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2010-2011-2012-2013
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
SOCIAL SECURITY LEGISLATION AMENDMENT
(PUBLIC HOUSING TENANTS' SUPPORT) BILL 2013
EXPLANATORY MEMORANDUM
(Circulated by the authority of the
Minister for Housing and Homelessness, the Hon Mark Butler MP)
SOCIAL SECURITY LEGISLATION AMENDMENT
(PUBLIC HOUSING TENANTS' SUPPORT) BILL 2013
OUTLINE
This Bill will implement the Housing Payment Deduction Scheme to reduce
the risk of homelessness for public housing tenants due to eviction and
housing abandonment as a result of rental arrears.
This will be achieved by providing for deductions to be made from certain
welfare payments for tenants who are in significant arrears, only after
reasonable action (consistent with fair processes for managing public
housing) has been taken by the public housing lessor.
The initiative flows from commitments made in the Australian Government's
2008 White Paper on Homelessness, The Road Home: a National Approach
to Homelessness (the Homelessness White Paper), and by the Australian
Government and State and Territory Governments under the National
Affordable Housing Agreement.
State Housing Authorities advise that there are around 600 evictions from
public housing a year due to non-payment of rent. Each year, many more public
housing tenants vacate their housing owing rent. Terminations and
abandonments of public housing are disruptive and costly for the individuals
and families involved. When families are involved, children's schooling and
relationships are often disrupted, and children may also be placed in care
facilities. Families and individuals being forced to vacate public housing can
also result in greater demand for crisis accommodation, support services,
mental health services and child protection services.
The Government understands the important decisions that need to be made
before introducing measures that allow for compulsory deductions to be made
from a person's social security or family assistance entitlement. Therefore,
careful consideration has been given to the need for the Housing Payment
Deduction Scheme as a necessary and appropriate way to address the
problem of homelessness due to non-payment of rent. It is part of the broader
package of programs and reforms that the Government has implemented
under the Homelessness White Paper to address homelessness.
The Bill has been significantly strengthened following public consultations to
focus more clearly on the prevention of homelessness, through a tightening of
the conditions for including a tenant under the scheme and the inclusion of
provisions aimed at ensuring that the scheme does not undermine due process
or weaken tenancy management processes in States and Territories.
1
Financial impact statement
The Department of Human Services will deliver the scheme, which will cost
around $4.5 million for 2013-14 (including $3.7 million in information technology
costs), assuming commencement in early 2014, and ongoing delivery costs of
around $1.4 million a year in addition to a transaction fee to be charged to
States and Territories for using the scheme at the same rate as is currently
charged for the use of the (voluntary) Rent Deduction Scheme.
Total resourcing ($,000)
2012-13 2013-14 2014-15 2015-16 2016-17
Nil $4,482 $1,367 $1,379 $1,401
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
The statement of compatibility with human rights appears at the end of this
explanatory memorandum.
2
SOCIAL SECURITY LEGISLATION AMENDMENT
(PUBLIC HOUSING TENANTS' SUPPORT) BILL 2013
NOTES ON CLAUSES
Abbreviations used in this explanatory memorandum
Family Assistance Administration Act means the A New Tax
System (Family Assistance) (Administration) Act 1999
Social Security Administration Act means the Social Security
(Administration) Act 1999
The Scheme means the Housing Payment Deduction Scheme
White Paper on Homelessness means the Australian Government's
White Paper on Homelessness, The Road Home: a National
Response to Homelessness, released on 21 December 2008
Clause 1 sets out how the new Act is to be cited once it becomes law -
that is, as the Social Security Legislation Amendment (Public Housing
Tenants' Support) Act 2013.
Clause 2 provides that the new Act will commence on the day after the Act
receives the Royal Assent. Note that, although the Act is effective from this
date, it may not have effect in practice until particular `public housing lessors'
are specified.
Clause 3 makes clear that the amendments in Schedule 1 to the Bill are
intended to make amendments to the principal legislation as stated.
1
Schedule 1 - Amendments
Summary
This Schedule introduces the Housing Payment Deduction Scheme into the
social security law and family assistance law. The Scheme will have effect in
relation to specified social security payments and payments under the
ABSTUDY scheme, as well as in relation to payments of family tax benefit.
The purpose of the Scheme is to reduce the risk of homelessness for public
housing tenants due to non-payment of rent.
Background
The Australian Government's White Paper on Homelessness commits the
Commonwealth to `work with States and Territories to introduce compulsory
rent payments from Centrelink payments for tenants in public housing at risk
of eviction due to non-payment of rent'.
The Council of Australian Governments has also agreed to the
implementation of compulsory rent deductions for public housing tenants as a
priority area of reform under the National Affordable Housing Agreement.
Public and targeted consultations on an exposure draft of the Bill were
conducted during April 2013. Submissions have been posted on the website
of the Department of Families, Housing, Community Services and Indigenous
Affairs, with the permission of the authors. The consultation process included
15 individual meetings with peak bodies, welfare groups and tenant advocates
to discuss the Bill in some detail. A follow-up teleconference was also held to
discuss the consultation feedback.
Some stakeholders were opposed in principle to the compulsory nature of the
Scheme, and others considered that the Bill needed modification to make it
more closely aligned to the Government's commitment in the Homelessness
White Paper to preventing homelessness, and to ensure that it did not
undermine good tenancy management practices and the right of tenants to
due process.
A number of changes have been made to the Bill since the exposure draft to
address the issues raised by stakeholders. The changes are:
OBJECTIVES - The objective is now more clearly focused on the
prevention of homelessness due to non-payment of rent only after
other reasonable recovery action has been taken.
CONDITIONS FOR APPROVING PUBLIC HOUSING LESSORS -
The Commonwealth Minister will need to be satisfied that public
housing authorities have appropriate tenancy management and review
processes before specifying in a legislative instrument that a public
housing lessor is able to participate in the Scheme.
