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
Purpose
Background
Main Provisions
Endnotes
Contact Officer and Copyright Details
Further 1998 Budget Measures Legislation
Amendment (Social Security) Bill 1999
Date Introduced: 11 February
1999
House: House of
Representatives
Portfolio: Family and Community Services
Commencement:Upon Royal Assent
except:
-
- Schedules 1 & 4 are proposed to commence on 1 July
1999.
-
- Schedules 2, 7, 8, & 9 are proposed to commence on 20
September 1999.
-
- Schedule 3 is proposed to commence immediately after the
proposed commencement of Schedule 2.
-
- Schedule 5 is proposed to commence from a day fixed by
proclamation, or, if Schedule 5 does not commence within 6 months
beginning on the day this Act receives Royal Assent, from the first
day after the end of the 6 month period.
-
- Schedule 10 is proposed to commence on 1 March 2000.
-
- Part 6 of Schedule 6 is proposed to commence from 1 August
2000.
The Bill proposes to amend the Social
Security Act 1991 (the Act) so as to give effect to a range of
initiatives announced by the government in the 1998-99 Budget and
to some other non-Budget initiatives. Passage of the Bill as
proposed will:
-
- abolish the definitions of 'special maintenance' so that
non-cash maintenance (eg. school fees, private health insurance),
will be treated the same as cash maintenance
make changes to the amount of assistance payable
to Community Development Employment Project (CDEP) participants to
align them closer to entitlements payable to other like allowance
recipients
-
- introduce a new special employment advance payment and at the
same time abolish the current employment entry payment
-
- introduce a new one-off crisis emergency payment
-
- extend the current two year newly arrived resident waiting
period to all newly arrived migrant residents, including those
currently not subject to the two year waiting period, because they
have come from a country with which Australia has a social security
reciprocal agreement
-
- extend the rules that apply within Australia for the grant,
rate of payment and portability of pensions to those pension claims
lodged outside Australia
-
- expand the definition of suitable work an unemployed jobseeker
may be required to look for and accept, under the work search
activity test requirements, to include work that may be outside
their local area
-
- expand the work search activity test penalty arrangements, that
currently apply to recipients of unemployed jobseekers payments,
who move to an area of low work prospects, to claimants who have
moved to an area of low work prospects;
-
- expand the liquid assets test waiting period provisions to
education leavers
-
- provide for a lower rate of pensioner education supplement for
part-time students, and
-
- restrict access to the Health Care Card for newly arrived
residents in Australia during the first two years of residency,
unless they are either a refugee, a former refugee, an exempt
resident, or a former exempt resident, or family members of exempt
residents, or former exempt residents.
There is no central theme to the proposals as
presented within this Bill, it being an omnibus Bill containing a
range of 1998-99 Budget and other non-Budget proposals. The
background and discussion about each proposed item is provided in
the comments on each of the Schedules as presented.
Schedule 1 - Abolition of special
maintenance income
Background - Current treatment of maintenance
income
To receive more than the minimum rate of family
allowance (FA) for a dependent child from a previous relationship,
and to have that child counted for payment of guardian allowance,
rent assistance and remote area allowance, a claimant must take
reasonable action to obtain child support, ie. maintenance for that
child. The minimum level of maintenance is set by a formula under
the Child Support (Assessment) Act 1989. This is to ensure
that the prime onus for the support for children is placed on
parents, rather than on the taxpayer, by way of government
assistance.
Maintenance income received is only income under
the maintenance income test. That test only influences the amount
of FA and associated payments paid. Maintenance is not regarded as
income for pensions or allowance income support payments and
therefore has no effect on the rate of these payments.
Historic treatment of non-cash maintenance
Prior to January 1993, the maintenance income
test was applied to pensions and allowances. This meant that in
those cases where a large amount of non-cash maintenance was being
provided, the recipient of the maintenance could have their income
support payment significantly reduced or even precluded. This was
an undesirable result, with the maintenance recipient left with no
on-going means of support, having received a large amount of
in-kind maintenance and little or no cash. Consequently, there were
ceilings or caps placed on the amount of income in respect of
non-cash maintenance.
From January 1993, the maintenance income test
has been only taken into account for FA. The partial or total loss
of FA is less of a problem, FA being an income supplement, not
income support. Consequently, the need for special ceilings or caps
for non-cash maintenance now no longer exists.
What is non-cash maintenance?
Examples of non-cash maintenance are:
-
- food
-
- clothing
-
- household items
-
- rent
-
- mortgage payments
-
- free lodging
-
- health insurance
-
- medical expenses
-
- loan repayments
-
- credit card and store account repayments
-
- child care fees
-
- school and tuition fees
-
- general education expenses
-
- sporting club fees
-
- sporting costs including, equipment, associated travel and
accommodation costs, coaching fees
-
- travel or holiday expenses
-
- utility bills, ie electricity, gas, telephone, heating
-
- rates, ie council, water, sewerage
-
- motor vehicle expenses, and
Savings and numbers effected with the proposal to remove
caps on non-cash maintenance
This proposal was announced in the 1998-99
Budget and the explanatory memorandum to the Bill estimates that
the measure will cost $0.369 million in 1998-99 and thereafter save
$1.209 million in 1999-2000, $1.300 million in 2000-2001 and $1.366
million in 2001-2002.
These savings would be achieved by way of
reduced program outlays for FA, being the income supplement payment
under the Act, which is affected by the level of
maintenance income paid to custodial parents.
An estimated of 1,170 custodial parents losing
an average of $1,060 per year of FA was provided in the 1998-99
Budget papers(1). These costings assume that for the cases affected
each receives on average $12,500 in non-cash maintenance and $4,000
cash maintenance per year.
Items 1, 2, and 3 remove the
definitions of non-cash maintenance, which is called 'special
maintenance income' in the Act. Items 4 and
5 remove the provisions in FA income test in the
Act, which provided for the special treatment of
maintenance income in that test. Item 6 repeals
the section in the SSA that places a cap or ceiling on the amount
of non-cash maintenance, to be regarded as income under the FA
income test. Item 7 removes sections in the Act
that referred to the treatment of non-cash maintenance, where there
was no agreement for maintenance under the Child Support
(Assessment) Act 1989. Item 8 removes from
the Act a section that provided for a cap or ceiling on the value
of the provision of residence accommodation, commonly the former
family home, as non-cash maintenance.
Schedule 2 - Amendments relating to the
Community Development Employment Project (CDEP)
Background - What is CDEP?
The first CDEP scheme was established in 1977
and was designed to deal with Aboriginal unemployment, aiming at
providing an alternative to 'sit-down' money. Since 1977, more than
30,000 indigenous Australians have been involved in up to 274 CDEP
schemes throughout Australia.(2) In the second reading speech to
the Bill it was claimed that there are more than 26,000 workers
currently employed in CDEP.
CDEP involves an alternative method of providing
government assistance otherwise paid to individuals in the form of
income support payments.
