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Monday, 9 May 1994
Page: 427


Senator SCHACHT (Minister for Small Business, Customs and Construction) (3.55 p.m.) —I move:

  That these bills be now read a second time.

I seek leave to have the second reading speeches incorporated in Hansard.

  Leave granted.

  The speeches read as follows

HUMAN SERVICES AND HEALTH LEGISLATION AMENDMENT BILL 1994

This bill makes amendments to a number of acts within the Human Services and Health Portfolio. The amendments are largely of a minor procedural nature and are aimed at rectifying a number of drafting anomalies which have arisen.

Part 2 of this bill amends the Disability Services Act 1986 to provide for the recovery of costs incurred by the Commonwealth in the provision of rehabilitation programs.

It has been a long standing practice in the Commonwealth Rehabilitation Service (CRS) to serve notices in relation to the recovery of rehabilitation costs on insurers prior to the settlement, or conclusion of litigation between the insurer and the insured person. The amendment will provide legislative backing for notices to be served in time for the debt to the Commonwealth to be considered as part of the negotiations prior to the settlement of the compensation claim.

Under current legislation there is no requirement for the party deemed liable to pay compensation to discharge the debt to the Commonwealth before paying the person receiving the compensation. This has led to situations where the Commonwealth has had to recover moneys from its rehabilitation client. The amendment will ensure that the insurer pays the debt to the Commonwealth before award moneys are disbursed.

Both amendments to section 23 will serve to strengthen legislative support for the recovery of costs by the Commonwealth for rehabilitation programs provided to clients with compensation claims.

Finally, the bill amends section 26 to require decision-makers under Part III of the Disability Services Act to notify persons affected by their decisions of the making of the decisions and of their rights of appeal. The Administrative Review Council has recently explored ways of improving a client's appeal rights. The council's advice is implemented through this amendment.

The amendments to the Health Insurance Commission Act 1973, made by Part 3 of this bill, are consequential to the Childcare Rebate Act 1993.

The Childcare Rebate Act 1993 was another important step to ensure that child care is affordable for all working families.

From 1 July 1994, parents using child care while in employment, training, studying or looking for work will be able to claim a cash rebate for part of their child care expenses.

An estimated 230,000 families with 358,000 children will benefit from the scheme.

The Commonwealth Childcare Cash Rebate will be administered by the Health Insurance Commission on behalf of the Department of Human Services and Health. The cash rebate will be payable by mail or in person through Medicare offices of the Health Insurance Commission.

To enable the Health Insurance Commission to begin preparations for the Childcare Rebate, the Health Insurance Commission Amendment Act 1993 was passed during the Autumn sittings last year.

Part 3 of this bill makes further amendments to the Health Insurance Commission Act 1973, to ensure that it makes adequate provision in relation to the Childcare Cash Rebate functions of the Commission.

Accordingly, the Health Insurance Commission will be required to prepare estimates of receipts and expected expenditure related to the performance of its Childcare Cash Rebate functions, to expend its moneys in relation to those functions only in accordance with approved estimates of expenditure, apportion its assets appropriately, apportion its expenditure appropriately and open bank accounts required to enable it properly to handle its moneys.

The opportunity has also been taken to make technical and drafting amendments to the Health Insurance Commission Act 1973 to facilitate the operation of the financial provisions of the act in relation to functions conferred on the Commission.

In Part 4, the bill proposes a schedule of amendments to two Acts. The schedule makes technical and drafting amendments to the Health Insurance Commission Act 1973 and the National Health Act 1953, substantially to cast certain references in inclusive rather than sexist language.

I commend this bill to the Senate and present the explanatory memorandum.

STUDENT ASSISTANCE AMENDMENT BILL 1994

This bill will make a number of amendments to the Student Assistance Act 1973. The act provides the legislative basis for the AUSTUDY scheme and for the AUSTUDY/ABSTUDY Supplement scheme.

The Assistance for Isolated Children scheme and the ABSTUDY scheme

The bill will give a legislative basis to the Assistance for Isolated Children scheme and the ABSTUDY scheme. Currently, these schemes are not legislated and are administered under guidelines approved by the government. The schemes are, however, covered by the debt management and special appropriation provisions in the Student Assistance Act.

The Assistance for Isolated Children scheme provides assistance to the parents of children who are isolated from normal educational facilities, whether because of geographic isolation or disability.

