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2013-2014-2015
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
SOCIAL SERVICES LEGISLATION AMENDMENT
(YOUTH EMPLOYMENT AND OTHER MEASURES) BILL 2015
EXPLANATORY MEMORANDUM
(Circulated by the authority of the
Minister for Social Services, the Hon Scott Morrison MP)
SOCIAL SERVICES LEGISLATION AMENDMENT
(YOUTH EMPLOYMENT AND OTHER MEASURES) BILL 2015
OUTLINE
This Bill introduces a number of measures in the Social Services portfolio, including
2015 Budget measures and several measures previously introduced in the Social
Services and Other Legislation Amendment (2014 Budget Measures No. 4) Bill 2014
(the No. 4 Bill).
The measures are provided by Schedules to the Bill numbered as set out below:
1. Ordinary waiting periods - exclude widow allowance claimants from the
one-week ordinary waiting period for working age payments, to be
implemented from 1 July 2015 - that is, reintroduce Schedule 3 to the No. 4
Bill but excluding widow allowance claimants.
2. Age requirements for various Commonwealth payments - delay to
1 July 2016 the start date for the measure increasing the age of eligibility for
newstart allowance and sickness allowance - that is, reintroduce Schedule 6
to the No. 4 Bill with new start date.
3. Income support waiting periods - introduce a revised four-week waiting
period for youth income support from 1 July 2016 - that is, introduce a
replacement for the measure provided by Schedule 7 to the No. 4 Bill, which
required young people with full capacity to serve a six-month waiting period
for income support, with access to payment for six months and rolling
six-month non-payment periods thereafter.
4. Low income supplement - cease the low income supplement from
1 July 2017.
5. Indexation - reintroduce the following changes to Australian Government
payments provided by Schedule 1 to the No. 4 Bill:
maintain at level for three years the income free areas for all working
age allowances (other than student payments) and for parenting
payment single - from the existing start date of 1 July 2015; and
maintain at level for three years the income free areas and other
means test thresholds for student payments, including the student
income bank limits - with a new start date of 1 January 2016.
1
Financial impact statement
MEASURE FINANCIAL IMPACT OVER THE
FORWARD ESTIMATES
(SAVINGS)
1. Ordinary waiting periods $274.8 million
2. Age requirements for various Commonwealth $517.0 million
payments
3. Income support waiting periods $173.3 million
4. Low income supplement $42.9 million
5. Indexation:
maintain at level for three years the income $134.8 million (combined)
free areas for all working age allowances (other
than student payments) and for parenting
payment single
maintain at level for three years the income
free areas and other means test thresholds for
student payments, including the student
income bank limits
STATEMENTS OF COMPATIBILITY WITH HUMAN RIGHTS
The statements of compatibility with human rights appear at the end of this
explanatory memorandum.
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SOCIAL SERVICES LEGISLATION AMENDMENT
(YOUTH EMPLOYMENT AND OTHER MEASURES) BILL 2015
NOTES ON CLAUSES
Abbreviations used in this explanatory memorandum
Farm Household Support Act means the Farm Household Support Act 2014
Social Security Act means the Social Security Act 1991
Social Security Administration Act means the Social Security
(Administration) Act 1999
Clause 1 sets out how the new Act is to be cited - that is, as the Social Services and
Other Legislation Amendment (Youth Employment and Other Measures) Act 2015.
Clause 2 provides a table setting out the commencement dates of the various
sections in, and Schedules to, the new Act.
Clause 3 provides that legislation that is specified in a Schedule is amended or
repealed as set out in that Schedule.
1
Schedule 1 - Ordinary waiting periods
Summary
This Schedule makes amendments to extend and simplify the ordinary waiting period
for all working age payments from 1 July 2015.
Background
Currently, a person who is qualified for newstart allowance or sickness allowance
under the Social Security Act must, subject to some exceptions, serve an ordinary
waiting period of seven days before either of those allowances is payable.
The exceptions include where the Secretary is satisfied that the person is in severe
financial hardship. Depending on the circumstances, an ordinary waiting period may
be served concurrently with other waiting periods and preclusion periods.
This Schedule creates a new ordinary waiting period for parenting payment and
youth allowance for a person who is not undertaking full-time study and is not a new
apprentice (in this Schedule, referred to as youth allowance (other)).
This Schedule also provides that the current exemption on the basis of severe
financial hardship will only apply if the person is also experiencing a personal
financial crisis. A person will be taken to be experiencing a personal financial crisis if
they have been subjected to domestic violence, incurred unavoidable or reasonable
expenditure or in the circumstances prescribed by the Secretary in a legislative
instrument.
The Schedule further clarifies that an ordinary waiting period is to be served after
certain other relevant waiting periods or preclusion periods have ended.
The amendments made by this Schedule commence on 1 July 2015.
Explanation of the changes
Part 1 - Main amendments
Amendments to the Social Security Act
Items 1 and 2 amend the definition of unavoidable and reasonable expenditure
so the definition can apply for the purpose of whether a person is experiencing a
personal financial crisis. Item 5 inserts a new section 19DA to provide for when a
person is experiencing a personal financial crisis. This is relevant for whether a
person has an exemption from the ordinary waiting period. Under new
subsection 19DA(3), a person is experiencing a personal financial crisis if the person
is in severe financial hardship because the person has incurred unavoidable or
reasonable expenditure.
Current subsection 19C(4) provides for the meaning of unavoidable or reasonable
expenditure in relation to a person who is serving a liquid assets test waiting period,
is subject to a seasonal work preclusion period, or a person to whom an income
maintenance period applies.
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Schedule 1 - Ordinary waiting periods
Items 1 and 2 amend subsection 19C(4) to provide that, in relation to working out
whether a person is subject to an ordinary waiting period, unavoidable or reasonable
expenditure includes, but is not limited to, the reasonable costs of living, under
subsection 19C(6) and (7) that the person has incurred in the four-week period
before the person's claim for the relevant payment, if the person is qualified for the
payment on the day of claim.
Current subsection 19C(5) provides that the reasonable costs of living of a person
include, but are not limited to, the following costs:
food costs;
rent or mortgage payments;
regular medical expenses;
rates, water and sewerage payments;
gas, electricity and telephone bills;
costs of petrol for the person's vehicle;
public transport costs; and
any other cost that the Secretary determines is a reasonable cost of living in
relation to a person.
Items 3 and 4 amend subsections 19C(6) and (7) to provide for the maximum
amount of the reasonable costs of living that are taken to have been incurred for the
purpose of subsection 19C(4). The amount of reasonable costs of living cannot
exceed the amount of newstart allowance, youth allowance (other), sickness
allowance or parenting payment (as the case may be) that would have been payable
in the four-week period before the person's claim for that payment if the payment
was payable, or in the case of a person who is a member of a couple, twice the
amount of the payment that would have been payable in that period.
Item 5 inserts a new definition of experiencing a personal financial crisis.
There is currently an exemption to the ordinary waiting period for newstart allowance
and sickness allowance for a person who is in severe financial hardship.
Section 19C generally provides that a person is in severe financial hardship if the
value of the person's liquid assets is less than the fortnightly amount at the maximum
payment rate of the relevant social security payment. Other items in this Schedule
replace this exemption with a new concept of experiencing a personal financial crisis.
A person will still need to be in severe financial hardship in order to be experiencing
a personal financial crisis. However, the exemption will now apply only if, in addition
to being in severe financial hardship, subsection 19DA(2), (3) or (4) applies to the
person. Those subsections will apply if the person:
has been subjected to domestic violence in the four-week period before the
person makes a claim for a relevant payment, if the person is qualified for the
payment on the day of claim (subsection (2));
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Schedule 1 - Ordinary waiting periods
is in severe financial hardship because the person has incurred unavoidable
or reasonable expenditure in the four-week period before the person makes a
claim for a relevant payment, if the person is qualified for the payment on the
day of claim. Items 1 and 2 amend the definition of unavoidable and
reasonable expenditure in section 19C so that it can apply for the purpose of
determining whether a person has an exemption from an ordinary waiting
period (subsection (3)); or
satisfies circumstances prescribed in a legislative instrument made by the
Secretary (subsection (4)). Subsection 19DA(5) provides the Secretary with
the power to prescribe circumstances for this purpose.
Subsection 19DA(6) clarifies that a person will not be taken to satisfy the
circumstances in subsections 19DA(2), (3) or (4) unless he or she can produce
evidence that demonstrates a reasonable possibility that he or she satisfies the
circumstances. It is expected that a person will meet this evidence requirement by
complying with the current evidentiary requirements of the Department of Human
Services. It will not always be necessary for a person to provide written evidence.
For example, a person may provide confirmation from a social worker that they have
experienced domestic violence and this will likely satisfy the 'evidence requirement'
in subsection 19DA(6).
Item 6 is consequential to the amendments made by item 5.
Items 7 and 8 amend the definitions of ordinary waiting period and waiting period
in subsection 23(1) to refer to the new ordinary waiting periods for parenting
payment and youth allowance (other). The definition of waiting period is also
amended to refer to a newly arrived resident's waiting period. This is a waiting
period that may currently apply under the Social Security Act but which has been
inadvertently omitted from the definition of waiting period.
Item 9 amends subsection 23(10) to clarify when a person is taken to have served
an ordinary waiting period.
Current subsection 23(10) refers to the ordinary waiting periods for newstart
allowance and sickness allowance. The amendments made by this item replace the
references to 'newstart allowance' and 'sickness allowance' with references to 'social
security benefit' and 'social security pension' to cover all of the payments to which an
ordinary waiting period may apply.
Items 10 and 12 provide for a new ordinary waiting period for parenting payment
and youth allowance (other), and provide for the duration of those waiting periods.
New subsection 549CA(1) makes it clear that the new ordinary waiting period
provisions for youth allowance apply only in relation to a person who is qualified for
youth allowance (other) and not in relation to a person who is qualified for youth
allowance on the basis of being a student or new apprentice.
Under new subsections 500WA(1) and 549CA(2), a person will be subject to the
ordinary waiting period for parenting payment and youth allowance (other) unless:
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Schedule 1 - Ordinary waiting periods
the person was receiving an income support payment at some time in the
13 weeks immediately before the person made a claim for parenting payment
or youth allowance (other); or
the Secretary is satisfied that the person is experiencing a personal financial
crisis (as defined in new section 19DA, inserted by item 5); or
in relation to youth allowance (other), immediately before the person was
qualified for that payment, the person was qualified for youth allowance on the
basis of being a student or new apprentice. This means that a person
transitioning from youth allowance on the basis of being a student or new
apprentice to youth allowance (other) will not serve an ordinary waiting period.