2
IN-SCOPE HOUSING COSTS - Housing costs which can be deducted
have been limited to rent, rent arrears and household utilities (where
payment of these is a requirement under a lease). Maintenance debt
incurred as a result of property damage will not be included,
in response to stakeholder concerns that these are often contentious
and may unduly impact on domestic violence victims.
REASONABLE ACTION DEFINED - The Bill now defines
`reasonable action' which a lessor must take to recover arrears before
a request for deductions under the Scheme can be made, which go to
due process and whether the person has been advised of available
financial or other services that may be of assistance to them.
MINIMUM LEVEL OF ARREARS - The minimum level of arrears for a
public housing lessor to be able to request deductions will be set out in
a legislative instrument to be made by the Minister. It is intended that
the equivalent of four weeks' rent will be initially specified in that
instrument.
AT RISK - The category of `at risk' of arrears for making a request to
make deductions under the Scheme has been removed in response to
stakeholder concerns that this may unfairly include people whose
circumstances had changed.
SAFETY NET - To address concerns that deductions for a person
under the Scheme may stop and start repeatedly, the Bill allows a
public housing authority to request that a person remain on the
Scheme for a further 12 months for their rent, once their arrears are
paid, to allow time for the person to address their financial or other
support needs.
REVIEWS - Provisions are included to ensure that public housing
lessors (which may include State and Territory housing authorities)
have appropriate review processes in place before being specified as
able to make requests for deductions under the Scheme. These
provisions have been inserted to ensure that requestors have their own
review processes to address disputes arising under leases or under
State or Territory tenancy legislation. Decisions by a delegate of the
Secretary to act on a request by a public housing lessor have not been
exempted from the existing internal review provisions in the social
security or family assistance law, or provisions relating to review in the
Social Security Appeals Tribunal or the Administrative Appeals
Tribunal. However, it is not expected that internal review or merits
review will be able to resolve disputes between tenants and landlords
around the basis for making a request under the Scheme.
3
Note that, following consultations, it is also proposed that deductions from
bereavement allowance will not be able to be made under the Scheme. This
outcome will be achieved not through this Bill, but by excluding reference to
this payment from the legislative instrument expected to be made under
clause 2 of new Schedule 6 to the Social Security Administration Act.
Stakeholders opposed the inclusion of bereavement allowance under the
Scheme on hardship grounds.
Explanation of the changes
Part 1 - Amendments to the Social Security Administration Act
Items 1 and 2 ensure that new section 238A of the Social Security
Administration Act (which gives new Schedule 6 its legal effect) and new
Schedule 6 are exceptions to the rule against the alienability of social security
payments. Under section 60 of the Social Security Administration Act, social
security payments, with certain exceptions, are absolutely inalienable, which
means they are to be paid to a person to whom they are payable and not to
another entity. Because the new Housing Payment Deduction Scheme
operates to ensure a deduction from a person's payment can be paid directly
to a public housing lessor, a new exception to this rule is required.
Items 3 and 7 ensure that the definition of household utilities is now
consolidated in one place in the Social Security Administration Act. Prior to
these amendments, this term had been defined in subsection 123TH(1) of the
Social Security Administration Act, which is a specific section containing
definitions for income management. Now that the same term is also to be
used in the context of the new Housing Payment Deduction Scheme
provisions (with the same meaning it had in subsection 123TH(1)),
a consolidated definition in subclause 1(1) of Schedule 1 to the Social
Security Administration Act provides clarity around the meaning of the term for
both income management and for the Housing Payment Deduction Scheme.
Item 4 is a provision that ensures the consistent operation of the Housing
Payment Deduction Scheme with the income management regime.
The provision makes clear that, when the Secretary receives a Housing
Payment Deduction Scheme request in relation to a person who is subject to
income management, it is appropriate for the Secretary to take action under
the income management regime in existing Part 3B of the Social Security
Administration Act to enable deductions under existing income management
provisions to meet the request. Existing Part 3B contains measures enabling
income managed funds to be directed towards `priority needs', including
housing payments.
This provision reflects the fact that requests received in relation to people
subject to income management cannot be acted upon under the new Housing
Payment Deduction Scheme deduction rules (subclause 8(2) of new
Schedule 6 to the Social Security Administration Act).
4
Item 5 inserts new section 238A into the Social Security Administration Act.
This ensures that the Scheme outlined in new Schedule 6, as it relates to
certain social security payments and payments under the ABSTUDY scheme,
has effect according to its terms to make clear that the new Schedule
operates as part of the social security law.
Items 6 and 8 insert new definitions of divertible welfare payment and
public housing lessor into the list of definitions in Schedule 1 to the Social
Security Administration Act, referring to the meanings given for those terms in
clause 3 of new Schedule 6.
Item 9 adds to the end of the Social Security Administration Act new
Schedule 6, which contains the new Scheme as it affects certain social
security payments and payments under the ABSTUDY scheme.
New Schedule 6 to the Social Security Administration Act - Deductions
for payment for public housing
Part 1 - Introduction
Clause 1 of new Schedule 6 outlines the objects of the Schedule to clarify
that the Scheme's primary purpose is to reduce the risk of persons who
receive certain welfare payments and lease public housing becoming
homeless because they are evicted from or abandon housing for failure to
make payments required by their leases.
The clause states that the primary object is sought to be achieved by
providing for deductions to be made from the welfare payments and paid to
lessors after they have taken reasonable action (consistent with fair
processes for managing public housing) to recover arrears for rent or
household utilities.
Clause 2 of new Schedule 6 clarifies what a divertible welfare payment is,
and provides powers for the Minister to specify social security pensions, social
security benefits, other social security periodic payments (within the definition
of that term in the Social Security Administration Act) and payments under the
scheme known as the ABSTUDY scheme as payments from which
deductions can be made under the Scheme.
