that the definition of
student assistance benefit includes AUSTUDY payments that relate
to a period before 1 July 1998 but that are paid after that
date.
Item 9 is consequential on item 17, which repeals
Part 2 of the Student and Youth Assistance Act (Part 2 provides for the AUSTUDY
scheme).
Item 9 will amend paragraph (b) of the definition of
student assistance benefit so that the definition includes the
Student Financial Supplement Scheme as in force before 1 July 1998
(the date on which Part 4A will be amended so as to apply only to ABSTUDY
students). The definition will therefore include payments under the Supplement
Scheme as it applies in relation to the AUSTUDY scheme (including any payments
that relate to a period before 1 July 1998 but that are paid after that
date).
Item 10 is consequential on item 17, which repeals
Part 2 of the Student and Youth Assistance Act (Part 2 provides for the AUSTUDY
scheme).
The amendment will insert a reference to the AUSTUDY scheme as
in force before 1 July 1998, when Part 2 is to be repealed. The
transitional provisions in Part 2 of Schedule 11 to this Bill will
therefore apply so that the definition of student assistance overpayment
includes overpayments that relate to a period before 1 July 1998 but
that are paid after that date.
Item 11 is consequential on item
17, which repeals Part 2 of the Student and Youth Assistance Act (Part 2
provides for the AUSTUDY scheme).
Item 11 will amend paragraph (b)
of the definition of student assistance overpayment. This refers
to payments that are made under the Student Financial Supplement Scheme and that
occur because the debtor failed to meet statutory obligations to advise a change
in his or her circumstances or because false or misleading information was
provided. Such overpayments may be immediately payable, in contrast to normal
Supplement Scheme debts (which have a deferred repayment
arrangement).
Under the amendment, paragraph (b) will include debts of
this kind that relate to the Supplement Scheme as in force before 1 July 1998,
when Part 2 is to be repealed. The transitional provisions in Part 2 of
Schedule 11 to this Bill will therefore apply so that paragraph (b) includes any
such overpayments that were made under the Supplement Scheme in relation to
AUSTUDY (including any overpayments that relate to a period before 1 July 1998
but that are paid after that date).
A new subsection 3(2A) is inserted by
item 14 which will ensure that any determination by the Minister for
Employment, Education, Training and Youth Affairs in respect of the definitions
of education institution, higher education
institution, secondary school and technical and
further education institution (see items 3, 4, 6 and 12) is a
disallowable instrument for the purposes of section 46A of the Acts
Interpretation Act 1901.
Item 15 repeals subsection 5(1)
and substitutes a new subsection that removes the previous limitations imposed
upon the Crown.
Item 16 inserts a new section 5D which allows the
Minister for Employment, Education, Training and Youth Affairs to determine
secondary and tertiary education courses. The Minister's determination is a
disallowable instrument for the purposes of section 46A of the Acts
Interpretation Act 1901. At present the Minister has this power under
paragraph 7(1)(c). Subsection 7(6) currently provides that the determination
under paragraph 7(1)(c) is a disallowable instrument for the purposes of section
46A of the Acts Interpretation Act 1901. This paragraph and
subsection were in Part 2 (AUSTUDY Scheme) which is repealed by item 17.
New subsection 5D(2) saves the determination that was in force immediately
before the day the section commences.
Item 17 repeals Part 2 and
Part 4 which are no longer required.
Item 23 repeals subsection
12C(2). It linked to subsections 7(3) to 7(7) in Part 2 which provided that a
course may be undertaken away from the educational institution offering the
course. They also provided for the Minister for Employment, Education, Training
and Youth Affairs to determine specific places where this may not occur and for
any Determination so made to be a disallowable instrument for the purposes of
section 46A of the Acts Interpretation Act 1901. As Part 2 is
repealed by item 17, these provisions are now inserted by the new
subsection 12C(2). Part 4A will continue to apply to the Student Financial
Supplement Scheme related to ABSTUDY.
Subsection 12C(2) is repealed and
substituted by a new subsection 12C(2) by item 23. The new subsection
allows a person undertaking a course to do so at a place other than the
institution where the course is being offered. The Minister will be able to
determine a place or a class of place where a person may be undertaking a course
is a place or class of place that is considered to wholly within the institution
where the course is offered. The Minister's determination is a disallowable
instrument for the purposes of section 46A of the Acts Interpretation Act
1901.
Item 26 inserts a new subsection 12X(5A) to provide
that, before each 1 June, the indexation factor worked out under subsection
12X(4) in relation to the period of 12 months commencing on that day must be
published in the Gazette. Subsection 12X(5A) replaces subsection 12ZZB(3)
in Part 4B which is repealed by item 28. Item 26 also inserts new
subsection 12X(5B) which provides that an indexation factor gazetted under
subsection 12ZZB(3) before the commencement day of this Act is taken to be an
indexation factor published under subsection (5A).
Item 27 inserts
a new subsections 12ZF(7A) to provide that, before each 1 June, the indexation
factor worked out under subsection 12ZF(6) that is applicable in working out
Financial Supplement debts and accumulated Financial Supplement debts incurred
on the 1 June concerned must be published in the Gazette. Subsection 12ZF(7A)
replaces subsection 12ZZB(4) in Part 4B which is repealed by item 28.
Item 27 also inserts new subsection 12ZF(7B) which provides that an
indexation factor gazetted under subsection 12ZZB(4) before the commencement day
of this Act is taken to be an indexation factor published under subsection
(7A).
Part 4B of the Student and Youth Assistance Act which provides for
indexation for the AUSTUDY scheme is repealed by item 28.
Item
29 reflects extensive drafting changes to be made to the provisions relating
to overpayments under student assistance schemes.
• A number of the
proposed changes will be consequential on the repeal of the AUSTUDY scheme under
the Student and Youth Assistance Act.
• At present, provisions on
the write off and waiver of debts are placed in Part 8 of the Student and Youth
Assistance Act, which deals with the youth training allowance, but are deemed to
apply also to debts under student assistance schemes. Because of the repeal of
the youth training allowance, these provisions will be re-located to Part 6 of
the Student and Youth Assistance Act, which provides a debt management regime
for student assistance schemes.
The heading of the existing Part 6 is
Overpayments under this Act and under certain other Acts and
Administrative Schemes. The heading is to be repealed and a new heading
inserted. The new heading in effect omits the reference to other
Acts, to reflect item 30 which will repeal section 38 of the
Student and Youth Assistance Act (section 38 enables the recovery of certain
overpayments by withholding payments of a benefit under student assistance).
(The reference in the heading to Overpayments under .. Administrative
Schemes refers to special educational assistance scheme overpayments.
These are overpayments under non-legislated, administrative schemes such as
ABSTUDY (see the definition of special educational assistance scheme
overpayments in subsection 3(1) of the Student and Youth Assistance
Act.))
The new Part 6 will include three
Divisions:
• Division 1 - Debts recoverable by the Commonwealth
(see item 32);
• Division 2 - Recovery of debts (see item
32);
• Division 3 - Non-recovery of debts (see item
40).
Item 40 provides that all the amendments relating to the
Part 6 will apply to debts that arose before 1 July 1998, as well as to any
debts arising after that date.
Section 38 the Student and Youth
Assistance Act applies where a person is entitled to AUSTUDY and has an
overpayment under the Student and Youth Assistance Act, under a non-legislative
student assistance schemes, or under Social Security or Veterans' Entitlement
legislation. The section enables the overpayment to be recovered by withholding
from the AUSTUDY entitlements.
Section 38 will be repealed, consequential
on the repeal of AUSTUDY under the Student and Youth Assistance Act. (However,
section 38 will continue to apply where a person is paid AUSTUDY under the
transitional provisions in Part 2 of Schedule 11.)
As
explained in relation to item 29, Part 6 is to be divided into three
Divisions. Item 31 will insert Division 1 of Part 6. Division 1
will define what debts are dealt with by Part 6 (new section 38) and will
provide that these debts are recoverable by the Commonwealth (new section
39).
A new section 38 is to be inserted into Part 6. The new section
will define debt, so as to indicate the ambit of Part 6. The
debts dealt with by Part 6 are:
(a) special education assistance scheme
overpayments. This expression is defined in subsection 3(1) of the Student and
Youth Assistance Act and refers to overpayments under non-legislated schemes
such as ABSTUDY;
(b) student assistance overpayments. This expression is
also defined in subsection 3(1) (see also the amendments to be made by
items 10 and 11). The definition refers to overpayments under the former
AUSTUDY scheme or the Financial Supplement;
(c) debts that arise in
relation to an overpayment. The definition refers in particular to debts
arising under section 40 (late payment charge or interest on an outstanding
debt) and to debts arising under subsection 42(10) (a debt incurred by a person
who refuses to comply with a garnishee notice).