Further, subsections 500WA(2) and 549CA(3) provide that an ordinary waiting period
will not apply if the person is undertaking an activity specified in a legislative
instrument. These provisions replicate a current exemption to the ordinary waiting
period for newstart allowance and sickness allowance. The legislative instrument
made for the purpose of those current provisions (the Social Security (Exemptions
from Non-payment and Waiting Periods - Activities) (DEEWR) Specification 2013
(No. 1)) specifies the following activities:
an activity undertaken by a person as part of Stream 4 employment services
provided to the person;
a rehabilitation programme; and
an activity undertaken by a person as part of the Remote Jobs and
Communities Programme in certain circumstances.
Subsections 500WA(3) and 549CA(4) allow the Secretary to specify these activities
in a legislative instrument.
Subsections 500WB(1) and 549CB(1) provide that, subject to subsections (2) and (4)
of those provisions, the ordinary waiting period is a period of seven days that starts
on the day that parenting payment or youth allowance (other), as applicable, would
have been payable but for the ordinary waiting period.
Subsection 500WB(2) provides for the start of an ordinary waiting period for
parenting payment where the person is subject to a seasonal work preclusion period,
a lump sum preclusion period or an income maintenance period, where the rate of
parenting payment payable would be nil on the start day. Subsection 549CB(2)
provides for the start of an ordinary waiting period for youth allowance (other) where
a person is subject to one or more these preclusion periods, but also where the
person is subject to a liquid assets test waiting period or a newly arrived resident's
waiting period.
If a person is subject to one or more of the other waiting periods or preclusion
periods, then the ordinary waiting period starts on the day after all the other waiting
periods and preclusion periods have ended. The effect of this is that the ordinary
waiting period cannot be served concurrently with other relevant waiting periods and
preclusion periods.
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Schedule 1 - Ordinary waiting periods
Subsections 500WB(3) and 549CB(3) provide for circumstances in which a person is
subject to an income maintenance period where the person's rate of parenting
payment or youth allowance (other) is nil on the person's start day, but where the
rate of payment subsequently would become payable at a rate greater than nil during
the income maintenance period. In these circumstances, the effect of
subsections 500WC(3) and 549CB(3) is that the income maintenance period is taken
to have ended for the purpose of the ordinary waiting period provisions when the
payment would have become payable at a rate greater than nil. This means that the
person will serve the ordinary waiting period when their rate of parenting payment or
youth allowance (other) would have become payable at a rate greater than nil.
Subsections 500WB(4) and 549CB(4) provide for the start of an ordinary waiting
period for parenting payment or youth allowance (other) where:
a person is subject to an ordinary waiting period (the first ordinary waiting
period) for any payment; and
during the first ordinary waiting period, the person ceases to be qualified for
the payment to which the first ordinary waiting period relates; and
during the first ordinary waiting period, the person claims another payment
which has an ordinary waiting period (the second ordinary waiting period).
In these circumstances, the second ordinary waiting period starts on the day that the
first ordinary waiting period starts.
Item 11 inserts a reference to an ordinary waiting period in section 549.
Section 549 provides that a youth allowance is not payable to a person who is
subject to a waiting period. Certain waiting periods are specified for the purpose of
that provision, and it is appropriate to include a reference to an ordinary waiting
period, given one of the effects of this Schedule is to create an ordinary waiting
period for youth allowance (other).
Items 13, 14 and 15 make consequential amendments to section 549F.
Section 549F makes it clear that a youth allowance is not payable until both the
waiting periods mentioned in Subdivision C of Division 2 of Part 2.11 of the Social
Security Act have ended. As this Schedule inserts a new ordinary waiting period for
youth allowance (other), section 549F will now make it clear that a youth allowance
is not payable until all of the waiting periods in Subdivision C, including an ordinary
waiting period, have ended.
Items 16 and 21 amend paragraphs 620(1)(a) and 693(a). Current sections 620
and 693 provide for the ordinary waiting period for newstart allowance and sickness
allowance. Paragraphs 620(1)(a) and 693(a) provide that a person is not subject to
an ordinary waiting period for newstart allowance and sickness allowance if the
person has received an income support payment in a 13-week period. The effect of
these items is to make it clear that this 13-week period is the period before the
person's start day, disregarding clause 5 of Schedule 2 to the Social Security
Administration Act. This will generally be the 13 weeks before the person made a
claim for newstart allowance or sickness allowance.
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Schedule 1 - Ordinary waiting periods
Items 17 and 22 are consequential to the amendments made by items 19 and 24.
Items 18 and 23 amend paragraphs 620(1)(g) and 693(f), the effect of which is that
an ordinary waiting period for newstart allowance and sickness allowance will not
apply if the person is experiencing a personal financial crisis, as defined in new
section 19DA (inserted by item 5 of this Schedule).
Items 19 and 24 insert new notes that are consequential to the amendments made
by this Schedule.
Items 20 and 25 substitute sections 621 and 694 with new provisions that provide
for the duration of the ordinary waiting period for newstart allowance and sickness
allowance.
The effect of subsections 621(1) and 694(1) is that, subject to subsections (3) and
(5) of those provisions, the ordinary waiting period is a period of seven days starting
on the day that newstart allowance or sickness allowance, as applicable, would have
been payable but for the ordinary waiting period.
Subsections 621(2) and 694(2) provide for the start of an ordinary waiting period for
newstart allowance and sickness allowance where the person is disqualified for
those payments because of the liquid assets test. In these circumstances,
the ordinary waiting period is the period of seven days that starts after the end of the
liquid assets test waiting period.
Subsections 621(3) and 694(3) provide for the start of an ordinary waiting period for
newstart allowance and sickness allowance where the person is subject to a newly
arrived resident's waiting period, a seasonal work preclusion period, a lump sum
preclusion period or an income maintenance period where the rate of newstart
allowance or sickness allowance payable would be nil on the start day. If a person is
subject to one or more of the other waiting periods or preclusion periods, then the
ordinary waiting period starts on the day after all the other waiting periods and
preclusion periods have ended. The effect of this is that the ordinary waiting period
cannot be served concurrently with other relevant waiting periods and preclusion
periods.
Subsections 621(4) and 694(4) provide for circumstances in which a person is
subject to an income maintenance period where the person's rate of newstart
allowance or sickness allowance is nil on the person's start day, but where the rate
of payment subsequently would become payable at a rate greater than nil during the
income maintenance period. In these circumstances, the effect of
subsections 621(4) and 694(4) is that the income maintenance period is taken to
have ended for the purpose of the ordinary waiting period provisions when the
payment would have become payable at a rate greater than nil. This means that the
person will serve the ordinary waiting period when their rate of newstart allowance or
sickness allowance would have become payable at a rate greater than nil.
Subsections 621(5) and 694(5) provide for the start of an ordinary waiting period for
newstart allowance and sickness allowance where:
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Schedule 1 - Ordinary waiting periods
a person is subject to an ordinary waiting period (the first ordinary waiting
period) for any payment; and
during the first ordinary waiting period, the person ceases to be qualified for
the payment to which the first ordinary waiting period relates; and
during the first ordinary waiting period, the person claims another payment
which has an ordinary waiting period (the second ordinary waiting period).
In these circumstances, the second ordinary waiting period starts on the day that the
first ordinary waiting period starts.
Item 26 provides that the amendments made by this Schedule apply in relation to a
claim for a social security payment that is made on or after the commencement of
this Schedule.
8
Schedule 2 - Age requirements for various Commonwealth payments
Summary
From 1 July 2016, this Schedule provides that young unemployed people
aged 22 to 24 would no longer be eligible for newstart allowance or sickness
allowance until they turn 25 years of age and would, instead, be able to claim and
qualify for youth allowance. To enable this, youth allowance for all types of people
who can satisfy the activity test, will be available to people who have not yet reached
25. Youth disability supplement will also be available to all youth allowance
recipients who have not yet reached 25. The amendments include a grandfathering
arrangement to allow existing newstart allowance recipients who are 22, 23 or 24
leading up to commencement (or people undergoing certain waiting periods or
suspension periods) to remain in receipt of newstart allowance. Similar savings
rules are provided for sickness allowance.
This Schedule also makes consequential amendments to the Farm Household
Support Act to align rates at which farm household allowance is paid to farmers and
their partners, with newstart allowance and youth allowance rates.
Background
The key aim of this measure is to provide incentives to young unemployed people to
obtain the relevant education and training to increase employability. Changes to
labour markets presage the need for a highly educated and skilled workforce and
this measure is designed to encourage young people to adequately skill themselves
and move off unemployment benefits. The proposal is driven by the current high
youth unemployment rate.
Presently, unemployed youth aged 22 to 24 are able to qualify for newstart
allowance or sickness allowance rather than youth allowance. People in this age
bracket may perceive an advantage by remaining in receipt of newstart allowance
and a disincentive to pursue full-time study or employment, given the higher rate of
newstart allowance and sickness allowance as compared to youth allowance. This
measure removes this disincentive by placing all under 25 year olds on the same
payment levels whether unemployed or studying full-time. The broad financial
incentives provided for further education in lieu of working, applying to those on
youth allowance (student) payments are not diminished, since youth allowance
(student) attracts more generous income testing compared to youth allowance
(other). In addition, a facility is provided to youth allowance (student) recipients to
accumulate a student income bank of $10,000 without affecting payments.
While youth allowance is paid at lower rates to newstart allowance, the payment has
a larger income free area compared to newstart allowance, providing greater
flexibility to earn while on payment.
9
Schedule 2 - Age requirements for various Commonwealth payments
Explanation of the changes
Amendments to the Social Security Act
Item 1 replaces the reference to age 22 in paragraphs 19C(8)(b) and (c) of the
Social Security Act with a reference to age 25. This amendment is consequential on
the age adjustments proposed to be made by the Bill to youth allowance and
newstart qualification rules. Section 19C deals with definitions for a number of terms
related to when a person is in severe financial hardship. The concept of severe
financial hardship is relevant to a number of provisions in the Social Security Act,
including those dealing with advance payments, ordinary waiting periods, special
employment advances, certain rules dealing with seasonal workers and others.
