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Family and Community Services and Veterans' Affairs Legislation Amendment (2004 Election Commitments) Bill 2004

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2004

 

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

 

 

 

 

FAMILY AND COMMUNITY SERVICES AND VETERANS’ AFFAIRS LEGISLATION AMENDMENT (2004 ELECTION COMMITMENTS) BILL 2004

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Circulated by the authority of the

Minister for Family and Community Services,

Senator the Hon Kay Patterson)



FAMILY AND COMMUNITY SERVICES AND VETERANS’ AFFAIRS LEGISLATION AMENDMENT (2004 ELECTION COMMITMENTS) BILL 2004

 

OUTLINE AND FINANCIAL IMPACT STATEMENT

 

This Bill amends the social security law, the family assistance law and the Veterans’ Entitlements Act 1986 to give effect to 2004 election commitments in respect of self funded retirees, older Australians and carers on income support, grandparents caring for children and certain disability pensioners.  The bill will:

 

·          establish the new utilities allowance, generally $100 a year for singles and $50 for each member of a couple, payable to senior Australians of age pension or veteran pension age who are in receipt of income support, to help this group to pay regular household bills;

 

·          establish the new seniors concession allowance, a payment of $200 a year to holders of a Commonwealth Seniors Health Card, in recognition of the fact that most self funded retirees do not receive concessions for energy, rates, water and sewerage, and motor vehicle registration from state and territory governments and also to acknowledge the contribution made by self funded retirees in providing for their own retirement ;

 

·          improve opportunities and flexibility for carers by increasing the number of hours (from 20 to 25 hours per week) that carers may spend in work, training or study, without losing qualification for carer payment;

 

·          make child care more affordable for grandparents who have primary care of a grandchild and who are receiving income support, by enabling them to have access to a special rate of child care benefit that will cover the full cost of child care fees charged to eligible grandparents by  approved child care services ; and

 

·          amend the Veterans’ Entitlements Act 1986 to increase bereavement payments in respect of  persons receiving above general rate disability pension.

 



Schedule 1 (Utilities Allowance)

 

Commencement:     1 December 2004 or Royal Assent (whichever earlier)
 

Financial impact:                             Administered resourcing

                                                            2004-05         $80.4 m

                                                            2005-06         $168.0 m

                                                            2006-07         $175.5 m

                                                            2007-08         $183.0 m

 

                                                            Departmental resourcing

                                                            2004-05         $1.7 m

                                                            2005-06         $1.3 m

                                                            2006-07         $0.1 m

                                                            2007-08         $0.1 m

 

Schedule 2 (Seniors Concession Allowance)

 

Commencement:     1 December 2004 or Royal Assent (whichever earlier)
 

Financial impact:                             Administered resourcing

                                                            2004-05         $57.8 m

                                                            2005-06         $61.6 m

                                                            2006-07         $65.7 m

                                                            2007-08         $70.1 m

 

                                                            Departmental resourcing

                                                            2004-05         $1.0 m

                                                            2005-06         $0.6 m

                                                            2006-07         $0.7 m

                                                            2007-08         $0.8 m

 

Schedule 3 (Carer payment)

 

Commencement:     1 April 2005
 

Financial impact:                             Administered resourcing

                                                            2004-05         $0.1 m

                                                            2005-06         $2.3 m

                                                            2006-07         $5.9 m

                                                            2007-08         $10.2 m

 

                                                            Departmental resourcing

                                                            2004-05         $0.7 m

                                                            2005-06         $0.1 m

                                                            2006-07         $0.1 m

                                                            2007-08         $0.1 m

 



Schedule 4 (Special child care benefit rate for grandparents on income support)

 

Commencement:     1 January 2005

 

Financial impact:                             Administered resourcing

                                                            2004-05         $7.4 m

                                                            2005-06         $18.0 m

                                                            2006-07         $22.9 m

                                                            2007-08         $28.1 m

 

                                                            Departmental resourcing

                                                            2004-05         $1.3 m

                                                            2005-06         $0.3 m

                                                            2006-07         $0.3 m

                                                            2007-08         $0.3 m

 

Schedule 5 (Increase in bereavement payments in respect of above general rate disability pensioners)

 

Commencement:     1 January 2005
 

Financial impact:                             Administered resourcing

                                                            2004-05         $1.9 m

                                                            2005-06         $4.1 m

                                                            2006-07         $4.3 m

                                                            2007-08         $4.5 m

 

                                                            Departmental resourcing

                                                            nil

 



FAMILY AND COMMUNITY SERVICES AND VETERANS’ AFFAIRS LEGISLATION AMENDMENT (2004 ELECTION COMMITMENTS) BILL 2004

 

NOTES ON CLAUSES

 

Clause 1 sets out how the Act is to be cited, that is, the Family and Community Services and Veterans’ Affairs Legislation Amendment (2004 Election Commitments) Act 2004 .