Instead of individuals being paid social
security payments, eg. disability support pension, sickness
allowance, newstart allowance, age pension, partner allowance
(except sole parent pension), a single consolidated amount is paid
to the community.
Under CDEP, money is paid under the
administrative direction of the Aboriginal and Torres Strait
Islander Commission (ATSIC) via a paying agency and is based on a
per-capita amount which is about $6.00 a fortnight above the
maximum newstart allowance rate. Payments are made three monthly
and are linked to the number of CDEP participants in the
community.
CDEP is voluntary and individuals are not
compelled to receive assistance through the CDEP payment
arrangements. However, in reality within communities there is often
considerable pressure to participate so that the local scheme
maintains its numbers and maximises its financial resources. Unlike
newstart allowance, it is not necessary for an individual to be
looking for work to receive CDEP payments, nor to be in paid work.
Many participants spend periods not working and still receive CDEP
payments.
There are exclusion provisions within the Act,
to preclude payment of allowances (eg. newstart, sickness, partner,
widow, mature-age), to a person who elects to be a CDEP
participant.
There is no like preclusion for pension payments
in the Act, but ATSIC guidelines preclude pension payments to CDEP
participants, except for sole parents (see CDEP monetary and other
assistance inequities below).
Benefits of CDEP
The main benefits of CDEP schemes are:
- money can be pooled for community development projects and for
community activities;
- individuals can be paid for work performed; and
- the community gains some power and capacity to decide community
needs, future directions and priorities.
CDEP monetary and other assistance
inequities
Lying somewhere between a labour market program
and a community welfare program, there have been some longstanding
concerns with some aspects of CDEP. One of these concerns has been
the lack of access to some of the ancillary payments and fringe
benefits otherwise available to persons receiving assistance under
the Act. These are rent assistance, bereavement payments, telephone
rental allowance, pharmaceutical allowance, and pensioner
concession cards. This assistance is not available, as access is
contingent on qualification for a payment under the Act.
Access to the health care card (HCC) has always
been available as for other low-income earners, but it was not
automatically issued as with other income support recipients.
Access to the HCC has required the CDEP participant to claim the
card and the take-up rate amongst Indigenous Australians has always
been low.
These differences in assistance have been a
long-standing source of concern and tension and more recently have
been highlighted with the advent of the Work for the Dole Scheme,
which pays participants an extra $20 a fortnight to cover the costs
of transport and participation.
Sole parent pensioners entitled to the social
security sole parent pension (now called parenting payment -
single) are not excluded under ATSIC guidelines from being a CDEP
participant and at the same time also receiving the parenting
payment - single. In addition to the parenting payment - single,
the extra payments and assistance currently available to sole
parents under the SSA are:
-
- guardian allowance
-
- rent assistance
-
- pensioner education supplement
-
- the Jobs Education Training Scheme (JET)
-
- employment entry payment
-
- pensioner concession card
-
- telephone rental allowance
Sole parents participating in CDEP communities
are currently paid the parenting payment - single, as it provides
more money and access to fringe benefits. The CDEP money is not
paid to recipients of parenting payment - single.
Costs/savings, numbers effected and winners and
losers
The initiative proposes to give CDEP
participants access to most of the fringe benefits and ancillary
payments otherwise available to persons with low incomes on social
security assistance.
It is estimated 26,400 CDEP participants will
receive the $20 participant supplement for engaging in work or work
like activities.(3) Some of the differences for sole parents are
addressed by this proposal, but not all and approximately 4,000
sole parents will be comparatively worse off.(4) The reduction in
outlays for sole parents is where most of the projected savings for
this proposal are achieved - see below.
The 1998-99 Budget Papers project a cost of
$3.078 million for the 1998-99 year, thereafter followed by savings
of $1.275 million in 1999-2000, $4.901 in 2000-2001 and $9.243
million in 2001-2002.(5) These savings would be largely achieved by
the reduced amounts of payments to sole parents who are CDEP
participants.
Other CDEP issues
This initiative addresses only some of the
monetary inequities that have been at issue with CDEP schemes, but
there are other CDEP issues still very much a matter of public
debate. For discussion on these other CDEP issues, see the
Independent Review of the CDEP Scheme by Ian Spicer, Commonwealth
of Australia, December 1997.
Item 9 - social security recipient status
Item 9 proposes amendments to
the Act to assign 'social security recipient' status
within the Act, to CDEP participants, thereby providing
access to many of the add-on payments and assistance from which
they have been previously excluded. Hitherto, CDEP participants
have not been defined within the Act as a 'social security
recipient', and therefore have not been able to access much of
the additional payments and assistance.
Items 12, 15, 22, 28, 35 and 40 - option to have
additional payments paid quarterly
These items propose to allow the option of
accumulating any add-on payments owing to a CDEP participant, to be
paid as a lump sum at the end of a quarter. This is an optional
arrangement and recognises that the add-on amounts may not be large
in terms of fortnightly amounts, and that many CDEP participants
living in remote communities may not have ready or convenient
access to banking arrangements.
For these CDEP participants, the payment of a
periodic accumulated lump sum may be of more assistance and more
conveniently accessed. This option is also extended in respect of
the CDEP participant supplement of $20 per fortnight - see Item 53
below.
Item 53 - New Part 3.15A - Division 1 - definition of a
CDEP scheme and a CDEP scheme participant
Item 53 of the Bill inserts a
new Part 3.15A into the Act containing several divisions. Division
1 contains much of the definitional descriptions and requirements
for a scheme to be called a CDEP scheme and for a person to be
categorised as a CDEP scheme participant.
Item 53 - New Part 3.15A - Division 2 - prevention of
dual payments of CDEP payment and other social security
payment
Division 2 provides for the prevention of dual payments of a
social security pension or benefit and a CDEP payment to a CDEP
participant.
Item 53 - New Part 3.15A - Division 3 - CDEP
supplement
Division 3 inserts new provisions into the Act
to provide for the CDEP participant supplement of $20 per
fortnight, being the same amount of supplement currently provided
to Work for the Dole program participants.
Item 53 - New Part 3.15A - Division 4 - CDEP to be
assigned long-term social security recipient status
Division 4 contains transitional provisions for
the treatment of existing CDEP participants to be accepted as
long-term social security recipients to allow access to ancillary
assistance.
Schedule 3 - special employment advance
(SEA) and abolition of the employment entry payment (EEP)
Introduction
This proposal was announced in the 1998-99 Budget and aims to
introduce a repayable advance for jobseekers entering employment to
aid with the costs of starting a new job, and, at the same time
abolish the EEP(6).
Origins and history of EEP
From February 1989 a Newstart program to improve
the employment prospects of long-term unemployment benefit
recipients was trialed on a group of 40,000 recipients. As part of
this program a transition to work incentive payment of $100, called
an employment entry payment, was provided to those entering
permanent full time work. From January 1990 a similar EEP of $50
was introduced for Job Search Allowees (the payment at that time
for young unemployed people) who had been on the allowance for at
least 9 months and took up full time employment.