The proposed definition
of debt provides that it applies to debts that arose before and
after the commencement of the new Part 6.
A new section 39 is to be
inserted into Part 6. The new section will state that debts covered by Part 6
are debts recoverable by the Commonwealth.
The amendment in effect will
move the provisions of existing subsection 40(1) to Division 1 of Part 6.
(Section 41 deals mainly with the late payment charge and interest on
outstanding debts, so that the general provision about debts being recoverable
is more appropriately placed in new Division 1.)
A new Division 2,
Recovery of debts, is to be inserted in Part 6. Division 2 will deal
with approval for repayment by instalments (new section 39A), late payment
charge and interest on outstanding debts (existing sections 40 and 41), and
garnishee action (section 42).
The new section 39A will repeat the
provisions of existing section 284 of the Student and Youth Assistance Act,
which authorises the recovery of debt by instalments (see the notes on the
repeal of existing section 43 for why the provisions of section 284 need to be
restated in this way).
The normal means for the payment of a debt is by a
one-off payment, but the section authorises an agreement to accept payment by
instalments and so defer the Commonwealth's right to recover the
debt.
New subsection 39A(3) will preserve any arrangement that were made
under section 284 for instalments to pay debts relating to a student
assistance schemes.
Item 32 will redraft subsection 40(1) to
reflect the insertion of the new section 39 (inserted by item 31). (The
existing subsection 40(1) provides that student assistance overpayments and
special educational assistance scheme overpayments are debts owed to the
Commonwealth. This provision is more appropriately placed in the new
section 39, rather than in section 40, which deals with late payment
charges and interest on outstanding debts.)
Item 33 is
consequential on the insertion of the new section 39A, and amends existing
subsection 40(5) to replace references to existing sections 284 and 43 with a
reference to the new section 39A. (Existing subsection 40(5) provides that
interest is not payable if an arrangement has been made to repay an overpayment
by instalments. At present, subsection (5) refers such arrangements as being
made under section 284, as applied by section 43, but new section 39A will
replace section 284.)
Item 34 will repeal existing subsection
42(1), which defines recoverable amount. This definition will no
longer be needed, as references to recoverable amount will be
replaced by references to debt (see the amendments to be made by
items 35 to 38). The definition of debt will be in new
section 38 (see item 31). (Section 42 authorises the use of garnishee
action to recover debts relating to student assistance schemes.)
Items
35, 36 and 37 will amend provisions in existing section 42 to replace
references to recoverable amount with references to
debt (see notes on item 34).
Item 38 will
repeal existing subsection 42(13) and substitute a new subsection. The
amendment is consequential on the changes to be made by item 34. (The
existing subsection 42(13) provides a procedure that can be adopted where a
person has more than one debt relating to student assistance schemes. The
amendment makes no change to this procedure.)
Existing subsection 43(2)
enables the write off or waiver action for debts relating to a student
assistance scheme. It achieves this by providing that section 284 and
Subdivision D of Division 15 of Part 8 apply to such debts.
Part 8 deals
with youth training allowance and is to be repealed (see item 55). It is
therefore necessary to insert provisions corresponding to section 284 and
Subdivision D of Division 15 into Part 6, which deals with overpayments
under the student assistance schemes.
Two provisions of Subdivision D
will not be incorporated into the new Part 6:
• section 286 defines
debt for the purposes of Subdivision D. The new section 38, to be
inserted by item 31, will define debt in relation to
student assistance schemes;
• section 291 enables the revocation of
interest on outstanding debts relating to youth training allowance. Existing
section 41 already covers this in relation to student assistance
schemes.
Part 6 is to be divided into three Divisions (see notes on
item 27). Item 39 will insert the third of these, Division 3,
which will provide for situations where it is not possible to recover debt and
will provide for write off and waiver of debts.
The new section 43 will
enable write off action to be undertaken for debts relating to a student
assistance scheme (debt will be defined in the new section
38).
New section 43 will restate the provisions of existing section 287,
as applied to Part 6 by existing section 43. The notes on the repeal of
existing section 43 explain why the provisions of section 287 need to be
restated in this way.
Write off is an administrative action and indicates
that a debt is regarded, for accounting purposes, as being a "bad debt", that
is, as not being likely to be recovered. As the note to the new section 43
indicates, write off does not involve a surrender of the right to recover the
debt and, if a debtor's financial situation improves, recovery action might well
be taken to recover the debt.
A new section 43A will be enable waiver of
debts relating to a student assistance scheme (debt will be
defined in the new section 38).
New section 43A will restate the
provisions of existing section 288, as applied to Part 6 by existing
section 43. The notes on the repeal of existing section 43 explain why the
provisions of section 288 need to be restated in this way.
As the note to
the new section 43A indicates, waiver is a legal surrender of the right to
recover a debt and therefore differs from write off, which is a purely
administrative decision that a debt is not recoverable.
The new section
43B will require waiver of a debt relating to a student assistance scheme where
the debt arises solely because of administrative error. Waiver will only apply,
however, if there is a delay of at least 6 weeks before the debt is raised, or
of at least 6 weeks after the period in which the customer was required to
provide information about his or her situation. (Debt will be
defined in the new section 38.)
New section 43B will also require waiver
where a debt arises because a person (the customer or a partner or parent) gave
an incorrect estimate of an asset's value but the person acted in good faith and
it was difficult to give an accurate valuation.
New section 43B will
restate the provisions of existing section 289, as applied to Part 6 by
existing section 43. The notes on the repeal of existing section 43 explain why
the provisions of section 289 need to be restated in this way.
New
subsection 43B(5) will define parent and partner, to
preserve the meanings they have in existing section 289. (For the purposes of
existing section 289, parent is defined by subsection 58(1) and
partner takes the definition in the Social Security Act by virtue
of section 57.)
The new section 43C will require waiver of a debt
relating to a student assistance scheme where a court has imposed a longer
prison or other custodial sentence because the debtor has not repaid the debt.
(Debt will be defined in the new section 38.)
New section
43C will restate the provisions of existing section 290, as applied to
Part 6 by existing section 43. The notes on the repeal of existing section
43 explain why the provisions of section 290 need to be restated in this
way.
The new section 43D will require waiver of a debt relating to a
student assistance scheme if it is a small debt, ie is less than $50, and
if it is not cost effective to recover the debt. (Debt will be
defined in the new section 38.)
New section 43D will restate the
provisions of existing section 290A, as applied to Part 6 by existing section
43. The notes on the repeal of existing section 43 explain why the provisions
of section 290A need to be restated in this way.
Under existing
subsection 43(3), existing section 290A applies to Part 6 as if the cut off
level is $50 (the cut off is $200 as section 290A applies in relation to the
youth training allowance). Subsection 43A also provides that subsection 290A(2)
does not apply in relation to Part 6 (subsection 290A(2) provides for the
waiver of debts over $50 that can be recovered by withholding from the debtor's
youth training allowance).
The new section 43E will require waiver of a
debt relating to a student assistance scheme where an agreement has been made
that the debtor will make a partial payment and that this will be accepted in
full satisfaction for the debt.
Agreements may be in relation to a civil
action that has been commenced (subsection 43E(1)), in relation to an
action that has been taken to the Administrative Appeals Tribunal (subsection
43E(2)), or in relation to a debt that has at least 80% paid off if the debtor
cannot pay any more (subsection 43E(3)).
In addition, subsection 43E(4)
deals with an offer that does not come in the preceding subsections. Subsection
43E(5) provides waiver can proceed under subsection 43E(4) only
if:
• the debtor cannot pay more than the proposed payment at the
time of the agreement (paragraph (a));
• the partial payment is at
least equal to the value of the remaining debt as discounted to take account of
its overall value if it were paid by instalments ((paragraph (b) and subsection
43E(5));
• it would take at least 12 months to recover the debt by
instalments (paragraph (c)).
New section 43E will restate the provisions
of existing section 290B, as applied to Part 6 by existing section 43. The
notes on the repeal of existing section 43 explain why the provisions of section
290B need to be restated in this way.
Item 134 in Part 2 of Schedule
11, provides a transitional provision where an agreement has been reached
under existing section 290B in relation to a debt relating to a student
assistance scheme but the necessary administrative action was not taken to waive
the debt before the repeal of section 290B. Under item 134, the
obligation to waive the debt will continue and will be exercised by the
Secretary to Department of Employment, Education, Training and Youth Affairs.