The specific amendments to paragraphs 19C(8)(b) and (c) will ensure that the
reference to 'maximum payment rate' in subsections 19C(2) and (3) will mean that
the age thresholds relevant to determining a person's maximum payment rate will be
interpreted in line with the new qualification age thresholds for youth allowance and
newstart allowance as proposed by this Schedule to the Bill.
Item 2 replaces the reference to age 22 in paragraphs 38K(2)(a) and (b) with a
reference to age 25. Section 38K sets out an income test for a person's social
security pension if green army allowance is payable to the person's partner.
Subsection 38K(1) provides that if the amount of the partner's green army allowance
exceeds the threshold applicable under subsection 38K(2), the part of the green
army allowance that exceeds that threshold is ordinary income of the person's
partner. Current subsection 38K(2) provides a different threshold where a person's
partner is aged under 22 compared to where the person's partner is aged 22 or over.
There is a higher threshold for a person aged over 22 years compared with a person
aged under 22 years. This item will changes the age references in
subsection 38K(2) to 25 years.
Item 3 is the key amendment that will lift the qualification age for youth allowance,
allowing people who have not yet reached 25 to qualify. Under section 543 of the
Social Security Act, a person is of youth allowance age if the person has attained the
'minimum age for youth allowance' and has not yet attained the 'maximum age for
youth allowance' as set out under section 543B. Prior to these amendments,
the maximum age for youth allowance under section 543B was set at different ages
(either 22 or 25) for people not undertaking full-time study, people undertaking
full-time study and people who are 'new apprentices'. This amendment proposes to
set the maximum age of youth allowance at 25 for all people previously dealt with by
subsection 543B(1). Note that subsection 543B(2) will still provide that people in
receipt of youth allowance at the time they turn 25 to remain below the maximum
age for youth allowance if they continue full-time study or remain as a new
apprentice after they turn 25. The amendments made by this item will operate
subject to the application rules set out in item 15.
Items 4 and 5 propose to make changes to the basic qualification rules for newstart
allowance, amending references to age 22 to age 25. These amendments will
ensure that a person is only qualified for youth allowance during a period where they
have reached the age of 25. These amendments will operate subject to the
application rules set out in item 16.
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Schedule 2 - Age requirements for various Commonwealth payments
Item 6 proposes to amend the age at which a person can qualify for sickness
allowance, by changing the reference to 22 years to 25 years in paragraph 666(1)(e)
of the Social Security Act. This will mean that, from commencement, a person will
no longer be able to qualify for sickness allowance if they have not yet turned 25
years old. This amendment will operate subject to the application rules set out in
item 17.
Item 7 proposes to amend the age at which a person is able to have an amount by
way of youth disability supplement to be added to their rate of youth allowance under
the youth allowance rate calculator. Prior to these amendments, a person can only
receive an amount by way of youth disability supplement if they have not turned 22.
These amendments will allow a person to receive youth disability supplement up to
the age of 25 to align with the adjustment to the maximum age for youth allowance
made by item3.
Items 8, 9, 10 and 11 propose to make changes to the rules around how to
determine the 'partner income free area for a person' for the purposes of the youth
allowance, austudy payment, benefit rate calculator B (including for newstart
allowance) and parenting payment (partnered) rate calculators. Prior to these
amendments, the partner income free area was determined by reference to the
amount of income of a partner beyond which youth allowance or newstart allowance
would not be payable to the partner if the partner were qualified for youth allowance
or newstart allowance. Whether the calculation is conducted by reference to youth
allowance or newstart allowance depends on the age of the partner: whether they
have reached 22 years of age or not. The amendments propose to change
references to 22 to 25 for relevant 'partner income free area' provisions such that the
'partner income free area for a person' will be calculated by reference to the income
test for youth allowance for partners who are not yet 25 and by reference to the
income test for newstart allowance for partners who have already turned 25.
Item 12 is an amendment consequential upon the changes to youth disability
supplement proposed by item 7. Item 12 addresses the description of youth
disability supplement in the indexation table at section 1190 of the Social Security
Act to refer to youth disability supplement as payable to a recipient of youth
allowance who is under 25 (rather than under 22). This item in the indexation table
operates to make clear which amount is subject to the indexation rules in Part 3.16
of the Social Security Act.
Item 13 is an application provision to clarify that the amendments made to the
'severe financial hardship' definitions in item 1 will apply for days on or after the
commencement date.
Item 14 is an application provision to clarify that the amendment made by item 2 to
the income test for a person's social security pension where green army allowance is
payable to the person's applies in relation to instalment periods ending on or after
the commencement date.
Item 15 is an application provision that sets out how various amendments proposed
by this Schedule will affect different people.
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Schedule 2 - Age requirements for various Commonwealth payments
Subitem 15(1) sets out the default rule ('default' in the sense that it operates subject
to subitems 15(2) and (3)) that the amendments made by item 3 to the 'maximum
age for youth allowance' apply for the purposes of working out whether a person
qualifies for youth allowance for days from commencement date and onwards.
Subitem 15(2) provides that, if a person was aged 22, 23 or 24 on the day before
the amendments to adjust the 'maximum age of youth allowance' commence and is,
at that time, receiving newstart allowance (or is undergoing a period of suspension),
the amendment to the maximum age of youth allowance does not apply to the
person until their newstart allowance is cancelled. This provision will operate to
ensure, along with subitem 16(2), that existing people in receipt of newstart
(or subject to a period of suspension) will remain in receipt of newstart in spite of the
amendments proposed to the ages at which a person can qualify for youth allowance
and newstart allowance as proposed by this Schedule to the Bill.
Subitem 5(3) is an application provision that will apply to a person where a claim for
newstart allowance was granted before the commencement of item 3 in
circumstances where the start day is worked out as being on a day after the
commencement date. If this provision applies to a person, the amendments made
by item 3 (to adjust the 'maximum age of youth allowance') will not apply to that
person until their newstart allowance is cancelled.
Subitem 15(4) is an application provision that deals with when the changes to youth
disability supplement (as paid as an amount by way of youth allowance) proposed by
item 7 will apply to a person. The subitem states that the amendment made by
item 7 will apply from the commencement date onwards.
Item 16 deals with various circumstances around how the amendments made by
items 4 and 5 (to raise the lower age qualification limits for newstart allowance)
apply, depending upon a person's particular case as follows.
Subitem 16(1) sets out the default rule (to operate subject to the more specific rules
in the remainder of item 16) that the amendments made by items 4 and 5 apply for
working out whether a person is qualified for newstart allowance from days
extending from the commencement date onwards.
Subitem 16(2) provides that if, immediately before the amendments made by this
Schedule commence (that is, on 30 June 2015), the person was aged 22, 23 or 24
and was receiving newstart allowance (or subject to a period of suspension),
the amendments made by items 4 and 5 (to raise the lower qualification age for
newstart allowance from 22 to 25) do not affect the person from the commencement
date until their newstart is cancelled. This provision will mean that existing recipients
of newstart allowance, at the time this Schedule commences, will be able to remain
in receipt of newstart allowance.
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Schedule 2 - Age requirements for various Commonwealth payments
Subitem 16(3) operates to ensure that claims for newstart allowance made by
people aged 22, 23 or 24 that have been made but not determined by the Secretary
at the time immediately before the commencement date can still be granted on the
basis that the lower age limit for qualification for newstart allowance is not affected
by the amendments proposed by items 4 and 5. This means that 22, 23 and 24 year
old people who have a claim pending (that is, made but not determined) on the
commencement date can still be granted newstart allowance on the basis of the
claim as if the lower age limit for qualification remains 22, from the commencement
date until the person's payment (if granted as a result of the claim) is cancelled.
Subitem 16(4) deals with the application of the amendments proposed by items 4
and 5 to people aged 22, 23 or 24 who have claimed newstart allowance prior to the
time this Schedule commences and who are undergoing a liquid assets test waiting
period, in relation to that claim, on the commencement date. For such people,
the amendments made by items 4 and 5 do not apply from the commencement date
in relation to their claim and subsequent qualification for and payment of newstart
allowance as a result of that claim. Once any payment as a result of that claim is
cancelled, the person will no longer be subject to this application provision and will
not be able to qualify for newstart allowance again until they turn 25.
Subitem 16(5) ensures that people serving an income maintenance period on
1 January 2015 in relation to newstart allowance are not affected by the
amendments proposed by items 3 and 4 from the commencement date until their
payment is cancelled. This provision will operate as a beneficial rule for people who
are 22, 23 and 24 in these circumstances, as they will able to resume payment on
newstart allowance following their income maintenance period, notwithstanding the
proposal to raise the age of qualification for newstart allowance to 25.
Subitem 16(6) is an application provision that will apply to a person where a claim
for newstart allowance was granted before the commencement of items 4 and 5 in
circumstances where the start day is worked out as being on a day after the
commencement date. If this provision applies to a person, the amendments made
by items 3 and 4 (to raise the lower age for qualification for newstart allowance) will
not apply to that person until their newstart allowance is cancelled. This will operate
beneficially for such people aged 22, 23 or 24 at the time of commencement, as
people of these ages will still be able to receive newstart allowance, notwithstanding
the amendments to the qualification age for newstart allowance proposed by this
Schedule.
Subitems 17(1) and (2) provide that item 6, which amends the lower qualification
age for sickness allowance from 22 to 25, applies for working out a person's
qualification for sickness allowance from the commencement date onwards, unless
the person is 22, 23 or 24 on the commencement date and is in receipt of sickness
allowance or is undergoing a period of suspension in relation to their sickness
allowance: such people can remain in receipt (or have their sickness allowance
payment resumed after a period of suspension) following the commencement date
until their payment is cancelled.
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Schedule 2 - Age requirements for various Commonwealth payments
Subitems 17(3) to 17(6) are modelled on the application provisions for newstart
allowance at subitems 16(3) to 16(6), and operate as described in more detail above
in relation to newstart allowance in circumstances where, for people aged 22, 23 and
24: a claim is made but not determined; the person is serving a liquid assets test
waiting period; the person is serving an income maintenance period; or a claim is
granted but the person's start day is after the commencement date.