From January 1991 an EEP of $100 was made
available for Sole Parent Pensioners who had been on the pension
for at least 12 months and increased their earnings above a certain
level or got a job which took them off the pension.
Thereafter, the EEP was steadily expanded to
recipients of other payments as an employment incentive and to aid
with the costs of starting a job.
Currently EEP is available to recipients of
disability support pension -($300), carer payment ($100), newstart
allowance ($100), mature age allowance ($100), partner allowance
($100), widow pension ($100) and widow allowance ($100).
Attempts to abolish the EEP
The first attempt to abolish EEP was made with
the Social Security Legislation Amendment (Budget and Other
Measures) Bill 1996. See Bills Digest No. 52 1996-97(7). The
Bill arose from a proposal in the 1996-97 Budget(8). The parts of
the Bill that proposed the abolition of the EEP were rejected in
the Senate.
The second attempt to abolish the EEP was made
with the Social Security Amendment (Entry Payments) Bill
1997, which was introduced in the Senate on 26 June 1997. See
Bills Digest No. 44 1997-98(9). The Bill was not subsequently
debated in the Senate prior to the 38th Parliament being
dissolved on 31 August 1998.
Reasons presented for the abolition of the
EEP
The reasons provided in the explanatory
memorandum attached to the Bill and in the Budget papers for the
abolition of EEP are:
-
- departmental evaluations suggest that the EEP has not been a
major factor in influencing decisions to take up work; and
-
- the scheme is complex, with the differing rates and conditions
determined by the income support payment received.
In summary, the abolition of EEP is for
targeting and simplicity reasons. The other probable and unstated
reason is also to achieve savings.
It is probably unarguable that the EEP is not an
incentive to take up work, ie. a person is unlikely to start work
solely to access a $100 EEP. However, the original purpose of EEP
was to help with the extra costs of starting work, eg. new or
special work clothes or uniform, travel costs before first
salary/wages payment.
For unemployed jobseekers, especially those
unemployed for a significant period and therefore with little or no
cash reserves, the presence of the EEP to assist with the extra
one-off costs of starting a job is probably highly beneficial.
In 1996, the abolition of the EEP was
anticipated to affect 160,500 jobseekers.(10) More recently, in a
response to a question on notice in Senate Estimates, it was
revealed that the EEP paid 137,000 persons in a year at a cost of
$15.5 million per year.(11)
Propose New Special Employment Advance
(SEA)
This proposal was announced in the 1998-99
Budget and the main purpose of the proposed SEA is to assist people
who face problems with taking up employment due to start up
costs.
The other aim is to assist those people undertaking casual work
who are in financial difficulties, as they have not been paid. The
first of these problems is to a large degree currently addressed by
the EEP.
The new SEA appears to target assistance much
more specifically than the EEP to those who actually face
specifically identifiable financial disincentives or impediments in
commencing or sustaining work. The other major differences between
the current EEP and the proposed SEA are:
- the SEA is means tested in cases where casual earnings are owed
but not yet paid
- the SEA is a repayable advance, unlike the EEP which is not
repayable
- the SEA may not be payable where it is determined repayment
would result in severe financial hardship
- the SEA is not a fixed pre-set amount (ie. $100 or $300), but
is variable from between a minimum of $50 up to a maximum of $500,
depending on individual need and cost circumstances
- a 3 month payment receipt qualifying period applies, whereas
for EEP attached to newstart allowance a 12 month period is
required, but for parenting payment - single and disability support
pensioners, no qualifying period applies
- where the SEA is being sought in respect of commencing
full-time employment, the employment must be for 6 weeks or
more
SEA will require significantly added administrative cost
compared to EEP
Currently, where a person qualifies for an EEP,
it is paid automatically, and being non-means tested and with very
little other qualification requirements, the time, effort and cost
of delivery is minimal.
This has been seen as a virtue in terms of quick
and hassle free delivery to meet costs of starting a job, when
these costs are often unexpected and need to be met quickly, to
allow the commencement of work. With the proposed SEA, the
comparatively extensive qualification and payment rate assessment
requirements will add considerably to the cost and time associated
with the delivery of the payment.
Cost of the SEA
The 1998-99 Budget Papers presented estimates
that about 35,000 people will receive the payment at a cost of
$0.758 million in 1998-99, $0.010 million in 1999-2000 and $0.074
million in 2000-2001, followed by a saving of $0.009 million in
2001-2002.(12)
Comment on the proposed Bill
Part I of Schedule 3 contains a number of insertions into the
Act to prescribe which social security payment recipients will be
entitled to the proposed SEA.
Item 43 - New Part 2.22A
Item 43 of Schedule 3 inserts new Part 2.22A
into the Act, which contains a number of new sections for the
proposed SEA.
New section - 1061EM - qualification for
SEA
Item 43 contains new section
1061EM - qualification for SEA. A feature of this section is that a
person needs to have been in receipt of a qualifying payment for 3
months or more to also qualify for a SEA. This contrasts with the
EEP were generally there is no qualifying period, except for
newstart allowance where the qualifying period is 12 months.
Also contained in the new section 1061EM are
proposed sub-sections that prescribe that SEA is not payable where
earned income (ie. casual earnings), which have not yet been
received, would otherwise reduce the rate of income support payment
otherwise payable by 50% or more.
Item 43 - New Part 2.22A - section 1061EN - severe
financial hardship
New Part 2.22A also contains a new section
1061EN, which sets out the requirements for severe financial
hardship.
Where the SEA is being sought in cases where
casual earnings are owed but not yet paid, a 'severe financial
hardship test' is to apply. Hardship is met where liquid assets on
hand (ie. cash, money in bank accounts), are less than the
equivalent of two weeks payment, at the maximum rate, for the
income support payment the claimant is otherwise entitled to be
paid. This liquid assets test is consistent with like liquid assets
tests used in respect of other payment requirements in the
Act.
Item 43 - New Part 2.22A - New section 1061EO - SEA not
payable in some circumstances
A claimant is not qualified for a SEA where:
- the SEA payable is less than $50;
- the claimant has a debt owing to the Commonwealth, which is
repayable against deductions from a payment under the Act, or
- the person is undertaking a program of employment
assistance.
The last exclusion point is the one of most
interest, especially for those jobseekers gaining assistance from
the new Job Network assistance arrangements. It is not clear from
the explanatory memorandum attached to the Bill as to exactly which
jobseekers this exclusion exactly refers to.
As explained in the memorandum, it could
potentially apply to all jobseekers with access to assistance under
Flex 1 - Job Matching, Flex 2 - Job Search Training and Flex 3 -
Intensive Assistance. If this is the case, then SEA would not be
payable to the vast majority of newstart allowance recipients, all
of whom are entitled to at least Flex 1 assistance. SEA would also
be precluded for those recipients of other income support payments
gaining assistance from the Flex arrangements. Flex assistance is
potentially available to persons in receipt of other social
security income support assistance, eg. disability support pension,
parenting payment - single, mature age allowance and mature age
partner allowance, youth allowance, widow allowance.
