Bills Digest 102 1995-96
Social Security Legislation Amendment (Newly Arrived
Resident's Waiting Periods and Other Measures) Bill 1996
WARNING:
This Digest is prepared for debate. It reflects the legislation as introduced
and does not canvass subsequent amendments.
This Digest was available from 25 June 1996
CONTENTS
Social Security Legislation Amendment (Newly Arrived Resident's Waiting
Periods and Other Measures) Bill 1996
Date Introduced: 23 May 1996
House: House of Representatives
Portfolio: Social Security
Commencement: The changes to benefit eligibility take place either
from Royal Assent; or from 1 April 1996. The commencement dates of the
various measures are detailed in the Main Provisions section of this Digest.
This Bill is designed to impose on immigrants a two-year waiting period
for a range of social security payments. Refugees, humanitarian category
migrants, and their partners and dependent children are exempt.
There is support from both the Coalition and the Labor parties for imposing
a waiting period on newly arrived migrants before they are allowed to
access at least some social security payments.
In 1993, the previous Labor government imposed a six-month waiting period
for job search allowance, newstart allowance, and sickness allowance,
and, from their inception in 1995, youth training allowance and parenting
allowance.
The Arguments
The Second Reading Speech to the Bill offers few clues as to why the
Government is taking these measures other than to say:
The Government expects that new entrants to Australia should provide
for their own support during their first two years (104 weeks) in Australia,
and as a result, announced as part of its 1996 election policy commitments,
that the newly arrived resident's waiting period would be so extended.
The main arguments advanced elsewhere in favour of the Bill seem to be
that with unemployment running at 8.5 per cent in May 1996, and a net
foreign debt of $184.8 billion in the March quarter of 1996, Australia
cannot afford to have new migrants coming here, and immediately drawing
social welfare payments, like unemployment benefits. For example, research
by Monash sociologist Ernest Healy has shown that in May 1994, 27 per
cent of all migrants in the labour force who arrived in Australia during
1992-93 were on unemployment benefits.(1)
Put simply, the Bill seeks to discourage those who cannot pay their way,
and may cause them to think twice before immigrating.
In an interview in April, the Federal Minister for Immigration and Multicultural
Affairs, the Hon. Phillip Ruddock hinted at this.
It was a clear, unambiguous policy commitment ... designed to ensure
that people who desire to enter Australia who are not refugees, are not
humanitarian (migrants), who have not been subject to significant change
in their circumstances, will be excluded from obtaining (benefits) for
two years.
An effect that there might be is that some people who apply to come here,
they might reconsider their situation.(2)
However, opponents of the Bill believe the government has another agenda
- to change the pattern of migration.
Victor Rebikoff, the chairman of the peak ethnic lobby group, the Federation
of Ethnic Communities Councils of Australia, has accused the Coalition
of planning to use the waiting period as a means of cutting back on family
reunion migration. He has also said that the proposal raises questions
about the Coalition's commitment to a non-discriminatory immigration policy.
Mr Rebikoff has also claimed that one-quarter of the annual intake of
migrants would be affected, particularly poorer ones from new communities.(3)
Research by Professor Bob Birrell seems to support the argument that
certain categories of migrants - for example spouse/fiance(e)s - from
particular countries may, in practice, be disadvantaged by the changes.
According to Professor Birrell, spouse/fiance(e) immigration has risen
sharply, doubling between the early 1980s and 1990s.
(T)he spouse-fiance(e) category contributed around 26,000 people or 29%
of the total migration program of 89,760 for 1994-95.(4)
Professor Birrell says the vast majority of spouses and fiances(es) come
from the poorer countries in Asia and the Middle East, with the most rapid
growth from Vietnam and China.
Whilst this group will be affected by the proposed laws tightening spouse
eligibility, it is impossible to predict whether these changes will stop
people migrating, or simply lead to more calls on voluntary welfare services
once they are here.
There may be an argument as to whether the Bill breaches section 10(1)
of the Racial Discrimination Act 1975 which prohibits discrimination
on the basis of nationality. Under section 18, an act is discriminatory
even if only one of the reasons for it are illegal.
Supporters of the Bill may argue that even if it does change the composition
of the immigration program, the government has the right to do this in
the interests of the whole community.
Genesis in Fightback
The Bill has its genesis in Coalition Fightback policy released
in 1991 which stated:
The Coalition will not permit future migrants access to benefits for
two years after they first arrive, unless they are given refugee or humanitarian
entry status. Access to Family Allowances will however, be maintained.(5)
In the lead-up to the last election, this policy was reaffirmed by then
Shadow Treasurer and Deputy Leader of the Opposition, Peter Costello.