 

Clause 2 provides a table that sets out the commencement dates of the various sections in, and Schedules to, the Act.

 

Clause 3 provides that each Act that is specified in a Schedule is amended or repealed as set out in that Schedule.

 

 

This Explanatory Memorandum uses the following abbreviations:

 

·          ‘Social Security Act’ means the Social Security Act 1991 ;

·          ‘Social Security Administration Act’ means the Social Security (Administration) Act 1999 ;

·          ‘Family Assistance Act’ means the A New Tax System (Family Assistance) Act 1999 ;

·          ‘Family Assistance Administration Act’ means the A New Tax System (Family Assistance) (Administration) Act 1999 ; and

·          ‘Veterans’ Entitlements Act’ means the Veterans’ Entitlements Act 1986 .

 



Schedule 1 - Utilities Allowance

 

Summary

 

The amendments made by this Schedule will introduce a new payment for senior Australians, to be known as the utilities allowance.  The payment will be made to recipients of income support who are of age pension or veteran pension age.  The payment will be made if the person is qualified for the allowance on 20 March and 20 September of each year, commencing on 20 March 2005.  In general, the new allowance will, subject to CPI indexation, be a payment of $100 a year for singles and $50 to each member of a couple.  The allowance will be paid in two instalments on the person’s income support payday following the ‘test days’ on 20 March and 20 September of each year.

 

Background

 

During the 2004 election campaign, the Government made a commitment to introduce a new payment to provide more help for older Australians on income support payments.  Senior Australians on income support are entitled to receive one of a number of concession cards, which provide access to cheaper prescriptions and a range of other benefits.  However, some of these older Australians can experience difficulties in saving up to pay regular household bills, such as for gas and electricity.  Accordingly, the new payment will be introduced to provide assistance for older Australians in paying for such utilities.

 

Explanation of changes

 

Part 1 - Amendments relating to Family and Community Services’ payment of utilities allowance

 

Income Tax Assessment Act 1997

 

Item 1 inserts a reference to the new utilities allowance in the table in section 52-10, which provides for the income tax treatment of social security payments.  The effect of the amendment is that in each of the first two cases dealt with in that table, the new allowance will be exempt from income tax.  In particular, case 1 applies if a person receives an ordinary payment of the allowance (that is, a payment made other than because of a person’s death) unless case 2 applies.  Case 2 applies if a person’s partner dies, the person does not qualify for bereavement payments (because no bereavement payments are payable in relation to the allowance), and the person receives an ordinary payment of the allowance on any of the person’s paydays after their partner’s death.  Cases 3 and 4 are not applicable to the new allowance.

 

Item 2 inserts a reference to the new utilities allowance in the table in section 52-40, which lists the provisions of the Social Security Act under which social security payments are made that are wholly or partly exempt from income tax.

 

Social Security Act 1991

 

Item 3 inserts a definition of ‘utilities allowance‘ in subsection 23(1) of the Social Security Act.

 

Item 4 inserts new Part 2.25A into the Social Security Act to provide for the new utilities allowance.

 

Division 1 - Qualification for and payability of utilities allowance

 

New subsection 1061T provides the qualification conditions for the new allowance.  First, the person must have reached ‘pension age’, which is defined in subsection 23(1) of the Social Security Act, as elaborated in subsections 23(5A) to (5D).  Pension age is 65 years for men and is currently 62.5 years for women.

 

Secondly, the person must be receiving an ‘income support payment’, which is defined in subsection 23(1) of the Social Security Act.

 

Thirdly, the person must be either in Australia, or temporarily absent from Australia for a continuous period not exceeding 13 weeks.

 

New subsection 1061TA provides for when the new allowance is payable.

 

New subsection 1061TA(1) provides the general rule that the allowance is payable to a person for each utilities allowance test day (defined in new subsection 1061TA(3) as 20 March and 20 September) on which the person is qualified for the allowance.

 

New subsection 1061TA (2) provides that the allowance will not be payable on a utilities allowance test day if:

 

·          service pension or income support supplement is payable to the person on that day - this recognises that a person cannot be paid two allowances if they are receiving income support payments under both the Social Security Act and the Veterans’ Entitlements Act.  In this case, an allowance will be payable under the Veterans’ Entitlements Act only; or

 

·          two instalments of any combination of the new utilities allowance and the new seniors concession allowance (whether under the Social Security Act or the Veterans’ Entitlements Act) have already been payable in the same financial year as the test day - this recognises that a person is not entitled to more than two payments of either or both of the new payments in any financial year, as the new payments are closely related; or

 

·          before that day, the person has elected not to receive the allowance, and has not withdrawn such an election - this recognises that a person has the right to not receive the payment if they so decide, but they can change their mind about this, so that that the allowance can again become payable.