There are several other Divisions in
Item 43 of Schedule 3, all inserted under the
proposed new Part 2.22A. These new Divisions are Division 2 - claim
for SEA, Division 3 - determination of claim and payment of SEA,
Division 4 - amount of SEA payable, Division 5 - payment of SEA,
Division 6 - protection of SEA and Division 7 - repayment of
SEA.
Item 53 - New Part 3.16B - SEA recovery
Item 53 inserts a new Part 3.16B into the Act
being the provisions for the recover of the SEA.
Part 2 - repeal of EEP
This part of the Bill repeals EEP from the Act - see
comments about EEP above.
Schedule 4 - introduction of a crisis
payment
Introduction
This initiative was announced in the 1998-99
Budget and aims to introduce a new, non-repayable crisis payment
for persons in extreme circumstances.
It is proposed to commence from 1 July 1999 and
the costs as outlined in the 1998-99 Budget papers are $0.896
million in 1998-99, $1.408 million in 1999-2000, $1.411 million in
2000-2001 and $1.433 million in 2001-2002.(13)
The crisis payment as proposed is to be only
provided to recipients of a social security income support
payment. The amount of the proposed crisis payment will be
the equivalent of one week's full entitlement of the income support
payment otherwise payable without any add ons, eg. rent
assistance.
Item 13 - New Part 2.23A - qualification for crisis
payment
Item 13 inserts into the Act
new section - 1061JG - Qualification for crisis payment - release
from prison or psychiatric confinement.
Current special benefit 'prison release'
payment
The crisis payment proposes to provide some
assistance to persons in circumstances where some help is currently
provided. This help is in the form of the current special benefit
'prison release' payment. This payment currently provides immediate
cash assistance to newly released prisoners and is designed to
provide financial assistance on release to assist with the
immediate costs of food, accommodation and transport etc.
The special benefit 'prison release' payment
recognises that a newly released prisoner may take some time to
obtain employment and for most social security payments, there is
either a waiting period or some time delay, before the first
payment is available.
The current special benefit 'prison release'
payment provides up to one week of payment of special benefit at
twice the normal rate. Special benefit 'prison release' is
not payable where the newly released prisoner can claim and
otherwise qualify for newstart or youth allowance. In such cases,
special benefit at the normal rate may be payable in the one week
waiting period for newstart or youth allowance.
So in terms of replacing the current special
benefit 'prison release' payment, which can provide twice a
one-week payment, the proposed one off crisis payment, being a
one-week payment, provides less assistance. Likewise, the time in
prison requirements are proposed to be doubled from 7 to 14 days
and it is from these two changes that much of the projected savings
will be achieved.
Item 13 - New Part 2.23A - 1061JH - extreme circumstance
forcing departure from the family home
Item 13 proposes to insert new
section 1061JH - Qualification - extreme circumstances forcing
departure from home, for example, domestic violence. It has been a
matter of criticism that newly released prisoners gain immediate
assistance for accommodation and food etc on release from prison
with the special benefit 'prison release' payment, while persons
fleeing domestic violence, with very like needs, are not provided
with any help. For those forced to vacate the family home due to
domestic violence, the current special benefit guidelines do not
provide any assistance.
The payment conditions as proposed refer to
cases where the person has been forced from their home, cannot
return and intends establishing a new home. So it is somewhat
different to the current special benefit - 'major disaster not
declared' payment which is mainly for a person intending to return
to their home. See Special benefit - Major disaster not declared
below.
The claim must be lodged within 7 days of the
extreme circumstance occurring, thereby emphasising the immediacy
of the payment.
Item 13 - New Part 2.23A - 1061JJ - crisis payment not
payable where a disaster relief payment (DRP) is
payable
Currently, a DRP is available to victims of
major (or widespread) disasters if their normal place of residence
has been severely damaged and/or they have suffered a significant
interruption to their normal source of livelihood as a result of
the disaster. Recipients of a pension or benefit at the time of the
disaster are also eligible for the payment.
DRP is a one-off payment equivalent to two weeks
pension plus the standard family allowance rate, less the minimum
standard family allowance rate, plus rent assistance at the rate
appropriate to the claimant's family circumstances, disregarding
income and assets testing.
DRP can only be paid where the Minister for
Family and Community Services declares, by notice in the Gazette,
that a disaster is a major disaster for the purposes of the Act. In
no circumstances can payment of DRP be made without this
authority.
The crisis payment as proposed will not be payable where a DRP
is also payable.
Special benefit - Major disaster not
declared
Separate to DRP payments, where a disaster
occurs which is not a major (or widespread) disaster requiring a
DRP payment to be activated, special benefit may be payable.
Payment of special benefit may only be made on a
temporary basis to assist people during a short-term period of
crisis. The following are only a few examples of where special
benefit might be appropriate:
- a person (without paid leave entitlements) is required to take
time off to repair or clean up property
- a person (without paid leave entitlements) is temporarily
unable to work because of damage to his or her place of
employment
- a self-employed person is unable to open for business because
of damage to premises or stock
- a person is unable to support himself or herself or his or her
family as a result of the disaster
It should be noted that special benefit may also
be payable to victims of isolated disasters affecting only one
person or family. For example:
- the family home may be devastated by fire and the person may be
temporarily unable to earn a sufficient livelihood as other
accommodation must be sought
- the person is temporarily unable to work due to damage to their
place of employment
Each case is assessed on its merits.
Item 13 - New Part 2.23A - Divisions 2, and 3 - claim
for and determination of claim for crisis payment
Item 13 proposes the insertion
of the new Part 2.23A containing Division 2 - Claim for Crisis
payment and also Division 3 - Determination of claim for crisis
payment.
Item 13 -New Part 2.23A - Division 4 1061JU - amount of
crisis payment
The proposed new section 1061JU sets out the
amount of the crisis payment which is one weeks payment set at the
rate of the maximum basic rate of income support payment otherwise
payable to the claimant.
Item 13 - New Part 2.23A - Divisions 5 and 6 - Payment
and protection of crisis payment
Item 13 proposes the insertion
of the new Part 2.23A containing Division 5 - Payment of crisis
payment and also Division 6 - Protection of crisis payment.