(In practice, Centrelink would waive the debt under a delegation authorised by
existing section 338 of the Student and Youth Assistance Act.)
The new
section 43F will enable waiver of a debt relating to a student assistance scheme
where there are special circumstances. Unlike the other waiver provisions,
section 43C will be discretionary.
Waiver under section 43F will not
apply if false or misleading information was provided or there was a failure to
comply with an obligation under the Act (eg the obligation under existing
section 48 to advise of a change in circumstances).
Further, waiver under
section 43F will not apply only because the debtor is in financial hardship. If
the debtor is not able to make repayments because of his or her financial
situation, write off action could be undertaken; for this reason, paragraph
43F(c) will provide that waiver is not to apply if write off action is more
appropriate. (Write off action will be taken under new section 43.)
New
section 43F will restate the provisions of existing section 290C, as applied to
Part 6 by existing section 43. The notes on the repeal of existing section
43 explain why the provisions of section 290C need to be restated in this
way.
Item 40 refers to the amendments to be made by items 29 to
39, which deal with debts relating to student assistance schemes. Item
40 ensures that the amendments apply both to debts arising on or after 1
July 1998 and to debts that arose before that date.
Items 42, 44, 46,
47, 57 to 59, 61, 62, 65, 67 to 69, 71, 75, 78 to 87, 90, 91, 99, 106 to 117,
126, 127 and 129 are all technical amendments to the Student and Youth
Assistance Act that are necessary because of the repeal of Part 8 (youth
training allowance) (see item 55). The amendments deal with omitting
references to Part 8 and replacing these with new references (item 42),
just omitting references to Part 8 (items 44, 46, 47 and 106),
repealing various sections, subsections, paragraphs, Notes and Schedules
(items 58, 59, 61, 65, 68, 69, 71, 75, 78, 80 to 82, 84 to 87, 91, 99, 107 to
111, 114, 115, 126, 127 and 129) and amendments consequential upon the
repeal of sections, subsections and paragraphs (items 57, 62, 67, 79, 83, 90,
112, 113, 116 and 117).
Item 48 will amend section 51, which
provides for evidentiary certificates to be given in legal proceedings to
confirm that payments were made under the Student and Youth Assistance Act
(except in relation to youth training allowance under Part 8) and under special
educational assistance schemes, such as ABSTUDY. Evidentiary certificates can
also be given to confirm that a notice has been issued under the Student and
Youth Assistance Act.
The amendment will amend section 51 to include a
reference to payments under the Student and Youth Assistance Act as in force
before 1 July 1998, the date when Part 2 is to be repealed. This means that,
under the transitional provisions in Part 2 of Schedule 11 to the Bill,
evidentiary certificates may be given confirming that a payment of student
assistance under the Student and Youth Assistance Act that relates to a period
before 1 July 1998 but that is paid after that date.
Subsection 55A(1AA)
is repealed and substituted with a new subsection by item 50 that
provides that the transitional provisions of Part 2 of Schedule 11 is
appropriated as necessary from the Consolidated Revenue Fund.
Items 51
and 52 omit references to the AUSTUDY scheme from the regulation making
powers contained in section 56 in relation to the furnishing of information
required to calculate a benefit under the AUSTUDY scheme. These amendments are
consequential on item 17 which repeals the AUSTUDY Scheme.
Item
53 omits the regulation making power in relation to the times at which, the
manner in which and the persons to whom benefits under student assistance are to
be paid. The power will not be required as a consequence of the repeal of the
AUSTUDY scheme.
Item 54 inserts two new regulation making powers
in relation to matters pertaining to a period before 1 July 1998 that may arise,
or be dealt with, after 30 June 1998.
New subsection 56(2) will enable
regulations to be made in relation to any transitional matters arising out of
the abolition of the youth training allowance, the AUSTUDY scheme and that part
of the Student Financial Supplement Scheme that is in connection with the
AUSTUDY scheme, and their replacement by amounts payable under the Social
Security Act (see Part 2 - Transitional provisions). A transitional
matter would also include a saving or an application provision.
New
subsection 56(3) will enable regulations to be made, in spite of any other
provisions in this Act or any other Act, so that:
• a person may be
paid a benefit under the AUSTUDY scheme (as previously in force under this Act)
in respect of a period ending at the end of 3 July 1998 in specified
circumstances; and
• such a payment to be disregarded in
determining the person’s entitlement to any youth allowance or austudy
payment under the Social Security Act; and
• the receipt by the
person of any youth allowance or austudy payment under that Act to be
disregarded in determining the person’s entitlement to the AUSTUDY scheme
payment referred to above (see item 130 in Part 2).
The specified
circumstances could include a situation in which a person establishes their
eligibility for the AUSTUDY scheme for the period 1 July to 3 July 1998 after
the commencement day. Examples would include the finalisation of a person's
application for AUSTUDY if it relates to a period which commenced before the
commencement day or a review decision on or after that day.
The purpose
of the regulation making power would be to make regulations that could modify
the effect of provisions in Part 2 which generally provide that payments could
only be made up to the commencement day. The regulations would authorise the
AUSTUDY scheme payments for the period to students in the circumstances
contemplated for instance by item 132, 133 and 134 in Part 2 for the
period 1 July to 3 July 1998. The regulation making powers are intended to
complement the provision in Part 2 of Schedule 11 at item 131 which
authorises the payment of AUSTUDY for a period ending on 3 July 1998 for
recipients who already receive AUSTUDY prior to the commencement
day.
While the new subsection 56(3) provides a widened regulation making
power that would override the effect of transitional provisions in Part 2 of
Schedule 11 of the Bill, the scope of the power is very limited and the
purpose of the regulation is beneficial for students. The regulation making
power would also allow the making of regulations to treat a person who receives
AUSTUDY for the period up to and including 3 July 1998 consistently for example
with those persons who receive AUSTUDY as a result of the transitional
provisions in item 132.
Item 55 repeals Part 8 which is no
longer required.
Item 60 repeals subsection 303(2) and substitutes
a new subsection that provides that a decision of the Secretary to the
Department of Employment, Education, Training and Youth Affairs in respect to
the Secretary's powers to settle proceedings before the AAT is a decision that
cannot be reviewed. The new subsection is required because current paragraphs
(a) to (d) all related to youth training allowance.
Items 63, 73 and
77 omits references to "the AUSTUDY scheme, Financial Supplement and youth
training allowance" and substitutes references to "Financial Supplement" in
subsections 305(1), 314(1) and paragraph 316(5)(b). Related items 64 and
74 repeal the definition of adverse decision in subsections
305(5) and 314(6) and substitute new definitions that refer to decisions to stop
the payment of Financial Supplement to a person.
Item 70 repeals
subsection 311(3) and substitutes a new subsection that provides that an
application to the SSAT for review of a decision must be made within 3 months or
such longer period, as the Secretary to the Department of Employment, Education,
Training and Youth Affairs, in special circumstances, allows. The new
subsection simply redrafts the current provisions after omitting the reference
to youth training allowance.
Section 313 prescribes which decisions are
unable to reviewed by the SSAT. Item 72 repeals and substitutes this
section so that it conforms with the changed arrangement following the repeal of
the AUSTUDY scheme and youth training allowance.
Item 76 repeals
subsections 316(2) and (3) and substitutes new subsection (2) which will provide
how the SSAT is to deal with a Financial Supplement decision if that tribunal
sets aside a decision that is subject to review.
The repeal of youth
training allowance also means that the Secretary to the Department of Social
Security will, from 1 July 1998, have no administrative responsibility under the
Student and Youth Assistance Act. Accordingly, items 88, 92 to 94, 96 to 98,
100 to 103, 105, 118 to 125 and 128 remove all references to the Secretary
to the Department of Social Security and to that Department, where necessary, by
either amending the relevant provision or by repealing the section, subsection
or paragraph. Item 104 is a technical amendment required because of the
repeal of subsection 339(2) (item 105).
Item 95 is also a
technical amendment and it is made at this time because the reference to
paragraph 128(1)(a) of the Social Security Act is incorrect. The correct
reference is paragraph 1281(1)(a).
Part 2 - Transitional provisions
The transitional provisions provide for the treatment of people who
request a review of a decision that was made under the Student and Youth
Assistance Act prior to the commencement day, and who have either not requested
a review of that decision until after that date or who have an unfinalised
review in process at that time.