Item 18 provides that the amendments made by items 8, 9, 10 and 11 (which make
changes to the rules around how to determine the 'partner income free area' for a
person) apply in relation to working out that rates of social security payments for a
person for days following the commencement date onwards.
Amendments to the Farm Household Support Act
Items 19, 20, 21 and 22 replace a number of references in the Farm Household
Support Act to a person who has 'turned 22' to references to a person who has
'turned 25'. The changes are consequential upon the changes to the qualification
ages for youth allowance and newstart allowance proposed by items 3, 4 and 5 of
this Schedule to the Bill. Prior to these amendments, farm household allowance was
paid either at youth allowance rates or newstart allowance rates, depending upon
whether a person had turned 22. These amendments will ensure payment rates of
farm household allowance remain aligned with payment rates of youth allowance
and newstart allowance for people of the same age.
Similarly, items 23, 24 and 25 replace a number of references in the Farm
Household Support Act to a person who has 'not turned 22' to references to a person
who has 'not turned 25'. These amendments will also ensure payment rates of farm
household allowance remain aligned with payment rates of youth allowance and
newstart allowance for people of the same age.
Item 26 makes amendments to the table in section 93 of the Farm Household
Support Act that deals with reading certain references in the Social Security Act for
the purposes of the Farm Household Support Act. The amendments to items 1
and 2 in the table will ensure that, from commencement, references to newstart
allowance and youth allowance in the Social Security Act are to be read as including
references to people who have and have not turned 25 respectively (subject to the
other rules in Division 2 of Part 5 of the Household Support Act). The amendments
to items 15 and 16 in the table will ensure that, from commencement, references to
the newly arrived resident's waiting period for newstart allowance and youth
allowance are to be read as references to a newly arrived resident's waiting period
(within the meaning of the Farm Household Support Act) for people who have and
have not turned 25 respectively.
The amendments made by item 27 are various application rules which determine
how certain people are affected by the amendments made by items 21, 22, 24 and
24 from the commencement date.
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Schedule 2 - Age requirements for various Commonwealth payments
Subitem 27(1) sets out a default rule (that is, one that is subject to subitems 27(2)
and (3)) for how various substantive provisions made by this Schedule apply
(excluding amendments made to headings and the outline at section 7 of the Farm
Household Support Act). Subitem (1) states that amendments made by items 21,
22, 24 and 25, to change references to age 22 to age 25 throughout the Farm
Household Support Act apply for working out the rate of a person's farm household
allowance from the commencement date and days following.
Subitem 27(2) ensures that people in receipt of farm household allowance on the
commencement date (or for whom payment is suspended) and who are aged 22, 23
or 24 are not affected by amendments to change references to age 22 to age 25
made by items 21 and 22. This is a beneficial rule which will ensure that such
people will be able to be paid farm household allowance at the newstart allowance
rate (under benefit rate calculator B of the Social Security Act) notwithstanding
amendments made to Subdivision A of Division 8 of the Farm Household Support
Act. Note that equivalent amendments are not required in relation to the
amendments made by items 24 and 25 as these items change references to people
who 'have not turned 22' to references to people who 'have not turned 25', the
rationale being that people who have not turned 22 on commencement will also have
not turned 25. People will only remain able to benefit from this application provision
until their payment is cancelled.
Subitem 27(3) is a similar rule that deals with people who are aged 22, 23 or 24 on
commencement whose claim has been granted prior to the commencement date for
a start date on or after the commencement date. Such people are also not affected
by the amendments made by items 21 and 22 and can therefore receive farm
household allowance at the newstart allowance rate (under benefit rate calculator B
of the Social Security Act) notwithstanding amendments made to Subdivision A of
Division 8 of the Farm Household Support Act. People will only remain able to
benefit from this application provision until their payment is cancelled.
Subitem 27(4) ensure that the amendments proposed for changing the reference
from 22 to 25 in items 1 and 16 of the table in subsection 93(1) of the Farm
Household Support Act do not apply during the period that the application provisions
described above (and particularly subitems 27(2) and (3)) do not apply. Aligned in
this way to the period for which the application provisions dealing with items 21 and
22 operate for a person, this subitem also ensures that people aged 22, 23 and 24
on commencement who are in receipt of farm household allowance, subject to a
period of suspension, or for whom a claim has been determined but whose start date
follows the commencement date, can benefit from their payment being calculated at
the at the newstart allowance rate (under benefit rate calculator B of the Social
Security Act) until their farm household allowance is cancelled.
15
Schedule 3 - Income support waiting periods
Summary
This measure introduces a four-week waiting period for job ready young people who
are looking for work to receive income support payments. During this four-week
period, job seekers under 25 years of age who have been classified as job ready
(Stream A) by the Job Seeker Classification Instrument will also be required to
complete assigned activities, through a new program, RapidConnect Plus, that will
help them prepare for and find work.
Background
This measure aims to encourage greater participation in work and other activities
and make the welfare system fairer and more sustainable, to ensure a productive
Australian workforce for the future. The measure establishes firm expectations for
young job seekers. It provides an incentive for affected persons to be self-sufficient,
or to undertake further relevant education or training to increase employability before
relying on the taxpayer for support.
Subject to some exceptions, the amendments made by this Schedule will apply from
1 July 2016 to a person aged under 25 years who is a new claimant for youth
allowance (other) and, in certain circumstances, special benefit. Such a person will
be subject to a four-week waiting period, as well as any other waiting periods that
may apply, before the social security benefit becomes payable.
A person will not be subject to the new waiting period if they are subject to an
exemption. This Schedule sets out a number of exemptions for a person who is not
yet job ready and allows the Minister to specify further exemptions in a legislative
instrument.
The amendments made by this Schedule commence on 1 July 2016.
Explanation of the changes
Part 1 - Main amendments
Amendments to the Social Security Act
Item 1 inserts a new definition of income support waiting period into
subsection 23(1). This Schedule provides for a new youth allowance income support
waiting period under new section 549CAA and a new special benefit income support
waiting period under new section 739AA.
Items 2 and 3 amend the definition of waiting period in subsection 23(1) to refer to
the new income support waiting period for youth allowance and special benefit.
Item 4 is a technical amendment to remove a redundant reference to section 732 in
paragraph (ka) of the definition of waiting period. Section 732 no longer provides
for a waiting period.
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Schedule 3 - Income support waiting periods
Item 5 amends subsection 549(2) to provide for an income support waiting period
under section 549CAA (as inserted by item 6). Section 549 provides that youth
allowance is not payable if a person is subject to certain waiting periods.
Item 6 inserts new sections 549CAA and 549CAB to provide for a new income
support waiting period for youth allowance and exemptions from that waiting period.
Persons subject to the income support waiting period
Subsection 549CAA(1) provides that a person is subject to an income support
waiting period if the person who is qualified for youth allowance is neither
undertaking full-time study nor a new apprentice.
As a result of amendments made by Schedule 2 to this Bill, the maximum age at
which a person is qualified for youth allowance will be increased to 24 years.
As such, the youth allowance income support waiting period will apply to a person
who is under the age of 25 years.
Subsection 549CAA(2) provides that a person is not subject to an income support
waiting period if:
the person was qualified for another income support payment (other than
youth allowance or special benefit) on the day before the person qualified for
youth allowance (other). This means that a person who 'transfers' from most
other social security payments to youth allowance (other) will not be subject to
the income support waiting period;
an exemption in section 549CAB (inserted by this item) applies to the person
on the person's start day (worked out disregarding clause 5 of Schedule 2 to
the Social Security Administration Act). The general rule is that the start day
is the day of the person's claim for a social security payment, if the person is
qualified for the payment on that day;
the person has served a four-week income support waiting period for youth
allowance or special benefit in the previous six months.
Length of the income support waiting period
Subsection 549CAA(3) provides that an income support waiting period starts on the
person's start day (worked out disregarding clause 5 of Schedule 2 to the Social
Security Administration Act) for youth allowance. This means that, in most
circumstances, a youth allowance income support waiting period will start on the day
the person makes a claim for youth allowance, if the person is qualified for youth
allowance on that day.
The income support waiting period will start even if the person is subject to other
waiting periods and exclusion periods. That is, the income support waiting period
will be served concurrently with any other waiting periods and exclusion periods, with
the exception of the ordinary waiting period which will start after the income support
waiting period has ended (see item 7 of this Schedule).
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Schedule 3 - Income support waiting periods
Subsection 549CAA(4) provides that the income support waiting period ends on the
earliest of the following:
four weeks after it started;
when the person turns 25 years of age;
when section 549CAB applies to the person. Section 549CAB (inserted by
this item) provides for exemptions to the income support waiting period;
if the person was serving an income support waiting period for special benefit
when the person claims and qualifies for youth allowance (other), when the
income support waiting period for special benefit would have ended.
Special rules for transitioning between youth allowances
Subsection 549CAA(5) modifies rules in section 549CAA where a person becomes
qualified for youth allowance (other) immediately after they were qualified for youth
allowance on the basis of being a student or new apprentice. In particular, one of
the effects of subsection 549CAA(5) is that a person may be required to serve an
income support waiting period if the person became qualified for youth allowance
(other) on the day after the person was qualified for youth allowance on the basis of
being a student or new apprentice.
Subsection 549CAA(6) provides for the end of an income support waiting period
where a person was previously subject to that waiting period because they were
qualified for youth allowance (other) and they then become qualified for youth
allowance on the basis of being a student or new apprentice. In these
circumstances, the waiting period will end when the person becomes qualified for
youth allowance on the basis of being a student or new apprentice.
Exemptions
New section 549CAB provides for exemptions from the income support waiting
period. A person is exempt from an income support waiting period if the person:
is a parent of an FTB child. The effect of this is that a parent who has
35 per cent care of a child will be exempt from an income support waiting
period;
is the principal carer of a child;
is in State care or ceased to be in State care during the previous 12 months.
Subsection 549CAB(3) provides that a person is in State care if:
o the person is in the guardianship, care or custody of a court, a Minister,
or a Department, of the Commonwealth, a State, or a Territory; or
o there is a current direction from such a court, Minister or Department
placing the person in the guardianship, care or custody of someone
who is not the person's parent;
is not required to satisfy the activity test for 15 days or more on the basis that
the person has:
o a temporary incapacity exemption;
18
Schedule 3 - Income support waiting periods
o a pre-natal exemption or post-natal exemption;
o a domestic violence or other special family circumstances exemption;
o a disabled child or other family circumstances exemption;
o a training camp exemption; or
o a special circumstances exemption.
requires employment services or disability employment services of a class
determined by the Minister in a legislative instrument.
