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Family and Community Services Legislation Amendment (Australians Working Together and other 2001 Budget Measures) Bill 2003
Schedule 6 Working credit

Part 1 Amendment of the A New Tax System (Family Assistance) Act 1999

A New Tax System (Family Assistance) Act 1999

1  Subsection 3(1) (definition of receiving )

Repeal the definition, substitute:

receiving :

                     (a)  in relation to a social security payment—has the same meaning as in subsections 23(2) and (4) of the Social Security Act 1991 ; and

                     (b)  for the purpose of construing references to a person receiving a social security pension or a social security benefit in clauses 1 and 17 of Schedule 1, and in clause 7 of Schedule 2, to this Act—is taken to include the meaning provided in subsection 23(4A) of the Social Security Act 1991 as if those clauses were specified provisions of that Act referred to in subsection 23(4AA) of that Act.



 

Part 2 Amendment of the Social Security Act 1991

Social Security Act 1991

2  Subsection 8(1)

Insert:

employment income , in relation to a person, means ordinary income of the person that comprises employment income under subsection (1A) and includes ordinary income that is characterised as employment income of the person because of the operation of subsection (1B).

3  Subsection 8(1)

Insert:

student income bank means the student income bank set out:

                     (a)  in Module J of the Youth Allowance Rate Calculator; or

                     (b)  in Module E of the Austudy Payment Rate Calculator.

4  Subsection 8(1)

Insert:

working credit participant means a person who is a working credit participant within the meaning of section 1073D.

5  After subsection 8(1)

Insert:

          (1A)  A reference in this Act to employment income , in relation to a person, is a reference to ordinary income of the person:

                     (a)  that is earned, derived or received, or that is taken to have been earned, derived or received, by the person from remunerative work undertaken by the person as an employee in an employer/employee relationship; and

                     (b)  that includes, but is not limited to, salary, wages, commissions and employment-related fringe benefits that are so earned, derived or received or taken to have been so earned, derived or received;

but does not include:

                     (c)  a superannuation payment to the person; or

                     (d)  a payment of compensation, or a payment to the person under an insurance scheme, in relation to the person’s inability to earn, derive or receive income from that remunerative work; or

                     (e)  a leave payment to the person; or

                      (f)  a payment to the person by a former employer of the person in relation to the termination of the person’s employment; or

                     (g)  a comparable foreign payment.

          (1B)  For the avoidance of doubt, if:

                     (a)  a person is treated, for the purposes of working out the person’s ordinary income, as having earned, derived or received any ordinary income that was in fact earned, derived or received, or taken to have been earned, derived or received, by the partner of the person; and

                     (b)  that ordinary income would be characterised as employment income in the hands of the partner if the partner were not a member of a couple;

then, for the purposes of this Act, that ordinary income is to be similarly characterised in the hands of the person.

          (1C)  For the purposes of paragraph (1A)(e), a leave payment:

                     (a)  includes a payment in respect of sick leave, annual leave, maternity leave or long service leave; and

                     (b)  may be made as a lump sum payment, a payment that is one of a series of regular payments or otherwise; and

                     (c)  is taken to be made to the person if it is made to another person:

                              (i)  at the direction of the first-mentioned person or of a court; or

                             (ii)  on behalf of the first-mentioned person; or

                            (iii)  for the benefit of the first-mentioned person; or

                            (iv)  if the first-mentioned person waives or assigns his or her right to the payment.

6  Subsection 23(1)

Insert:

instalment period , in relation to a person, means a period that is determined by the Secretary under section 43 of the Social Security (Administration) Act 1999 to be an instalment period of the person.

7  After subsection 23(4)

Insert:

          (4A)  Despite subsection (4), if:

                     (a)  a person is receiving a social security pension or social security benefit; and

                     (b)  the person’s rate of payment of the pension or benefit is worked out with regard to the income test module of a rate calculator in Chapter 3; and

                     (c)  the person has not reached pension age; and

                     (d)  the person or the person’s partner earns, derives or receives, or is taken to earn, derive or receive, employment income; and

                     (e)  the person would, but for this subsection, cease to be receiving the pension or benefit on and from a day (the cessation day ):

                              (i)  if paragraph (d) applies to the person—because of the employment income of the person (either alone or in combination with any other ordinary income earned, derived or received, or taken to have been earned, derived or received, by the person) (and after any working credit balance or student income bank balance of the person is reduced to nil); or

                             (ii)  if paragraph (d) applies to the partner—because of the employment income of the partner (either alone or in combination with any other ordinary income earned, derived or received, or taken to have been earned, derived or received, by the partner) (and after any working credit balance or student income bank balance of the partner is reduced to nil); and

                      (f)  but for the employment income, or the combined income, referred to in paragraph (e), the pension or benefit would continue to be payable to the person on and from the cessation day; and

                     (g)  the person continues to be qualified for the pension or benefit on and from the cessation day;

then, for the purposes only of the provisions of this Act that are specified in subsection (4AA), the person is taken to be receiving the pension or benefit until:

                     (h)  12 weeks after the end of the instalment period in which the cessation day occurs; or

                      (i)  the day the person reaches pension age; or

                      (j)  the day the pension or benefit would cease to be payable to the person for a reason other than the employment income, or the combined income, referred to in paragraph (e); or

                     (k)  the day the person ceases to be qualified as mentioned in paragraph (g);

whichever happens first.

       (4AA)  For the purposes of subsection (4A), the following are the specified provisions of this Act:

                     (a)  provisions in Chapter 2 that provide for an increase in a person’s rate of payment by an amount to be known as the approved program of work supplement;

                     (b)  section 1048;

                     (c)  section 1061PJ;

                     (d)  section 1061Q;

                     (e)  point 1067G-F3;

                      (f)  provisions within the rent assistance module of a rate calculator in Chapter 3 describing a partner with a rent increased pension;

                     (g)  provisions within the rent assistance module of a rate calculator in Chapter 3 describing a partner with a rent increased benefit;

                     (h)  provisions within the income test module of a rate calculator in Chapter 3 prescribing the partner income free area or the partner income excess for a person.

8  At the end of Part 2.13 of Chapter 2

Add:

665AA   Existence of working credit does not prevent payments under this Part

             (1)  If:

                     (a)  a person is a working credit participant qualified for newstart allowance; and

                     (b)  either:

                              (i)  the participant commences to earn, derive or receive, or to be taken to earn, derive or receive, employment income; or

                             (ii)  there is an increase in the employment income that is earned, derived or received, or taken to be earned, derived or received, by the participant; and

                     (c)  the participant has a working credit balance greater than nil at the start of the instalment period of the participant in which the commencement or increase occurs;

then, for the purpose of determining the participant’s qualification for employment entry payment, the participant ceases to be qualified for newstart allowance at the time when the participant would have so ceased if the participant had not had a working credit balance greater than nil.