 

New section 1061TB provides for a person’s annual rate of the new allowance.  The person’s annual rate is $100 (subject to indexation) if the person is single or a member of an illness separated, respite care or temporarily separated couple.  The person’s annual rate is half of the rate specified in column 3 of item 1 (that is, $50, when the first payment is made shortly after the 20 March 2005 test day) if the person is a member of a couple (other than an illness separated, respite care or temporarily separated couple).

 

Items 5 and 6 provide for the indexation of each of the annual rates of utilities allowance listed in the table in new section 1061TB.  In general terms, the annual rates of the allowance are indexed twice a year in line with CPI increases.  Item 7 inserts new subsection 1192(6), which will have the effect that the first indexation of the allowance will occur in relation to the utilities allowance payment made for the 20 September 2005 test day.

 

Social Security (Administration) Act 1999

 

Item 8 inserts new section 12C, which provides that a claim is not required for the new utilities allowance.  The new payment will be made automatically if a person is qualified for the allowance, and the allowance is payable, on a test day.

 

Item 9 inserts new section 48A, which provides for the payment of the new utilities allowance.  New subsection 48A(1) provides that the allowance is to be paid by instalments.  New subsection 48A(2) provides that an instalment of the allowance is to be paid on the person’s payday (as defined in subsection 23(1) of the Social Security Act) on or after the utilities allowance test day. In effect, the allowance will be added to the person’s normal income support payment on their first payday on or after 20 March or 20 September in each year.

 

Item 10 amends subsection 55(1) to enable the usual provisions relating to the manner of payment of a social security entitlement to apply to the new allowance.

 

Items 11 and 12 amend subsection 68(1) and 69(1) to provide, in effect, that the Secretary cannot give notices under section 68 or 69 in relation to a person to whom the new allowance is being paid.  The reason for this is that the entitlement to the new allowance is based on receipt of an income support payment and obligations can be imposed, by way of notices under section 68 or 69 notices given in relation to that payment, which can be relied upon to determine entitlement to the new utilities allowance.

 

Item 13 amends paragraph 75(1)(b) to provide that the Secretary’s power to request tax file numbers does not apply in relation to the new allowance.

 

Item 14 inserts new section 78A, which provides that Subdivision A of Division 7 does not apply in relation to the new utilities allowance and the new seniors concession allowance.

 

Item 15 inserts new section 90A, which provides that Subdivision A of Division 8 does not apply in relation to the new utilities allowance and the new seniors concession allowance.

 

Item 16 adds new paragraphs (d) and (e) to the definition of ‘relevant payment’ in section 123A to enable payments of the new utilities allowance and the new seniors concession allowance to be made to the payment nominee of the person entitled to those payments.

 

Part 2 - Amendments relating to Veterans’ Affairs’ payment of utilities allowance

 

The amendments made in this Schedule provide for the introduction of new Part VIIAC into the Veterans’ Entitlements Act, providing for the payment of the utilities allowance to recipients of service pension (age, invalidity or partner) and income support supplement, who are of veteran pension age.

 

Pensioner males will be eligible for the allowance from 60 years of age and females will be eligible depending on their date of birth. Currently, veteran pension age for females is 57 years and 6 months and this age is increasing by 6 months every 2 years until eligibility for females is also 60 years.

 

The utilities allowance will initially be payable at a rate of $100 per year to a single pensioner and at a rate of $50 per year to the members of a couple with the payment to be indexed.

 

In the circumstances where the members of a couple separately receive income support payments from Department of Veterans’ Affairs and from Centrelink, each agency will pay the utilities allowance at the member of a couple rate.

 

Where only one member of a couple is receiving a service pension or income support supplement (including the circumstances where the spouse is of pension age but not receiving a service pension), payment of the allowance will be at the member of a couple rate.

 

The utilities allowance will be payable in two instalments each year, from March 2005 and from each September and March thereafter.

 

The utilities allowance will be payable to eligible persons on the relevant paydays being the first pension paydays on or after 20 March and 20 September of each year.

 

The amount of the payment is indexed twice yearly on the basis of CPI increases and is provided for in new section 198E.

 

The utilities allowance will be subject to the general payment provisions of sections 122, 122A, 122B, 202, 202A and 202B relating to such matters as the manner of payment and payments to agents and trustees.

 

The payments will be non-taxable and amendments have been made to sections 52-65 and 52-75 of the Income Tax Assessment Act 1997 .

 

The utilities allowance will be payable to a person who has been temporarily absent from Australia for a continuous period not exceeding 13 weeks.