Item 130 adds to the range of
definitions relating to these transitional provisions. By specifically
identifying an "applicable decision" as a decision made by an officer under the
Student and Youth Assistance Act, the application of this Part is limited to
decisions made prior to the commencement day, unless an exception is specified.
The definition provides that where the applicable decision relates to the
AUSTUDY scheme or the Student Financial Supplement Scheme, to the extent that it
is in connection with the AUSTUDY scheme, then the Secretary referred to is the
Secretary to the Department of Employment, Education, Training and Youth
Affairs. Where the decision is in relation to youth training allowance, the
Secretary referred to is the Secretary to the Department of Social
Security.
Specifically, item 130 introduces the following
definitions that apply in Part 2:
• SA Act means the
Student Assistance Act and includes any regulations in force under that Act. In
relation to the transitional provisions this includes the Student and Youth
Assistance Act and any relevant regulations, for example the AUSTUDY
regulations, immediately in force before the commencement
day;
• AAT means the Administrative Appeals
Tribunal;
• applicable decision means a decision by
an officer under the SA Act as in force at any time before 1 July 1998 in
relation to AUSTUDY, the youth training allowance or the Student Financial
Supplement Scheme as it relates to AUSTUDY;
• authorised
review officer means an authorised review officer under the SA
Act;
• commencement day means 1 July
1998;
• officer has the same meaning as in the SA
Act;
• Secretary means the Secretary to the
Department of Employment, Education, Training and Youth Affairs in relation to
an applicable decision about the AUSTUDY scheme or the Student Financial
Supplement Scheme and the Secretary to the Department of Social Security in
relation to the youth training allowance; and
• SSAT
means the Social Security Appeals Tribunal.
Part 2 of the Student and
Youth Assistance Act, which establishes the AUSTUDY scheme is repealed by
item 17 of the Bill. It is intended that on 30 June 1998 students will
be paid their final AUSTUDY payment under the AUSTUDY scheme. The final payment
will also include a payment in respect of the period 1 July 1998 to 3 July 1998
inclusive. The purpose of this item is to authorise and make lawful this
payment despite the repeal of Part 2 of the Student and Youth Assistance Act
under item 17 of the Bill.
AUSTUDY students are paid fortnightly
in respect of a period 11 days in arrears and 3 days in advance of the payday.
Payments under the youth allowance and new austudy payment will also be
fortnightly but they will be paid wholly in arrears.
It was apparent that
when AUSTUDY students transferred on 1 July 1998 to the new income support
arrangements they would face a "short pay". The last AUSTUDY pay day would fall
on 30 June (one day earlier than usual because AUSTUDY would be replaced by the
new income support arrangements from 1 July 1998 which would have otherwise been
the payday) and would be for only the 10 previous days.
The short pay had
the potential to inflict hardship and, at least, budgeting difficulties for
students trying to meet their accommodation and living cost commitments from the
funds provided by the 30 June payday. Therefore, it was decided that the final
pay on 30 June 1998 would cover the period 10 days in arrears and four in
advance to 3 July 1998, the AUSTUDY pay period that would have applied
had the youth allowance not been introduced. This effectively creates an
overlap of three days with the new income support arrangements (1 July through 3
July).
Item 131(1) provides that if a payment of benefit under the
AUSTUDY scheme would have been made to a person in respect of a period before 1
July 1998 in respect of a period that ends on 3 July 1998 then that payment,
will be lawfully made under the Student and Youth Assistance Act despite the
repeal of Part 2. This item authorises the payment of an amount of AUSTUDY that
relates to a period after the repeal of the scheme despite the fact that the
scheme is to be repealed from 1 July 1998.
It should be noted that the
provisions of the Student and Youth Assistance Act (which includes the AUSTUDY
Regulations) apply to this payment as if the relevant parts of the Act were in
force immediately before commencement day.
Subitem 131(2)
clarifies that the payment may be included in the calculation of an AUSTUDY
overpayment that might be the subject of recovery under Part 6 of the Student
and Youth Assistance Act in the future.
Subitem 131(3) provides
that a payment of AUSTUDY to a person under subitem 131(1) would not
affect his or her entitlement to a youth allowance or austudy payment under the
Social Security Act for period and, conversely, if a person receives a youth
allowance or austudy payment for the period 1 to 3 July 1998, he or she would
not be prevented from receiving a payment under the AUSTUDY scheme under
subitem 131(1). The AUSTUDY regulations immediately in force prior to
the commencement day and the Social Security Act prohibit a person being
entitled or able to receive multiple Commonwealth benefits.
Part 2 makes
transitional provisions for the payments of amounts under the AUSTUDY scheme for
the period ending on 3 July 1998, claims and applications, the review of
decisions that were made prior to the commencement day, the review of decisions
made on or after the commencement day, and obligations to waive the right to
recover amounts.
Item 132 provides that claims and applications
for AUSTUDY or youth training allowance can be dealt with on or after the
commencement day of this Act in specific circumstances.
Subitem
132(1) enables an application for AUSTUDY that is:
• lodged
before the commencement day in respect of a period commencing before that day;
and
• not dealt with before the commencement day;
to be
dealt with on or after the commencement day as if the Student and Youth
Assistance Act continued in force.
Subitem 132(2) enables a claim
for youth training allowance that is lodged on or after the commencement day in
respect of a period commencing before that day to have effect as if it had been
made immediately before the commencement day as if the Student and Youth
Assistance Act in force immediately before that day had continued in
force.
Subitem 132(3) enables an application for AUSTUDY or
Financial Supplement in connection with AUSTUDY, that is lodged on or after the
commencement day in respect of a period commencing before that day to have
effect as if it had been made immediately before the commencement day as if the
Student and Youth Assistance Act in force immediately before that day had
continued in force.
Subitem 132(4) provides that nothing in this
section will enable AUSTUDY to be paid for a period after the commencement day
(see item 131 and item 54).
Item 133 outlines the
procedures relating to the review of a decision made prior to the commencement
day under the Student and Youth Assistance Act. The general purpose of this
provision is to preserve any review rights that could or did accrue prior to the
commencement day. In general terms the relevant law would the law that would
have applied in the particular circumstances of an applicable decision as
described in the item. Where the Secretary to the Department of Employment,
Education, Training and Youth Affairs (the Employment Secretary) may have
reviewed a decision under section 303, prior to the commencement day, but did
not do so, then the Secretary may review that decision, and that review and any
subsequent review of that decision will have effect until the commencement day
as if that Act continued in force as it was immediately prior to the
commencement day.
If the person to whom an "applicable decision" relates
may have applied to the Employment Secretary, the SSAT or the AAT for a review
of that decision under the Student and Youth Assistance Act, but did not do so,
they may make the application for review after the commencement day (subject to
any time limitation regarding such an application). The outcome of that review
and any subsequent review of that decision will have effect, prior to the
commencement day, as if that Act as in force immediately before that day had
continued in force.
If the person to whom an "applicable decision"
relates did apply to the Employment Secretary, the SSAT or the AAT for a review
of that decision under the Student and Youth Assistance Act prior to the
commencement day, but that review had not been finalised by that day, then the
application will continue to have effect, and the outcome of that application
will be as if that Act immediately before the commencement day continued in
force.
Any review mechanism for examining a decision made prior to the
commencement day will only have the power to make a decision regarding the
payment of a benefit under the AUSTUDY scheme in respect of a period that ends
before the commencement day.
Finally, where the original decision has
been reviewed, then an applicable decision will include a reference to a
decision as affirmed, varied or set aside and replaced with a new
decision.
Item 134 relates to decisions made under the Student
Assistance Act after the commencement day. If a decision is made under either
Part 6 of that Act, or as it continued in force because of the Part 2 of
Schedule 11 amendments, and, apart for these amendments, a person would have
had a right to appeal that decision under that Act, then the person may exercise
that right as if that Act as in force immediately before the commencement day
had continued in force.
The Secretary, an ARO, the SSAT or the AAT may
only make a payment as a result of a review under subclause (1), to the extent
that any payment is in respect of a period that ends before the commencement
day.
Item 135 will apply where:
• an agreement is
reached before 1 July 1998 to accept partial repayment in full satisfaction of
a debt relating to a student assistance scheme; and
• existing
section 290B imposed an obligation to waive the debt (section 290B applies to
student assistance schemes by virtue of subsection 43(2));
and
• the necessary administrative action to waive the remainder of
the debt is not taken before 1 July 1998.