The capacity to make legislative instruments under this provision ensures that
there will be flexibility in the payments that can be affected, and will,
in particular, allow for the Minister to remove certain payments from the
Scheme over time should a decision be made to narrow and refine the
payment types able to be affected by deductions under the Scheme.
5
Clause 3 of new Schedule 6 provides power for the Minister to specify certain
States, authorities and other persons as public housing lessors. The power to
specify as public housing lessors States or Territories, authorities of States or
Territories or `persons' is intended to address the various legal arrangements
in place for managing public housing in each State and Territory. Housing
Authorities in some jurisdictions may be bodies corporate and therefore legal
`persons' for this purpose. It is not intended to specify private landlords in
reliance on this power.
Once specified, a public housing lessor can make a request under the
Scheme for a deduction to be made from a divertible welfare payment.
Before specifying States, authorities or other persons as public housing
lessors, the Minister must be satisfied of both of the following matters:
that there is an appropriate process for reviewing decisions (including
through internal review processes or a State Tribunal) made by the
person or authority (including through their officers) relating to amounts
due and payable under leases with tenants; and
that there are appropriate processes that the person or authority
follows in dealing with matters relating to leases with tenants.
Regarding what constitutes appropriate processes for reviewing decisions,
the Minister is obliged to have regard to the following matters:
a) the costs of the review process to applicants;
b) the timeliness of the review process;
c) whether applicants are able to be represented and heard;
d) the independence of the process; and
e) the availability of interpreters, where required.
Regarding what constitutes appropriate processes for reviewing decisions,
the Minister is obliged to have regard to the following matters:
a) the transparency of decision-making processes;
b) the extent to which tenants' individual circumstances (such as financial
hardship) are taken into account;
c) whether tenants are informed of their rights and responsibilities under
their lease and of support services available; and
d) whether reasonable action (a term outlined in clause 6) is taken.
6
The power to specify certain public housing lessors by legislative instrument
has been provided to ensure that public housing authorities in certain States
are only able to make requests under the Scheme once the Commonwealth
enters into a Memorandum of Understanding with the relevant State or
Territory to ensure there is policy agreement and a shared understanding of
how the Scheme will operate. Further, the power allows for, and requires,
the Minister to assess public housing lessors as suitable for participation in
the Scheme before prescribing them as able to make requests for deductions.
A note at the end of the provision points out that the Minister is able to revoke
a specification (under an existing rule in the Acts Interpretation Act 1901)
in relation to a public housing lessor if the Minister is no longer satisfied of the
required matters set out in the provision. It is intended that the Minister would
monitor public housing lessors' participation in the Scheme to ensure that they
remain in satisfaction of those matters.
Clause 4 of new Schedule 6 ensures, to avoid doubt, that the provisions in
the Scheme bind the Crown, which includes agencies of the Commonwealth
involved in administering the Scheme, as well as agencies of States and
Territories within which public housing lessors have been specified.
Part 2 - Deductions from divertible welfare payments
Clause 5 of new Schedule 6 provides for the conditions under which a public
housing lessor is able to make a request for a deduction from a divertible
welfare payment.
The power to request is enlivened in two circumstances:
where a person already owes a minimum amount (as specified in a
legislative instrument) under a lease with a public housing lessor and
the lessor has taken reasonable action to recover the amount from the
person; and
where a person has repaid all outstanding amounts, having already
been subject to a request or requests in relation to a minimum amount.
This clause also clarifies that, in the case of doubt, it does not matter when
the lease was entered into, whether the person is the only lessee or a joint
lessee, or whether or not the relevant accommodation is also accommodation
for others.
The content of a request is subject to a limitation referred to as a specified
maximum amount (subclause 5(3)). For each request, that amount must not
be more than:
the amount specified in subclause 6(1), where the request is made
because the person owes a prescribed minimum amount; or
7
the amount that is payable by the person under the lease by way of
rent and household utilities for the period to which the divertible welfare
payment relates (if the payment is an instalment, this will generally be
the period of the days in relation to which that instalment is made as a
result of section 43 of the Social Security Administration Act), if the
request is made because the conditions in clause 7 are met (where the
person no longer owes an amount under their lease).
The provision deals with the possibility of a tenant's rent or household utilities
liability under their lease changing after a request (or a number of requests)
under the Scheme have been made. It does this by allowing a public housing
lessor to amend a request or requests to specify a different maximum amount.
Before making amendments, the public housing lessor must take reasonable
action to inform the person and give then a reasonable opportunity to make
representations about it. This will ensure that, if a tenant's rent increases or
decreases, requests can be adjusted accordingly.
Importantly, although the `maximum amount' of a request can be amended,
the maximum amount of actual deductions following a request will still be
capped as outlined in clause 9.
Clause 5 also specifies that the content of the request must conform to a
method approved by the Secretary (which could be a computerised method)
and that it must set out the maximum amount requested from a divertible
welfare payment, which must not be more than any amount due under the
lease. The clause also clarifies that requests relating to different divertible
welfare payments can be made in a single communication.
Requests under this clause can be made in respect of any person in receipt of
a divertible welfare payment, including if they are subject to income
management. If the person is subject to income management, the Secretary
will be able to use the power in section 123YA of the Social Security
Administration Act to direct funds towards meeting the request. If the person
is not subject to income management, new clause 8 allows for the Secretary
to direct a deduction towards meeting the request under the Scheme.
Clause 6 of new Schedule 6 sets out conditions for the first kind of request
referred to in subclause 5(1). The first condition is that there is an amount
due and payable by the tenant to the public housing lessor by way of rent
and/or household utilities and that amount exceeds the minimum amount
specified by legislative instrument. In particular circumstances, that amount
may be able to include an amount payable under a former lease if that
amount is also owing under the relevant lease with the public housing lessor
and if allowed under State or Territory Government legislation.