 

As it is possible for individuals to move from receiving income support to holding a Commonwealth Seniors Health Card (and back again) over time, some people may meet the tests for both the utilities allowance and the new seniors concession allowance in any one year.  To prevent ‘double dipping’, a person will only be entitled to be paid no more than two instalments of either of the new payments in any financial year (including the financial year commencing 1 July 2004).

 

The amendments also provide the cardholder with the opportunity to elect (by written notice) to not receive the allowance.

 

The existing debt recovery provisions in Part XII of the Veterans’ Entitlements Act will provide for the recovery of a payment made to a person not entitled to receive it.

 

Income Tax Assessment Act 1997

 

Item 17 amends section 52-65.  Section 52-65 contains a table setting out the income tax treatment of veterans’ affairs payments.

 

The table setting out the income tax treatment of veterans’ affairs payments is amended by the inclusion of new item 20A.1 referring to payments of the utilities allowance.  The reference provides that payments of utilities allowance will be exempt from income tax.

 

Item 18 inserts a reference to the new utilities allowance being payable under Part VIIAC in the table in section 52-75 listing the provisions of the Veterans’ Entitlements Act under which payments are made.

 

Social Security Act 1991

 

Item 19 inserts new subparagraph (viia) referring to utilities allowance payable under Part VIIAC of the Veterans’ Entitlements Act in paragraph 8(8)(y).  Paragraph 8(8)(y) lists Veterans’ Entitlements Act payments that are to be regarded as an ‘excluded amount’ for the purposes of determining income under the Social Security Act.

 

Veterans’ Entitlements Act 1986

 

Item 20 amends subsection 5H(8) by inserting new paragraph (ga).  Subsection 5H(8) sets out the payments that are to be regarded as being an ‘excluded amount’ for the purposes of determining the income of a person under the Veterans’ Entitlements Act.

 

New paragraph 5H(8)(ga) provides that all payments of utilities allowance made under Part VIIAC are to be regarded as being an ‘excluded amount’.

 

Item 21 inserts in subsection 5Q(1) a definition of ‘utilities allowance’ as meaning the utilities allowance payable under new Part VIIAC.

 

Item 22 inserts new Part VIIAC into the Veterans’ Entitlements Act.

 

New Part VIIAC is titled ‘Utilities Allowance’.

 

Division 1 - Eligibility for and payability of utilities allowance

 

New section 118O defines the ‘utilities allowance test day’ for the purposes of the new Part as being either the 20 March or 20 September of each year.

 

New section 118OA provides the eligibility conditions for the new allowance.  The conditions as set out in paragraph 118OA(1)(a) are firstly, that the person must have reached ‘qualifying age’ as set out in subsection 118OA(2).

 

Secondly, paragraph 118OA(1)(b) provides that service pension or income support supplement must be payable to the person and thirdly as provided for in paragraph 118OA(1)(c), the person must be either in Australia, or temporarily absent from Australia for a continuous period not exceeding 13 weeks.

 

Subsection 118OA(2) provides that qualifying age for a veteran is pension age and is therefore 60 years for men and is currently 57.5 years for women.  Subsection 118OA(2) also provides that qualifying age for a person who is not a veteran will be the same as if that person were a veteran.

 

The Note to subsection 118OA(2) refers the reader to the pension age as being defined in section 5QA of the Veterans’ Entitlements Act.

 

New section 118OB provides for when the new allowance is payable.

 

New subsection 118OB(1) provides the general rule that the allowance is payable to a person for each utilities allowance test day (as defined in new section 118O as 20 March and 20 September) on which the person is eligible for the allowance.

 

New subsection 118OB(2) provides that the allowance will not be payable on a utilities allowance test day if either:

 

·          two instalments of any combination of both the new utilities allowance and the new seniors concession allowance have already been payable under the Veterans’ Entitlements Act or the Social Security Act in the same financial year as the test day - this provision recognises that a person is not entitled to more than two payments of either or both of the new payments in any financial year, as the new payments are closely related; or

 

·          before that day, the person has elected not to receive the utilities allowance, and has not withdrawn such an election - this recognises that a person has the right to not receive the payment if they so decide, but they can change their mind about this, so that that the allowance can again become payable.

 

Subsection 118OB(3) refers to the making of an election not to receive payments of utilities allowance and the withdrawal of such an election.  It provides that an election and the withdrawal of an election must be by document lodged at an office of the Department of Veterans’ Affairs in accordance with section 5T.  The lodgement of the document will be taken to have been made on a date determined under that section.

 

Division 2 - Rate of utilities allowance

 

New section 118OC provides for a person’s annual rate of payment of the new allowance.  The person’s annual rate is $100 (subject to indexation) if the person is single or a member of an illness separated or respite care couple.  The person’s annual rate is half of the single rate (that is, $50, when the first payment is made shortly on or after the 20 March 2005 test day) if the person is a member of a couple (other than an illness separated or respite care couple).

