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MEMBERSHIP OF THE COMMITTEE
THE INQUIRY
THE BILL
ISSUES
Payment of arrears - CDA Inclusion of deafblindness on the list of manifest disabilities Parenting Payment - impact on sole parents
RECOMMENDATION
MINORITY REPORT
APPENDIX 1 - Submissions received by the Committee
APPENDIX 2 - Public hearing

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MEMBERSHIP OF THE COMMITTEE

Members

Substitute Members

Participating Members

Report - Social security legislation amendment (Parenting and other measures) Bill 1997

1. THE INQUIRY

1.1 The Social Security Legislation Amendment (Parenting and Other Measures) Bill was introduced into the House of Representatives on 2 October 1997. On 30 October 1997 the Senate, on the recommendation of the Selection of Bills Committee (Report No.17 of 1997), referred the provisions of the Bill to the Committee for report by 17 November 1997.

1.2 The Committee considered the Bill at a public hearing on 10 November 1997. Details of the public hearing are referred to in Appendix 2. The Committee received eleven submissions relating to the Bill and these are listed at Appendix 1.

2. THE BILL

2.1 The Bill gives effect to a number of measures announced in the 1997-98 Budget and these are outlined below.

Parenting Payment

2.2 The Bill provides for the introduction, from 20 March 1998, of a new income support payment, Parenting Payment, that replaces Sole Parent Pension (SPP) payable to lone parents and Parenting Allowance payable to partnered parents.

2.3 The new payment aligns a number of conditions that currently vary between the existing payments, including the non-tapered assets test, the application of an income maintenance period, a 26 week period of payment during an overseas absence and a two-year residence requirement before qualifying for payment. Other differences between SPP and PgA, including rates of payment, income testing arrangements, and access to concession cards, will be retained under the new Parenting Payment.[1]

2.4 In the second reading speech, the Minister stated that the introduction of a single Parenting Payment ‘simplifies income support arrangements for parents by providing support for people with child rearing responsibilities, regardless of whether they are partnered or not. It also aims to reduce social stigma which is sometimes associated with being a recipient of sole parent pension’.[2]

Child Disability Allowance

2.5 The Bill amends the Social Security Act 1991 to reform the qualification provisions for Child Disability Allowance (CDA). The amendments are designed to provide a more objective assessment regime for children with a disability, through the use of a new Child Disability Allowance Tool (CDAT) and a prescribed list of recognised disabilities.

2.6 The CDAT will be introduced for use in relation to all new claims for CDA from 1 July 1998. Existing recipients of CDA are protected through the insertion of a 5 year savings provision. The CDAT will measure the impact of a child’s disability on his/her functional ability in communication, mobility, self-care and community living skills against developmental milestones. It will also assess a child’s behaviour, emotional state and special care needs.

2.7 In the second reading speech, the Minister stated that the use of the revised assessment process:

...will provide a simpler, more objective means of assessing eligibility for child disability allowance than the current criterion of “substantially more care and attention”. It will provide a more objective method of assessment for parents and treating medical professionals, will minimise the subjectivity and inconsistency in the current criteria, will reduce the number of reviews and appeals, and will increase the level of understanding of the program by staff, parents and the medical profession.[3]

2.8 The amendments also increase the number of days allowed in the temporary cessation of care provisions under which a CDA recipient is able to cease temporarily providing care for their child while remaining qualified for payment. The Bill also provides for a reduction in the maximum period for which CDA arrears are payable, from 12 months to 6 months.[4]

3. ISSUES

Payment of arrears - CDA

3.1 Several groups were opposed to the proposed reduction for arrears payments for CDA from 12 to 6 months.[5] It was claimed that the proposal would cause hardship to many families at a time when they are coming to terms with the extent of their child’s disability and seeking practical support to assist with the challenges of caring for a child with special needs.[6] The Carers Association of Australia, indicated, however, that the proposed reduction was ‘reasonable’.[7]

3.2 The Department of Social Security (DSS) explained that the rationale for the Government’s decision was that ‘it is very difficult, in assessing entitlement to child disability allowance, to go back 12 months and establish that the entitlement existed 12 months ago. As six months is a much more reasonable period for doing that, the government has settled on that six-month period’.[8] Some social security payments, such as the Carer Pension and the Domiciliary Nursing Care Benefit cannot be backdated at all.[9] DSS also stated that in the 1996-97 Budget the Government had sought to reduce the period of arrears payments to three months - while the current proposal extends this period to six months.[10]

Inclusion of deafblindness on the list of manifest disabilities

3.3 Several organisations argued that deafblindness should be included on the list of manifest disabilities.[11] The purpose of the list of manifest disabilities is to provide fast-track entry to CDA for children with very severe disabilities which are unlikely to improve.[12] ACROD argued that it is the combination of the two sensory disabilities that makes deafblindness such a severe disability.[13]

3.4 DSS stated that, in relation to the issue of deafblindness, ‘the big problem...is establishing a suitable definition. It is fairly certain that the sorts of people [ACROD] have in mind will qualify under the broader child disability assessment tool, but finding a definition which can operate effectively in the context of the list of manifest conditions is much more problematic’.[14] The Department added that the issue is currently under review and ‘it may well be that we can find a solution to that before the disallowable instrument [is introduced], which will contain all the details of the measures’.[15]

Parenting Payment - impact on sole parents

3.5 Evidence received by the Committee generally indicated support for the introduction of the Parenting Payment in terms of removing the stigma attached to the SPP and making it easier for people to transfer between payments.[16]