             (2)  If:

                     (a)  a person is a working credit participant to whom widow allowance or a mature age allowance under Part 2.12B is payable; and

                     (b)  either:

                              (i)  the participant commences to earn, derive or receive, or to be taken to earn, derive or receive, employment income; or

                             (ii)  there is an increase in the employment income that is earned, derived or received, or taken to be earned, derived or received, by the participant; and

                     (c)  the participant has a working credit balance greater than nil at the start of the instalment period of the participant in which the commencement or increase occurs;

then, for the purpose of determining the participant’s qualification for employment entry payment, the allowance referred to in paragraph (a) ceases to be payable to the participant at the time when it would have so ceased if the participant had not had a working credit balance greater than nil.

             (3)  If:

                     (a)  a person is a working credit participant to whom a partner allowance is payable; and

                     (b)  either:

                              (i)  the participant commences to earn, derive or receive, or to be taken to earn, derive or receive, employment income; or

                             (ii)  there is an increase in the employment income that is earned, derived or received, or taken to be earned, derived or received, by the participant; and

                     (c)  the participant has a working credit balance greater than nil at the start of the instalment period of the participant in which the commencement or increase occurs;

then, for the purpose of determining the participant’s qualification for employment entry payment, newstart allowance ceases to be payable to the participant’s partner at the time when it would have so ceased if the participant had not had a working credit balance greater than nil.

9  After subsection 1061ZB(1)

Insert:

          (1A)  If:

                     (a)  either:

                              (i)  the person first referred to in subsection (1) commences employment; or

                             (ii)  there is an increase in the ordinary income from employment of the person so referred to; and

                     (b)  at the start of the instalment period of the person in which the commencement or increase occurs, the person’s working credit balance is greater than nil; and

                     (c)  the balance is subsequently reduced to nil because of the commencement or increase;

subsection (1) has effect as if the reference to 26 weeks after the commencement or increase were a reference to 26 weeks after the day on which the balance is reduced to nil.

          (1B)  If:

                     (a)  either:

                              (i)  the partner of the person first referred to in subsection (1) commences employment; or

                             (ii)  there is an increase in the ordinary income from employment of the partner of the person so referred to; and

                     (b)  at the start of the instalment period of the partner in which the commencement or increase occurs:

                              (i)  the partner is a working credit participant or a person to whom the student income bank applies; and

                             (ii)  the partner’s working credit balance or student income bank balance is greater than nil; and

                     (c)  the balance is subsequently reduced to nil because of the commencement or increase;

subsection (1) has effect as if the reference to 26 weeks after the commencement or increase were a reference to 26 weeks after the day on which the balance is reduced to nil.

10  Section 1061ZB(2)

After “Subsection (1)”, insert “(including that subsection as modified by subsection (1A) or (1B))”.

11  Subsection 1061ZB(3)

After “subsection (1)”, insert “(including that subsection as modified by subsection (1A) or (1B))”.

12  After subsection 1061ZC(1)

Insert:

          (1A)  If:

                     (a)  either:

                              (i)  the person first referred to in subsection (1) commences employment; or

                             (ii)  there is an increase in the ordinary income from employment of the person so referred to; and

                     (b)  at the start of the instalment period of the person in which the commencement or increase occurs:

                              (i)  the person is a working credit participant; and

                             (ii)  the person’s working credit balance is greater than nil; and

                     (c)  the balance is subsequently reduced to nil because of the commencement or increase;

subsection (1) has effect as if the reference to 26 weeks after the commencement or increase were a reference to 26 weeks after the day on which the balance is reduced to nil.

          (1B)  If:

                     (a)  either:

                              (i)  the partner of the person first referred to in subsection (1) commences employment; or

                             (ii)  there is an increase in the ordinary income from employment of the partner of the person so referred to; and

                     (b)  at the start of the instalment period of the partner in which the commencement or increase occurs:

                              (i)  the partner is a working credit participant or a person to whom the student income bank applies; and

                             (ii)  the partner’s working credit balance or student income bank balance is greater than nil; and

                     (c)  the balance is subsequently reduced to nil because of the commencement or increase;

subsection (1) has effect as if the reference to 26 weeks after the commencement or increase were a reference to 26 weeks after the day on which the balance is reduced to nil.

13  Subsections 1061ZC(2), (3) and (4)

After “subsection (1)”, insert “(including that subsection as modified by subsection (1A) or (1B))”.

14  Paragraph 1061ZD(2)(c)

Repeal the paragraph, substitute:

                     (c)  because of the commencement of that employment, the person ceases (having regard, where appropriate, to the operation of section 1073J) to be qualified for the disability support pension.

15  Paragraph 1061ZD(3)(b)

Repeal the paragraph, substitute:

                     (b)  because there is an increase in the person’s ordinary income from employment (and after any working credit balance of the person is reduced to nil), the disability support pension ceases to be payable to the person.

16  Paragraph 1061ZE(2)(d)

Repeal the paragraph, substitute:

                     (d)  the person ceases to be qualified for wife pension because the partner of the person:

                              (i)  commences that employment; and

                             (ii)  as a result, ceases (having regard, where appropriate, to the operation of section 1073J) to be qualified for the disability support pension.

17  Paragraph 1061ZE(3)(c)

Repeal the paragraph, substitute:

                     (c)  the wife pension ceases to be payable to the person because there is an increase in the ordinary income of the person’s partner from employment (and after any working credit balance of the partner is reduced to nil).

18  After section 1061ZE

Insert:

1061ZEA   Further extended qualification rule: loss of payment because of employment income

             (1)  This section does not apply in any case where a person is qualified for a pensioner concession card under section 1061ZB, 1061ZC, 1061ZD or 1061ZE.

             (2)  If:

                     (a)  a person is receiving a social security pension or a social security benefit; and

                     (b)  the person’s rate of payment of the pension or benefit is worked out with regard to the income test module of a rate calculator in Chapter 3; and

                     (c)  the person has not reached pension age; and

                     (d)  the person is qualified for a pensioner concession card; and

                     (e)  the person or the person’s partner earns, derives or receives, or is taken to earn, derive or receive, employment income; and

                      (f)  a payment mentioned in subsection 1061ZA(1) ceases to be payable to the person or the person ceases to receive a payment mentioned in subsection 1061ZA(2):

                              (i)  if paragraph (e) applies to the person—because of the employment income of the person (either alone or in combination with any other ordinary income earned, derived or received, or taken to have been earned, derived or received, by the person) (and after any working credit balance of the person is reduced to nil); or

                             (ii)  if paragraph (e) applies to the partner—because of the employment income of the partner (either alone or in combination with any other ordinary income earned, derived or received, or taken to have been earned, derived or received, by the partner) (and after any working credit balance or student income bank balance of the partner is reduced to nil); and

                     (g)  but for the employment income, or the combined income, referred to in paragraph (f), the person would have been, or would have continued to be, qualified for a pensioner concession card:

                              (i)  under subsection 1061ZA(1)—because the payment referred to in that subsection would have continued to be payable to the person; or

                             (ii)  under subsection 1061ZA(2)—because the person would have continued to receive the payment referred to in that subsection;

the person is qualified for a pensioner concession card until:

                     (h)  12 weeks after the end of the instalment period in which the payment ceases to be payable to the person or the person ceases to receive the payment, as the case requires; or

                      (i)  the day the person reaches pension age; or

                      (j)  the day the person would cease to be qualified for a pensioner concession card as mentioned in paragraph (g) for a reason other than the employment income, or the combined income, referred to in paragraph (f);

whichever happens first.