 

The Note to section 118OC refers to the annual rate of the utilities allowance being indexed in line with increases in the CPI as provided for in section 198E.

 

Division 3 - Payment of utilities allowance

 

New section 118OD provides for the payment of the new utilities allowance.  New subsection 118OD(1) provides that the allowance is to be paid in instalments.

 

New subsection 118OD(2) provides that an instalment of the allowance is to be paid on the person’s first pension payday (as defined in subsection 5Q(1)) on or after the utilities allowance test day.  In effect, the allowance will be added to the person’s normal service pension or income support supplement payment on their first payday on or after 20 March or 20 September in each year.

 

Subsection 118OD(3) provides for the six monthly instalments of utilities allowance to be paid at a rate equivalent to one half of the annual rate.

 

Subsection 118OD(4) provides for an instalment of utilities allowance that is not a multiple of ten cents to be rounded up to the next ten cents.

 

Item 23 amends section 121 by including payments of utilities allowance in the list of payments made under the Veterans’ Entitlements Act that are to excluded from the definition of a ‘pension’ in subsection 121(7).  The effect of the exclusion is to provide that payments of utilities allowance will not be subject to the operation of the provisions of section 121.

 

Section 121 provides for the payment of all pensions and allowances (with the exception of the payments referred to in subsection 121(7)) under the Veterans’ Entitlements Act to be paid in instalments and in arrears.  The section also sets out the eligibility rules that apply to the payment of instalments.

 

Item 24 amends section 128A.  Section 128A refers to the provision of tax file numbers by the recipients and the partners of recipients of payments made under the VEA.

 

Subsection 128A(1) defines the Veterans’ Entitlements Act payments that are to be considered to be an ‘income payment’ for the purposes of the section.

 

Paragraph 128A(1)(d) is amended by including a reference to payments of utilities allowance and seniors concession allowance as being excluded from the definition of an ‘income payment’.  The effect of the exclusion is that power to request tax file numbers does not apply in relation to the new allowance.

 

Item 25 inserts new section 198E to provide for the indexation of each of the annual rates of utilities allowance listed in the table in new section 118OC.  In general terms, the annual rates of the allowance are indexed twice a year in line with CPI increases with reference to the December and June quarters.

 

Subsection 198E(10) provides that the first indexation of the allowance will occur in relation to the utilities allowance payment made for the 20 September 2005 test day.

 



Schedule 2 - Seniors concession allowance

 

Summary

 

The amendments made by this Schedule will introduce a new payment for self funded retirees, to be known as the seniors concession allowance.  In general, the payment will be made to a person who holds a seniors health card on 1 December and 1 June of each year, commencing on 1 December 2004.  Special transitional arrangements will enable the payment to be made to any person who is entitled to hold a card during any time in December 2004 (that is, other than on 1 December 2004).  The new allowance will, subject to CPI indexation, be a payment of $200 a year.  The allowance will be paid in two instalments as soon as practicable after 1 December and 1 June each year (with special arrangements for the transitional payment in December 2004).

 

Background

 

During the 2004 election campaign, the Government made a commitment to introduce a new payment to provide more help for self funded retirees.  In general, the seniors health card is available to retirees with adjusted taxable income of less than $50,000 for single people and $80,000 (combined) for couples.  The seniors health card provides access to cheaper prescriptions and a range of other benefits.  However, it is recognised that most self funded retirees do not receive concessions for energy needs, rates, water and sewerage and motor vehicle registration costs from state and territory governments.  Accordingly, the new payment will be introduced to provide assistance for self funded retirees in meeting such expenses.  The allowance also recognises the contribution that this group has made in providing for their own retirement.

 

Explanation of changes

 

Part 1 - Amendments relating to Family and Community Services’ payment of seniors concession allowance

 

Division 1 -Amendments

 

Income Tax Assessment Act 1997

 

Item 1 inserts a reference to the new seniors concession allowance in the table in section 52-10, which provides for the income tax treatment of social security payments.  The effect of the amendment is that in each of the first two cases dealt with in that table, the new allowance will be exempt from income tax.

 

In particular, case 1 applies if a person receives an ordinary payment of the allowance (that is, a payment made other than because of a person’s death) unless case 2 applies.  Case 2 applies if a person’s partner dies, the person does not qualify for bereavement payments (because no bereavement payments are payable in relation to the allowance), and the person receives an ordinary payment of the allowance on any of the person’s paydays after their partner’s death.  Cases 3 and 4 are not applicable to the new allowance.