Schedule 5 - Amendments relation to
newly arrived residents' waiting periods
Background - residency for social security
assistance
There are residency qualifying periods (ie.
length of legal residence in Australia), for most social security
income support payments. Some common examples are:
- age pension - 10 years
- disability support pension - 10 years if incapacitated on
arrival
- parenting payment - single and widows pension - 5 years if a
sole parent or widow on arrival
With the passage of the Social Security
Legislation Amendment (Newly Arrived Resident's Waiting Periods and
Other Measures) Act 1996(14), since 4 March 1997 newly arrived
residents have to wait two years before they can receive payments
of income support. Two years residence refers to legal residence in
Australia. Currently, the two-year newly arrived resident waiting
period does not apply to 'reciprocal agreement' countries or to
refugees, humanitarian entrants, and the partners and dependent
children of refugees and humanitarian entrants. These are the
countries with which Australia has an international social security
reciprocal agreement.
Social Security Reciprocal Agreement with New Zealand
(NZ)
The reciprocal agreement with NZ was first
signed in 1943 and was the first such agreement with any country.
The agreements was last up-dated in 1995. Under the agreement,
subject to some conditions some payments are payable immediately on
arrival, eg. age pension, carer pension, sickness allowance and
family allowance. However, for some payments there is a 26-week
waiting period, eg. newstart allowance, parenting payment - single.
There is no entitlement where the person is temporarily in
Australia and is not residing here, the waiting period referring to
those moving to Australia to reside on a permanent basis. Under the
agreement, like rules apply to persons moving from Australia to
NZ.
The proposal is to now apply the two-year newly
arrived resident period to some payments for persons moving from NZ
to reside in Australia. The payments are partner allowance, mature
age allowance, sickness allowance and mobility allowance, all of
which were previously available immediately on arrival. For
newstart allowance, the current 26-week waiting period would also
become the two-year newly arrived resident period.
This proposal was announced in the 1998-99
Budget and the projected savings as presented in the Budget papers
are $0.072 million in 1998-99, $9.623 million in 1999-2000, $16.073
million in 2000-2001 and $16.677 million in 2001-2002.(15)
Numbers of NZ citizens moving to Australia
Most of the long-term movements between the two
countries are persons moving to Australia. Over the 1996-97 period,
some 17,500 NZ born moved to Australia permanently, making up about
20 per cent of all settler arrivals.
Reimbursement of payments between NZ and
Australia
Under the current social security reciprocal
agreement between Australia and NZ, there are reimbursement
arrangements for some payments made to persons moving to the other
country. In very general terms, each country is reimbursed by the
other country for payments of social security assistance paid
during periods the person would otherwise have had to serve a
residence-qualifying period, if they had come from another country.
The reimbursements apply only if the person would have otherwise
qualified for the like payment in the previous country of residence
(ie. NZ or Australia).
The reimbursement arrangements mainly apply to
pension payments and are not affected by this initiative.
Renegotiation of agreement between NZ and
Australia
The NZ government has already indicated that it
will respond by also introducing a like waiting period for the
similar payments in NZ.
Part 1 - Item 1 - addition of carer payment in section
7(6AA)
Some payments under the Act are payable to
'exempt residents' inside the two-year newly arrived resident
waiting period. Under section 7(6) of the Act, 'exempt residents'
for the two-year newly arrived resident waiting period refers to a
refugee or former refugee. For the purposes of 7(6) of the Act,
section 7(6B) of the Act defines a 'refugee' as a person admitted
to Australia as a refugee, their partners and dependent children,
humanitarian entrants and their partners and dependent children.
The payments currently available to 'exempt residents' are special
benefit, parenting payment - single, family allowance, non-benefit
partnered payment, maternity allowance and mobility allowance.
Item 1 amends section 7(6AA) of the Act to add
carer payment to this list of payments payable to refugees and
former refugees in the two year newly arrived resident waiting
period.
Immediate payment of sickness allowance to some newly
arrived former residents of the United Kingdom (UK)
In the 1998-99 Budget papers, it was proposed to
extend the two-year waiting period the current immediate access to
sickness allowance for some former UK residents(16). There are no
items within this Bill touching on this element, so it is assumed
that either there has been a change of intention or it is to be
attempted at a later date.
Schedule 6 - Amendments relating to
overseas residence and travel
Background - pension can be commenced either by claiming
or by being transferred
This schedule proposes a series of amendments to
the Act, attempting to provide for greater consistency and equity
to the rules that apply for claiming a pension and taking it
overseas. The current legislation inadvertently provides different
rules for some age pension recipients, depending on how their
pension commenced, ie. between those who lodged a claim and those
who were automatically transferred from another income support
payment.
One of the inconsistencies arose from the
different ways a pension may have commenced to be paid. For most
recipients, the commencement of payment was instigated by the
lodgement of a claim for pension. Some recipients may not have
actually lodged a claim, having been automatically transferred to
the pension, on obtained qualification. For example, where a widow
pension recipients reaches age pension age, and all the age pension
qualification requirements are met, the legislation (ie.
sub-section 43(1)) allows automatic transfer to an age without the
need for a claim to be lodged. These automatic transfers to pension
were not caught by the 12-month rule for portability of payments,
having never technically lodged a claim as set out in the
legislation.
Portability
Portability refers to persons leaving Australia
to reside permanently overseas and having their Australian pension
paid to them overseas.
Resident in Australia
The use of the terms 'resident' and 'residing in
Australia' in this context deserves some clarification. Resident
refers to a person who is legally in Australia and is allowed to
reside permanently. A person may be legally in Australia but only
visiting and not intending to reside permanently, and while
physically present, is not in this context 'resident in
Australia'.
Items 1 and 2 - Part 1 - Amendments relating to the
portability of pensions
Items 1 and 2 in Part
1 propose amendments to the Act to ensure the current 12
month rule for persons returning to Australia and seeking to take
their pension overseas is applied to all pension recipients. Under
the current wording of section 1220 of the Act, only those who have
actually lodged a claim for pension are caught by the rule. Those
who were transferred to a pension, without having actually lodged a
claim are not subject to the 1`2 month rule.
Items 3 to 8 - Parts 2 and 3: Amendments relating to
rates of pension payable under portability provisions and
Amendments relating to the grant of pensions overseas
Part 2 and Part
3 flow from Part 1. Part 2 is designed to
ensure consistency in the rules that apply to the rate of portable
pension, between those who claimed or were transferred to a pension
in Australia, and those who claimed or were transferred to a
pension whilst resident overseas. Part 3 is
designed to ensure consistency in the rules that apply for the
transfer to age pension for persons resident in Australia and for
those resident overseas. See also Part 6 of this
Schedule, which refers to making consistent the rate of pension
paid.
Items 9 and 10 - Part 4: Amendments relating to the
application of international agreements where persons transfer to
another pension while overseas
Under some international social security
agreements, the normal residency periods for an age pension (ie. 10
years) may not apply and a person can access the age pension at an
earlier date. This amendment is like those in the previous Parts in
this Schedule, in referring to those automatically transferred to
an age pension inside the 10-year period by virtue of an
international agreement. This amendment will ensure that for those
who gain entitlement to the age pension inside the 10-year period,
it is contingent on the existence of the international
agreement.