The ABSTUDY scheme provides assistance for Aboriginal and Torres Strait Islander students for educational purposes.

Decisions made under the Assistance for Isolated Children scheme and the ABSTUDY scheme will become reviewable by the Student Assistance Review Tribunal and the Administrative Appeals Tribunal in the same way as AUSTUDY decisions.

The provisions for the Assistance for Isolated Children scheme will commence on 1 January 1995. The provisions for the ABSTUDY scheme will commence on 1 January 1996. These commencement dates will allow sufficient time for the drafting of the necessary regulations to set out the rules for the schemes.

Debt management changes

The bill will extend the debt management regime under the act to include the Aboriginal Student Support and Parent Awareness Program, the Aboriginal Tutorial Assistance Scheme and the Vocational and Educational Guidance for Aboriginals Scheme.

The bill will decriminalise the existing requirement to advise the Department within seven days of a change of circumstances that may affect entitlement. Instead, there will be a charge of $10 a week, up to a maximum of $1,000. The period for notification of a change in circumstances without penalty will be increased from seven to 14 days.

A number of minor changes will also be made to the debt management provisions.

Financial supplement scheme

Several changes will be made relating to the repayment of benefits under the AUSTUDY and ABSTUDY schemes in relation to eligibility for financial supplement.

The taxable income thresholds for the compulsory repayment of financial supplement debts will be varied so that they are equivalent to the thresholds for the Higher Education Contribution Scheme. The amendments are necessary because of amendments to the Higher Education Funding Act 1988 last year.

Other changes

The bill will provide for the dependent spouse allowance under the AUSTUDY scheme to be indexed in accordance with the All Groups Consumer Price Index.

The bill will also make a number of minor amendments to the act.

Financial impact

Additional revenue of about $1m annually is expected from the introduction of a charge for failing to inform the Department of a change in circumstances likely to affect entitlement to assistance. The purpose of the measure is, however, not to attract revenue but to serve as an incentive for clients to inform changes in their circumstances, so that overpayments can be avoided. On this basis, it is expected that there will be savings of about $2.5m a year through the identification of changes that would otherwise have gone unreported and so led to overpayments.

The other provisions in the bill have no significant revenue implications.

I should perhaps mention that the indexation of the dependent spouse allowance under AUSTUDY does not constitute a change in government policy and so will not involve any additional expenditure above the forward estimates.

The major administrative change in the bill is the establishment of the ABSTUDY and Assistance for Isolated Children Schemes on a legislated basis. This does not, however, require any change to the scheme rules and is therefore revenue neutral.

Conclusion

I commend the bill to the Senate and table the Explanatory Memorandum.

COMMONWEALTH RECIPROCAL RECOVERY LEGISLATION AMENDMENT BILL 1994

This bill seeks to facilitate the reciprocal recovery of debts arising under the Social Security Act 1991, the Student Assistance Act 1973 and the Veterans' Entitlements Act 1986.

These three acts are the main Commonwealth statutes dealing with income maintenance. Each provides that an overpayment may be recovered by making deductions from a person's payments, whether the overpayment was incurred under the same act or one of the other acts.

The bill proposes to amend the Social Security Act and the Veterans' Entitlements Act to enable their payments to be adjusted to recover debts associated with an overpayment under another act. These associated debts are penalty charges incurred by a person who has incurred an overpayment and who is dilatory in arranging a repayment regime with the relevant Department or voluntarily breaks an agreed repayment arrangement.

The Student Assistance Act already provides for the recovery of associated debts under the other two acts. An amendment is, however, needed to the Student Assistance Act to take account of a new charge to be introduced into the Social Security Act by the Social Security Legislation Amendment Bill (No. 3) 1993.

I would add that only a limited amount of a person's income maintenance payments is withheld to recover a debt. Further, the rationalisation of the debt recovery provisions in this bill will not lead to an increase in the level of deductions from a person's payments. The Government is very aware of the need to balance a debtor's need for adequate income maintenance with the responsibility to recover debts to the Commonwealth as expeditiously as possible.

Turning to the financial impact, the bill will provide enhanced recovery procedures for debts to the Commonwealth arising from income maintenance overpayments. These debts amount to about $1m in a full financial year.

I commend the bill to the House.

  Debate (on motion by Senator Reid) adjourned.

  Motion (by Senator Schacht) agreed to:

  That the Human Services and Health Legislation Amendment Bill 1994 be listed as a separate order of the day.