 

Item 2 inserts a reference to the new seniors concession allowance in the table in section 52-40, which lists the provisions of the Social Security Act under which social security payments are made that are wholly or partly exempt from income tax.

 

Social Security Act 1991

 

Item 3 inserts a definition of ‘seniors concession allowance’ in subsection 23(1) of the Social Security Act.

 

Item 4 inserts new Part 2.25B into the Social Security Act to provide for the new seniors concession allowance.

 

Division 1 - Qualification for and payability of seniors concession allowance

 

New subsection 1061U provides the qualification conditions for the new allowance.  A person is qualified for the allowance if the person is the holder of a seniors health card and is in Australia.  Alternatively, qualification will arise if a person is temporarily absent from Australia for a continuous period not exceeding 13 weeks, and the person was the holder of a seniors health card immediately before leaving Australia.  (Under subsection 1061ZG(1) of the Social Security Act, a person must be in Australia to be qualified for the seniors health card.)

 

New subsection 1061UA provides for when the new allowance is payable.

 

New subsection 1061UA(1) provides the general rule that the allowance is payable to a person for each seniors concession allowance test day (defined in new subsection 1061UA(3) as 1 June and 1 December) on which the person is qualified for the allowance.

 

New subsection 1061UA (2) provides that the allowance will not be payable on a seniors concession allowance test day if:

 

·          two instalments of any combination of the new seniors concession allowance and the new utilities allowance (whether under the Social Security Act or the Veterans’ Entitlements Act) have already been payable in the same financial year as the test day - this recognises that a person is not entitled to more than two payments of either or both of the new payments in any financial year, as the new payments are closely related; or

 

·          before that day, the person has elected not to receive the allowance, and has not withdrawn such an election - this recognises that a person has the right not to receive the payment if they so decide, but they can change their mind about this, so that that the allowance can again become payable; or

 

·          subsection 55(5) of the Social Security Administration Act applies to the person, as a result of the person failing to nominate a bank account.

 

New section 1061UB provides that a person’s annual rate of the new allowance is $200.  This annual rate of the allowance is indexed twice a year in line with CPI increases.

 

Item 5 inserts a reference to ‘income support supplement’ in paragraph 1061ZG(1)(g).  The effect of this amendment is that a person who is receiving this payment cannot be qualified for a seniors health card under the Social Security Act.  A person receiving income support supplement may be qualified for a seniors health card under the Veterans’ Entitlements Act.

 

Item 6 inserts new paragraph 1061ZG(2)(aa) to provide that a person is not qualified for a seniors health card under the Social Security Act if the person holds a seniors health card under the Veterans’ Entitlements Act.  This mirrors the corresponding rule in section 118X of the Veterans’ Entitlements Act.

 

Items 7 and 8 provide for the indexation of the annual rate of seniors concession allowance set out in new section 1061UB.  In general terms, the annual rate of the allowance is indexed twice a year in line with CPI increases.  Item 9 provides that the first indexation of the allowance will take place on 1 June 2005.

 

Social Security (Administration) Act 1999

 

Item 10 inserts new section 12D, which provides that a claim is not required for the new seniors concession allowance.  The new payment will be made automatically if a person is qualified for the allowance, and the allowance is payable, on a test day.

 

Item 11 inserts new section 48B, which provides for the payment of the new seniors concession allowance.  New subsection 48B(1) provides that the allowance is to be paid be instalments.  New subsection 48B(2) provides that an instalment of the allowance is to be paid as soon as is reasonably practicable on or after the relevant seniors concession allowance test day (defined in subsection (4) as 1 June and 1 December).  New subsection 48B(3) provides that an instalment of the new allowance is the annual rate of the allowance divided by two.

 

Item 12 amends subsection 55(1) to enable the usual provisions relating to the manner of payment of a social security entitlement to apply to the new allowance.

 

Division 2 - Transitional provisions

 

Item 13 contains rules relating to the special payment of seniors concession allowance, to be known as transitional seniors concession allowance.

 

Subitem 13(1) provides definitions of terms used in the item.

 

Subitem 13(2) provides that the transitional allowance is payable in relation to a transitional day (defined as any day in December 2004 other than 1 December 2004) if the seniors concession allowance would be payable if that day had been the 1 December 2004 test day, and seniors concession allowance was not payable in relation to the 1 December 2004 test day.

 

Subitem 13(3) provides that the transitional allowance is payable only once in relation to December 2004.

 

Subitem 13(4) provides that the transitional payment of the allowance is to be paid as soon as practicable on or after the transitional day, and that the amount of the instalment of the allowance is $100.

 

Subitem 13(5) provides that, for the purposes of relevant legislation, transitional seniors concession allowance is to be treated as if it were seniors concession allowance payable in relation to the 1 December 2004 test day, and an instalment of the transitional allowance is to be treated as an instalment of seniors concession allowance under new section 49B of the Social Security Administration Act in relation to the 1 December 2004 test day.