             (3)  Subject to subsection (5), subsection (2) only applies to a person while the person is in Australia and is an Australian resident.

             (4)  If, during the period of 12 weeks referred to in subsection (2), a person receives an instalment of social security pension or a mature age allowance under Part 2.12B that relates to one or more days within that period, the person is not qualified under this section for a pensioner concession card on the day or the days in relation to which the person receives the instalment.

             (5)  In spite of subsection (3), subsection (2) applies to a person when:

                     (a)  the person is in Australia; and

                     (b)  the social security pension or the social security benefit that the person had been receiving was received solely because of the operation of the scheduled international agreement between Australia and New Zealand.

19  Paragraphs 1061ZM(1)(b) and (c)

Repeal the paragraphs, substitute:

                     (b)  because either:

                              (i)  the person or the partner commences employment; or

                             (ii)  there is an increase in the ordinary income of the person or the partner from employment;

                            the person ceases to be an employment-affected person; and

                     (c)  the person has been a qualified recipient for a continuous period of 52 weeks immediately before so ceasing;

20  After section 1061ZM

Insert:

1061ZMA   Further extended qualification rule: loss of payment because of employment income

             (1)  This section does not apply in any case where a person qualifies for a health care card under section 1061ZM.

             (2)  If:

                     (a)  a person is receiving a social security pension or a social security benefit; and

                     (b)  the person’s rate of payment of the pension or benefit is worked out with regard to the income test module of a rate calculator in Chapter 3; and

                     (c)  the person has not reached pension age; and

                     (d)  the person is qualified for a health care card; and

                     (e)  the person or the person’s partner earns, derives or receives, or is taken to earn, derive or receive, employment income; and

                      (f)  the person ceases to receive a payment mentioned in subsection 1061ZK(5):

                              (i)  if paragraph (e) applies to the person—because of the employment income of the person (either alone or in combination with any other ordinary income earned, derived or received, or taken to have been earned, derived or received, by the person) (and after any working credit balance of the person is reduced to nil); or

                             (ii)  if paragraph (e) applies to the partner—because of the employment income of the partner (either alone or in combination with any other ordinary income earned, derived or received, or taken to have been earned, derived or received, by the partner) (and after any working credit balance or student income bank balance of the partner is reduced to nil); and

                     (g)  but for the employment income, or the combined income, referred to in paragraph (f), the person would have been, or would have continued to be, qualified for a health care card under section 1061ZK because the person would have continued to receive the payment mentioned in subsection 1061ZK(5);

the person is qualified for a health care card until:

                     (h)  12 weeks after the end of the instalment period in which the person ceases to receive the pension or benefit; or

.                     (i)  the day the person reaches pension age; or

                      (j)  the day the person would cease to be qualified for a health care card as mentioned in paragraph (g) for a reason other than the employment income, or the combined income, referred to in paragraph (f);

whichever happens first.

             (3)  If, during the period of 12 weeks referred to in subsection (2), a person receives a payment of a social security pension or benefit specified in the definition of employment-affected person in subsection (4) that relates to one or more days within that period, the person ceases to be qualified under this section for a health care card on the day on which the person receives the payment.

             (4)  In this section:

employment-affected person has the same meaning as it has for the purposes of section 1061ZM.

             (5)  This section has effect subject to section 1061ZN.

21  Point 1067G-H1 (step 1 of the method statement, note)

Repeal the note.

22  Section 1067G (at the end of Module J)

Add:

Opening balance following cancellation of another social security pension or benefit

  1067G-J7  If:

                     (a)  a person ceases to be a working credit participant because of a determination to cancel, or an automatic cancellation of, the person’s social security pension or social security benefit; and

                     (b)  the person had a working credit balance greater than nil immediately before the date of effect of the determination or cancellation; and

                     (c)  the person makes a claim, or is taken to have made a claim, for a youth allowance; and

                     (d)  the Secretary determines that the claim is to be granted with effect from a day within 12 months after the date of effect mentioned in paragraph (b); and

                     (e)  the person becomes a person to whom this Module applies on a day (the module application day ), being either the day with effect from which the claim is granted or a day following that day;

the working credit balance mentioned in paragraph (b) becomes the opening balance of the income bank credit applicable to the person on the module application day.

Opening balance following suspension of youth allowance

  1067G-J8  If:

                     (a)  a person ceases to be a working credit participant because of a determination to suspend the person’s youth allowance; and

                     (b)  the person had a working credit balance greater than nil immediately before the date of effect of the determination; and

                     (c)  within 12 months after the date of effect of the determination:

                              (i)  the person commences to undertake full-time study; and

                             (ii)  the payment of the person’s youth allowance is resumed; and

                     (d)  the person becomes a person to whom this module applies on the day with effect from which the person’s youth allowance is resumed;

the working credit balance mentioned in paragraph (b) becomes the opening balance of the income bank credit applicable to the person on the day mentioned in paragraph (d).

Opening balance following suspension and subsequent cancellation of another social security pension or benefit

  1067G-J9  If:

                     (a)  a person ceases to be a working credit participant because of a determination to suspend the person’s social security pension or social security benefit; and

                     (b)  while the person’s pension or benefit is suspended, there is a determination to cancel the person’s pension or benefit; and

                     (c)  the person had a working credit balance greater than nil immediately before the date of effect of the suspension determination; and

                     (d)  the person makes a claim, or is taken to have made a claim, for a youth allowance; and

                     (e)  the Secretary determines that the claim is to be granted with effect from a day within 12 months after the date of effect mentioned in paragraph (c); and

                      (f)  the person becomes a person to whom this Module applies on a day (the module application day ), being either the day with effect from which the claim is granted or a day following that day;

the working credit balance mentioned in paragraph (c) becomes the opening balance of the income bank credit applicable to the person on the module application day.