Items 12 and 13 - Part 6: Amendments relating to the
transfer to age pension of persons temporarily
overseas
Part 6 is like Part
3, and is aimed at ensuring those who are granted a
pension overseas, by virtue of an international agreement, cannot
be paid at a rate higher than they would otherwise be entitled to
if they were residing in Australia. With some international
agreements, there are income test concessions recognising periods
of residence in the overseas country, while the person was of
working age. This arises from the fact that overseas age pension
arrangements are often linked to contributions paid and /or period
spent in the country whilst working. This is unlike Australia where
generally there is no nexus between entitlement and rate of pension
paid with contributions and working life residency. The exception
to this is the rate of Australian age pension payable when it is
taken overseas, which can be determined by period of residency
during working age in Australia.
Schedule 7 - Amendments relating to
youth allowance and newstart allowance and unsuitable work
Introduction
This proposal was announced in the 1998-99
Budget and the projected savings as presented in the Budget papers
are $1.171 million in 1998-99, $3.900 million in 1999-2000, $3.799
million in 2000-2001 and $3.873 million in 2001-2002.
These savings are to be achieved by way of an
estimated 400 youth and newstart allowance recipients accepting out
of area jobs.(17)
Background - Current work search activity test
requirements to look for and accept work near to place of
residence
In situations where an unemployed jobseeker does
not live in close proximity to the place of work, or job vacancy,
current policy requires that they be expected to commute up to 90
minutes each way. Travel is not restricted to motor vehicles or
public transport, and can include motor bike, bicycle or walking.
There are some exceptions to the application of this rule and some
examples are:
-
- the jobseeker is aged less than 18 years
-
- the jobseeker is pregnant or in ill health
-
- where taking the job would cause financial hardship
Expansion of the work test to out of area jobs where
jobseeker indicates a willingness to look for and accept work out
of local area
Under this proposed initiative, these 90 minute
rules will still apply to most jobseekers. However, where a
jobseeker indicates a willingness to look for and accept suitable
work in excess of the 90 minute limit, then the 90 minute rule may
be waived.
In these cases, where the jobseeker then
subsequently refuses a job offer, or leaves a job due to the excess
travel or cost of travel, then an activity test penalty may apply.
Work in an outside area refers to permanent full-time work.
Items 2 to 5 - amendment to subsections 541D(1) and
601(2A)
Items 2 to 5 propose like
amendments to sub-section 541(1A) for youth allowance and
sub-section 601(2AA) for newstart allowance and they provide a list
of exemptions where the out of area provisions would be waived or
not be applied. Most of these appear to be sensible and
self-evidently appropriate.
Sub-paragraph (k) in both Item
2 (541(1A)) for youth allowance and in Item
5 (601(2AA)) for newstart allowance refers to 'severe
financial hardship'. However, there is no legislation prescription
or explanation setting out or describing what constitutes 'severe
financial hardship'. One must assume this will be a matter of
policy guidelines, but it is not clear what will be required to
meet 'severe financial hardship'.
Item 2 and Item 5 - Job referrals by contracted
employment service providers
Sub-section (1B) in Item 2 and also (2AB) in
Item 5 refer to jobseekers and employment service
providers.
With the advent of the new employment assistance
arrangements, ie. the Job Network, that commenced from 1 May 1998,
it is the contracted employment service providers that largely
undertake job referrals and placements. Where a jobseeker indicates
to a contracted employment service provider that they are willing
to look for and accept out of area jobs, then the proposed
provisions will apply.
Schedule 8 - amendments relating to
claim made for youth or newstart allowance after moving to an area
of lower employment prospects
Introduction
This proposal was announced in the 1998-99
Budget and the projected savings as presented in the Budget papers
are $0.069 million in 1998-99, $0.503 million in 1999-2000, $0.482
million in 2000-2001 and $0.502 million in 2001-2002. The Budget
papers claimed that these savings would be achieved by an estimated
100 jobseekers having a 26 week non-payment period applied in a
year.(18)
Background - Jobseeker moves to an area of lower
employment prospects
There are currently legislative provisions in
the Act, to provide for the non-payment of youth allowance and
newstart allowance where a jobseeker has reduced his/her chances
and opportunities to obtain employment by moving to an area of
lower employment prospects. The non-payment period is 26 weeks.
Under the current legislation, the non-payment period can only be
applied where the jobseeker moved whilst receiving newstart or
youth allowance. However, where the movement occurred when the
jobseeker was not in actual receipt of newstart or youth allowance,
the non-payment period cannot be applied.
Some jobseekers getting around the movement to an area
of lower employment rules
There has been some concern that anecdotal
evidence suggests that some jobseekers have been able to circumvent
the application of the current 'moving to an area of lower
employment prospects', non-payment provisions. This can be achieved
by contriving their circumstances to ensure they are not actually
in receipt of newstart or youth allowance payment at the time of
moving. For example, the jobseeker cancels their newstart or youth
allowance payment immediately prior to the move, then re-claims
newstart or youth allowance immediately after the move has been
completed. There is a significant incentive to achieve this given
the severity of the 26 week non-payment period.
Determinations of movements that meet the requirement of
moving to an area of lower employment prospects
To determine whether a movement to an area of
lower employment prospects has occurred, a comparison is made of
the unemployment rates between the area and the area moved to.
Where the area moved to has a rate that is two
or more percentage points higher than the area moved from, a
non-payment period might be applied. For example, a jobseeker moves
from Adelaide with an unemployment rate of 9% to Mount Gambier with
an unemployment rate of 14%.
Situations where the non-payment provisions may not apply are
where the:
- jobseeker moves to reside with, or near, a family member
already established in the area; or
- jobseeker moves for the purposes of treating, or alleviating an
illness of the person or family member.
Originally, it was the Commonwealth Employment
Service (CES) that made the determinations about jobseekers moving
to an area of lower employment prospects. With the advent of new
employment assistance arrangements, that commenced from 1 May 1998,
ie. the new Job Network, the CES is no longer operative.
Technically the CES still exists but only as a statutory shell. In
this new environment, it is now Centrelink staff who make out of
area determinations, using policy guidelines provided by the
Department of Family and Community Services.
Items 1 and 4 - repeal and replace subsection 553B(1)
and amend subsection 634(1)
Items 1 and 4 propose
amendments to the Act for both the youth allowance and newstart
allowance provisions to provide for the application of a 26 week
non-payment period, where a person prior to claiming either payment
has moved to an area of lower employment prospects. However,
neither Items 1 or 4 as proposed contain any time
limit or period in which the movement should take place, prior to
the lodgement of the claim. This means a claimant may have moved
three or even six months prior to claiming and these provisions may
be applied.
Does the punishment fit the crime?