 

Part 2 - Amendments relating to Veterans’ Affairs payment of seniors concession allowance

 

The amendments made in this Schedule provide for the introduction of new Part VIIAD into the Veterans’ Entitlements Act providing for the payment of the seniors concession allowance of $200 per year to holders of a Commonwealth Seniors Health Card (seniors health card) under Part VIIC of the Veterans’ Entitlements Act.  The allowance will be paid in two instalments each year with the payments being made as soon as practicable after the 1 December and 1 June of each year.

 

The first payment will be made to all eligible persons who are cardholders on 1 December 2004.

 

In addition, the first payment will be made to a person whose claim for a seniors health card has been granted in respect of a period that includes any day in December 2004.  In that case, the payment will be made as soon as reasonably practicable after eligibility for the seniors health card has been determined.

 

The amount of the payment will be indexed twice yearly on the basis of CPI increases.  Section 198E has been amended to provide for the indexation of the allowance.

 

The allowance will be subject to the general payment provisions of sections 122, 122A, 122B, 202, 202A and 202B relating to such matters as the manner of payment and payments to agents and trustees.

 

The payments will be non-taxable and amendments have been made to sections 52-65 and 52-75 of the Income Tax Assessment Act 1997 .

 

The seniors concession allowance will be payable to an eligible person who has been temporarily absent from Australia for a continuous period not exceeding 13 weeks.

 

To ensure that persons will not be eligible under both the Social Security Act and Veterans’ Entitlements Act for the payment of the allowance section 118X of the Veterans’ Entitlements Act provides that a person who holds a seniors health card under the Social Security Act is not entitled to one under the Veterans’ Entitlements Act.

 

As it is possible for individuals to move from receiving income support to holding a seniors health card (and back again) over time, some people may meet the test for both the seniors concession allowance and the new utilities allowance in any one year.  To prevent ‘double dipping’, a person will only be entitled to be paid no more than two instalments of either of the new payments in any financial year (including the financial year commencing 1 July 2004).

 

The amendments also provide the cardholder with the opportunity to elect (by written notice) to not receive the allowance.

 

The existing debt recovery provisions in Part XII of the VEA will provide for the recovery of a payment made to a person not entitled to receive it.

 

Division 1 -Amendments

 

Income Tax Assessment Act 1997

 

Item 14 amends section 52-65.  Section 52-65 contains a table setting out the income tax treatment of veterans’ affairs payments.

 

The table setting out the income tax treatment of veterans’ affairs payments is amended by the inclusion of new item 16A.1 referring to payments of the seniors concession allowance.  The reference provides that payments of seniors concession allowance will be exempt from income tax.

 

Item 15 inserts a reference to the new seniors concession allowance being payable under Part VIIAD in the table in section 52-75 listing the provisions of the Veterans’ Entitlements Act under which payments are made.

 

Social Security Act 1991

 

Item 16 inserts new subparagraph (viib) referring to seniors concession allowance payable under Part VIIAD of the Veterans’ Entitlements Act in paragraph 8(8)(y).  Paragraph 8(8)(y) lists Veterans’ Entitlements Act payments that are to be regarded as an ‘excluded amount’ for the purposes of determining income under the Social Security Act.

 

Veterans’ Entitlements Act 1986

 

Item 17 amends subsection 5H(8) by inserting new paragraph (gb).  Subsection 5H(8) sets out the payments that are to be regarded as being an ‘excluded amount’ for the purposes of determining the income of a person under the Veterans’ Entitlements Act.

 

New paragraph 5H(8)(gb) provides that all payments of seniors concession allowance made under Part VIIAD are to be regarded as being an ‘excluded amount’.

 

Item 18 inserts in subsection 5Q(1) a definition of ‘seniors concession allowance’ as meaning the seniors concession allowance payable under new Part VIIAD.

 

Item 19 inserts new Part VIIAD into the Veterans’ Entitlements Act.

 

New Part VIIAD is titled ‘Seniors concession Allowance’.

 

Division 1 - Eligibility for and payability of seniors concession allowance

 

New section 118P defines the ‘seniors concession allowance test day’ for the purposes of the new Part as being either the 1 June or 1 December of each year.

 

New section 118PA provides the eligibility conditions for the new allowance.  The conditions as set out in paragraph 118PA(a) are that the person must be the holder of a seniors health card and be in Australia.

 

For the allowance to be payable to a person who is not in Australia, paragraph 118PA(b) provides that the person must be temporarily absent from Australia for a continuous period not exceeding 13 weeks and that the person was the holder of a seniors health card immediately before leaving Australia.

 

New section 118PB provides for when the new allowance is payable.