Opening balance following commencement of full-time study by youth allowance recipient

1067G-J10  If:

                     (a)  a person is receiving youth allowance and is not undertaking full-time study; and

                     (b)  the person commences to undertake full-time study; and

                     (c)  either because of a determination made as a result of the commencement or, if no determination is necessary, because of the commencement itself, the person, on a day (the module application day ):

                              (i)  ceases to be a working credit participant; and

                             (ii)  becomes a person to whom this Module applies; and

                     (d)  the person had a working credit balance greater than nil immediately before the module application day;

the working credit balance mentioned in paragraph (d) becomes the opening balance of the income bank credit applicable to the person on the module application day.

23  Point 1067L-D1 (note to step 1 of the method statement)

Repeal the note.

24  Section 1067L (at the end of Module E)

Add:

Opening balance following cancellation of another social security pension or benefit

1067L-E6  If:

                     (a)  a person ceases to be a working credit participant because of a determination to cancel, or an automatic cancellation of, the person’s social security pension or social security benefit; and

                     (b)  the person had a working credit balance greater than nil immediately before the date of effect of the determination or cancellation; and

                     (c)  the person makes a claim, or is taken to have made a claim, for an austudy payment; and

                     (d)  the Secretary determines that the claim is to be granted with effect from a day within 12 months after the date of effect mentioned in paragraph (b); and

                     (e)  the person becomes a person to whom this Module applies on a day (the module application day ), being either the day with effect from which the claim is granted or a day following that day; and

                      (f)  the person has not reached pension age before the module application day;

the working credit balance mentioned in paragraph (b) becomes the opening balance of the income bank credit applicable to the person on the module application day.

Opening balance following suspension and subsequent cancellation of another social security pension or benefit

1067L-E7  If:

                     (a)  a person ceases to be a working credit participant because of a determination to suspend the person’s social security pension or social security benefit; and

                     (b)  while the person’s pension or benefit is suspended, there is a determination to cancel the person’s pension or benefit; and

                     (c)  the person had a working credit balance greater than nil immediately before the date of effect of the suspension determination; and

                     (d)  the person makes a claim, or is taken to have made a claim, for an austudy payment; and

                     (e)  the Secretary determines that the claim is to be granted with effect from a day within 12 months after the date of effect mentioned in paragraph (c); and

                      (f)  the person becomes a person to whom this Module applies on a day (the module application day ), being either the day with effect from which the claim is granted or a day following that day; and

                     (g)  the person has not reached pension age before the module application day;

the working credit balance mentioned in paragraph (c) becomes the opening balance of the income bank credit applicable to the person on the module application day.

25  Point 1068B-D19 (examples 1 and 2)

Repeal the examples.

26  After Division 1 of Part 3.10

Insert:

Division 1AA Employment income attribution rules

1073A   Employment income attribution over a period for social security pensioners

             (1)  Employment income:

                     (a)  that is a lump sum amount either:

                              (i)  in respect of a period greater than a fortnight; or

                             (ii)  resulting from remunerative work although not in respect of any particular period; and

                     (b)  that is earned, derived or received, or is taken to have been earned, derived or received, by a person:

                              (i)  who is receiving a social security pension; and

                             (ii)  whose rate of payment of that pension is worked out with regard to the income test module of a rate calculator in this Chapter; and

                            (iii)  who has not reached pension age;

is to be taken to have been earned, derived or received over such period, not exceeding 52 weeks, as the Secretary determines.

             (2)  The person’s employment income for the period determined by the Secretary is to be reduced to a fortnightly rate rounded to the nearest cent (rounding 0.5 cents downwards).

1073B   Daily attribution of employment income

                   If:

                     (a)  a person is receiving a social security pension or a social security benefit; and

                     (b)  the person’s rate of payment of the pension or benefit is worked out with regard to the income test module of a rate calculator in this Chapter; and

                     (c)  the person has not reached pension age; and

                     (d)  the person earns, derives or receives, or is taken, either by virtue of the operation of section 1073A or any other provision of this Act, to earn, derive or receive, employment income during the whole or a part of a particular instalment period of the person;

the person is taken to earn, derive or receive, on each day in that instalment period, an amount of employment income worked out by dividing the total amount of the employment income referred to in paragraph (d) by the number of days in the period.

1073C   Fortnightly or yearly expression of attributed employment income

                   If, in accordance with the operation of section 1073B, a person is taken to earn, derive or receive a particular amount of employment income on each day in an instalment period:

                     (a)  the rate of the person’s employment income on a fortnightly basis for that day may be worked out by multiplying that amount by 14; and

                     (b)  the rate of the person’s employment income on a yearly basis for that day may be worked out by multiplying that amount by 364.

Division 1AB Working credit accrual and depletion rules and their consequences

1073D   To whom do working credit accrual and depletion rules apply?

                   The rules in this Division apply to a person (a working credit participant ):

                     (a)  who is receiving a social security pension or a social security benefit; and

                     (b)  whose rate of payment of the pension or benefit is worked out with regard to the income test module of a rate calculator in this Chapter; and

                     (c)  who has not reached pension age; and

                     (d)  to whom the student income bank does not apply.

1073E   Opening balance

Basic opening balance rule

             (1)  Subject to this section, each working credit participant has, on becoming a working credit participant, a working credit opening balance of nil.

Opening balance following cancellation of social security pension or benefit

             (2)  If:

                     (a)  a person ceases to be a working credit participant or a person to whom the student income bank applies because of a determination to cancel, or an automatic cancellation of, the person’s social security pension or social security benefit; and

                     (b)  the person had a working credit balance or a student income bank balance greater than nil immediately before the date of effect of the determination or cancellation; and

                     (c)  the person makes, or is taken to have made, a new claim for a social security pension or social security benefit; and

                     (d)  the Secretary determines that the new claim is to be granted with effect from a day within 12 months after the date of effect mentioned in paragraph (b); and

                     (e)  the person becomes a working credit participant on a day (the participation day ), being either the day with effect from which the new claim is granted or a day following that day;

the working credit balance mentioned in paragraph (b), or the student income bank balance mentioned in that paragraph to the extent that it does not exceed $1,000, becomes the opening balance of the working credit applicable to the person on the participation day.

Opening balance following suspension of social security pension or benefit

             (3)  If:

                     (a)  a person ceases to be a working credit participant because of a determination to suspend the person’s social security pension or social security benefit; and

                     (b)  the person had a working credit balance greater than nil immediately before the date of effect of the determination; and

                     (c)  within 12 months after the date of effect of the determination, the payment of the person’s pension or benefit is resumed; and

                     (d)  the person becomes a working credit participant on the day with effect from which the person’s pension or benefit is resumed;

the working credit balance mentioned in paragraph (b) becomes the opening balance of the working credit applicable to the person on the day mentioned in paragraph (d).