The 26-week non-payment period, for jobseekers
moving to an area of lower employment prospects, is a rather harsh
penalty compared to other penalties applied for like breaches of
the work search activity test. Some common examples of activity
test breaches where a penalty may be applied are:
- fails to satisfy the requirements of the activity test
- refuses or fails to attend a job interview without sufficient
reason
-
- fails to complete a labour market program, or is dismissed from
such a program before its completion due to misconduct
-
- refuses or fails to correctly declare earnings from
employment
-
- recklessly or knowingly gives false or misleading information
about earnings
-
- becomes unemployed voluntarily without sufficient reason
-
- becomes unemployed due to misconduct
-
- refuses or fails to accept suitable job offers without
sufficient reason
Where an activity test breach has occurred, the Table below sets
out the regime of penalties.
If...
|
Then...
|
it is the first activity test breach within a 2 year period
|
the customer's basic rate of payment will be reduced by 18% for
a period of 26 weeks.
|
it is a second activity test breach within a 2 year period
|
the customer's basic rate of payment will be reduced by 24% for
a period of 26 weeks.
|
it is a third or subsequent activity test breach within a 2 year
period
|
a non-payment period will apply for 8 weeks.
|
In comparison to the penalty regime applying to other breaches
of the work search activity test, the 26 week non-payment period is
not progressive and is far more severe.
Schedule 9 - Amendments relating to the
liquid assets test waiting period (LATWP)
Introduction
This proposal was announced in the 1998-99
Budget and the projected outlays as presented in the Budget papers
are $0.327 million in 1998-99, $1.718 million in 1999-2000, $1.717
million in 2000-2001 and $1.763 million in 2001-2002. These savings
estimates are based on an estimated 2,500 newstart allowance and 60
sickness allowance claimants and 20 partners being effected, with
liquid assets of $3,000 or more ($6,000 or more if a member of a
couple).(19)
Background
The LATWP applies to claimants for newstart
allowance, youth allowance, sickness allowance and the Austudy
payment. The LATWP can be up to 13 weeks, depending on the amount
of liquid assets held by the claimant. The purpose of the LATWP is
to ensure claimants with some readily available financial resources
at claim use those resources first before payment commences.
The amendments to the Act presented in this
Schedule are designed to ensure a person cannot be considered as
unemployed while enrolled as a full-time student.
For unemployment benefit type payments (ie.
youth allowance and newstart allowance), it has never been
specifically spelt out in the Act that a person undertaking
full-time studies is not unemployed. It has been a matter of
interpretation and application by decision makers and tribunals
that a person who is a full-time student is not unemployed. The
exception to this has been for sickness allowance where the Act did
contain specific provisions precluding qualification to full-time
students.
Items 1 to 4 - persons in full-time study not unemployed
while studying
It is claimed in the Explanatory memorandum
attached to the Bill, that as a result of interpretations by
Tribunals, some full-time students can be considered as unemployed,
notwithstanding that they are still enrolled as a student. So the
primary purpose of this Schedule is to spell out in the Act that
full-time students are not unemployed. The proposed amendments in
Items 1 to 4 give effect to this
purpose.
Application of the LATPW - date of
unemployment
An indirect result of the amendments proposed
will also address a perceived imbalance in the application of the
LATWP, between claimants who were formerly full-time students and
claimants formerly employed. The origins of this different
treatment probably arise from the introduction of youth allowance
in July 1998. Prior to July 1998, the student income support
payment was AUSTUDY, for which there was no LATWP. An example of
the different application of the LATWP is set out below.
A person ceases work and commences full-time
study. However, study is only sustained for 6 weeks, and the person
then claims newstart allowance (with cash on hand of $10,000 so a
LATWP applies). Under the current provisions, the LATWP commences
from the date of unemployment, being before studies commenced.
Indirectly the claimant has self-served part of the LATWP during
the 6 week study period. This contrasts with a newstart claimant
(also with cash on hand of $10,000 so a LATWP applies), who ceased
work on the same day as the first person ceased studies. For this
claimant, the LATWP starts from a later date. This is because
sub-section 598(1) of the Act stipulates that the LATWP starts from
the date the person becomes unemployed.
Liquid assets test waiting
period
598.(1) Subject to subsections
(4A), (5), (6), (7) and (8), if:
(a) the value of a person's liquid assets
exceeds the person's maximum reserve on:
(i) the day on which the person becomes
unemployed; or
(ii) the day on which the person claims a
newstart allowance; and
(b) the person is not a transferee to a newstart
allowance;
the person is not qualified for a newstart
allowance for a period unless the person has served the liquid
assets test waiting period in relation to the claim before the
beginning of that period.
So the net effect of the proposed amendments as presented in
Items 1 to 4, means that in cases as presented in
the example, a person is not unemployed while a student and the
date of unemployment becomes the day after date ceased studies.
Schedule 10 - Amendment relating to the
pensioner education supplement
Introduction
This proposal was announced in the 1998-99
Budget and the projected savings as presented in the Budget papers
are $0.000 million in 1998-99, $1.228 million in 1999-2000, $6.016
million in 2000-2001 and $6.526 million in 2001-2002.
The Budget papers presented an estimate of 7,800
students receiving the reduced Pensioner Education Supplement (PES)
of $30.(20) Without this change part-time students would otherwise
receive the full PES rate of $60. These savings are to be achieved
by no longer paying the full rate of PES, but a part rate of PES to
part-time students.
What is the PES?
The PES is a payment to certain categories of
pensioners who undertake full-time or part-time study. The payment
is $60 a fortnight or $1,564 a year and is free of income and
assets tests.
Who can get PES?
PES is available to people who are receiving certain payments
from Centrelink or the Department of Veterans' Affairs (DVA).
Centrelink provided payments that attract the PES:
- Carer payment
- Disability support pension
- Rehabilitation allowance
- Parenting payment - single
- Special Benefit (is a sole parent)
- Widow B pension
- Widow allowance
- Wife pension (if partner receives a disability support
pension)
DVA provided payments that attract the PES:
-
- Carer service pension
-
- Defence widows pension (if has a dependent child)
-
- Invalidity service pension
-
- Partner service pension (if partner is receiving an invalidity
service pension)
-
- War widow's pension (if has a dependent child)
Rationale for proposal
The rationale, as outlined in the 1998-99 Budget
papers, for removing access to the full rate of PES to part-time
students was that a lower rate of PES for part-time students
recognises that they probably are likely to incur lower costs than
full-time students.
Part-time students in receipt of a disability
related income support payment, namely disability support pension,
invalidity service pension and invalidity income support
supplement, will still receive the $60 full-time PES rate.
Number of students affected by introduction of a
part-rate PES for part-time students
In an answer to a question in Senate Estimates on 2 June 1998,
the Department of Social Security provided an estimated breakdown
of the 7,800 students affected.
Approximately 7,800 customers will receive a
reduced rate of payment in the first full year of implementation.
Ninety-seven per cent of those are parenting payment single
recipients; that is, sole parents. As you are probably aware,
Senator, 1,800 students receiving disability support pension, who
are those in study load groups, will be exempt from the measure.