Paragraph 549CAB(2)(a) provides that the Minister may determine classes of
employment services or disability employment services for this purpose. It is
intended that the legislative instrument would determine classes of
employment services or disability employment services which mean that the
person is not 'job ready'. This means that only a person who is 'job ready' will
be subject to the income support waiting period;
is covered by an exemption determined by the Minister by legislative
instrument. Paragraph 549CAB(2)(b) provides that the Minister may
determine exemptions for this purpose.
Item 7 amends new subsection 549CB(2) (as inserted by Schedule 1 to this Bill)
to provide that an ordinary waiting period for youth allowance starts after the income
support waiting period ends. This will ensure that the new income support waiting
period is treated in the same way as other waiting periods and exclusion periods.
An ordinary waiting period will start after all waiting periods and exclusion periods
have ended.
Item 8 inserts a new paragraph into a special benefit qualification provision.
A person is generally qualified for special benefit only if other social security benefits
or social security pensions are not payable to the person. However, under current
provisions, a person is not qualified for special benefit if youth allowance is not
payable to the person because of certain non-payment periods or preclusion periods.
The effect of this item is that a person will not be qualified for special benefit if youth
allowance is not payable to the person because of an income support waiting period.
It would undermine the integrity of income support waiting periods if a person was
able to qualify for, and be paid, special benefit while they are subject to an income
support waiting period for youth allowance.
Item 9 inserts new sections 739AA and 739AB to provide for a new income support
waiting period for special benefit and exemptions from that waiting period.
Persons subject to the income support waiting period
Subsection 739AA(1) provides that a person is subject to an income support waiting
period if:
the person is qualified for a special benefit; and
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Schedule 3 - Income support waiting periods
the person is an Australian resident or the holder of a visa determined by the
Minister in a legislative instrument. Subsection 739AA(5) provides that the
Minister may determine classes of visas; and
on the person's start day (worked out disregarding clause 5 of Schedule 2 to
the Social Security Administration Act) for the special benefit, the person has
attained the minimum age for youth allowance but less than 25 years of age.
The general rule is that the start day is the day of the person's claim for a
social security payment, if the person is qualified for the payment on that day.
Subsection 543A(1) provides that, subject to some exceptions, a person has
attained the minimum age for youth allowance if the person is at least 16
years old, or is 15 years old and is independent.
Subsection 739AA(2) provides that a person is not subject to an income support
waiting period if:
the person was qualified for another income support payment on the day
before the person qualified for special benefit. This means that a person who
'transfers' from another social security payment to special benefit will not be
subject to the income support waiting period;
an exemption in section 739AB (inserted by this item) applies to the person;
and
the person has served a four-week income support waiting period for youth
allowance or special benefit in the previous six months.
Length of the income support waiting period
Subsection 739AA(3) provides that an income support waiting period starts on the
person's start day (worked out disregarding clause 5 of Schedule 2 to the Social
Security Administration Act) for special benefit. This means that, in most
circumstances, a special benefit income support waiting period will start on the day
the person makes a claim for special benefit.
The special benefit income support waiting period will start even if the person is
subject to other waiting periods and exclusion periods. That is, the income support
waiting period will be served concurrently with any other waiting periods and
exclusion periods.
Subsection 739AA(4) provides that the income support waiting period ends on the
earliest of the following:
four weeks after it started;
when the person turns 25 years of age;
when the person becomes subject to an exemption under section 739AB.
Exemptions
New section 739AB provides that a person is exempt from an income support
waiting period if the person:
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Schedule 3 - Income support waiting periods
is a parent of an FTB child. The effect of this is that a parent who has 35 per
cent care of a child will be exempt from an income support waiting period;
is a principal carer of a child;
is in State care or ceased to be in State care during the previous 12 months.
Subsection 739AB(3) provides that a person is in State care if:
o the person is in the guardianship, care or custody of a court, a Minister,
or a Department, of the Commonwealth, a State, or a Territory; or
o there is a current direction from such a court, Minister or Department
placing the person in the guardianship, care or custody of someone
who is not the person's parent;
is not required to satisfy the activity test for 15 days or more on the basis that:
o the person has been subjected to domestic violence;
o has responsibility for the care of a child;
o special circumstances beyond the person's control exist;
o a pre-natal exemption or post-natal exemption applies to the person;
o the person was granted a visa during the previous 13 weeks that is
included in a class of visas granted for temporary protection,
humanitarian or safe haven purposes; or
o the person is temporarily incapacitated for work;
is taken to satisfy the activity test for 15 days or more on the basis that the
person would be qualified for carer payment in certain circumstances;
a special circumstances exemption;
requires employment services or disability employment services of a class
determined by the Minister in a legislative instrument. Paragraph 739AB(2)(a)
provides that the Minister may determine classes of employment services or
disability employment services for this purpose. It is intended that the
legislative instrument would determine classes of employment services or
disability employment services which mean that the person is not 'job ready'.
This means that only a person who is 'job ready' will be subject to the income
support waiting period;
is covered by an exemption determined by the Minister by legislative
instrument. Paragraph 739AB(2)(b) provides that the Minister may determine
exemptions for this purpose.
Item 10 provides the application provision for this Schedule.
Subitem 10(1) provides that the amendments made by this Schedule apply in
relation to a claim for a social security payment made on or after the commencement
of the Schedule.
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Schedule 3 - Income support waiting periods
Subitem 10(2) provides a specific application provision for a person transitioning
between youth allowances. Where a person made a claim for youth allowance
before commencement and became qualified for that payment on the basis of being
a student or new apprentice, but becomes qualified for youth allowance (other) after
commencement, then the new income support waiting period starts on the day the
person became qualified for youth allowance (other).
22
Schedule 4 - Low income supplement
Summary
This Schedule provides for the cessation of the low income supplement from
1 July 2017.
Background
This Schedule ceases the low income supplement from 1 July 2017. The low
income supplement is an annual lump sum to be paid to independent adults in
low-income households who met residence, income and tax requirements, and who
could show that they were not adequately assisted through the tax reform package
and the household assistance measures set out with the introduction of the carbon
price.
The low income supplement is paid, as an annual tax-exempt lump sum, to adults in
low-income households, based on the household's circumstances from the previous
income year. The low income supplement was payable to qualifying individuals from
1 July 2012. The amount of the payment was $300 for each qualifying individual,
and was limited to one payment per year.
A person must make a new claim for the low income supplement each financial year,
and only during the relevant financial year. That is, a claim for the 2014-15 financial
year must be lodged between 1 July 2014 and 30 June 2015, and a claim for the
2015-16 financial year must be lodged between 1 July 2015 and 30 June 2016.
A person's claim for the low income supplement is assessed with reference to the
claimant's income for the previous financial year. Claims for the low income
supplement in respect of more than one financial year cannot be rolled into one
claim. Members of a couple cannot make a combined claim, and have to make a
claim for the low income supplement separately. The person, at the time the claim is
lodged, must be an Australian resident or a special category visa holder residing in
Australia and not subject to a newly arrived resident's waiting period. In addition,
a person must be in Australia at the time of making a claim.
The payment was originally known as the clean energy low income supplement,
and then changed to the low income supplement following the repeal of the carbon
price. It is also known by its administrative name of the low income family
supplement (as it applies to family tax benefit recipients).
Very few claims for low income supplement have been received, and it is
administratively highly complex. Recipients of most Government payments will
continue to receive carbon tax compensation through the energy supplement, which
provides up to $14.10 per fortnight depending on individual circumstances.
The amendments made by this Schedule commence on 1 July 2017.
23
Schedule 4 - Low income supplement
Explanation of the changes
Part 1 - Main amendments
Amendments to the Social Security Act
Item 3 repeals Division 3 of Part 2.18A, which provides qualification criteria for
low income supplement.
Items 1, 2, and 4 to 7 are consequential to item 3, and remove references to
low income supplement.
Amendments to the Social Security Administration Act
Items 8 to 10 and 16 repeal provisions relating only to low income supplement,
which become redundant as a result of the repeal of low income supplement.
Items 11 to 15 omit references to 'low income supplement' consequential to the
main amendments repealing low income supplement.
Part 2 - Taxation amendments
Amendments to the Income Tax Assessment Act 1936
Item 17 repeals paragraph 202(haa) from section 202 of the Income
Tax Assessment Act 1936 as it facilitated the administration of Division 3 of
Part 2.18A of the Social Security Act, which is repealed by item 3.
Amendments to the Taxation Administration Act 1953
Items 18 and 19 make minor technical amendments to paragraphs 8WAA(1AA)(b),
8WB(1A)(a) and 8WB(1A)(b) of the Taxation Administration Act 1953 as a
consequence of the amendment made by item 18.
Part 3 - Contingent amendments
Amendments to the Social Security Administration Act
Item 20 and 21 are contingent on the commencement of item 57 of Schedule 2 to
the Social Services and Other Legislation Amendment (Student Measures) Act 2015.
Item 20 will commence on 1 July 2017, unless item 57 of Schedule 2 to the Social
Services and Other Legislation Amendment (Student Measures) Act 2015
commences on or before 1 July 2017, in which case item 20 does not commence at
all. Item 20 removes the redundant reference to low income supplement in
subsection 238(1A).
24
Schedule 4 - Low income supplement
However, item 21 deals with item 57 of Schedule 2 to the Social Services and Other
Legislation Amendment (Student Measures) Act 2015 commencing after the low
income supplement is ceased. Item 21 will commence immediately after the
commencement of the remainder of Schedule 4 ceasing low income supplement and
immediately after the commencement of item 57 to Schedule 2 to the Social
Services and Other Legislation Amendment (Student Measures) Act 2015 unless
item 57 of the Social Services and Other Legislation Amendment (Student
Measures) Act 2015 does not commence at all, in which case item 21 does not
commence.
Item 21 repeals paragraph 238(1A)(a), which is inserted by item 57 to Schedule 2 to
the Social Services and Other Legislation Amendment (Student Measures) Act 2015.
That paragraph refers to low income supplement, and would be redundant.