Item 135 provides
that the obligation to waive the debt remains in force and is to be exercised by
the Secretary to Department of Employment, Education, Training and Youth
Affairs. (In practice, the waiver would be exercised by Centrelink by a
delegation under section 338 of the Student and Youth Assistance
Act.)
This provision applies to:
• an overpayment under a
student assistance scheme; and
• a debt arising in relation to an
overpayment, such as a debt arising under section 40 (late payment charge or
interest on an outstanding debt) or under subsection 42(10) (a debt incurred by
a person who refuses to comply with a garnishee notice).
5. Commencement
The amendments in this Schedule will commence on 1 July 1998.
Schedule 12 - Amendment of taxation legislation
1. Summary
This Schedule amends three pieces of taxation legislation to provide for
the taxation treatment of the new youth allowance package.
2. Background
The abolition of the former AUSTUDY allowance and youth training
allowance and the introduction in their place of new social security payments,
that is, youth allowance, austudy payment, pensioner education supplement and
fares allowance necessitate changes to the taxation legislation to provide for
the taxation treatment of the new payments.
Similarly, changes to the
taxation legislation are required as a consequence of the decision to set up in
the Social Security Act a new Student Financial Supplement Scheme.
The
aim is to replicate for the new payment structure the taxation treatment
currently given to the payments that are to be repealed. This essentially
involves refining the current tax provisions so that they refer correctly to the
new payment structure.
3. Clauses and Schedule involved in the changes
Clause 2: provides the commencement rules for this
Schedule.
Clause 3: provides that each Act that is specified in
this Schedule is amended as set out in the Schedule.
Schedule 12 - Amendment of taxation legislation
Items 1 to 24: amend the Income Tax Assessment Act 1936
(the 1936 Tax Act).
Item 1: amends paragraph (b) of the
definition of "Commonwealth education or training payment" in subsection
6(1).
Item 2: amends paragraph 16(4)(hb).
Item
3: amends subsections 24ABZE(4) and (5).
Item 4: repeals
subsections 24ABZF(2), (3), (4) and (5).
Item 5: amends subsection
51(6AA) (note).
Item 6: amends paragraph (a) of the definition of
"prescribed allowance" in subsection 79A(4).
Item 7: amends
paragraph (c) of the definition of "expenses of self-education" in subsection
82A(2).
Item 8: amends paragraph (a) of the definition of
"rebatable benefit" in subsection 160AAA(1).
Item 9: amends
paragraph (b) of the definition of "rebatable pension" in subsection
160AAA(1).
Items 10 and 11: amend subsection
163B(10).
Item 12: amends section 202.
Items 13 and
14: amend paragraph 202CB(6)(a).
Item 15: repeals paragraph
202CB(6)(aa).
Item 16: amends paragraph
202CB(6)(b),
Items 17 and 18: amend paragraph
202CE(7)(a).
Item 19: repeals paragraph
202CE(7)(aa).
Item 20: amends paragraph
202CE(7)(b).
Item 21: amends paragraph (c) of the definition of
"prescribed non-resident" in subsection 221A(1).
Item 22: omits
the definition of "FS assessment debt" in subsection 221ZY(1) and
substitutes a new version.
Items 23 and 24: provide application
provisions in respect of payments made under the AUSTUDY scheme and payments of
youth training allowance, respectively.
Items 25 to 46: amend the
Income Tax Assessment Act 1997 (the 1997 Tax Act).
Item
25: amends section 11-15.
Item 26: amends paragraph
26-20(1)(d).
Items 27 to 30: amend section 52-10
(table).
Items 31 to 37: amend section 52-15
(table).
Item 38: amends subsection 52-20(3).
Items 39
and 40: amend subsection 52-30(1).
Items 41 to 44: amend
section 52-40.
Items 45 and 46: amend section
52-70.
Item 47: amends subsection (3)(1) of the Taxation
(Interest on Overpayments and Early Payments) Act 1983.
4. Explanation of the changes
Youth allowance, austudy payment, pensioner education supplement and
fares allowance
Currently, the taxation treatment of social security
benefits, youth training allowance and AUSTUDY allowance is similar in that
supplementary amounts of these payments are exempt from tax and the balance is
not. The supplementary amounts in respect of social security benefits and youth
training allowance are amounts of pharmaceutical allowance, rent assistance and
remote area allowance. The supplementary amounts in respect of the AUSTUDY
allowance include pensioner education supplement amounts and fares allowance.
Certain social security benefit and youth training allowance bereavement
payments are also exempt from tax. Social security benefits, youth training
allowance and AUSTUDY allowance are rebatable.
Youth allowance and
austudy payment
It is intended that the taxation treatment of youth
allowance and austudy payment, that are to be defined in the Social Security Act
as “social security benefits”, be the same as the taxation treatment
of other social security benefits payable to the unemployed, eg, newstart
allowance. Amendments made in this Schedule to the provisions of the
1936 Tax Act and the provisions of the 1997 Tax Act ensure that
supplementary amounts of youth allowance (rent assistance, remote area allowance
and pharmaceutical allowance) and supplementary amounts of austudy payment
(pharmaceutical allowance and remote area allowance) are exempt, the balance of
these payments is taxable and the payments are treated as rebatable
benefits.
(a) amendments to the 1997 Tax Act
Section 52-10
specifies, in a table, social security amounts that are exempt from income tax.
To indicate the exempt amounts of austudy payment and youth allowance, item
27 inserts after table item 2.1 a new item 2A.1 for austudy payment and
item 30 inserts at the end of the table a new item 35.1 for youth
allowance. The entries specify further when supplementary amounts and certain
bereavement payment amounts of those payments are exempt.
Items 31, 32
and 34 to 36 amend section 52-15 that provides a table for the calculation
of supplementary amounts of the specified social security payments. These items
amend item 1, 2 and 4 of the table in section 52-15 by omitting from the column
relating to supplementary amounts an obsolete reference to residential care
charge amount. (Items 45 and 46 make similar technical amendments
to paragraphs 52-70(c) and (d) to omit an obsolete reference to residential care
charge amount from section 52-70 referring to supplementary amounts of
payments under the Veterans' Entitlements Act.) Item 33 inserts in the
table, in item 2 that lists supplementary amounts of social security benefits, a
new entry referring to youth allowance. Item 37 adds a new item 5 to the
table to provide for the listing of supplementary amounts of austudy
payment.
Section 52-20 sets out in a table the Subdivisions of the
Social Security Act that are bereavement Subdivisions and the provisions of that
Act under which a person qualifies for bereavement payments. Item 38
amends the table by inserting the relevant youth allowance references, that is,
Division 10 of Part 2.11 and paragraph 567(1)(f), and the relevant austudy
payment references, that is, Division 10 of Part 2.11A and
paragraph 592(1)(f).
Section 52-30 determines the amount of a
tax-free amount of certain other bereavement lump sum payments and lists social
security benefits to which this section applies. Items 39 and 40 amend
subsection 52-30(1) by inserting references to youth allowance and austudy
payment.
Section 52-40 lists social security payments and the respective
social security provisions under which the payments that are exempt from income
tax are made. Items 41 and 44 amend section 52-40 by inserting a
new entry, 2A, for austudy payment and its relevant provisions and a new entry,
35, for youth allowance and its relevant provisions,
respectively.
(b) amendments to the 1936 Tax Act
Item
8 amends the definition of "rebatable benefit" in subsection 160AAA(1) by
inserting in paragraph (a) of the definition references to Part 2.11 and 2.11A
of the Social Security Act under which youth allowance and austudy payment will
be payable. Item 9 amends the definition of "rebatable pension" in
paragraph 160AAA(1)(b) to exclude youth allowance and austudy payment from this
definition. Items 13, 14 and 16 amend section 202CB dealing with
quotation of tax file number in employment declaration. Items 13 and 14
amend paragraph 202CB(6)(a) to include references to declarations given by
austudy payment and youth allowance applicants. Item 16 makes a
consequential technical amendment to the wording of paragraph 202CB(6)(b).
Items 17, 18 and 20 amend section 202CE dealing with effect of
incorrect quotation of tax file number in employment declaration. Items 17
and 18 amend paragraph 202CE(7)(a) to include references to
declarations given by austudy payment and youth allowance applicants. Item
20 makes a consequential technical amendment to the wording of paragraph
202CE(7)(b). Item 21 makes a consequential amendment to paragraph (c) of
the definition of "prescribed non-resident" in subsection 221A(1) to include,
alongside references to other social security benefits, references to Parts 2.11
and 2.11A of the Social Security Act under which austudy payment and youth
allowance are to be payable.