Opening balance following suspension and subsequent cancellation of social security pension or benefit

             (4)  If:

                     (a)  a person ceases to be a working credit participant or a person to whom the student income bank applies because of a determination to suspend the person’s social security pension or social security benefit; and

                     (b)  while the person’s pension or benefit is suspended there is a determination to cancel the person’s pension or benefit; and

                     (c)  the person had a working credit balance or a student income bank balance greater than nil immediately before the date of effect of the suspension determination; and

                     (d)  the person makes, or is taken to have made, a new claim for a social security pension or social security benefit; and

                     (e)  the Secretary determines that the new claim is to be granted with effect from a day within 12 months after the date of effect mentioned in paragraph (c); and

                      (f)  the person becomes a working credit participant on a day (the participation day ), being either the day with effect from which the new claim is granted or a day following that day;

the working credit balance mentioned in paragraph (c), or the student income bank balance mentioned in that paragraph to the extent that it does not exceed $1,000, becomes the opening balance of the working credit applicable to the person on the participation day.

Opening balance following cessation of full-time study by youth allowance recipient

             (5)  If:

                     (a)  a person is receiving youth allowance and is undertaking full-time study; and

                     (b)  the person ceases to undertake full-time study; and

                     (c)  either because of a determination made as a result of that cessation or, if no determination is necessary, because of the cessation itself, the person, on a day (the participation day ):

                              (i)  ceases to be a person to whom the student income bank set out in Module J of the Youth Allowance Rate Calculator applies; and

                             (ii)  becomes a working credit participant; and

                     (d)  the person had a student income bank balance greater than nil immediately before the participation day;

the student income bank balance mentioned in paragraph (d), to the extent that it does not exceed $1,000, becomes the opening balance of the working credit applicable to the person on the participation day.

Opening balance following cessation of ABSTUDY payment

             (6)  If:

                     (a)  a person to whom the income bank under the ABSTUDY scheme applies stops being such a person; and

                     (b)  the person becomes a working credit participant within 12 months after so stopping; and

                     (c)  immediately before so stopping, the person had a credit balance greater than nil under the scheme;

the credit balance, to the extent that it does not exceed $1,000, becomes the opening balance of the working credit applicable to the person on the day on which the person becomes a working credit participant.

1073F   Working out accruals and depletions of working credit for social security beneficiaries

                   This section determines, in respect of each working credit participant who is receiving a social security benefit, whether, for each day in an instalment period:

                     (a)  there is an accrual to the participant’s working credit balance; or

                     (b)  the participant’s working credit balance is unaffected; or

                     (c)  the participant’s working credit balance is depleted;

and, if there is an accrual to, or a depletion from, the participant’s working credit balance, the amount of that accrual or depletion.

Method statement

Step 1.   Work out the amount of the participant’s employment income earned, derived or received on the day. This could be a nil amount or it could be an amount that is taken, under section 1073B, to have been earned, derived or received on the day.

Step 2 .   Multiply the amount determined under step 1 by 14. This is the participant’s rate of employment income on a fortnightly basis for the day.

Step 3 .   Add to the participant’s rate of employment income on a fortnightly basis for the day the participant’s rate of any other ordinary income on a fortnightly basis for the day. This is the participant’s fortnightly rate of total ordinary income on a fortnightly basis for the day.

Step 4 .   If the participant’s rate of total ordinary income on a fortnightly basis for the day is less than $48, there is an accrual to the participant’s working credit balance for the day of an amount equal to one fourteenth of the amount by which $48 exceeds that rate. The maximum working credit balance is $1,000.

Step 5 .   If the participant’s rate of total ordinary income on a fortnightly basis for the day is at least $48 but does not exceed the ordinary income free area applicable to the participant for the day under the income test module of the appropriate rate calculator, the participant’s working credit balance for the day is neither increased nor reduced.

Step 6 .   If the participant’s rate of total ordinary income on a fortnightly basis for the day is at least $48 and exceeds the participant’s applicable ordinary income free area for the day, the participant’s working credit balance, if it is greater than nil on the day, is depleted on that day by the least of:

               (a)     the amount of employment income determined under step 1; or

              (b)     one fourteenth of the amount by which the participant’s rate of total ordinary income on a fortnightly basis exceeds the participant’s applicable ordinary income free area; or

               (c)     the participant’s available working credit balance.

1073G   Working out the effect of a working credit depletion on the fortnightly rate of ordinary income for a social security beneficiary

                   If, under section 1073F, the working credit balance of a working credit participant is depleted on a particular day, the participant’s rate of ordinary income on a fortnightly basis for that day is reduced by the working credit depletion amount applicable to that day, determined under step 6 of the method statement, multiplied by 14.

1073H   Working out accruals and depletions of working credit for social security pensioners

                   This section determines, in respect of each working credit participant who is receiving a social security pension, whether, for each day in an instalment period:

                     (a)  there is an accrual to the participant’s working credit balance; or

                     (b)  the participant’s working credit balance is unaffected; or

                     (c)  the participant’s working credit balance is depleted;

and, if there is an accrual to, or a depletion from, the participant’s working credit balance, the amount of that accrual or depletion.

Method statement

Step 1.   Work out the amount of the participant’s employment income earned, derived or received on the day. This could be a nil amount or it could be an amount that is taken, under section 1073B, to have been earned, derived or received on the day.

Step 2 .   Multiply the amount determined under step 1 by 364. This is the participant’s rate of employment income on a yearly basis for the day.

Step 3 .   Add to the participant’s rate of employment income on a yearly basis for the day the participant’s rate of any other ordinary income on a yearly basis for the day. This is the participant’s rate of total ordinary income on a yearly basis for the day.

Step 4 .   Divide the participant’s rate of total ordinary income on a yearly basis for the day by 26. This is the participant’s rate of total ordinary income, expressed on a fortnightly basis, for the day.

Step 5 .   Divide the yearly ordinary income free area applicable to the participant for the day under the ordinary income test module of the appropriate rate calculator by 26. This is the participant’s applicable ordinary income free area, expressed on a fortnightly basis, for the day.

Step 6 .   If the participant’s rate of total ordinary income, expressed on a fortnightly basis, for the day, is less than $48, there is an accrual to the participant’s working credit balance, for the day, of an amount equal to one fourteenth of the amount by which $48 exceeds that rate. The maximum working credit balance is $1,000.

Step 7 .   If the participant’s rate of total ordinary income, expressed on a fortnightly basis, for the day, is at least $48 but does not exceed the participant’s applicable ordinary income free area, expressed on a fortnightly basis for the day in accordance with step 5, the participant’s working credit balance for the day is neither increased nor reduced.

Step 8 .   If the participant’s rate of total ordinary income, expressed on a fortnightly basis, for the day, is at least $48 and exceeds the participant’s applicable ordinary income free area, expressed on a fortnightly basis for the day in accordance with step 5, the participant’s working credit balance, if it is greater than nil on the day, is depleted on that day by the least of:

               (a)     the amount of employment income determined under step 1; or

              (b)     one fourteenth of the amount by which the participant’s rate of total ordinary income, expressed on a fortnightly basis, exceeds the participant’s applicable ordinary income free area, expressed on that basis; or

               (c)     the participant’s available working credit balance.