Part 4 - Saving provisions
Item 22 sets out a number of saving provisions.
Subitem (1) states that, despite the amendment made by item 3, Division 3 of
Part 2.18A of the Social Security Act, as in force immediately before the
commencement of this item, continues to apply on and after that commencement in
relation to working out qualification for a low income supplement for the 2016-17
income year or an earlier income year. This will ensure that late claims for
low income supplement for the 2016-17 income year or an earlier income year may
continue to be considered on the basis the person may qualify under this Part.
Subitem (2) states that, despite the amendments made by items 4, 5, 6, 7, 20 and
21, sections 1224A and 1231 of the Social Security Act and section 238 of the
Social Security Administration Act, as in force immediately before the
commencement of this item, continue to apply on and after that commencement in
relation to payments of low income supplement made before, on or after that
commencement. This will ensure that any debts due to the Commonwealth for
payments of low income supplement made prior to 1 July 2017 may continue to be
recovered.
Subitem (3) states that, despite the amendments made by items 8, 9 and 10, Part 3
of the Social Security Administration Act, as in force immediately before the
commencement of this item, continues to apply on and after that commencement in
relation to the making of claims for low income supplement for the 2016-17 income
year or an earlier income year. This will ensure that the manner and time limit
provisions in place for claims made by a person for the low income supplement may
continue to be considered on the basis outlined in this Subsection and Subdivision.
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Schedule 4 - Low income supplement
Subitem (4) states that, despite the amendments made by items 11, 12, 13 and 14,
Part 3 of the Social Security Administration Act, as in force immediately before the
commencement of this item, continues to apply on and after that commencement in
relation to making payments of low income supplement for the 2016-17 income year
or an earlier income year, and determinations made under that Part before, on or
after that commencement in relation to low income supplement. This will ensure that
payments of a single lump sum may be made if an individual is qualified for low
income supplement for the 2016-17 income year or an earlier income year before,
on or after commencement.
Subitem (5) states that, despite the amendment made by item 15, Part 4 of the
Social Security Administration Act, as in force immediately before the
commencement of this item, continues to apply on and after that commencement in
relation to a decision under the social security law in relation to low income
supplement made before, on or after that commencement. This will ensure that, if
an officer makes a decision under the social security law in relation to low income
supplement and notice is given to the person concerned, the person is not entitled to
make an application under subsection 129(1) for review of the decision more than
13 weeks after the giving of the notice.
Subitem (6) states that, despite the amendment made by item 16, section 204B of
the Social Security Administration Act, as in force immediately before the
commencement of this item, continues to apply on and after that commencement in
relation to claims for low income supplement made for the 2016-17 income year or
an earlier income year. This will ensure that the Secretary may continue to require
the Commissioner of Taxation to provide the Secretary with information about a
person in relation to claims for low income supplement made for the 2016-17 income
year or an earlier income year.
Subitem (7) states that, despite the amendments made by Schedule 4 to this Bill,
subsection 52-10(1L) of the Income Tax Assessment Act 1997, as in force
immediately before the commencement of this item, continues to apply on and after
that commencement in relation to payments of low income supplement made before,
on or after that commencement. Subsection 52-10L exempts 'clean energy
payments' from income tax. This will preserve the tax-exempt status of such
payments.
Subitem (8) states that, despite the amendments made by items 17, 18 and 19,
sections 8WA and 8WB of the Taxation Administration Act 1953, as in force
immediately before the commencement of this item, continue to apply on and after
that commencement in relation to a person exercising powers or performing
functions under, or in relation to, a law of the Commonwealth of a kind referred to in
paragraph 202(haa) of the Income Tax Assessment Act 1936 (as in force
immediately before that commencement). This will ensure that tax file numbers may
continue to be requested or recorded after the repeal of the low income supplement
provisions, where the request or recording of the tax file number is by a person
exercising powers or performing functions relating to the administration of the low
income supplement provisions in force before the repeal.
26
Schedule 5 - Indexation
Summary
This Schedule implements the following changes to Australian Government
payments:
maintain at level for three years from 1 July 2015 the income free areas for all
working age allowances (other than student payments) and for parenting
payment single; and
maintain at level for three years from 1 January 2016 the income free areas
and other means test thresholds for student payments, including the student
income bank limits.
Background
Under the current rules, income free areas and means test thresholds are indexed
annually in line with movements in the Consumer Price Index. Indexation occurs
either on 1 July or 1 January, depending on the payment involved.
This Schedule pauses for three years the indexation that occurs on 1 July each year
of various income thresholds that apply to certain social security benefits and
allowances (other than student payments) and the income test free area for
parenting payment single. Under this measure, these amounts will not be indexed
on 1 July 2015, 1 July 2016 and 1 July 2017.
Similarly, the usual 1 January indexation of the income free areas and other means
test thresholds for student payments will be paused for three years. These amounts
will not be indexed on 1 January 2016, 1 January 2017 and 1 January 2018.
When indexation recommences, it will apply to the (paused) thresholds and there will
be no catch-up in respect of indexation that would otherwise have occurred during
the three-year pause.
Explanation of the changes
Amendments to the Social Security Act
Item 1 relates to the benefits and allowances 'payment free area' (defined in
item 20AAA of the table in section 1190 of the Social Security Act). Current
subsection 1192(4AB) provides that the first indexation of amounts to which
item 14AAA of the CPI Indexation Table in subsection 1191(1) relates is to take
place on 1 July 2015. This item substitutes 1 July 2018 for the recommencement of
indexation.
Item 2 adds further subsections to section 1192.
27
Schedule 5 - Indexation
New subsection (5AAA) affects indexation provided for by item 14 in the CPI
Indexation Table in subsection 1191(1). Item 14 deals with the pension free area
(which is an abbreviation for the ordinary income free area for social security pension
- see item 20 of the table in subsection 1190(1)). To the extent the pension free
area relates to the Pension PP (Single) Rate calculator in point 1068A-E14,
new subsection (5AAA) provides it is not to be indexed on 1 July 2015, 1 July 2016
and 1 July 2017.
New subsection (5AAB) affects indexation provided for by items 14AA (the youth
allowance and austudy ordinary income free area), 14AB (the youth allowance and
austudy range reduction boundary), 15 (the student income bank balance limit)
and 24 (the youth allowance (non-independent) assets value limit) of the
CPI Indexation Table in subsection 1191(1). The amounts under these items are not
to be indexed on 1 January 2016, 1 January 2017 and 1 January 2018.
28
Statements of compatibility with human rights
STATEMENTS OF COMPATIBILITY WITH HUMAN RIGHTS
Prepared in accordance with Part 3 of the
Human Rights (Parliamentary Scrutiny) Act 2011
SOCIAL SERVICES LEGISLATION AMENDMENT
(YOUTH EMPLOYMENT AND OTHER MEASURES) BILL 2015
Schedule 1 - Ordinary waiting periods
This Schedule is compatible with the human rights and freedoms recognised or
declared in the international instruments listed in section 3 of the
Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Schedule
This Schedule amends the Social Security Act 1991 to extend and simplify the
application of the ordinary waiting period. The ordinary waiting period is a one-week
waiting period that currently applies to new claimants of newstart allowance and
sickness allowance. These new claimants must serve the waiting period before they
start payment, unless they are exempt or the waiting period is waived. The ordinary
waiting period reflects the general principle that people should support themselves
before seeking Government assistance and has existed since the first iteration of
these payments commenced in 1945.
The amendments in this Schedule seek to better promote self-support and
discourage a culture of automatic entitlement to income support by ensuring that the
waiting period is applied consistently and effectively across similar working age
payments.
Extend the ordinary waiting period to youth allowance (other) and parenting payment
This Schedule will extend the application of the Ordinary Waiting Period to new
claimants of youth allowance (other) and parenting payment. From 1 July 2015,
claimants of these payments will be required to serve the one week ordinary waiting
period before those payments are payable, unless exempt or the waiting period is
waived. The ordinary waiting period will also continue to apply to new claimants of
newstart allowance and sickness allowance. This means that the rules governing
when payment commences will be more consistent across similar working age
payment types. This limitation is reasonable as it ensures more consistent access to
similar working age payments while maintaining the longstanding principle of
self-support. Claimants without the means to support themselves will have access to
exemptions and waivers.
Introducing additional evidentiary requirements to 'severe financial hardship' waiver
Under existing legislation, claimants can have their ordinary waiting period waived if
the Secretary is satisfied that they are in 'severe financial hardship'. A person is in
'severe financial hardship' if the value of their liquid assets is less than their
fortnightly rate of payment if they are single, or less than double their fortnightly
payment if they are partnered.
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Statements of compatibility with human rights
This Schedule will tighten these waiver provisions by introducing an additional
requirement, in addition to severe financial hardship, that the person be experiencing
a 'personal financial crisis' and provide supporting evidence in order to have the
ordinary waiting period waived. The tightening of the severe financial hardship
waiver also acts as a discouragement for people to spend their resources on
non-essential items in order to obtain income support payments. These limitations
are reasonable as they ensure claimants use their own resources first, while still
enabling those who are in hardship due to extenuating circumstances to access
payments immediately.
A person may be taken to be experiencing a personal financial crisis if they have
been subjected to domestic violence or incurred unavoidable or reasonable
expenditure. Further, as the individual circumstances of people are many and
sometimes complex, it is not possible to envisage or legislate specifically in the
primary legislation to cover all circumstances. The use of legislative instruments
provides the Secretary or the Minister with the flexibility to refine policy settings to
ensure that the rules operate efficiently and fairly without unintended consequences.
The measure in this Schedule allows the Secretary (under the current Administrative
Arrangements Order, this means the Secretary of the Department of Social Services)
to prescribe, by legislative instrument, the circumstances which constitute a
'personal financial crisis' for the purposes of waiving the ordinary waiting period, in
addition to the circumstances set out in this Schedule.
This provision provides the Secretary with the flexibility to consider other
unforeseeable or extreme circumstances which may be identified in the future where
it would be appropriate for a person to have immediate access to income support.
Using an instrument will enable this to occur in a timely manner without having to
amend the primary legislation. This power can only be used beneficially and any
instrument made by the Secretary would be subject to Parliamentary scrutiny and
disallowance.