Pensioner education supplement and fares
allowance
It is intended that the pensioner education supplement and
fares allowance which are currently exempt from tax, remain not taxable. To
achieve this, items 28, 29, 42 and 43 make the following relevant
amendments to the 1997 Tax Act.
Section 52-10 specifies, in a table,
social security amounts that are exempt from income tax. To indicate that fares
allowance and pensioner education supplement are exempt amounts, item 28
inserts after table item 13.1 a new item 13A.1 for fares allowance and
item 29 inserts after table item 22.1 a new item 22A.1 for pensioner
education supplement.
Section 52-40 contains a table listing the
provisions of the Social Security Act under which social security payments are
made that are wholly or partly exempt from income tax under Subdivision 52-A.
Item 42 inserts after table item 13 a new item 13A for the purposes of
listing fares allowance payable under Part 2.26 of the Social Security Act and
item 43 inserts after table item 22 a new item 22A for the purposes of
listing pensioner education supplement payable under Part 2.27 of the Social
Security Act.
Amendments consequential on the repeal of Part 2
(AUSTUDY allowance) and Part 8 (Youth training allowance) of the Student and
Youth Assistance Act
As a result of the repeal of Part 2 - AUSTUDY
scheme and Part 8 - Youth training allowance of the Student and Youth Assistance
Act, the following amendments are made to taxation legislation to remove the
references that are no longer needed.
(a) amendments to the 1936 Tax
Act
Item 1 omits subparagraph (b)(i) of the definition of
"Commonwealth education or training payment" in subsection 6(1) to remove the
reference to the AUSTUDY scheme. Item 3 repeals subsections 24ABZE(4)
and (5) that relate to expressions used in Part 8 of the Student and Youth
Assistance Act. Item 4 repeals subsections 24ABZF(2), (3), (4) and
(5) dealing with the taxation treatment of bereavement payments under Part 8 of
the Student and Youth Assistance Act. Item 6 amends subsection 79(4) by
amending paragraph (a) of the definition of "prescribed allowance" to remove the
reference to remote area allowance payable under Part 8 of the Student and Youth
Assistance Act. Items 15 and 19 repeal paragraphs 202CB(6)(aa) and
202CE(7)(aa) referring to declarations given by youth training allowance
applicants.
(b) amendment to the 1997 Tax Act
Item 25
amends section 11-15 that index provisions relating to ordinary or statutory
income that is exempt only if it is derived by certain entities. Item 25
omits the entry in this section referring to youth training allowance provisions
which, as a result of the amendments made by items 3 and 4, will no
longer apply to youth training allowance.
Application of the
amendments to AUSTUDY and youth training allowance payments
Items
23 and 24 are application provisions. They provide that the amendments to
the 1936 Tax Act made by this Schedule do not apply to payments
under the AUSTUDY scheme made under Part 2 of the Student Assistance Act
or to payments of youth training allowance made under Part 8 of the
Student Assistance Act. Consequently, the AUSTUDY and youth training allowance
payments made on or after 1 July 1998 will be assessed under the 1936 Tax Act as
in force before 1 July 1998.
Student Financial Supplement
Scheme
Items 2, 5, 7, 10, 11, 12, 22, 26 and 47 are all
consequential amendments flowing from the setting up in the Social Security Act
of the new Student Financial Supplement Scheme. This scheme, which will mirror
the one of the same name provided by Part 4A of the Student and Youth
Assistance Act, will apply for tertiary students within the social security
system, whereas the other scheme will apply only for ABSTUDY customers.
Therefore, the intention in relation to taxation amendments is to make sure that
the new scheme is given exactly the same taxation treatment as is the current
scheme.
Most of the amendments are to the 1936 Tax Act. Item 2
adds reference to the Secretary to the Department of Social Security, alongside
the existing reference to the Secretary to the Department of Education, as a
person to whom information may be communicated for the purpose of the
administration of any law of the Commonwealth relating to financial assistance
to students.
Item 5 adds reference to the new scheme in a note
signposting a relevant provision. Item 7 adds reference to the new
scheme in the definition of "expenses of self-education" in subsection 82A(2),
governing deductions for expenses of self-education. Section 163B relates to a
late lodgement penalty - additional tax for persons other than relevant entities
and instalment taxpayers. Item 11 inserts a new definition of
"FS assessment debt" for the purposes of this provision, making it clear
that there are now two schemes that might give rise to such a
debt.
Item 12 adds a new paragraph (ha) to section 202 which sets
down the objects of the relevant Part relating to tax file numbers so that it
applies in relation to recovery through the taxation system of a student's
outstanding financial supplement indebtedness. Such recovery will be dealt with
by disallowable instrument under new Chapter 2B of the Social Security Act.
Item 22 omits the current definition of "FS assessment debt" in
subsection 221ZY(1) and substitutes a new one to make it clear that there are
now two schemes that might give rise to such a debt.
Item 26
amends the 1997 Tax Act to add reference to the new scheme alongside reference
to the current scheme to provide that a payment to reduce a debt under the
scheme is not deductible. Item 47 makes the only amendment to the
Taxation (Interest on Overpayments and Early Payments Act) 1983,
omitting the current definition of "FS assessment debt" in subsection 3(1)
and substituting a new one to make it clear that there are now two schemes that
might give rise to such a debt.
5. Commencement
The amendments in this Schedule will commence on 1 July 1998.
Schedule 13 - Amendment of various Acts consequential on youth allowance and austudy payment
1. Summary of proposed changes
Schedule 13 amends the Aged Care Act 1997 (the Aged
Care Act), the Bankruptcy Act 1966 (the Bankruptcy Act), the
Child Care Payments Act 1997 (the Child Care Payments Act), the
Data-matching Program (Assistance and Tax) Act 1990 (the
Data-matching Program (Assistance and Tax) Act), the Disability Services
Act 1986 (the Disability Services Act), the Farm Household Support
Act 1992 (the Farm Household Support Act), the Health Insurance
Act 1973 (the Health Insurance Act), the National Health Act
1953 (the National Health Act), the Registration of Deaths Abroad
Act 1984 (the Registration of Deaths Abroad Act), the
Telecommunications Act 1997 (the Telecommunications Act) and the
Veterans' Entitlements Act 1986 (the Veterans' Entitlements Act)
that are consequential upon the introduction of youth allowance and austudy
payment.
2. Background
The amendments made to various Acts in Schedule 13 are necessary
because of references in these Acts to youth training allowance or the AUSTUDY
scheme under the Student and Youth Assistance Act, in force before 1 July 1998.
These payments will be repealed and new payments, youth allowance and austudy
payment under the Social Security Act will be introduced.
3. Clauses and Schedule involved in the changes
Clause 2: provides that the amendments made by Schedule 13
commence on 1 July 1998.
Clause 3: provides that each Act that is
specified in this Schedule is amended as set out in the Schedule.
Amendment of the Aged Care Act 1997
Items 1 and 2: amend paragraphs (c) and (d) of the definition of
income support payment in Clause 1 of Schedule 1.
Item
3: application provision to the amendments made by items 1 and
2.
Amendment of the Bankruptcy Act 1966
Item 4: amends subparagraph (b)(iii) (d) of the definition of
income in section 139L.
Amendment of the Child Care Payments Act 1997
Items 5 to 7: amend section 15.
Item 8: amends
paragraph 17(a).
Amendment of the Data-matching Program (Assistance and Tax) Act 1990
Item 9: amends paragraph (da) of the definition of personal
assistance in subsection 3(1).
Amendment of the Disability Services Act 1986
Items 10 and 11: amend paragraphs (b) and (ca) of the definition
of pensioner or beneficiary in subsection 22(4).
Amendment of the Farm Household Support Act 1992
Items 12 and 13: amend subsection 3(1).
Item
14: amends the definition of youth training allowance in
subsection 3(2).
Item 15: amends subsection
5(2).
Item 16: amends paragraph 8(2)(b).
Item
17: amends subsection 12(1).
Item 18: amends subsection
12(2).
Item 19: amends subsection 21A(1).
Item
20: amends paragraphs 21A(1)(a) and (b).
Item 21: amends
subsection 22(1).
Items 22 and 23: amend paragraphs 43(1)(a), (b)
and (d).
Item 24: amends subsection 52(3).
Item
25: repeals subsection 52(4) and substitutes a new subsection
52(4).
Item 26: application provision for the amendments made by
items 24 and 25.
Amendment of the Health Insurance Act 1973
Item 27: amends the definition of DSS benefit
dependant in subsection 3(1).