To quote one of his pre-election statements:
In January 1993, the Labor Government introduced a six month wait after
arrival in Australia for migrants, other than refugees and humanitarian
migrants, before they became eligible to receive most welfare benefits.
Access to welfare benefits for migrants other than refugee and humanitarian
migrants will be available after two years under a Coalition Government.
This will have little impact on those migrants, particularly those in
the Preferential Family Reunion category, who are accepted for entry into
Australia on the basis of formal assurances of support.
Full access to Family Allowance and Medicare will be maintained for all
migrants immediately upon arrival.
As well, the Coalition will provide a 'safety-net' in the form of a special
allowance for those migrants whose circumstances change significantly
after arrival in Australia for reasons beyond their personal control.
The Coalition projects that this will achieve savings of $602 million
over three years.
However, this policy will apply to prospective migrants only. It will
not be applied retrospectively or to migrants who arrive in Australia
before 1 April 1996.(6)
Retrospectivity
In general, the provisions affecting social security benefits which are
already subject to a six-month waiting have effect from 1 April 1996.
Provisions covering additional benefits, come into operation from the
date of Royal Assent. The waiting period will generally begin to run from
either the migrant's arrival in Australia or the granting of their permanent
residence visa - whichever is the later date.
Promises Honoured
The Bill reflects most of the commitments made by Mr Costello.
- As discussed above, many of the provisions are effective from 1 April
1996.
The Department of Social Security has already alerted staff to this,
sending a directive out in May that in part states:
It will not be possible for Parliament to pass the legislation before
the implementation date of 1 April 1996. However, it is the Government's
intention to enact this legislation retrospectively. This means that staff
will have to inform new migrant customers about the two year waiting period
from 1 April even though the Act will not have changed.
- The Bill does not include Medicare, so it will continue to be available
to newly arrived migrants.
- The Bill also provides a special safety-net benefit for migrants whose
circumstances change through no fault of their own. The payment is at
the discretion of the Secretary of the Department of Social Security.
In making the decision, the Secretary must act in accordance with guidelines
which are disallowable by parliament.(7)
Promises Ignored
Contrary to Mr Costello's pre-election remarks(8), the Bill does not
provide full access to the family payment (family allowance). It only
provides access at the minimum rate of $22.70 per child, as opposed to
a maximum of $121.10.(9)
Surprise Additions
In his February statement, Mr Costello gave no indication that the Coalition's
scheme would apply to more social security benefits than Labor's.
Additional benefits subject to the waiting period include:
- carer pension;
- maternity allowance;
- child disability allowance;
- double orphan allowance(10);
- Commonwealth Senior's health card and health care card under the disadvantaged
person scheme; and
- special benefits (migrants will only be entitled to special benefits
if, in the opinion of the Secretary of the Department, they are suffering
hardship because their circumstances have changed through no fault of
their own. This test is significantly tougher than the present one.)
In addition, the Bill substantially tightens eligibility for spouses/fiance(e)s.
They will have to serve their own two-year waiting period, even if their
partner is fully entitled to social security. However, spouses/fiance(e)s
in Australia on a subclass 820 visa (a two-year temporary visa which converts
to permanent residency providing the marriage/partnership has lasted)
will not have to serve an additional two years once they become permanent
residents.
Under the Bill, migrants must wait two years before they qualify for
the mature age allowance. This is an improvement on the present position.
At present, migrants have to wait ten years (the same period as for age
pensions).
Savings
In his February statement, Mr Costello(11) said the new measures would
save more than $600 million over three years. The then Deputy Prime Minister
and Minister for Finance, the Hon. Kim Beazley, contested this, claiming
the savings would be about $183.6 million.(12)
The amended Explanatory Memorandum to the Bill puts the savings at $360.5
million ($31.4 million in 1996-97, $143.5 million in 1997-98, and $185.6
million in 1998-99).
Refugees and Special Humanitarian Migrants and their Families.
Family members of refugees, or former refugees, will continue to have
access to the full range of social security benefits.
International Agreements
Australia has reciprocal agreements covering a range of social security
payments to citizens/and or residents of other countries including, for
example, Malta and Greece. Under section 1208(1) of the Social Security
Act 1991, these agreements take precedence over any contrary provision
in the Act.