8
Subclause 6(2) provides power for the Minister to make a legislative
instrument specifying the minimum amount for this purpose, and clarifies that
the power can be exercised by specifying a method for working the amount
out. This could be done, for instance, by specifying that the amount is worked
out for a person by reference to how much rent they will owe for a specific
period under their particular lease.
The second condition is that the public housing lessor has taken `reasonable
action' to recover the amount. Subclause 6(4) sets out the minimum standard
for what constitutes reasonable action for this purpose, stating that the public
housing lessor is taken not to have taken reasonable action unless:
the lessor has given the person written notice demanding payment of
some or all of the amount within a specified period that is reasonable;
that period has passed without the demand being met;
the lessor has taken reasonable action to inform the person of:
o financial counselling services, and other services relating to the
lease, that are or may be available to the person; and
o the person's rights to review of decisions of the lessor or its
officers or employees relating to amounts due and payable
under the lease; and
the lessor:
o has taken reasonable action to inform the person that the lessor
proposes to make one or more requests under clause 5
because of the amount; and
o has given the person a reasonable opportunity to make
representations to the lessor about the proposal.
In particular circumstances, reasonable action could also include other
matters.
Clause 7 of new Schedule 6 sets out conditions for the second kind of
request referred to in subclause 5(1).
The first condition is that the public housing lessor has taken reasonable
action to inform the person that the lessor proposes to make one or more
requests under clause 5 because of this clause and has given the person a
reasonable opportunity to make representations to the lessor about the
proposal.
9
The second condition is that the request is made at the time the public
housing lessor gives a notice under subclause 10(4) to the Secretary that no
amount is due and payable by the person to the public housing lessor under
the lease for rent or household utilities which caused an earlier request to
cease to be in force.
Because of paragraph 10(1)(e), such requests can remain in force for
12 months, allowing for ongoing rent and household utilities to be met in that
time.
Clause 8 of new Schedule 6 deals with when the Secretary can make a
deduction as requested from a public housing lessor. It clarifies that a
deduction can be made in accordance with a request (subject to clause 9,
which limits the amount of deductions) while a request remains in force (which
is dealt with by clause 10).
The Secretary has discretion either to act on or not to act on a request.
The Secretary cannot make deductions in relation to a person who is subject
to income management because the Secretary can take measures under
Part 3B of the Social Security Administration Act to meet housing expenses
for such people. Deductions are also unable to made in relation to a person
or class of persons covered by a legislative instrument made under
subclause 8(3). This power has been included in the Bill to ensure that
certain classes of persons for whom it is inappropriate, or becomes
inappropriate, for deductions to be made can effectively be exempted from the
Scheme as necessary.
Clause 9 of new Schedule 6 outlines the maximum amount that can be
deducted from a divertible welfare payment in response to a request by a
public housing lessor. That amount is effectively capped at the lowest of the
amounts worked out under each of the paragraphs:
a) the amount requested by the public housing lessor;
b) the amount of the actual payment (taking into account all deductions
and reductions) from which the deduction may be made;
c) 35 per cent of what the payment would have been apart from any law
of the Commonwealth that would make deductions or reductions from
the payment (including, for instance, section 238 of the Social Security
Administration Act), excepting any deduction made by way of a penalty
amount under Division 3 of Part 3A of the Social Security
Administration Act or section 1231 of the Social Security Act 1991;
d) for payments under the ABSTUDY scheme that include an amount
identified as living allowance, 35 per cent of the basic component as
identified in the ABSTUDY Policy Manual (available at
http://deewr.gov.au/abstudy).
10
Paragraph (c) means that, where this amount is lower than the amounts
outlined at paragraphs (a) and (b), the public housing deduction is the third
deduction in priority after deductions made under Part 3A of the Social
Security Administration Act and section 1231 of the Social Security Act 1991.
Although not expressly referred to, advance payment deductions would also
be higher in priority (would be made first) as these are accounted for under
rate calculators as part of the determination of a person's payable rate.
The Minister is given a legislative instrument power under this clause to
specify certain provisions to be disregarded for working out the amount for
paragraph 9(1)(c). This power will enable the Minister to ensure that certain
components that add to the amount of a payment that is payable to a person,
such as pension supplement, to be specified with the effect of reducing the
total amount that can be deducted for a person. It is intended that this power
will only be exercised beneficially to a person to reduce the amount of the
payment that 35 per cent is calculated against. It allows for new components
of payments, such as those that may be introduced to deal with emergency or
other urgent circumstances, to be specified as, in effect, immune from
deductions under the Scheme.
Clause 10 provides for a number of circumstances in which a request from a
public housing lessor ceases to be in force. These circumstances have been
adapted to ensure that the lessor can revoke the request, that a request
ceases when the relevant tenant ceases to lease property under the lease,
when the lessor is no longer specified as a public housing lessor, when a
person has paid any arrears of rent or household utilities outstanding under
the lease (for requests meeting the clause 6 conditions), and after the expiry
of 12 months from the date of a request made in conformity with the
conditions in clause 7.
The clause also ensures that public housing lessors are under an obligation to
inform the Secretary when a person ceases to lease the relevant
accommodation, or when their arrears under the lease are paid, so the
Secretary is aware of the lack of power to make deductions in relation to
those requests.
Part 3 - Treatment of amounts deducted
Part 3 of new Schedule 6 contains a number of clauses to clarify the effect of
action taken by the Secretary under Part 2 of new Schedule 6 to act on a
request by a public housing lessor.
Clause 11 makes clear, in the case of doubt, that the new Part applies if an
amount is deducted under new Part 2.