1073I   Working out the effect of a working credit depletion on the yearly rate of ordinary income for a social security pensioner

                   If, under section 1073H, the working credit balance of a working credit participant is depleted on a particular day, the participant’s rate of ordinary income on a yearly basis for that day is reduced by the working credit depletion amount applicable to that day, determined under step 8 of the method statement, multiplied by 364.

1073J   Working credit balance prevents loss of qualification in certain cases

                   If:

                     (a)  a person receiving disability support pension, carer payment, youth allowance, newstart allowance or sickness allowance is a working credit participant; and

                     (b)  either:

                              (i)  the participant commences to earn, derive or receive, or to be taken to earn, derive or receive, employment income; or

                             (ii)  there is an increase in the employment income that is earned, derived or received, or taken to be earned, derived or received, by the participant; and

                     (c)  the participant has a working credit balance greater than nil at the start of the instalment period of the participant in which the commencement or increase occurs; and

                     (d)  but for the commencement or increase, the participant would have continued to be qualified for the payment mentioned in paragraph (a) until the earlier of:

                              (i)  a day determined under Division 8 or 9 of Part 3 of the Administration Act; or

                             (ii)  the day on which the participant’s working credit balance is reduced to nil;

the participant is to be treated as if he or she had continued to be so qualified until the earlier of the days determined as referred to in subparagraphs (d)(i) and (ii).



 

Part 3 Amendment of the Social Security (Administration) Act 1999

Social Security (Administration) Act 1999

27  Paragraph 68(2)(b)

Omit “a statement”, substitute “one or more statements”.

28  Paragraph 72(1)(d)

Repeal the paragraph, substitute:

                     (d)  must specify:

                              (i)  in the case of a notice under section 68 that requires the giving of more than one statement, each relating to the payment of the social security payment in respect of a period—the date by which the person is to give each statement to the Department; or

                             (ii)  in any other case—the period within which the person is to give the information or statement to the Department; and

29  After subsection 72(2)

Insert:

                  (2A)  A date specified for the purposes of subparagraph (1)(d)(i) must be no earlier than 7 days after:

                              (i)  the day on which the notice under section 68 is given; or

                             (ii)  the day on which the period specified in the notice in relation to that first mentioned date begins;

                            whichever is the later.

30  Subsection 72(3)

Omit “subsections (4), (5), (6) and (7), the period specified for the purpose of paragraph (1)(d)”, substitute “subsections (4), (6) and (7), the period specified for the purpose of subparagraph (1)(d)(ii)”.

31  Subsections 72(4) and (6)

Omit “paragraph (1)(d)”, substitute “subparagraph (1)(d)(ii)”.

32  Paragraph 85(1)(a)

Repeal the paragraph, substitute:

                     (a)  a person’s social security payment is cancelled by force of section 93 or 94 or the Secretary cancels or suspends a person’s social security payment under section 80, 81 or 82; and

33  Section 93

Omit “If:”, substitute “Subject to subsection (2), if:”.

34  Paragraphs 93(g) and (h)

Omit “by force of this section”, substitute “by force of this subsection”.

35  At the end of section 93

Add:

             (2)  If:

                     (a)  a person who is receiving a social security payment is given a notice under subsection 68(2); and

                     (b)  the notice requires the person to inform the Department of the occurrence of an event or change of circumstances within a specified period (the notification period ); and

                     (c)  the event or change of circumstances occurs; and

                     (d)  the person informs the Department of the occurrence of the event or change of circumstances within the notification period in accordance with the notice; and

                     (e)  because of the event or change of circumstances, the person’s working credit balance or student income bank balance is reduced to nil in an instalment period (the nil instalment period ) of the person that is the same as, or later than, the instalment period in which the event or change of circumstances occurs (the event instalment period ); and

                      (f)  either because of the reduction of the balance to nil or because of the balance having already been reduced to nil—the social security payment would, but for this subsection, cease to be payable to the person; and

                     (g)  the social security payment is not cancelled before the end of the nil instalment period;

the social security payment continues to be payable to the person until a day determined in accordance with subsection (3) and is then cancelled by force of this subsection.

             (3)  For the purposes of subsection (2), the day until which the social security payment continues to be payable to the person is:

                     (a)  if the cancellation is attributable to the reduction of the balance referred to in paragraph (2)(e) to nil and the payment is so cancelled during the instalment period (the next instalment period ) following the nil instalment period—the later of:

                              (i)  the day before the day on which the balance was reduced to nil; or

                             (ii)  the end of the event instalment period; and

                     (b)  if the cancellation is attributable to the balance having already been reduced to nil and the payment is so cancelled during the next instalment period—the later of:

                              (i)  the day before the first day on which the opening balance was nil; or

                             (ii)  the end of the event instalment period; and

                     (c)  if the cancellation is attributable to the reduction of the balance to nil but the payment is not so cancelled during the next instalment period—the later of:

                              (i)  the day before the day on which the balance was reduced to nil; or

                             (ii)  the end of the notification period; and

                     (d)  if the cancellation is attributable to the balance having already been reduced to nil but the payment is not so cancelled during the next instalment period—the later of:

                              (i)  the day before the first day on which the opening balance was nil; or

                             (ii)  the end of the notification period.

36  Section 94

Omit “If:”, substitute “Subject to subsection (2), if:”.

37  Section 94

Omit “the social security payment ceases to be payable to the person”, substitute “the social security payment is cancelled, by force of this subsection,”.

38  At the end of section 94

Add:

             (2)  If:

                     (a)  a person who is receiving a social security payment is given a notice under subsection 68(2); and

                     (b)  the notice requires the person to inform the Department of the occurrence of an event or change of circumstances within a specified period (the notification period ); and

                     (c)  the event or change of circumstance occurs; and

                     (d)  the person does not inform the Department of the occurrence of the event or change of circumstances within the notification period in accordance with the notice; and

                     (e)  because of the event or change of circumstances, the person’s working credit balance or student income bank balance is reduced to nil in an instalment period of the person that is the same as, or later than, the instalment period in which the event or change of circumstances occurs; and

                      (f)  either because of the reduction of the balance to nil or because of the balance having already been reduced to nil—the social security payment ceases to be payable to the person;

the social security payment is cancelled, by force of this subsection, on:

                     (g)  if the cancellation is attributable to the reduction of the balance to nil—the day on which the balance was so reduced; and

                     (h)  if the cancellation is attributable to the balance having already been reduced to nil—the first day on which the opening balance was nil.

