Posted 26/08/2014 by Michael Klapdor
In the midst of heated debate over the Budget’s welfare reforms some significant measures have escaped the headlines, including new restrictions on Disability Support Pension (DSP) recipients travelling overseas. The measures, proposed by the Social Services and Other Legislation (2014 Budget Measures No. 2) Bill 2014, will reduce the time disability pensioners can spend overseas from six-weeks at a time to four weeks in a 12-month period. A number of submissions to the Senate committee inquiry into the Bill, from individual DSP recipients and from welfare groups, took issue with the changes suggesting that DSP was being unfairly targeted and that the measures would increase red tape.
Portability
Eligibility to continue receiving an income support payment overseas is referred to as ‘portability’. For most payments, portability applies to a person who is overseas only during a temporary absence and payment is made for a short period—mostly up to six weeks at time. There are a few payments that can be paid where a person leaves Australia permanently to reside overseas (Age Pension, Wife Pension and DSP (in special circumstances)). Some payments, such as Newstart Allowance are not payable while the recipient is overseas (except in exceptional circumstances). Portability provisions allow income support recipients to take short trips overseas while continuing to receive financial support, meaning that they can visit family overseas without penalty and without having to reapply for their payment after a short absence.
DSP portability
Currently, DSP can be paid during a temporary absence from Australia of up to six weeks. The absence can be for any reason. Some of the submissions to the Senate inquiry were from DSP recipients who used the general portability provisions to visit close family members overseas. There are some exceptions to the six-week rule. DSP recipients with a severe and permanent impairment and no future capacity to work may also be eligible for unlimited portability. Also, severely disabled DSP recipients who are in the terminal phase of a terminal illness can have unlimited portability if they are departing permanently to their country of origin, or to be with, or near, a family member.
Recent and proposed changes to the portability rules
The previous Government reduced the temporary portability periods for a significant number of working-age payments from 13 weeks to six weeks through a 2012–13 Budget measure.
The Bill currently before the Senate proposes two key changes to the DSP portability rules. Firstly, it proposes to reduce the temporary absence period from six weeks down to 28 days. It also proposes that only a cumulative period of 28 days can be taken over a 12 month period. Currently, the temporary absence period for DSP is six weeks, but more than one six week period can be taken in any 12 month period. New provisions will allow for temporary absences of four weeks for particular purposes: to seek eligible medical treatment, to attend to an acute family crisis or for a humanitarian purpose. Allowable absences for these reasons will not be cumulative. The Bill makes no changes to the unlimited portability of DSP which only applies in special circumstances.
According to the Statement of Compatibility with Human Rights for the Bill, the change is intended:
… to strengthen the residence basis of Australia’s social security system by requiring most DSP recipients to be present in Australia for the great majority of the year and, where they have the capacity to do so, engage in activities that will assist them to participate socially and economically.
The changes may also reflect concerns expressed by the Minister for Social Services, Kevin Andrews, regarding DSP recipients who were effectively living overseas but returning to Australia for short stays in order to continue qualifying for their payment.
Targeting DSP recipients
The proposed changes will place restrictions on DSP that will not apply to similar payments such as Carer Payment. For example, the Bill proposes to limit the discretion of DHS to only suspend payments if a DSP recipient exceeds the allowable time-limit overseas. Currently, DHS can choose to either suspend or cancel a person’s income support payment if an overseas absence occurs after the end of the allowable portability period. The changes will mean that DHS must cancel a person’s DSP payment in such circumstances. Other payments allow for a greater level of discretion in terms of determining whether a payment should be suspended or cancelled.
The new rules restricting DSP recipients to a cumulative portability period of 28-days in any 12-month period will also not apply to other payments with time-limited portability.
It is unclear why DSP recipients will be subject to the cancellation obligations and cumulative portability period limit but other payments with time-limited portability will not.
The Bills Digest for the Social Services and Other Legislation (2014 Budget Measures No. 2) Bill 2014 provides further analysis of the changes and a number of other important social security changes.