Other existing exemptions from the ordinary waiting period will also continue to be
available to claimants of the above payments who are:
reclaiming within 13 weeks of last receiving an income support payment; or
participating in certain employment services designed for vulnerable job
seekers with multiple barriers to work.
Removing the concurrent application of the waiting period
Currently, depending on individual circumstances, claimants may be able to serve
the ordinary waiting period concurrently with certain other waiting periods or periods
of reduced or non-payment. This may result in some claimants being treated more
beneficially than others.
2
Statements of compatibility with human rights
The Government acknowledges the increasing costs of the welfare system and
seeks to ensure that working age people first use their own resources before relying
on Government assistance. Exclusion periods, such as the income maintenance
period and liquid assets test waiting period, apply to certain working age income
support payments to enforce self-support for a period which is based on the person's
level of resources.
The amendments in this Schedule will remove the ability for claimants to serve the
ordinary waiting period concurrently with other waiting periods. This means the
ordinary waiting period will be served following the end of any other waiting periods,
including the liquid assets test waiting period, income maintenance period, seasonal
work preclusion period and newly arrived resident's waiting period.
The changes to the concurrency rules in this measure ensure that income support
payments are directed towards those in need.
Human rights implications
Right to social security
This Schedule engages the rights to social security contained in article 9 of the
International Covenant on Economic, Social and Cultural Rights (ICESCR).
The right to social security requires that a system be established under domestic
law, and that public authorities must take responsibility for the effective
administration of the system. The social security scheme must provide a minimum
essential level of benefits to all individuals and families that will enable them to cover
essential living costs.
The United Nations Committee on Economic, Cultural and Social Rights
(the Committee) has stated that a social security scheme should be sustainable and
that the conditions for benefits must be reasonable, proportionate and transparent
(see General Comment No.19).
Article 4 of ICESCR provides that countries may limit the rights such as to social
security in a way determined by law only in so far as this may be compatible with the
nature of the rights contained within the ICESCR and solely for the purpose of
promoting the general welfare in a democratic society. Such a limitation must be
proportionate to the objective to be achieved.
A central principle underpinning Australia's social security system is that support
should be targeted to those in the community most in need in order to keep the
system sustainable and fair. The amendments in this Schedule do not affect
eligibility for social security pensions or benefits, rather they affect the rules
governing when those eligible for certain payments can start receiving their
entitlements. The amendments focus on promoting self-support by requiring people
to meet their own living costs for a short period where they are able. New claimants
who need immediate financial assistance will still be able to access exemptions and
waivers provided they meet the relevant eligibility criteria. In this way, the
amendments help to ensure that immediate access to working age payments is
targeted to those most in need.
3
Statements of compatibility with human rights
To the extent that the changes in this Schedule may limit the right to social security,
those limitations are reasonable and proportionate to the policy objective of ensuring
a sustainable and well-targeted payment system.
Right to an adequate standard of living, including food, water and housing
This Schedule engages the right to an adequate standard of living, including food,
water and housing, contained in article 11 of the ICESCR. The right to an adequate
standard of living, including food, water and housing provides that everyone is
entitled to adequate food, clothing and housing and to the continuous improvement
of living conditions.
To the extent that there is an impact on a person's right to an adequate standard of
living, including food, water and housing, by virtue of this Schedule, the impact is
limited. The ordinary waiting period is a period of one week only during which those
claimants with the means to support themselves are expected to do so. Those who
are unable to accommodate their own living costs for that one week period because
they are in severe financial hardship and have experienced a personal financial crisis
will be able to have the waiting period waived.
Therefore, this Schedule is compatible with the right to an adequate standard of
living as the potential limitations on this right are proportionate to the policy objective
of encouraging self-support while providing a safety net as eligible people can be
exempted from serving the ordinary waiting period or can have the ordinary waiting
period waived.
Right to equality and non-discrimination
To avoid doubt, this Schedule is compatible with the right to equality and
non-discrimination contained in articles 2 and 26 of the International Covenant on
Civil and Political Rights (ICCPR).
Article 2(1) of the ICCPR obligates each State party to respect and ensure to all
persons within its territory and subject to its jurisdiction the rights recognised in the
Covenant without distinction of any kind, such as race, colour, sex, language,
religion, political or other opinion, national or social origin, property, birth or other
status (see CCPR General Comment No. 18).
Article 26 not only entitles all persons to equality before the law as well as equal
protection of the law, but also prohibits any discrimination under the law and
guarantees to all persons equal and effective protection against discrimination on
any ground such as race, colour, sex, language, religion, political or other opinion,
national or social origin, property, birth or other status (see CCPR General Comment
No. 18).
It is important to note, however, that not all differential treatment will be considered
discriminatory. The Committee has provided the following commentary on when
differential treatment will be considered discriminatory:
4
Statements of compatibility with human rights
Differential treatment based on prohibited grounds will be viewed as
discriminatory unless the justification for differentiation is reasonable and
objective. This will include an assessment as to whether the aim and
effects of the measures or omissions are legitimate, compatible with the
nature of the Covenant rights and solely for the purpose of promoting the
general welfare in a democratic society. In addition, there must be a
clear and reasonable relationship of proportionality between the aim
sought to be realised and the measures or omissions and their effects. A
failure to remove differential treatment on the basis of a lack of available
resources is not an objective and reasonable justification unless every
effort has been made to use all resources that are at the State party's
disposition in an effort to address and eliminate the discrimination, as a
matter of priority (CESCR, General Comment No. 20).
This Schedule will extend and simplify the application of the ordinary waiting period.
There will be no differential treatment on the basis of race, colour, sex, language,
religion, political or other opinion, national or social origin, property or birth as the
ordinary waiting period will apply equally to claimants of affected working age income
support payments.
As more than 90 per cent of parenting payment recipients are women, the changes
may more significantly impact on women in that regard. However, the changes are
reasonable and proportionate to achieving the legitimate objective of providing
consistency across similar working age payments by ensuring that all new claimants
meet their own living costs for a short period before receiving Government
assistance, where they are able.
The application of the ordinary waiting period to youth allowance (other) and
parenting payment, in addition to newstart allowance and sickness allowance, will
ensure that the waiting period is applied consistently to working age payments which
have a similar purpose. While the ordinary waiting period is not being extended to all
social security payments, this will not be a limitation on the right to equality and non-
discrimination as the differential treatment is for a reasonable and objective purpose.
The above working age payments are generally intended to be shorter-term
payments which provide support while also offering incentives to return to work.
Claimants of these payments are also more likely to be able to support themselves
for a time before needing income support as they may have transitioned from
employment or had other means of support. In contrast, pension payments, such as
age pension and disability support pension, provide longer-term support and are
designed to acknowledge ongoing barriers that make it difficult for claimants to
support themselves through paid employment. Additionally, claimants of student
payments generally have up-front expenses associated with their study which may
substantially reduce any means of self-support.
It is therefore reasonable and objective to apply an ordinary waiting period with
respect to the above mentioned types of working age payments to ensure that
claimants of these payments support themselves where they are able before calling
on the Government for income support. Claimants will be able to access exemptions
and waivers to receive assistance sooner, if they are eligible.
5
Statements of compatibility with human rights
For these reasons, this Schedule is compatible with the right of equality and
non-discrimination.
Conclusion
This Schedule is compatible with human rights. To the extent that it may have
limited adverse impact on a person's right to social security, an adequate standard of
living and equality and non-discrimination, the limitation is reasonable, proportionate
to the policy objective and for legitimate reasons.
6
Statements of compatibility with human rights
Schedule 2 - Age requirements for various Commonwealth payments
This Schedule is compatible with the human rights and freedoms recognised or
declared in the international instruments listed in section 3 of the
Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Schedule
This measure proposes that, from 1 July 2016, young unemployed people aged 22
to 24 would no longer be eligible for newstart allowance or sickness allowance until
they turn 25 years of age and would, instead, be able to claim and qualify for youth
allowance. To enable this, youth allowance for all types of persons who can satisfy
the activity test, will be available to persons who have not yet reached 25. Youth
disability supplement will also be available to all youth allowance recipients who
have not yet reached 25. The amendments include safeguards to ensure that
existing newstart allowance recipients on commencement of the measure who are
22, 23 or 24 (or persons undergoing certain waiting periods or suspension periods)
can remain in receipt of newstart allowance. Similar savings rules are provided for
sickness allowance.
The measure also proposes to make consequential amendments to the Farm
Household Support Act 2014 to align rates at which farm household allowance is
paid, to farmers and their partners, with newstart and youth allowance rates.
Human rights implications
The measure engages the following human rights:
Right to social security
The measure engages article 9 of the International Covenant on Economic, Social
and Cultural Rights (ICESCR), which recognises the right of everyone to social
security.
The proposed measure broadly aligns the income support arrangements for all
young people aged under 25 years, with the objective of ensuring the social security
system supports and encourages young people in their transition from study to work.
The measure aims to provide rational incentives for young unemployed Australians
to acquire the required skills to obtain gainful employment by encouraging study,
particularly for young people who have been unsuccessful in gaining work.
Incentives are provided to persons aged 22, 23 or 24 who, as a result of this
measure, will no longer be able to qualify for newstart allowance. This is achieved
through the availability of a larger income free threshold compared to newstart
allowance, for those being paid for any work while in study or training.
7
Statements of compatibility with human rights
This measure also removes the incentive for young unemployed Australians to forgo
study in favour of moving to newstart allowance, which is paid at a higher rate than
youth allowance. This limitation is a reasonable and proportionate measure for the
achievement of that objective. The use of savings provisions for recipients already in
receipt of newstart allowance or sickness allowance on 30 June 2016 (or others
undergoing certain waiting periods or suspension periods), ensures 22, 23 and 24
year olds already qualified for newstart allowance and sickness allowance will not be
affected by the amendments following commencement until their payment is
cancelled. The measure will also not modify the age at which a person is regarded
as 'independent' (currently 22 years) for youth allowance. This will mean that
persons above that age will continue to not be subject to parental means testing.
Right to education
This measure engages article 13 of the ICESCR, which recognises the right of
everyone to education.
The proposed measure enhances and incentivises the acquiring of education and
skills for young people. It is designed to activate young unemployed youth (age 22
to 24) who are currently not in education or working. Enabling this cohort to qualify
for youth allowance rather than newstart allowance provides an incentive to obtain
the required training to place them in a position of improved employability. Youth
allowance has a higher income free threshold compared to newstart allowance,
enabling a greater scope to earn while learning or training.