11
Clauses 12, 13 and 14 provide that, when a Secretary takes action to make a
deduction, the amount is to be paid to the public housing lessor, that amount
reduces the person's liability under the lease, and the person is taken to have
been paid the amount deducted. These provisions ensure that deductions
under the Scheme are only used to meet actual housing liabilities of a person
under their lease with a public housing lessor. Subclause 13(2) has been
designed as a beneficial provision for a tenant to clarify that, if an amount is
not yet overdue and deductions are made to meet it, the tenant's liability is still
reduced.
Subclause 14(2) clarifies for the purposes of other laws of the
Commonwealth that the amount paid to the public housing lessor is to be
treated as if the person were paid that amount. Among other things, this
ensures, for example, that a person's income for income tax purposes
includes any amount deducted under the Scheme as if it were paid to the
person. There is a power to exclude certain laws of the Commonwealth for
this purpose through a legislative instrument made by the Minister. This
power is intended to be used for the benefit of a person in circumstances
where it is apparent that the person should not be treated as if an amount
deducted under the Scheme is paid to them.
Part 4 - Overpayments to public housing lessors
Part 4 of new Schedule 6 contains a code of debt rules that apply to the
circumstances outlined in the Part.
Clause 15 is intended to apply to circumstances where an amount paid to a
public housing lessor mistakenly exceeds the amount deducted from the
relevant person's payment. This ensures the lessor is under an obligation to
repay any such excess to the Commonwealth.
Clause 16 targets circumstances where a deduction is made and paid to a
public housing lessor, but is more than should have been paid. This could
include where the request identified an amount that was more than it should
have been, or where the Secretary deducted more than, for example,
35 per cent of the payment (as worked out in accordance with
paragraph 9(1)(c)) by error. Under this provision, where the Secretary is
satisfied that the person has requested to be repaid the excess and the public
housing lessor has refused to do so, the excess is a debt owing by the public
housing lessor to the Commonwealth. Whether or not this debt is paid,
the Secretary must pay to the person the excess (as long as the total paid to
the person does not exceed the person's entitlement to the divertible welfare
payment apart from the operation of the Scheme).
To ensure that payments are not double-counted (given the operation of
clause 14), there is provision to ensure that any amount paid to a person
under subclause 16(3) is not taken to have been paid to them. This ensures,
for instance, that the amount is not double-counted for income tax purposes.
12
Clause 17 allows the Secretary to set off an amount payable to a public
housing lessor under Part 3 against a debt due to the Commonwealth by the
lessor to ensure the efficient operation of the Scheme.
Clause 18 provides, in the case of doubt, that clause 13 (which states that a
person's liability under a lease to a public housing lessor is reduced by an
amount paid to the public housing lessor under the Scheme) does not apply to
any amount that gives rise to a debt, to ensure that mistaken or overpaid
amounts are dealt with purely by the debt provisions in Part 4 of new
Schedule 6.
Part 5 - Miscellaneous
Part 5 of new Schedule 6 empowers the Secretary to charge public housing
lessors fees for deducting amounts in accordance with requests or paying
amounts.
Subclause 19(2) clarifies that fees do not amount to tax, to ensure that it is
clear the imposition of fees is done on a fee-for-service basis and is
consistent with section 55 of the Australian Constitution.
It is intended that the costs for such fees will not be passed on to tenants.
To ensure that the debts under new Schedule 6 cannot also be taken to arise
under existing debt rules in Chapter 5 of the Social Security Act 1991
(in particular, section 1223), clause 20 clarifies that the debt rules in Part 4 of
new Schedule 6 operate as code and to the exclusion of those rules to avoid
confusion.
Part 2 - Amendments to the Family Assistance Administration Act
Item 10 inserts a new definition of household utilities into the Family
Assistance Administration Act (to mirror the definition in the Social Security
Administration Act), given that this term in used in the new Housing Payment
Deduction Scheme provisions in new Schedule 1.
Item 11 inserts a new definition into the Family Assistance Administration Act
to provide that the term public housing lessor has the meaning given by
clause 2 of new Schedule 1 to the Family Assistance Administration Act.
Item 12 ensures that sections 23 and 24 of the Family Assistance
Administration Act, which address who payments are to be made to, have
effect subject to the new deduction rules imposed under the Scheme. This
reflects the fact that the Scheme operates by making compulsory deductions
from instalments of family tax benefit that are otherwise payable.
Item 13 inserts an exception to the inalienability rules in section 66 to ensure
that deductions under the Scheme may effectively be made to redirect
amounts of certain payments of family tax benefit public housing lessors.
13
Item 14 ensures that new Schedule 1 to the Family Assistance Administration
Act has effect according to its terms, and also ensures the effectiveness of the
new Schedule as part of the family assistance law.
Item 14 inserts new Schedule 1, which provides for the new Scheme in
relation to family tax benefit.
New Schedule 1 to the Family Assistance Administration Act -
Deductions for payment for public housing
Part 1 - Introduction
Clause 1 of new Schedule 1 outlines the objects of the Schedule to clarify
that the Scheme's primary purpose is to reduce the risk of individuals who
receive family tax benefit and lease public housing becoming homeless
because they are evicted from or abandon housing for failure to make
payments required by their leases.
The clause states that the primary object is sought to be achieved by
providing for deductions to be made from family tax benefit payments and
paid to lessors after they have taken reasonable action (consistent with fair
processes for managing public housing) to recover arrears for rent or
household utilities.
Clause 2 ensures that the definition and specification of the term public
housing lessor under new Schedule 6 of the Social Security Administration
Act has the same meaning in the family assistance law. This ensures that the
matters that the Minister must be satisfied of (under clause 3 in that Schedule)
are also preconditions to public housing lessors' ability to make requests
under the family assistance law.
Clause 3 ensures, to avoid doubt, that the provisions in the Scheme bind the
Crown, which includes agencies of the Commonwealth involved in
administering the Scheme, as well as agencies of States and Territories within
which public housing lessors have been specified.
Part 2 - Deductions from family tax benefit payments
Clause 4 of new Schedule 1 provides for the conditions under which a public
housing lessor is able to make a request for a deduction from a payment of
family tax benefit.