39  Subsection 95(1)

Repeal the subsection, substitute:

             (1)  If:

                     (a)  a person who is receiving a social security payment is given a notice under subsection 68(2) requiring the person to give the Department a statement or a number of statements; and

                     (b)  the notice relates to the payment of the social security payment in respect of a period or a number of periods specified in the notice; and

                     (c)  the person does not comply with the notice so far as it relates to a particular period;

then, subject to subsection (2), the social security payment is cancelled, by force of this section, on the first day in that period.

40  Section 98

Omit “If:”, substitute “Subject to subsection (2), if:”.

41  At the end of section 98

Add:

             (2)  If:

                     (a)  a person is receiving a social security payment; and

                     (b)  the person’s partner starts to receive:

                              (i)  a social security pension or benefit; or

                             (ii)  a service pension; and

                     (c)  because the partner starts to receive that pension or benefit, the person’s working credit balance or student income bank balance is reduced to nil; and

                     (d)  either because of the reduction of the balance to nil or because of the balance having already been reduced to nil—the person’s social security payment rate is to be reduced;

the social security payment becomes payable to the person at the reduced rate on:

                     (e)  if the rate reduction is attributable to the reduction of the balance to nil—the day on which the balance was so reduced; and

                      (f)  if the rate reduction is attributable to the balance having already been reduced to nil—the first day on which the opening balance was nil.

42  Section 99

Omit “If:”, substitute “Subject to subsection (2), if:”.

43  At the end of section 99

Add:

             (2)  If:

                     (a)  a person who is receiving a social security payment is given a notice under subsection 68(2); and

                     (b)  the notice requires the person to inform the Department of the occurrence of an event or change of circumstances within a specified period (the notification period ); and

                     (c)  the event or change of circumstances occurs; and

                     (d)  the person informs the Department of the occurrence of the event or change of circumstances within the notification period in accordance with the notice; and

                     (e)  because of the event or change of circumstances, the person’s working credit balance or student income bank balance is reduced to nil in an instalment period (the nil instalment period ) of the person that is the same as, or later than, the instalment period in which the event or change of circumstances occurs (the event instalment period ); and

                      (f)  either because of the reduction of the balance to nil or because of the balance having already been reduced to nil—the rate of the person’s social security payment is to be reduced; and

                     (g)  the person’s rate of payment is not so reduced before the end of the nil instalment period;

the social security payment becomes payable to the person at the reduced rate from the day immediately after the day determined in accordance with subsection (3).

             (3)  For the purposes of subsection (2), the day immediately after which the social security payment becomes payable to the person at the reduced rate is:

                     (a)  if the rate reduction is attributable to the reduction of the balance referred to in paragraph (2)(e) to nil and the rate is so reduced during the instalment period (the next instalment period ) following the nil instalment period—the later of:

                              (i)  the day before the day on which the balance was reduced to nil; or

                             (ii)  the end of the event instalment period; and

                     (b)  if the rate reduction is attributable to the balance having already been reduced to nil and the rate is so reduced during the next instalment period—the later of:

                              (i)  the day before the first day on which the opening balance was nil; or

`                           (ii)  the end of the event instalment period; and

                     (c)  if the rate reduction is attributable to the reduction of the balance to nil but the rate is not so reduced during the next instalment period—the later of:

                              (i)  the day on which the balance was reduced to nil; or

                             (ii)  the end of the notification period; and

                     (d)  if the rate reduction is attributable to the balance having already been reduced to nil but the rate is not so reduced during the next instalment period—the later of:

                              (i)  the day before the first day on which the opening balance is nil; or

                             (ii)  the end of the notification period.

44  Section 100

Omit “If:”, substitute “Subject to subsection (2), if:”.

45  Paragraph 100(1)(e)

Omit “and”.

46  Paragraph 100(1)(f)

Repeal the paragraph.

47  At the end of section 100

Add:

             (2)  If:

                     (a)  a person who is receiving a social security payment is given a notice under subsection 68(2); and

                     (b)  the notice requires the person to inform the Department of the occurrence of an event or change of circumstances within a specified period (the notification period ); and

                     (c)  the event or change of circumstances occurs; and

                     (d)  the person does not inform the Department of the occurrence of the event or change of circumstances within the notification period in accordance with the notice; and

                     (e)  because of the event or change of circumstances, the person’s working credit balance or student income bank balance is reduced to nil in an instalment period of the person that is the same as, or later than, the instalment period in which the event or change of circumstances occurs; and

                      (f)  either because of the reduction of the balance to nil or because of the balance having already been reduced to nil—the rate of the person’s social security payment is to be reduced;

the social security payment becomes payable to the person at the reduced rate on:

                     (g)  if the rate reduction is attributable to the reduction of the balance to nil—the day on which the balance was so reduced; and

                     (h)  if the rate reduction is attributable to the balance having already been reduced to nil—the first day on which the opening balance was nil.

48  Subsection 110(1)

Omit “Subject to subsections (2) to (11)”, substitute “Subject to subsections (1A) to (11)”.

49  After subsection 110(1)

Insert:

          (1A)  If a favourable determination is made in relation to a person who has not reached pension age:

                     (a)  following the person’s having informed the Department of the occurrence of an event or change of circumstances; and

                     (b)  because, in an instalment period of the person:

                              (i)  there is a decrease in the amount of employment income that is earned, derived or received, or that is taken to have been earned, derived or received, by the person; or

                             (ii)  the person has ceased to earn, derive or receive, or to be taken to earn, derive or receive, employment income;

the determination takes effect on the first day of the instalment period, or on the first day of the instalment period in which the person so informs the Department, whichever is the later.

50  Subsection 110(2)

Omit “If a favourable determination”, substitute “Subject to subsection (2A), if a favourable determination”.

51  After subsection 110(2)

Insert:

          (2A)  If a favourable determination is made in relation to a person who has not reached pension age:

                     (a)  following the person’s having given the Department a statement about a matter in accordance with a notice under section 68 that relates to the payment of the social security payment in respect of an instalment period specified in the notice; and

                     (b)  because, in the instalment period:

                              (i)  there is a decrease in the amount of employment income that is earned, derived or received, or that is taken to have been earned, derived or received, by the person; or

                             (ii)  the person has ceased to earn, derive or receive, or to be taken to earn, derive or receive, employment income;

the determination takes effect on the first day of the instalment period.

52  Subsection 110(3)

Omit “If:”, substitute “Subject to subsection (3A), if:”.