Rights of persons with disabilities
This measure engages article 28 of the Convention of the Rights of Persons with
Disabilities, which recognises the right to an adequate standard of living and social
protection for those with disability. The proposal recognises the special
requirements of income support recipients with disability by raising the age of
qualification for the youth disability supplement (as paid as a component of youth
allowance) to 24 years.
Conclusion
This measure is compatible with human rights because it generally advances human
rights including the opportunity for education and gainful employment. To the extent
that it may have any adverse impact on human rights, that impact is reasonable and
proportionate, and is for legitimate reasons.
8
Statements of compatibility with human rights
Schedule 3 - Income support waiting periods
This Schedule is compatible with the human rights and freedoms recognised or
declared in the international instruments listed in section 3 of the
Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Schedule
This Schedule implements, from 1 July 2016, an income support measure that forms
part of the broader Growing Jobs and Small Businesses package announced in the
2015-16 Budget. This measure aims to encourage greater participation in work
through establishing firm expectations for young job seekers. It provides an incentive
for affected persons to become self-reliant before relying on the taxpayer for support.
Waiting periods
The amendments made by this Schedule will apply from 1 July 2016 to a job seeker
if they are:
placed in stream A of the Employment Services 2015 model following
assessment using the Job Seeker Classification Instrument (JSCI); and
aged under 25 years; and
a new claimant for youth allowance (other) and, in certain circumstances,
special benefit. Special benefit recipients will not be required to serve another
waiting period if they transfer to youth allowance (other).
Such persons will be subject to an income support waiting period before the social
security benefit becomes payable.
This measure does not apply to full-time students or new apprentices.
Interaction with other waiting periods
The income support waiting period will be served prior to the one week ordinary
waiting period. Other waiting periods, such as the income maintenance period, liquid
assets test waiting period, or seasonal work preclusion period, will be served
concurrently with the income support waiting period, if they apply.
Exemptions
Exemptions from the income support waiting period will be made for:
job seekers in Streams B or C with a jobactive provider
Disability Employment Services participants
parents with 35 per cent or more care of a child, and
9
Statements of compatibility with human rights
young people in State care, or who have left State care within the past
12 months
people with an activity test exemption of 15 days or more - this will include
pregnant women in the six weeks before birth, and people testing their
eligibility for disability support pension, as well as victims of domestic violence
and people in special circumstances.
The Minister will also be able to determine other categories of exemption via a
legislative instrument.
Activity test and participation requirements
Job seekers will be required to comply with pre-benefit activities as part of 'Rapid
Connect Plus' (a separate Budget measure led by the Employment portfolio) during
the income support waiting period. These activities will include meeting with a
jobactive provider, agreeing to a Job Plan, developing an up-to-date resume,
creating a job seeker profile on the JobSearch website, and providing evidence of
satisfactory job search with a total of 20 job applications (with flexibility for job
seekers in poor labour markets).
Failure to complete these activities within 28 days from the date of application for
income support will result in the lapse of a job seeker's application for income
support. The job seeker will be required to re-apply, and subsequently comply with
the Rapid Connect Plus activity requirements over the course of a further four weeks
before any payment is made.
Job seekers will be eligible to participate in Work for the Dole as required by their
jobactive provider, with Stream A job seekers commencing Work for the Dole six
months after application for income support. Stream B and C job seekers will
commence Work for the Dole after 12 months. Job seekers will participate in Work
for the Dole for six months out of every 12 months thereafter.
Emergency relief
Around $8.1 million in additional funding will be available to Emergency Relief
providers to provide assistance for those impacted by the measure.
Special benefit
Inclusion of certain special benefit applicants is designed to prevent applicants who
would otherwise apply for youth allowance (other), applying and qualifying for special
benefit in order to avoid serving an income support waiting period. Failure to include
special benefit in the measure would provide a loophole which would effectively
defeat the purpose of the measure.
Human rights implications
This measure engages the following human rights:
10
Statements of compatibility with human rights
Right to work
Article 6 of the International Covenant on Economic, Social and Cultural Rights
(ICESCR) recognises the right to work. This includes the right to the opportunity to
gain a living by work which the person freely chooses or accepts, and is considered
an inherent part of human dignity1.
This measure provides incentives for young unemployed Australians to either
acquire employment or the required skills to obtain gainful employment. As such, this
Schedule encourages affected persons to enter the workforce, or undertake further
study to enhance their employment prospects, rather than relying on the social
security system. This measure therefore seeks to ensure that more job seekers
experience the benefits of employment - for example, greater social and economic
inclusion.
Right to social security
Article 9 of the ICESCR recognises the right of everyone to social security.
The right to social security requires that a system be established under domestic
law, and that public authorities must take responsibility for the effective
administration of the system. The social security scheme must provide a minimum
essential level of benefits to all individuals and families that will enable them to cover
essential living costs.
The measure acknowledges the particular needs of vulnerable job seekers. To this
end, the following vulnerable young job seekers will be exempt from the measure:
those who have 35 per cent or more care of a child; those who have more significant
barriers to employment and are placed in Streams B or C with a jobactive provider;
those who are in or have recently left state care; who have a temporary activity test
exemption; or whose disability qualifies them for Disability Employment Services.
The minister will also have the discretion, via a disallowable instrument, to provide
further exemptions from the measure for other classes of people identified as
vulnerable.
The specific targeting of this measure to young people who are job ready without
significant barriers to prevent them finding work will mitigate the risk of limiting a
person's right to social security.
This measure also continues to provide access to social security for those young
people who elect to undertake full-time study or training to further their employment
prospects, with no waiting period applied for access to student income support
payments. Therefore the right to social security is not removed and the limitation on
immediate access to unemployment benefits is reasonable and proportionate to the
objective of having young people either earning or learning to increase their
employment prospects.
The savings made by this measure will ensure that the broader social security
system is focussed on those who need it most, helping to promote general welfare in
a democratic society (consistent with article 4 of the ICESCR).
1
Committee on Economic, Social and Cultural Rights, General Comment 18, paragraphs 1 and 2.
11
Statements of compatibility with human rights
This measure will help to maintain the integrity of the social security system and
ensure finite resources are equitably allocated among genuine job seekers. To the
extent that this measure may limit the right to social security, the impact is
reasonable and proportionate.
Right to an adequate standard of living
Article 11 of the ICESCR recognises the right of everyone to an adequate standard
of living and to the continuous improvement of living conditions.
The limitations imposed on the social security system by this measure, in focusing
on young persons, acknowledges that young persons often have access to family
support to enjoy an adequate standard of living. To assist claimants experiencing
hardship, the measure includes $8.1 million in additional funding for Emergency
Relief providers.
In encouraging young persons to work or undertake further study, the measure also
acknowledges that the best way for a person to enjoy an adequate standard of living
is through entering the workforce. There is a connection between the limitation and
the objective. The limitation of immediate access to unemployment benefits
supports that objective.
Currently, claimants of social security payments may be subject to a range of waiting
and exclusion periods which operate on the basis that claimants should draw on their
own resources before drawing from taxpayer funded financial support. This
additional income support waiting period will be served concurrently with any other
applicable waiting periods (except the ordinary waiting period).
Rights of persons with disabilities
Article 28 of the Convention on the Rights of Persons with Disabilities deals with the
adequate standard of living and social protection issues of those having a disability.
This measure recognises the special requirements of certain income support
recipients in such a situation by exempting job seekers with disability who qualify for
Disability Employment Services.
Non-discrimination on the basis of age
Article 2(2) of the ICESCR requires States Parties to implement the rights contained
within the ICESCR without discrimination of any kind. Although this measure
differentiates between those aged under 25 and those aged 25 and over, this
differential treatment is designed so that those subjected to a waiting period are
young enough to reasonably draw on family support to assist them during the waiting
period. Additional funding for Emergency Relief providers acts as a further
contingency plan for those young people who need it.
Conclusion
This Schedule is compatible with human rights. To the extent that it limits rights, the
limitation is reasonable, proportionate to the policy objective and for legitimate
reasons.
12
Statements of compatibility with human rights
Schedule 4 - Low income supplement
This Schedule is compatible with the human rights and freedoms recognised or
declared in the international instruments listed in section 3 of the
Human Rights (Parliamentary Scrutiny) Act 2011 .
Overview of the Schedule
The low income supplement inclusive of the low income family supplement is a $300
annual lump sum supplement claimed by independent adults in low-income
households who were not adequately assisted through the tax systems or other
Household Assistance Package measures for the cost of living impact of the carbon
tax.
This supplement will cease from 1 July 2017.
Human rights implications
Individuals eligible for the supplement are now better off following the abolition of the
carbon tax. The abolition of the carbon tax has delivered cost of living benefits to
low income households that are greater than the value of the supplement they
receive.
Individuals eligible for the low income family supplement will continue to receive the
energy supplement with their Family Tax Benefit payment.
Individuals receiving an income support or Family Tax Benefit payment automatically
receive an energy supplement payment. There is also a range of assistance that
individuals and families can access through the social security system to ensure they
can maintain a minimum standard of living.
Conclusion
There are no human rights impacts as all low income households are better off
because there are no longer price pressures from the carbon tax.
13
Statements of compatibility with human rights
Schedule 5 - Indexation
This Schedule is compatible with the human rights and freedoms recognised or
declared in the international instruments listed in section 3 of the
Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Schedule
This Schedule implements the following changes to Australian Government
payments:
maintain at level for three years from 1 July 2015 the income free areas for all
working age allowances (other than student payments) and for parenting
payment single; and
maintain at level for three years from 1 January 2016 the income free areas
and other means test thresholds for student payments, including the student
income bank limits.
Human rights implications
The Schedule engages the following human rights:
Right to social security
Article 9 of the International Covenant on Economic, Social and Cultural Rights
(ICESCR) recognises the right of everyone to social security.
The Schedule has no effect on the right to social security.
The changes to the value of income test free areas and thresholds for certain
Australian Government payments assist in targeting payments according to need.
Payments will not be reduced unless customers' circumstances change, such as
their income increasing in value.
Conclusion
The amendments in the Schedule are compatible with human rights because they do
not limit access to social security.
[Circulated by the authority of the Minister for Social Services,
the Hon Scott Morrison MP]
14