According to an internal instruction issued by the Department of Social
Security in May 1996, most people from countries with whom Australia has
one of these international agreement will have to serve out the two-year
waiting period.
The exceptions listed in the internal instruction are:
- People covered by the New Zealand agreement who arrive in Australia
on a New Zealand passport will continue to have access to allowances
after 26 weeks - except for the parenting allowance, which is payable
immediately.
- Temporary residents covered by the UK agreement will continue to have
access to sickness allowance.
Schedule 1
Part 1 amends the Social Security Act 1991
The changes to the allowances/benefits will apply from 1 April 1996 unless
otherwise stated.
Item 2: makes it clear the waiting period does not apply to a
close family members of a refugee or a former refugee, or to a spouse/partner
who has a acquired a permanent visa after coming into the country on an
820 subclass visa (this last category only get a permanent visa after
serving a two-year wait).
Item 7: amends various definitions to take account of the extended
waiting period and the new categories of benefits added.
Items 13 and 14: introduce a two-year waiting period for a carer
pension, (applies from the date of Royal Assent).
Items 15 to 17: extend the waiting period for widow allowance
from six months to two years.
Items 18 to 21: introduce a waiting period for disability wage
supplement - unless the person is 20 per cent or more impaired or
permanently blind or the impairment/blindness occurred in Australia (applies
from the date of Royal Assent).
Items 22 to 25: extend the waiting period for job search.
Items 26 to 29: extend the waiting period for the newstart
allowance.
Items 30 and 31: introduce a waiting period for mature age
allowance. (As noted above, this is added because of changes to the
residency rules. At the moment, a 10-year residency rule applies. From
1 July, that will be relaxed, with Australian residency the only requirement.)
Items 32 to 35: extend the waiting period for sickness allowance.
Items 36 to 38: introduces a waiting period for special benefit
allowance - unless the secretary is satisfied of a substantial change
in circumstances beyond the migrants control (applies from date of Royal
Assent).
Items 39 and 40: introduce a waiting period for partner allowance
(applies from date of Royal Assent).
Item 41: introduces a waiting period for maternity allowance
(applies from date of Royal Assent).
Items 42 to 45: extend the waiting period for parenting allowance.
Items 46 and 47: introduce a waiting period for child disability
allowance (applies from date of Royal Assent).
Items 48 and 49: introduce a waiting period for double orphan
allowance (applies from date of Royal Assent).
Items 50 and 51: introduce a waiting period for mobility allowance
(applies from date of Royal Assent).
Items 52 to 54: introduce a waiting period for the seniors
health card (applies from date of Royal Assent).
Items 55 to 61: introduce a waiting period for more than the
minimum family payment (applies from date of Royal Assent);
Part 2 amends the Student and Youth Assistance Act 1973
Items 62 to 65: extend the waiting period for youth training
allowance.
(1) Katharine Betts, 'From Airport to Dole Queue', The Independent
Monthly, April 1995: 50.
(2) Colleen Egan, and AAP, 'Migration Pattern to change: Ruddock',
The Australian, 2 April 1996.
(3) Kimina Lyall, The Weekend Australian, 17 February 1996: 6.
(4) Bob Birrell, People and Place, Vol. 3(4) 1993: 37.
(5) Fightback, Liberal and National Party Coalition, 1991:
289.
(6) Peter Costello MP, News Release, 'Meeting Our Commitments',
February 19, 1996.
(7) It is worth noting that the Second Reading Speech to the Bill also
makes it clear the Government is re-examining sponsorship arrangements
with a view to ensuring that where a person formally sponsors an immigrant,
they, rather than the taxpayer, will pick up the bill if the migrant falls
on hard times.
(8) Costello, op cit.
(9) Details of family payments contained in a Department of Social Security
leaflet, Social Security Payment Rates - 20 March - 30 June 1996:
6.
(10) A double orphan is defined as a child whose parents are both dead,
or where one or both parents are uncontactable, or living outside Australia,
or a long-term prisoner, or a long-term mental or nursing home patient.
(11) Costello, op cit.
(12) Kim Beazley, Media Release, 'Coalition Costings - the Real
Story'.
Bronwyn Young Ph. 06 277 2699
12 June 1996
Bills Digest Service
Parliamentary Research Service
This Digest does not have any official legal status. Other sources should
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ISSN 1323-9032
Commonwealth of Australia 1996
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Published by the Department of the Parliamentary Library, 1996.
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Last updated: 24 June 1996
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