The power to request is enlivened in two circumstances:
where an individual already owes a minimum amount (as specified in a
legislative instrument) under a lease with a public housing lessor and
the lessor has taken reasonable action to recover the amount from the
individual; and
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where an individual has repaid all outstanding amounts, having already
been subject to a request or requests in relation to a minimum amount.
This clause also clarifies that, in the case of doubt, it does not matter when
the lease was entered into, whether the individual is the only lessee or a joint
lessee, or whether or not the relevant accommodation is also accommodation
for others.
The content of a request is subject to a limitation referred to as a specified
maximum amount (subclause 4(3)). For each request, that amount must not
be more than:
the amount specified in subclause 5(1), where the request is made
because the individual owes a prescribed minimum amount; or
the amount that is payable by the individual under the lease by way of
rent and household utilities for the period to which the divertible welfare
payment relates, if the request is made because the conditions in
clause 6 are met (where the individual no longer owes an amount
under their lease).
The provision deals with the possibility of a tenant's rent or household utilities
liability under their lease changing after one or more requests under the
Scheme have been made. It does this by allowing a public housing lessor to
amend a request or requests to specify a different maximum amount. Before
making amendments, the public housing lessor must take reasonable action
to inform the individual and give then a reasonable opportunity to make
representations about it. This will ensure that, if a tenant's rent increases or
decreases, requests can be adjusted accordingly.
Importantly, although the `maximum amount' of a request can be amended,
the maximum amount of actual deductions following a request will still be
capped as outlined in clause 8.
Clause 4 also specifies that the content of the request must conform to a
method approved by the Secretary (which could be a computerised method),
and that it must set out the maximum amount requested from a divertible
welfare payment, which must not be more than any amount due under the
lease. The clause also clarifies that requests relating to different divertible
welfare payments can be made in a single communication.
Requests under this clause can be made in respect of any individual in receipt
of family tax benefit, including if they are subject to income management.
If the individual is subject to income management, the Secretary will be able
to use the power in section 123YA of the Social Security Administration Act to
direct funds towards meeting the request. If the individual is not subject to
income management, new clause 7 allows for the Secretary to direct a
deduction towards meeting the request under the Scheme.
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Clause 5 of new Schedule 1 sets out conditions for the first kind of request
referred to in subclause 4(1). The first condition is that there is an amount
due and payable by the tenant to the public housing lessor an amount by way
of rent and/or household utilities and that amount exceeds the minimum
amount specified by legislative instrument under subclause 6(2) of the Social
Security Administration Act.
The second condition is that the public housing lessor has taken `reasonable
action' to recover the amount. Subclause 5(3) sets out the minimum standard
for what constitutes reasonable action for this purpose stating that the public
housing lessor is taken not to have taken reasonable action unless:
the lessor has given the individual written notice demanding payment
of some or all of the amount within a specified period that is
reasonable;
that period has passed without the demand being met;
the lessor has taken reasonable action to inform the individual of:
o financial counselling services, and other services relating to the
lease, that are or may be available to the individual; and
o the individual's rights to review of decisions of the lessor or its
officers or employees relating to amounts due and payable
under the lease; and
the lessor:
o has taken reasonable action to inform the individual that the
lessor proposes to make one or more requests under clause 5
because of the amount; and
o has given the individual a reasonable opportunity to make
representations to the lessor about the proposal.
In particular circumstances, reasonable action could also include other
matters.
Clause 6 of new Schedule 1 sets out conditions for the second kind of
request referred to in subclause 4(1).
The first condition is that the public housing lessor has taken reasonable
action to inform the individual that the lessor proposes to make one or more
requests under clause 5 because of this clause and has given the individual a
reasonable opportunity to make representations to the lessor about the
proposal.
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The second condition is that the request is made at the time the public
housing lessor gives a notice under subclause 9(4) to the Secretary that no
amount is due and payable by the person to the public housing lessor under
the lease for rent or household utilities which caused an earlier request to
cease to be in force.
Because of paragraph 9(1)(e), such requests can remain in force for
12 months, allowing for ongoing rent and household utilities to be met in that
time.
Clause 7 of new Schedule 1 provides a power for the Secretary to make a
deduction as requested where the Secretary is satisfied that the request has
been made in accordance with Part 2 of the new Schedule. Once a request is
received, it is at the discretion of the Secretary as to whether to act upon it in
reliance on this power.
The Secretary does not have the power to direct a payment under the
Scheme in relation to an individual who is subject to the income management
regime in recognition of the fact that, once a request is received in relation to
an individual subject to income management, the Secretary is able to direct
income managed funds towards priority needs, including a housing purpose
or rent under Part 3B of the Social Security Administration Act.
The clause also ensures that the power in subclause 8(3) of Schedule 6 to the
Social Security Administration Act to specify certain persons, including as a
class, as persons in relation to whom deductions should not be made under
the Scheme is operative in relation to individuals under the family assistance
law.
There is a power under this provision (subclause 7(3)) to enable the Minister
to specify kinds of payments of family tax benefit from which deductions are
unable to be made under the Scheme. A kind of payment for this purpose
could be a payment for a past period or other kinds of lump sums.
There is also an explicit power to notify public housing lessors if the Secretary
exercises discretion not to make deductions following a request.
Clause 8 of new Schedule 1 outlines the maximum amount that can be
deducted from a payment of family tax benefit in response to a request by a
public housing lessor. That amount is capped at the lowest of:
a) the amount requested by the public housing lessor;
b) the amount of the payment (remaining after other deductions have
been applied) to ensure that no more can be deducted than the
individual may be entitled to;
c) 35 per cent of payment, taking account any reduction made under
sections 84 and 84A, which relate to deductions to repay debts or
`set offs' with respect to debts.
