The Financial Framework Legislation Amendment Bill (No. 2) 2013 (the
bill) sought to:
The bill was subsequently passed by the Parliament and received Royal
Assent on 28 May 2013.
The committee sought clarification from the Minister for Finance as to:
You have asked for clarification of amendments made by the
FFLA Bill to the Social Security Act 1991 (Social Security Act)
regarding payments made under the Australian Government Disaster Recovery
Payments scheme (the scheme). It is first necessary to explain the background
to these amendments, and the context of the FFLA Bill in general.
The amendments to the Social Security Act were designed to
address potential inconsistencies with section 83 of the Australian
Constitution, which sets out the rules for payments of money made by the
Commonwealth. In summary, no money is to be drawn from the consolidated revenue
fund except under an appropriation, made by the Parliament for a specified
An appropriation specifies the purpose(s) for which money may
be spent, and associated legislation, including regulations, may specify
conditions under which payments are to be made. For example, who is entitled to
be paid and how much in specific circumstances. Drawing money from the
consolidated revenue fund beyond the scope of the appropriation's purpose
constitutes a breach of section 83.
In 2012, the Australian National Audit Office (ANAO) raised
with Finance that it had identified potential inconsistencies with section 83
of the Constitution across a range of Commonwealth payments being made by
Departments and agencies. The ANAO asked Finance to work with all Departments
and agencies to ensure they addressed any further section 83 issues. The
majority of issues subsequently identified required amendments to legislation
and the previous Finance Minister offered FLLA Bills as a mechanism for
Departments and agencies to make the necessary amendments.
While these amendments were made through a FFLA Bill, put to
the Parliament by the previous Finance Minister, the policy substance of the
amendment to the Social Security Act was requested by the then
The intention of the amendments was to ensure that in
disaster situations, recovery payments would be able to be made even where the
qualification requirements of the scheme could not be satisfied. For example,
during the Victorian bushfires, many people were unable to provide evidence of
identity as required due to the nature of the disaster. The amendments sought
to ensure that recovery funds would be able to be made in an emergency, while
an administrative recovery framework would be in place should incorrect
payments be discovered at a later date.
The recoverable payment provisions were excluded from merits
review under the Social Security(Administration) Act 1999 because the
associated arrangements only relate to payments that are later found not to
meet the qualification requirements under the Social Security Act. These
provisions provide a mechanism for the Department to recover payments that are
ineligible at law and do not go to matters of eligibility, merit or quantum.
Importantly, external merits review would be available under Part 4 of the Social
Security (Administration) Act 1999 for decisions that determine
qualification to a payment made under section 1061 K of the Social Security
Judicial review would also be available for all decisions
made under the scheme, including decisions to recover a payment. This would
include judicial review under the Administrative Decisions (Judicial Review)
Act 1977 or section 75(v) of the Constitution. In such an instance, the
court would examine the lawfulness of the relevant administrative decision,
potentially including a review of the facts to determine the legality of the
On the basis of the availability of these review mechanisms,
I do not consider that human rights have been impinged by the amendments to the
Social Security Act.