Item 28: inserts a
definition of youth allowance in subsection 3(1).
Item
29: amends subsection 4D(1A).
Item 30: repeals the definition
of qualified recipient in subsection 4D(3) and substitutes a
new definition.
Item 31: transitional provision for qualified
recipients.
Item 32: inserts subsection 5B(1A).
Item
33: repeals the definition of dependant in subsection 5B(12)
and substitutes a new definition.
Item 34: amends the definition
of income in subsection 5B(12).
Item 35: repeals
paragraph (aa) of the definition of income in
subsection 5B(12).
Item 36: amends paragraph
5D(1)(a).
Item 37: inserts subsection 5D(1)(1AA).
Item
38: amends paragraph 5D(1A)(b).
Item 39: inserts subsections
5D(2) and 5D(3).
Item 40: repeals the definition of youth
training allowance in subsection 5D(8).
Item
41: saving provision; for declarations made under section 5D prior to
commencement of this item.
Item 42: amends section 130H.
Amendment of the National Health Act 1953
Item 43: amends subparagraph (aa)(iii) of the definition of
pensioner in subsection 4(1).
Item 44: amends
subparagraph (a)(i) of the definition of social security
beneficiary in subsection 4(1).
Item 45: repeals paragraph
(aa) of the definition of social security beneficiary in
subsection 4(1) and substitutes new paragraph (aa).
Item
46: application provision for amendments made by items 44 and
45.
Item 47: repeals paragraph (ae) of the definition of
concessional beneficiary in subsection 84(1) and substitutes new
paragraph (ae).
Amendment of the Registration of Deaths Abroad Act 1984
Item 48: repeals paragraph (ca) of the definition of
prescribed person in subsection 3(1).
Amendment of the Telecommunications Act 1997
Item 49: amends paragraph (a) of the definition of tertiary
education institution in subsection 23(11).
Amendment of the Veterans' Entitlements Act 1986
Items 50 and 51: amend section 5.
Item 52: amends
the definition of member of a couple in
subsection 5E(1).
Item 53: inserts subsection
5E(4A).
Item 54: repeals subparagraph 5E(5)(b)(iv).
Item
55: repeals subparagraph 5E(5)(c)(iia).
Item 56: amends
paragraph 5E(5)(e).
Item 57: amends paragraph (j) of the
definition of child in subsection 5F(1).
Item
58: amends the definition of child in subsection
5F(1).
Item 59: repeals subsection 5F(5).
Item
60: repeals paragraph 5H(8)(ha).
Item 61: application
provision because of the repeal of paragraph 5H(8)(ha) (item
60).
Item 62: amends subparagraph 5H(8)(v)(i).
Item
63: repeals paragraph 5H(8)(zg).
Item 64: inserts definition
of austudy payment in subsection 5Q(1).
Item
65: repeals the definition of education leavers waiting period
in subsection 5Q(1).
Item 66: inserts new paragraphs (ab) and (ac)
in the definition of social security benefit in subsection
5Q(1).
Item 67: inserts definition of youth
allowance in subsection 5Q(1).
Item 68: repeals the
definition of youth training allowance in
subsection 5Q(1).
Item 69: repeals paragraph 13(7)(d) and
substitutes a new paragraph.
Item 70: amends paragraphs 13(7)(e)
and (f).
Item 71: inserts subsection 53E(2A).
Item
72: inserts point 53F-6A.
Item 73: repeals paragraph
53F-7(d).
Item 74: repeals paragraph 70(10A)(a) and substitutes a
new paragraph.
Item 75: amends paragraph 118AA(c).
Item
76: amends subparagraph 118AA(d)(i).
Item 77: repeals
paragraph (d) of the definition of prescribed educational scheme
in subsection 205(8).
Item 78: saving provision in respect of the
amendment made by item 77.
Item 79: inserts new subclauses
10(3A) and (3B) of Schedule 5.
Item 80: repeals paragraph
SCH6-E10(d) of Schedule 6.
Item 81: amends paragraph SCH6-G4(b) of
Schedule 6.
Item 82: inserts a definition of dependent
child at new point SCH6-E12 of Schedule 6.
4. Explanation of the changes
Amendment of the Aged Care Act 1997
Schedule 1 to the Aged Care Act contains a dictionary of defined terms.
A payment of a benefit under Part 2 of the Student and Youth Assistance Act
means an income support payment. This paragraph becomes
unnecessary after the repeal of the AUSTUDY scheme (Part 2 of the Student and
Youth Assistance Act) from 1 July 1998 and item 2 accordingly
repeals the paragraph. Item 1 makes a technical amendment to paragraph
(c) of the definition of income support payment.
Item
3 is an application provision that provides that the amendments made by
items 1 and 2 apply for the purposes of working out whether a person was
receiving an income support payment after the commencement of this
item.
Amendment of the Bankruptcy Act 1966
Item 4 repeals subparagraph (b)(iii) of the definition of
income in section 139L of the Bankruptcy Act because this
subparagraph applies to payments received under Part 8 of the Student and Youth
assistance Act (youth training allowance) which is to be repealed from 1 July
1998.
Amendment of the Child Care Payments Act 1997
New paragraph 15(1)(ba) of the Child Care Payments Act inserted by
item 5 will provide that a person has recognised work or work
related commitments if the person receives a youth allowance or a
newstart allowance under the Social Security Act.
Paragraph 15(1)(d) of
the Child Care Payments Act will be repealed by item 6 because
registration with the Commonwealth Employment Service in an allowance category
as being unemployed is no longer necessary. Item 7 will repeal
subsection 15(2) of that Act because it only applied for the purpose of
paragraph 15(1)(d).
Section 17 of the Child Care Payments Act provides at
paragraph (a) that a person has a recognised study commitments if
they receive a benefit under the AUSTUDY scheme under the Student and Youth
Assistance Act. Item 8 will repeal this paragraph and replace it with
new paragraphs (a), (aa) and (ab) such that this commitment will be satisfied if
a person receives a youth allowance, austudy payment or a pensioner education
supplement under the Social Security Act.
Amendment of the Data-matching Program (Assistance and Tax) Act 1990
Paragraph (da) of the definition of personal assistance in
subsection 3(1) of the Data-matching Program (Assistance and Tax) Act is amended
by item 9 to indicate that the payment of youth training allowance is
that payment made prior to 1 July 1998.
Amendment of the Disability Services Act 1986
Item 10 amends paragraph (b) of the definition of pensioner
or beneficiary in subsection 22(4) of the Disability Services Act to
insert references to Parts 2.11 (youth allowance) and Part 2.11A (austudy
payment) in that definition. Item 11 repeals paragraph (ca) of the
definition because that paragraph relates to youth training allowance and that
payment will cease to exist following the repeal of Part 8 of the Student and
Youth Assistance Act.
Amendment of the Farm Household Support Act 1992
Items 12 and 13 amend subsection 3(1) of the Farm Household
Support Act by inserting references to austudy payment and
youth allowance.
The definition of youth training
allowance at subsection 3(2) is amended by item 14 to indicate
that it means that payment as in force before 1 July 1998.
Subsection
5(2) and paragraph 8(2)(b) are amended by items 15 and 16 by adding
references to austudy payment and youth allowance. A similar amendment to
subsection 12(2) is made by item 18 and to paragraphs 43(1)(b) and (d) by
item 23.
Items 17 and 22 omits the reference to youth
training allowance in subsection 12(1) and paragraph 43(1)(a) of the Farm
Household Support Act because it is no longer relevant after the repeal of that
payment from 1 July 1998.
Items 19, 21 and 24 amend subsections
21A(1), 22(1) and 52(3) by omitting the age requirement of 18 and substituting
21. This reflects the changed age limits between youth training allowance and
youth allowance.
Paragraphs 21A(1)(a) and (b) are amended by item
20 so that all references to youth training allowance become references to
youth allowance.
Item 25 repeals subsection 52(4) and substitutes
a new subsection 52(4) of the Farm Household Support Act. The new subsection is
reflects the changed age limits of youth training allowance (18 years) and youth
allowance (21 years).
Item 26 is an application provision so that
items 24 and 25 apply only in relation to farms sold on or after the
commencement of this item.
Amendment of the Health Insurance Act 1973
These are consequential amendments to make provision for the granting of
Health Care Cards to recipients of youth allowance and austudy payment. A
person may be entitled to a Health Care Card (HCC) if they are declared to be a
disadvantaged person under the provisions of the Health Insurance
Act 1973 ( the Health Insurance Act).