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Subclause 8(2) enables the Minister to make a legislative instrument to
specify provisions of the family assistance law to be disregarded to reduce the
amount against which 35 per cent is calculated. This would enable certain
supplements (such as clean energy amounts) to be disregarded to make such
supplements effectively immune from deductions under the Scheme.
Clause 9 provides for a number of circumstances in which a request from a
public housing lessor ceases to be in force. These circumstances have been
adapted to ensure that the lessor can revoke the request, or that a request
can cease when the relevant tenant ceases to lease property under the lease,
when the lessor is no longer specified as a public housing lessor, when an
individual has paid any arrears of rent or household utilities outstanding under
the lease (where the request is made under the conditions in clause 5), and
after the expiry of 12 months from the date of a request made in conformity
with the conditions in clause 6.
The clause also ensures that public housing lessors are under an obligation to
inform the Secretary when an individual ceases to lease the relevant
accommodation or when their arrears under the lease is paid so that the
Secretary is aware of the lack of power to make deductions in relation to
those requests.
Part 3 - Treatment of amounts deducted
Part 3 of new Schedule 1 contains a number of clauses to clarify the effect of
action taken by the Secretary under Part 2 of new Schedule 1 to act on a
request by a public housing lessor.
Notably, clauses 11, 12 and 13 provide that, when the Secretary takes action
to make a deduction, the amount is to be paid to the public housing lessor,
that amount reduces the individual's liability or future liability under the lease
and the individual is taken to have been paid the amount deducted.
These provisions ensure that deductions under the Scheme are only used to
meet actual housing liabilities of an individual under their lease with a public
housing lessor. Subclause 12(2) is a beneficial provision to clarify that, if an
amount is not yet overdue and deductions are made to meet it, the tenant's
liability is still reduced.
Subclause 13(2) clarifies for the purposes of other laws of the
Commonwealth that the amount paid to the public housing lessor is to be
treated as if the individual were paid that amount. Among other things, this
ensures, for example, that an individual's income for income tax purposes
includes any amount deducted under the Scheme as if it were paid to the
individual. There is a power to exclude certain laws of the Commonwealth for
this purpose through a legislative instrument made by the Minister. This
power is intended to be used for the benefit of an individual in circumstances
where it is apparent that the individual should not be treated as if an amount
deducted under the Scheme is paid to them.
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Part 4 - Overpayments to public housing lessors
Part 4 of new Schedule 1 contains a code of debt rules that apply to the
circumstances outlined in the Part.
Clause 14 is intended to apply to circumstances where an amount paid to a
public housing lessor mistakenly exceeds the amount deducted from the
relevant individual's payment of family tax benefit. This ensures the lessor is
under an obligation to repay any such excess to the Commonwealth.
Clause 15 targets circumstances where a deduction from a payment of family
tax benefit is made and paid to a public housing lessor, but is more than
should have been paid. This could include where the request identified an
amount that was more than it should have been, or where the Secretary
deducted more than the correct amount in error. Under this provision, where
the Secretary is satisfied that the individual has requested to be repaid the
excess and the public housing lessor has refused to do so, the excess is a
debt owing by the public housing lessor to the Commonwealth. Whether or
not this debt is paid, the Secretary must pay to the individual the excess
(as long as the total paid to the individual does not exceed the individual's
entitlement to the payment apart from the operation of the Scheme).
To ensure that payments are not double-counted (given the operation of
clause 13), there is provision to ensure that any amount paid to an individual
under subclause 15(3) is taken not to have been paid to them. This ensures,
for instance, that the amount will not be able to be double-counted for income
tax purposes.
Clause 16 allows the Secretary to set off an amount payable to a public
housing lessor undner Part 3 against a debt due to the Commonwealth by the
lessor to ensure the efficient operation of the Scheme.
Clause 17 provides, in the case of doubt, that clause 12 (which states that a
individual's liability under a lease to a public housing lessor is reduced by an
amount paid to them under the Scheme) does not apply to any amount that
gives rise to a debt, to ensure that mistaken or overpaid amounts are dealt
with solely by the debt provisions in Part 4 of new Schedule 1.
Part 5 - Fees
Part 5 of new Schedule 1 empowers the Secretary to charge public housing
lessors fees for deducting amounts in accordance with requests or paying
amounts.
Subclause 18(2) clarifies that fees do not amount to tax, to make it clear that
the imposition of fees is done on a fee-for-service basis and is consistent with
section 55 of the Australian Constitution.
It is intended that the costs for such fees will not be passed on to tenants.
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Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights
(Parliamentary Scrutiny) Act 2011
Social Security (Public Housing Tenants' Support) Bill 2013
This Bill is compatible with the human rights and freedoms recognised or
declared in the international instruments listed in section 3 of the
Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Bill
The Social Security Legislation Amendment (Public Housing Tenants'
Support) Bill 2013 is a Bill for and Act to establish the Housing Payment
Deduction Scheme (the Scheme) which will allow rent and household utilities
to be compulsorily deducted from a specified social security payments,
ABSTUDY and family tax benefit (referred to below collectively as `social
welfare payments'), if a person's payments under their lease are in arrears
above a specified minimum.
The objective of the Scheme is to reduce the capacity of individuals and
families at risk of non-payment of public housing rent to accumulate large
amounts of arrears, risking eviction and possible homelessness.
The Scheme recognises that social welfare payments should be used towards
a person's and their family's basic needs, and is intended to enhance security
of tenure in housing. As such, the Bill recognises that a person's home is an
important precondition to their ability to exercise their human rights and their
economic, social and cultural rights in particular.
The Secretary currently deducts public housing rent and other costs from
persons' social welfare payments, and pays amounts to public housing
authorities with the customer's consent, under the (voluntary) Rent Deduction
Scheme. The difference between the new Housing Payment Deduction
Scheme and the current (voluntary) Rent Deduction Scheme is that
deductions under the Housing Payment Deduction Scheme will be made
compulsorily following a request from a public housing lessor.
