Bills Digest No. 45   1997-98 Child Care Payments (Consequential Amendments and Transitional Provisions) Bill 1997


Numerical Index | Alphabetical Index

WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments. This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.

CONTENTS

Passage History

Child Care Payments (Consequential Amendments and Transitional Provisions) Bill 1997

Date Introduced: 28 August 1997
House: House of Representatives
Portfolio: Health and Family Services
Commencement: The transitional arrangements commence when the Child Care Payments Act 1997 commences. For details of the commencement of the consequential amendments, see the following Main Provisions - Consequential Amendments section of this Digest.

Purpose

To repeal the Child Care Rebate Act 1993 and amend other Acts necessary to implement the new child care arrangements proposed by the Child Care Payments Bill 1997.To provide transitional arrangements between existing child care payments and the new scheme.

Background

The Child Care Payments Bill 1997 was introduced in the House of Representatives on 26 June 1997.It provides for a system of approved child care services and simplifies the paperwork associated with child care by using the Commonwealth Services Delivery Agency to process all applications and payments.It also increases the threshold for the assets test, introduces a cap of 20 hours for parents who are not working, training or studying, and seeks to limit the number of new places so as to distribute child care facilities where they are most needed.

For a comprehensive analysis of the Child Care Payments Bill 1997 the reader is referred to Bills Digest No. 21, 1997-98.

Main Provisions

Transitional Arrangements

The effect of clause 5 is to continue operation of the current child care subsidies until the 'payment commencement day' which is a day to be fixed by Proclamation under clause 12 of the Child Care Payments Bill 1997.Subclause 5(2) allows people a period of 21 weeks after the 'payment commencement day' to lodge claims for child care already provided.

Clause 6 enables the Secretary to make determinations regarding existing child care services or centres about whether they are approved under the Child Care Payments Act 1997.These determinations operate for a period of up to 12 months from the 'payment commencement date' (Subclause 6(6)).

Clause 7 enables the Secretary to make determinations regarding the existing registration of carers about whether they are registered under the Child Care Payments Act 1997.Such determinations can only be made for a period of up to six months after the 'payment commencement day'.

Clause 8 provides exemption, subject to the Secretary's approval, from the new planning controls for a child care operator who had already taken action to build or extend a long day care centre before the limits on location were announced in the 1997 Budget (13 May 1997).To be eligible for this exemption, operators would need to have completed the building or extension by 30 September 1998.

Clause 9 provides exemption from the new, lower rate of Child Care Assistance for children who are attending school and already using a long day care centre or family day care service for outside school hours care.The new rate will have a ceiling of $1.95 per hour.School age children already in centres and family day care will retain their current entitlements of up to the current ceiling of $2.30 per hour (or $3.05 per hour for non-standard family day care hours) while they continue to use the same service(1).

Clause 10 provides arrangements for children who are receiving special child care assistance immediately before the 'payment commencement day' to continue to receive additional assistance, subject to the Secretary's approval, for the first 4 weeks of the new scheme.

Clause 12 enables regulations to be made to manage other transitional arrangements from the current child care payments scheme to the new scheme.

Consequential Amendments

All the consequential amendments to other legislation are included in Schedule 1.

Item 8 repeals the Childcare Rebate Act 1993.

Items 1-4 amend the Child Care Act 1972 by removing a number of definitions which had been added to it by the 1993 legislation which is now repealed.Item 7 repeals references to fee relief in the Child Care Act 1972.From 1 January 1998 Child Care Assistance and Child Care Cash Rebate will be paid as a parent entitlement, rather than as a grant to services.Payment will be administered by the new Commonwealth Service Rebate Agency under the Child Care Payments Act 1997(2).

Items 1-8 of Schedule 1 are to commence on the day that is the 'payment commencement day' for the purposes of the Child Care Payments Act 1997.

Items 9 and 10 amend the Data-matching Program (Assistance and Tax) Act 1990 to ensure that the new child care fee subsidies are included in the definition of 'personal assistance' for the purposes of data matching.These items will commence on the 'payment commencement day' unless the subparagraphs 3(1)(c) (xxivd) and (xxive), which refer to Child Care Assistance and fee relief under the old scheme, have been repealed earlier by another Act.

Item 17 amends paragraph 16(4)(fa) of the Income Tax Assessment Act 1936 to reflect the transfer of administrative responsibility for the registration of child care rebate services from the Health Insurance Commission to the Department of Health and Family Services.This subsection of the Income Tax Assessment Act 1936 provides for certain persons being authorised to receive information from the Commissioner of Taxation for certain specific purposes.

Items 18-21 provide that Child Care Assistance and the Child Care Rebate are exempt from income tax.The effect of Item 18 is to ensure that neither of these payments is included in the calculations of a taxpayer's dependant's 'separate net income' for the purposes of certain tax rebates.

Items 17-21 commence on the commencement of the Child Care Payments Act 1997.

Items 22-43 amend the Social Security Act 1991.The effect of Items 23, 24, 28-40, 42 and 43 is to amend various subsections of the Social Security Act 1991 in order to include decisions about child care payments in the appeal mechanisms of the Social Security Appeals Tribunal (SSAT).Access to the review and appeal mechanisms of the SSAT is introduced by Chapter 9 of the Child Care Payments Bill 1997.Under the previous legislation, decisions were reviewed by the Health Insurance Commission.

Items 26 and 27 allow overpayments of child care subsidies to be recovered from other payments made under the Social Security Act 1991.The effect of Item 41 is to require confidentiality of information obtained in connection with payments under the Child Care Payments Act 1997.

Amendments to the Social Security Act 1991 (Items 22-43) commence on the commencement of the Child Care Payments Act 1997.

Endnotes

  1. National Childcare Information Strategy, Information Kit, 29 August 1997.
  2. Department of Health and Family Services, Commonwealth Children's Services Program: report on public consultations on future directions 1996-97, May 1997: 12.

Contact Officer and Copyright Details

Rosemary Bell
19 September 1997
Bills Digest Service
Information and Research Services

This Digest does not have any official legal status. Other sources should be consulted to determine whether the Bill has been enacted and, if so, whether the subsequent Act reflects further amendments.

IRS staff are available to discuss the paper's contents with Senators and Members and their staff but not with members of the public.

ISSN 1328-8091
© Commonwealth of Australia 1997

Except to the extent of the uses permitted under the Copyright Act 1968, no part of this publication may be reproduced or transmitted in any form or by any means, including information storage and retrieval systems, without the prior written consent of the Parliamentary Library, other than by Members of the Australian Parliament in the course of their official duties.

Published by the Department of the Parliamentary Library, 1997.

This page was prepared by the Parliamentary Library, Commonwealth of Australia
Last updated: 22 September 1997

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