3.6 One submission claimed that the introduction of an income maintenance period for sole parents (under which lump sum leave payments, such as accrued annual leave and long service leave, are treated as income for a period equal to the period of leave to which the payment relates) will increase poverty traps suffered by lone parents in paid work.[17]

3.7 DSS advised the Committee that, while the unused leave entitlements will be assessed under the income test arrangements for the period that the leave payment represents, in those cases the leave entitlement ‘would be fairly small. Generally, it would only be for those who would have had continuing employment and who would have amalgamated a fairly substantial amount’.[18]

3.8 The Committee raised the issue of whether the Parenting Payment would be maintained at 25 per cent of Average Weekly Earnings.[19] DSS stated that the single pension rate of the payment which applies to lone parents ‘will be subject to those provisions - of the 25 per cent AWE. It is a continuation of a pension type of arrangement for lone parents under this payment’.[20]

4. recommendation

4.1 The Committee reports to the Senate that it has considered the Social Security Legislation Amendment (Parenting and Other Measures) Bill 1997 and recommends that the Bill proceed.

Senator Sue Knowles

Chairman
November 1997

MINORITY REPORT BY THE AUSTRALIAN DEMOCRATS AND THE AUSTRALIAN LABOR PARTY

Social Security Legislation Amendment (Parenting and Other Measures) Bill 1997

Senator Andrew Bartlett
Senator Kay Denman
Senator Michael Forshaw

The Australian Democrats and the Australian Labor Party fully support Government moves to reduce any social stigma which might be associated with the receipt of income support payments by sole parents or any other social security recipients.

We are concerned, however, that this needs to be done in a manner which in no way brings about a reduction in the level of support provided to sole parents.

We note that, under the provisions of this Bill, from 20 March 1998, sole parents will be subject to the allowance ‘sudden death’ assets test (rather than the pensions’ tapered assets test) and the Income Maintenance Period and that the portability of their payment will be reduced from 12 to 6 months.

We are re-assured by commitments given by the Minister’s office that:

• the level of Parenting Payment paid to sole parents will be legislatively pegged to 25% of MTAWE;
• sole parents will remain eligible for both the Employment and Education Entry Payments;
• when a decision is made that a person is no longer eligible for the sole parent rate of Parenting Payment that payment will be automatically continued pending any review of that decision;
• AUSTUDY regulations will be brought on at a later date to ensure that sole parents who are students can continue to receive the Pensioner Supplement; and
• sole parents will continue to receive the more adequate Pensioner Concession Card.

We understand that amendments will be introduced by the Government during debate on this legislation to ensure the first three of these issues are addressed in the legislation.

We will be seeking a further oral undertaking from the Minister during the Committee stage that AUSTUDY regulations will be introduced as soon as possible providing that student sole parents will continue to be eligible for the AUSTUDY pensioner supplement.

It is well established that sole parents are the group of Social Security recipients most likely to be in poverty. It is also true that sole parents often have a more broken connection with the workforce as a result of their need to balance work and family responsibilities. As such, we oppose the imposition of an income maintenance period for sole parents.

In regard to the changes to the Child Disability Allowance (CDA), we welcome the use of measureable criteria and the transparency of the process being introduced for the assessment of children with disabilities. We do, however, support those submissions which stressed the importance of on-going review of the effectiveness and fairness of the assessment instrument.

We also note with concern that, even with the savings provisions being introduced in conjunction with the new assessment tool, some 12,000 children are estimated to fail to qualify for CDA in 2000-2001 and a further 4,500 children will lose up to 6 months arrears of payment.

Evidence from ACROD indicated that the payment of 12 months arrears of CDA is justifiable in light of the fact that families often find it difficult obtaining an accurate diagnosis of their child and may then take some time to adjust to the implications of that diagnosis. As such, we oppose the reduction of the maximum period for which CDA arrears are payable.

We foreshadow the possibility of amendments on the floor of the Chamber on parts of the Bill not considered by the Committee.

Senator Andrew Bartlett
(AD, Queensland)

Senator Kay Denman
(ALP, Tasmania)

Senator Michael Forshaw
(ALP, New South Wales)

APPENDIX 1 - SUBMISSIONS RECEIVED BY THE COMMITTEE

APPENDIX 2 - PUBLIC HEARING

A public hearing was held on the Bill on 10 November 1997 in Senate Committee Room 2S1.

Committee Members in attendance

Senator Sue Knowles (Chairman)
Senator Kay Denman
Senator Andrew Bartlett
Senator Alan Eggleston
Senator Ross Lightfoot

Witnesses

ACROD

Ms Sue Taylor, Deputy Executive Director

Mr Roland Naufal

State Manager, Service Development, Association for the Blind
and former Executive Director, Association for Children with a Disability

Geelong Welfare Rights Service (teleconference)

Ms Lee Archer, Policy Officer
Ms Brenda Carmen, Policy Officer

Carers Association of Australia Inc

Ms Anne Marie Mioche, National Executive Director
Mr David Fisher, Senior Researcher

Department of Social Security

Mr Andrew Herscovitch, Assistant Secretary, Disability and Carers Programs
Ms Serena Wilson, Director, Carers Section
Mr Anthony Bartolo, Assistant Director, Carers Section
Ms Judy Raymond, Assistant Secretary, Parenting Branch
Mr Ian Wannan, Director, Parenting Branch

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