Compulsory public housing payments under the Scheme will be applicable
only to people who are lessees of public housing with a legal obligation to pay
the amount deducted, and only if they have public housing arrears greater
than a specified minimum amount. Rules will be made by legislative
instrument to determine the minimum amount.
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There are provisions in the Bill to ensure that a request to make deductions
will be made only after reasonable action (consistent with fair processes for
managing public housing) has been taken by public housing lessors.
The Commonwealth Minister will have to be satisfied that there are
appropriate review and tenancy management processes in place before a
public housing lessor is approved to make requests under the Scheme.
Amongst other things, the Minister must have regard to the extent to which
those processes provide for a tenant's individual circumstances in making
decisions, the processes for informing tenants of their rights and available
support services, and for taking reasonable action to recover amounts due
and payable under leases.
Human rights implications
The Bill engages the following Human Rights.
The 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, including
social insurance'. The ICESCR requires a country, within its maximum
available resources, to provide a minimum essential level of benefits to all
individuals and families that will enable them to acquire at least essential
health care, basic shelter and housing, water and sanitation, foodstuffs, and
the most basic forms of education.
People subject to the Housing Payment Deduction Scheme will benefit from
amounts compulsorily deducted by way of a reduction of their liability to a
public housing lessor. As such, the Scheme will be compatible with the right
to social security as expressed in the ICESCR. Although a person's ability to
choose how to spend social welfare payments will be limited, the Scheme is
designed to ensure people continue to enjoy an adequate standard of living
by reducing the risk of their eviction and possible homelessness. Further,
there are assurances built into the Scheme that no more than 35 per cent of a
person's social welfare payment can be deducted for housing payments
(determined after certain debt and compliance deductions are made, where
applicable), leaving affected people with the majority of their payment to
spend as they choose. A person cannot be subject to deductions under both
the Scheme and the income management regime. The Scheme also ensures
that a deduction can only be made in relation to actual amounts owing, and
there are safeguards built into the Scheme to prevent overpayment.
Article 26 of the Convention on the Rights of the Child also recognises
`for every child the right to benefit from social security' and that `benefits
should, where appropriate, be granted, taking into account the resources and
the circumstances of the child and persons having responsibility for the
maintenance of the child'.
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The Bill recognises that recipients of a range of social security payments,
ABSTUDY and family tax benefit have children, and that the bests interests of
children are served when parents responsibly ensure that their welfare
benefits are directed towards housing as a primary and basic need.
The right to an adequate standard of living including housing
Article 11.1 of the ICESCR states that everyone has the right to `an adequate
standard of living for himself and his family, including adequate food, clothing
and housing, and to the continuous improvement of living conditions' and that
`appropriate steps' be taken to `ensure the realization of this right'. Under the
Housing Payment Deduction Scheme, a maximum of 35 per cent of a
person's specified social security payments, ABSTUDY or instalments of
family tax benefit will be able to be deducted and directed to their public
housing lessor for people who have a legal obligation under their lease to pay
the amounts being deducted, if they have arrears of rent or household utilities
owing under their lease. This will protect vulnerable people's public housing
tenancies and reduce the risk of eviction due to arrears or debt. As such, the
Scheme is designed to operate to reduce the likelihood of a person becoming
homeless and is compatible with and enhancing the right to an adequate
standard of living including housing.
Article 27 of the Convention on the Rights of the Child also recognises
`the right of every child to a standard of living adequate for the child's physical,
mental, spiritual, moral and social development'. The Article also states that
`States Parties, in accordance with national conditions and within their means,
shall take appropriate measures to assist parents and others responsible for
the child to implement this right and shall in case of need provide material
assistance and support programmes, particularly with regard to nutrition,
clothing and housing'.
In ensuring that up to 35 per cent of affected social welfare payments can be
used to reduce the risk of homelessness and eviction, the Bill is compatible
with children's rights to an adequate standard of living by ensuring children of
social welfare payment recipients affected by the scheme are at lower risk of
being without a home.
The right to self-determination
Article 1 of the ICESCR states that `all peoples have the right of
self-determination. By virtue of that right they freely determine their political
status and freely pursue their economic, social and cultural development'.
While the Housing Payment Deduction Scheme will limit one's ability to
dispose freely of all of their income, it will be compatible with a person's right
to pursue freely their economic, social or cultural development because the
Scheme is intended to protect the tenancies of people affected in recognition
of the important role housing plays in a person's ability to economically,
socially and culturally develop.
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The right to privacy
Article 17 of the ICCPR provides that no one shall be subjected to arbitrary or
unlawful interference with their privacy. Privacy guarantees a right to secrecy
from the public of personal information. For interference with privacy not to be
arbitrary, it must be in accordance with the provisions, aims and objectives of
the ICCPR and should be reasonable in the particular circumstances.
Reasonableness in this context incorporates notions of proportionality to the
end sought and necessity in the circumstances. To operate, the Scheme will
only require limited information to be provided by a requesting public housing
lessor about a person solely for the purpose of administering the Scheme.
The Secretary will be able to act on a request to make a deduction without
requiring sensitive information about a person's tenancy and circumstances
being disclosed.
Conclusion
The Social Security Legislation Amendment (Public Housing Tenants'
Support) Bill 2013 is compatible with human rights. The Housing Payment
Deduction Scheme will advance the protection of human rights by
ensuring that a proportion of social welfare payments are spent on
housing costs for people who are having difficulty meeting their obligations
under their public housing leases and risking their tenancies. To the
extent that it may limit human rights, those limitations are reasonable,
necessary and proportionate to achieving the legitimate objective of
preventing evictions due to arrears and debt, which may force a person,
and their children, into homelessness.
The Hon Mark Butler MP, Minister for Housing and Homelessness
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