With the introduction of
the new payment types, the entitlement of a person to a declaration of
disadvantage will be as follows;
Recipients of austudy payment and
recipients of youth allowance undertaking full time study
Recipients
of austudy payment and youth allowance recipients who satisfy the activity test
by undertaking full time study ("full-time students") are to have no automatic
entitlement to a declaration of disadvantage and must satisfy the low income
test in section 5B. This reflects the previous treatment of full time students
who received the former AUSTUDY under the Student and Youth Assistance
Act.
All other recipients of youth allowance
All other
recipients of youth allowance are to have automatic entitlement to declaration
of disadvantage under section 5D of the Health Insurance Act.
This
reflects the previous treatment of recipients of the youth training allowance
under the Student and Youth Assistance Act.
Recipients of youth allowance
who are exempted from satisfying the activity test due to incapacity and who
might, before these changes, have been eligible for sickness allowance, will now
be entitled to a declaration of disadvantage under section 5D instead of 5DB
(the provision under which sickness allowance recipients were previously
entitled). In relation to the last mentioned group this change is intended to
have no detrimental effect and is likely, in most cases to be beneficial because
declarations under section 5D are for 12 weeks from the time of grant and are
made every 12 weeks thereafter provided the person is still being paid a
qualifying allowance. On the other hand, declarations made under section 5DB to
sickness allowance recipients remain in force only while sickness allowance is
payable. This is intended to be administratively simpler as all youth allowance
recipients (other than full time students) will be entitled to a declaration of
disadvantage under one provision.
Items 27, 29, 30, 33, 34, 35, 36,
37, 38, 39, 40 and 42 remove references to youth training allowance
and replace with provisions dealing with youth allowance (other than youth
allowance which is paid to full time students).
Item 28 inserts a
definition of youth allowance.
Item 31 is a transitional provision
which has the effect of deeming that a person who was receiving youth training
allowance before these changes was, for the purpose of section 4D, receiving a
social security benefit for that period. Section 4D provides that if a person
has been in receipt of any of the payments listed in section 4D for more 12
months and the person, or the person’s partner, commences employment and,
as a result, the person ceases to be entitled to that payment, the person
remains a disadvantaged person for 6 months after they lose entitlement to the
payment.
Item 32 deals with those who are disadvantaged persons
under section 5D (youth allowance recipients who are not full-time students).
In cases where the person becomes a full time student and remains a full time
student on the last day on which the declaration under section 5D was in force,
the person is deemed to make an application for a low income health care card on
that day. This has the result that a person who is a full-time student when he
or she starts receiving youth allowance must make an application for a health
care card but a person who starts receiving youth allowance and later becomes a
full-time student need not apply for a health care card.
Item 41
is a saving provision which provides that declaration of disadvantage under
section 5D (recipients of certain social security benefits) continue in force
despite these amendments. (This means that recipients of youth training
allowance will continue to be entitled to a health care card for up to 12 weeks
regardless of their status under the new provisions).
Amendment of the National Health Act 1953
Items 43 to 47 are technical amendments to remove references to
youth training allowance and replace with provisions dealing with youth
allowance (other than youth allowance which is paid to full time
students).
Amendment to the Registration of Deaths Abroad Act 1984
Item 48 repeals paragraph (ca) of the definition of
prescribed person in subsection 3(1) of the Registration of
Deaths Abroad Act because that paragraph applies to a person in receipt of a
youth training allowance and will therefore not be relevant after Part 8 of the
Student and Youth Assistance Act is repealed.
Amendment of the Telecommunications Act 1997
Item 49 amends paragraph (a) of the definition of tertiary
education institution in subsection 23(11) of the Telecommunications Act
by replacing the old Title of the Student and Youth Assistance Act with the new
Title of that Act.
Amendment of the Veterans' Entitlements Act 1986
Items 50 and 51 amend section 5 of the Veterans' Entitlements Act
by omitting the index entries for "education leavers waiting period" (see
item 65) and "youth training allowance" (see item 68) and
inserting the index entries for "austudy payment" (see item 64) and
"youth allowance" (see item 67).
Item 53 inserts new
subsection 5E(4A) into the Veterans' Entitlements Act. This new subsection will
provide that a partner of a person is not a member of a couple for
the purposes of specific provisions of that Act if that partner is receiving a
youth allowance and is not independent within the meaning of Part 3.5 of the
Social Security Act. Item 52 is a technical amendment to the definition
of member of a couple in subsection 5E(1) because of the amendment
made by item 53.
Subparagraphs 5E(5)(b)(iv) and 5E(5)(c)(iia),
paragraph 5H(8)(ha) and the definition of youth training allowance
in subsection 5Q(1) of the Veterans' Entitlements Act are repealed by items
54, 55, 60 and 68, respectively, because the subparagraphs, paragraph and
definition all apply to youth training allowance (Part 8 of the Student and
Youth Assistance Act) and are no longer necessary after the repeal of that
payment from 1 July 1998. Item 61 is an application provision because of
the amendment made by item 60 (repeal of paragraph 5H(8)(ha)) so that it
only applies for the purposes of working out income earned, derived or received
after 1 July 1998.
Items 56 and 58, respectively amend, paragraph
5E(5)(e) and the definition of child in subsection 5F(1) of the
Veterans' Entitlements Act by omitting references to youth training allowance.
Item 81 similarly amends paragraph SCH6-G4(b) of Schedule
6.
Paragraph (j) of the definition of child in subsection
5F(1) of the Veterans' Entitlements Act is amended by item 57 by
excluding youth allowance from the definition.
Items 59, 63, 73, 77
and 80, respectively, repeal subsection 5F(5), paragraphs 5H(8)(zg) and
53F-7(d), paragraph (d) of the definition of prescribed educational
scheme in subsection 205(8) and paragraph SCH6-E10(d) because all apply
to the AUSTUDY scheme (Part 2 of the Student and Youth Assistance Act) and are
no longer necessary after the repeal of that scheme from 1 July 1998. Item
78 is a saving provision that provides that the amendment made by item
77 (the repeal of paragraph (d) of the definition of prescribed
educational scheme in subsection 205(8)) does not affect arrangements or
proceedings for recovery of an amount paid under the AUSTUDY scheme that was not
lawfully paid before the commencement of that item. In addition, items 75
and 76 omit references to the AUSTUDY scheme in paragraph 118AA(c) and
subparagraph 118AA(d)(i) and substitute new references that reflect the
changed arrangements under the Social Security Act and the Student and Youth
Assistance Act.
References to youth allowance and austudy payment are
inserted by items 62, 64, 66, 67, 69, 71, 72 and 74 in subparagraph
5H(8)(v)(i), subsection 5Q(1) (new definition of austudy payment,
new paragraphs (ab) and (ac) of the definition of social security
benefit and new definition of youth allowance), paragraph
13(7)(d), new subsection 53E(2A), new point 53F-6A and paragraph 70(10A)(a)
of the Veterans' Entitlements Act. Item 70 is a technical amendment to
paragraphs 13(7)(e) and (f).
The definition of education leavers
waiting period in subsection 5Q(1) is repealed by item 65 because
the definition is no longer required.
Clause 10 of the Veterans'
Entitlements Act is a savings provision relating to certain income support
payments which continue to be paid in respect of children. These payments were
"saved" from transfer to family payment on 1 January 1998 as the recipients
would have been financially disadvantaged by that transfer. These "saved" child
related payments are almost identical to the more that minimum family payments
that are to be replaced by youth allowance for over 16 year olds.
Youth
allowance is intended to have universal application to young people, providing
them with access to income support arrangements that are simpler and more
flexible. The amendments made by item 79 ensure that the "saved" child
related payments for over 16 year olds are also replaced by youth
allowance.
New subclause 10(3A) of Schedule 5 ensures that from the time
of commencement of the Social Security Legislation Amendment (Youth
Allowance) Act 1998, "saved" child related amounts cease to be included
in the person's service pension or income support supplement when the child or
the youngest child for whom clause 10 applies reaches 16 years.
New
subclause 10(3B) of Schedule 5 ensures that from the time of commencement of the
Social Security Legislation Amendment (Youth Allowance) Act 1998,
children who are 16 years or over are disregarded for the purposes of
determining a person's notional/supplement child related amount or notional
family allowance child related amount.
A new definition of
dependent child is inserted at new point SCH6-E12 in Module E of
the Rate Calculator in Schedule 6 by item 82. The new definition only
applies for the purposes of Module E.
5. Commencement
The amendments in this Schedule will commence on 1 July 1998.