The other groups that make up the balance of the 100 per cent are
carer payment recipients and widows.(21)
PES evaluation
Senator Allison asked the Minister for Family and Community
Services, upon notice, on 7 December 1998 the following:
(1) Can a full account be given as to the
current status of the PES?
(2) Will recipients of this program lose the
retraining allowance under the proposed goods and services tax?
(3) (a) Is an evaluation currently being
conducted as to the efficacy of this program: if so, who is
conducting this evaluation, and what are the terms of reference;
and (b)when is such an evaluation taking place and can details be
provided?
(4) If this program is to be scrapped, are there
any plans to replace it with another scheme; if so, can details be
provided of such plans?
In response to this Question No. 355, on 17 February 1999
Senator Newman provided the following answer to the honourable
Senator's questions(22).
(1) Certain social security and Veterans'
Affairs pensioners who are studying may be eligible for a PES. PES
is payable to both full-time students and part-time students
studying at least 25% of a full-time study load.
The terms of reference for the PES evaluation
are to examine the objectives of the program and whether the
payment is achieving its objectives in the most effective and
efficient way. Key components of the PES evaluation comprise focus
groups with PES customers, as well as a national telephone survey
of 3,000 customers conducted by a consultant (Rush Social Research
Agency). The focus groups with PES customers were completed in
September 1998, while the customer telephone survey was undertaken
in November and December.
The Department of Family and Community Services
(DF&CS) anticipates that the evaluation should be finalised by
the end of February 1999. As the Department of Education, Training
and Youth Affairs (DETYA) retains policy responsibility for the
ABSTUDY component of PES, the role of ABSTUDY PES has been examined
separately.
The Minister for Education, Training and Youth
Affairs, the Hon Dr David Kemp MP, issued a Media Release on 15
December 1998, which stated that from 1 January 2000, ABSTUDY PES
will be fully aligned with AUSTUDY PES available under the Social
Security Act 1991.
(4) Any decisions regarding the future of the
AUSTUDY PES scheme will be made by the Government subsequent to the
completion of the PES evaluation.
Given that there is an evaluation of the PES program currently
under way, it is not clear how this proposal fits in with any PES
evaluation outcomes.
Item 1 - amendment to section 1061PZG - provides a part
rate PES for part-time students
Item 1 proposes the complete replacement of
section 1061PZG of the Act with a new PZG 1061PZG. The current
section 1061PZG simply provides for a rate of PES payable at $60
per fortnight to all who qualify. Item 1 provides
for the same full rate of PES to full-time students and a part-rate
PES of $30 for part-time students.
Schedule 11 - Minor technical
amendment
Introduction
This Schedule proposes a change to the
Health Insurance Act 1973 to preclude access to the
low-income earners Health Care Card (HCC) to newly arrived resident
migrants during the first two years of residency. The HCC currently
provides access to concessional rate pharmaceuticals, under the
Pharmaceutical Benefits Scheme.
Background
With the passage of the Social Security
Legislation Amendment) Newly Arrived Resident's Waiting Periods and
Other Measures) Act 1996(23), since 4 March 1997 newly arrived
residents have to wait two years before they can access payments of
income support. Two years residence refers to legal residence in
Australia.
It was the original intention to also preclude
access to the HCC for two years for newly arrived residents, see
Part 3 of Schedule 3 Social Security Legislation Amendment) Newly
Arrived Resident's Waiting Periods and Other Measures) Bill 1996.
However, due to a mistake in the wording in the Bill, the HCC was
not precluded to newly arrived residents as intended.
Savings and numbers effected
The explanatory memorandum attached to the Bill
provides no information on the estimated cost savings and the
numbers effected with this proposal. As with the current two year
newly arrived resident waiting period provisions, exempt residents
are not to be caught up by this proposal. Exempt residents
primarily refer to refugees and other humanitarian entrants, former
refugees and members of their families.
It is impossible to arrive at a dollar per
person benefit that the HCC provides as the health needs and use of
pharmaceuticals varies tremendously between individuals.
Components of newly arrived residents - migration and
humanitarian
Australia's permanent immigration program is separated into two
components:
-
- Migration (or non-Humanitarian) for Skilled and Family Stream
migrants; and
-
- Humanitarian for refugees and others with humanitarian
needs
On 8 April 1998, the Minister for Immigration
and Multicultural Affairs, The Hon. Philip Ruddock, MP announced
the Migration Program and Humanitarian Program planning levels for
the 1998-99 year.(24) Up to 80,000 new settlers will be selected,
made up of 68,000 under the Migration Program and 12,000 in the
Humanitarian Program. It is under the Humanitarian Program that
refugees gain access to residency in Australia.
-
- Portfolio Budget Statements 1998-99 Budget, Social
Security Portfolio, Budget Related Paper no. 1.14, p. 86.
- Ian Spicer, 'Independent Review of the CDEP Scheme',
Commonwealth of Australia, December 1997, p. 24.
- Portfolio Budget Statements, op. cit. P. 71.
- Ibid.
- Ibid., p. 72.
- Ibid., pp. 75-76
- Bills Digest no. 52 1996-97, Social Security
Legislation Amendment (Further Budget and Other Measures) Bill
1996.
- Portfolio Budget Statements, op. cit., pp. 122-123.
- Bills Digest no. 44 1997-98, Social Security Amendment
(Entry Payments) Bill 1997.
- Portfolio Budget Statements, op. Cit., pp. 123.
- Community Affairs Legislation Committee, Examination of Budget
Estimates 1998-99, Social Security Portfolio, Additional
Information received Volume 1, August 1998, p. 174.
- Portfolio Budget Statements, op. cit., pp. 75-76.
- Ibid., pp. 83-84.
- Bills Digest no.102 1995-96, Social Security
Legislation Amendment (Newly Arrived Resident's Waiting Periods and
Other Measures) Bill 1996.
- Portfolio Budget Statements, op. cit., pp. 69-70.
- Ibid., p. 69.
- Ibid., pp. 79-80.
- Ibid., p. 81.
- Ibid., pp. 77-78.
- Ibid., pp. 88-89.
- Senate Estimates, 2 June 1998, Community Affairs Legislation
Committee. Social Security Portfolio. Program 6 - Special payments
and services.
- Senate Hansard, Wednesday, 17 February 1999, pp.
2162-2163.
- Bills Digest no. 102 1995-96, Social Security
Legislation Amendment (Newly Arrived Resident's Waiting Periods and
Other Measures) Bill 1996.
- Minister for Immigration and Multicultural Affairs,
Ministerial Press Statement 37/98, Humanitarian Program
Announced for 1998-99.
Peter Yeend
23 March 1999
Bills Digest Service
Information and Research Services
This paper has been prepared for general distribution to
Senators and Members of the Australian Parliament. While great care
is taken to ensure that the paper is accurate and balanced, the
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ISSN 1328-8091
© Commonwealth of Australia 1999
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Published by the Department of the Parliamentary Library,
1999.
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