53  After subsection 110(3)

Insert:

          (3A)  If:

                     (a)  a person and his or her partner (the partner ) are each receiving a social security payment; and

                     (b)  the partner has not reached pension age; and

                     (c)  the partner has been given a notice under section 68 that requires the partner to give the Department a statement; and

                     (d)  the notice relates to the payment of the partner’s social security payment in respect of an instalment period specified in the notice; and

                     (e)  the partner gives the Department a statement, in accordance with the notice, about a matter that arose during the instalment period; and

                      (f)  following the giving of the statement, a favourable determination is made in relation to the person’s social security payment; and

                     (g)  the determination is made because, in the instalment period:

                              (i)  there is a decrease in the amount of employment income that is earned, derived or received, or that is taken to have been earned, derived or received, by the partner; or

                             (ii)  the partner has ceased to earn, derive or receive, or to be taken to earn, derive or receive, employment income;

the determination takes effect on the first day of the instalment period.

54  Section 112

Repeal the section.

55  Subsection 118(2)

Omit “If:”, substitute “Subject to subsections (2A) and (2B), if:”.

56  After subsection 118(2)

Insert:

          (2A)  If an adverse determination is made in relation to a person who has not reached pension age:

                     (a)  following the person’s having informed the Department of the occurrence of an event or change of circumstances; and

                     (b)  because the person earns, derives or receives, or is taken to earn, derive or receive, employment income in an instalment period of the person;

the determination takes effect on:

                     (c)  if the determination is attributable to the reduction, during the instalment period, of the person’s working credit balance or student income bank balance to nil—the day on which the balance was so reduced; and

                     (d)  if the determination is attributable to the person’s having a working credit balance or a student income bank balance that has already been reduced to nil during the instalment period—the first day in the instalment period on which the person’s opening balance was nil; and

                     (e)  in any other case—the first day of the instalment period;

so long as the person is not paid an instalment of the social security payment after the day worked out under paragraph (c), (d) or (e) and before the determination is made.

          (2B)  If:

                     (a)  an adverse determination is made in relation to a person following the person’s having informed the Department of the occurrence of an event or change of circumstances; and

                     (b)  the determination is made because, in an instalment period of the person, either:

                              (i)  the person earns, derives or receives, or is taken to earn, derive or receive, ordinary income other than employment income; or

                             (ii)  the person has reached pension age and earns, derives or receives, or is taken to earn, derive or receive, employment income; and

                     (c)  the person’s student income bank balance is reduced to nil during the instalment period;

the determination takes effect on:

                     (d)  if the determination is attributable to the reduction of the student income bank balance to nil—the day on which the balance was so reduced; and

                     (e)  if the determination is attributable to the person’s having a student income bank balance that has already been reduced to nil during the instalment period—the first day in the instalment period on which the person’s opening balance was nil;

so long as the person is not paid an instalment of the social security payment after the day worked out under paragraph (d) or (e) and before the determination is made.

57  Subsection 118(5)

Omit “If the adverse determination”, substitute “Subject to subsections (5A) and (5B), if the adverse determination”.

58  After subsection 118(5)

Insert:

          (5A)  If an adverse determination is made in relation to a person who has not reached pension age:

                     (a)  following the person’s having given the Department a statement about a matter in accordance with a notice under section 68 that relates to the payment of the social security payment in respect of an instalment period specified in the notice; and

                     (b)  because the person earns, derives or receives, or is taken to earn, derive or receive, employment income in the instalment period;

the determination takes effect on:

                     (c)  if the determination is attributable to the reduction, during the instalment period, of the person’s working credit balance or student income bank balance to nil—the day on which the balance was so reduced; and

                     (d)  if the determination is attributable to the person’s having a working credit balance or a student income bank balance that has already been reduced to nil during the instalment period—the first day in the instalment period on which the person’s opening balance was nil; and

                     (e)  in any other case—the first day of the instalment period.

          (5B)  If:

                     (a)  an adverse determination is made in relation to a person following the person’s having given the Department a statement about a matter in accordance with a notice under section 68 that relates to the payment of the social security payment in respect of an instalment period specified in the notice; and

                     (b)  the determination is made because, in the instalment period, either:

                              (i)  the person earns, derives or receives, or is taken to earn, derive or receive, ordinary income other than employment income; or

                             (ii)  the person has reached pension age and earns, derives or receives, or is taken to earn, derive or receive, employment income; and

                     (c)  the person’s student income bank balance is reduced to nil during the instalment period;

the determination takes effect on:

                     (d)  if the determination is attributable to the reduction of the student income bank balance to nil—the day on which the balance was so reduced; and

                     (e)  if the determination is attributable to the person’s having a student income bank balance that has already been reduced to nil during the instalment period—the first day in the instalment period on which the person’s opening balance was nil.

59  Subsection 118(6)

Omit “If:”, substitute “subject to subsections (6A) and (6B), if:”.

60  After subsection 118(6)

Insert:

          (6A)  If:

                     (a)  a person and his or her partner (the partner ) are each receiving a social security payment; and

                     (b)  the partner has not reached pension age; and

                     (c)  the partner is given a notice under section 68 requiring the partner to give the Department a statement; and

                     (d)  the notice relates to the payment of the partner’s social security payment in respect of an instalment period specified in the notice; and

                     (e)  the partner gives the Department a statement, in accordance with the notice, about a matter that arose during the instalment period; and

                      (f)  following the giving of the statement, an adverse determination is made in relation to the person’s social security payment; and

                     (g)  the determination is made because the partner earns, derives or receives, or is taken to earn, derive or receive, employment income in the instalment period;

the determination takes effect on:

                     (h)  if the adverse determination is attributable to the reduction, during the instalment period, of the partner’s working credit balance or student income bank balance to nil—the day on which the balance was so reduced; and

                      (i)  if the determination is attributable to the partner’s having a working credit balance or a student income bank balance that has already been reduced to nil during the instalment period—the first day of the instalment period on which the opening balance was nil; and

                      (j)  in any other case—the first day of the instalment period.

          (6B)  If:

                     (a)  a person and his or her partner (the partner ) are each receiving a social security payment; and

                     (b)  the partner is given a notice under section 68 requiring the partner to give the Department a statement; and

                     (c)  the notice relates to the payment of the partner’s social security payment in respect of an instalment period specified in the notice; and

                     (d)  the partner gives the Department a statement, in accordance with the notice, about a matter that arose during the instalment period; and

                     (e)  the partner’s student income bank balance is reduced to nil during the instalment period; and

                      (f)  following the giving of the statement, an adverse determination is made in relation to the person’s social security payment; and

                     (g)  the determination is made because, in the instalment period, either:

                              (i)  the partner earns, derives or receives, or is taken to earn, derive or receive, ordinary income other than employment income; or

                             (ii)  the partner has reached pension age and earns, derives or receives, or is taken to earn, derive or receive, employment income;

the determination takes effect on:

                     (h)  if the determination is attributable to the reduction of the partner’s student income bank balance to nil—the day on which the balance was so reduced; and

                      (i)  if the determination is attributable to the partner’s having a student income bank balance that has already been reduced to nil during the instalment period—the first day in the instalment period on which the partner’s opening balance was nil.