 

New subsection 118PB(1) provides the general rule that the allowance is payable to a person for each seniors concession allowance test day (as defined in new section 118P as either 1 June or 1 December) on which the person is eligible for the allowance.

 

New subsection 118PB(2) provides that the allowance will not be payable on a seniors concession allowance test day if either:

 

·          two instalments of any combination of both the new utilities allowance and the new seniors concession allowance have already been payable under the Veterans’ Entitlements Act or the Social Security Act in the same financial year as the test day - this provision recognises that a person is not entitled to more than two payments of either or both of the new payments in any financial year, as the new payments are closely related; or

 

·          before that day, the person has elected not to receive the seniors concession allowance, and has not withdrawn such an election - this recognises that a person has the right to not receive the payment if they so decide, but they can change their mind about this, so that that the allowance can again become payable.

 

Subsection 118PB(3) refers to the making of an election not to receive payments of seniors concession allowance and the withdrawal of such an election.  It provides that an election and the withdrawal of an election must be by document lodged at an office of the Department of Veterans’ Affairs in accordance with section 5T.  The lodgement of the document will be taken to have been made on a date determined under that section.

 

Division 2 - Rate of seniors concession allowance

 

New section 118PC provides for a person’s annual rate of payment of the new allowance.  The person’s annual rate is $200 (subject to indexation).

 

The Note to section 118PC refers to the annual rate of the seniors concession allowance being indexed in line with increases in the CPI as provided for in section 198E.

 

Division 3 - Payment of utilities allowance

 

New section 118PD provides for the payment of the new seniors concession allowance.  New subsection 118PD(1) provides that the allowance is to be paid in instalments.

 

New subsection 118PD(2) provides that an instalment of the allowance is to be paid as soon as is reasonably practicable on or after the seniors concession allowance test day.

 

Subsection 118PD(3) provides for the six monthly instalments of seniors concession allowance to be paid at a rate equivalent to one half of the annual rate.

 

Subsection 118PD(4) provides for an instalment of seniors concession allowance that is not a multiple of ten cents to be rounded up to the next ten cents.

 

Items 20 and 21 amend section 122A.  The amendments include a reference to a payment of seniors concession allowance in subsection 122A(1A) and insert new subsections 122A(1C) and (1D).

 

Section 122A provides for he payment of pensions and allowances under the Veterans’ Entitlements Act to be paid into a bank account nominated by the recipient.  Subsection 122A(1A) provides that a pension or allowance will not be payable if an account has not been nominated.  The effect of the amendment is to exclude payments of seniors concession allowance from being subject to the operation of the existing provisions of section 122A.

 

Subsection 122B(1B) operates so that a payment not payable under subsection 122A(1A) because bank account details were not provided will be later payable if the an account is nominated.

 

New subsection 122A(1C) provides that a payment of seniors concession allowance will not be payable after a period of 28 days (or more as nominated) if a response to request for bank account details made by the Repatriation Commission has not been received.

 

New subsection 122A(1D) provides that if a bank account is nominated after the end of the 28 day period (or more if nominated) then subsection 122A(1C) will no longer apply to the person.

 

Item 23 amends section 198E to provide for the indexation of the annual rate of seniors concession allowance referred to in new section 118PC.  In general terms, the annual rates of the allowance are indexed twice a year in line with CPI increases with reference to the March and September quarters.  Subsection 198E(10A) provides that the first indexation of the allowance will occur in relation to the seniors concession allowance payment made for the 1 June 2005 test day.

 

Division 2 - Transitional provision

 

Item 24 contains rules relating to the special payment of seniors concession allowance, to be known as transitional seniors concession allowance.

 

Subitem 24(1) provides definitions of terms used in the item.

 

Subitem 24(2) provides that the transitional allowance is payable in relation to a transitional day (defined as any day in December 2004 other than 1 December 2004) if the seniors concession allowance would be payable if that day had been the 1 December 2004 test day, and seniors concession allowance was not payable in relation to the 1 December 2004 test day.

 

Subitem 24(3) provides that the transitional allowance is payable only once in relation to December 2004.

 

Subitem 24(4) provides that the transitional payment of the allowance is to be paid as soon as practicable on or after the transitional day, and that the amount of the instalment of the allowance is $100.

 

Subitem 24(5) provides that, for the purposes of relevant legislation, transitional seniors concession allowance is to be treated as if it were seniors concession allowance payable in relation to the 1 December 2004 test day, and an instalment of the transitional allowance is to be treated as an instalment of seniors concession allowance under new Part VIIAD in relation to the 1 December 2004 test day.

 



Schedule 3 - Carer payment

 

Summary

 

This measure will amend section 198AC of the Social Security Act to give effect to an election commitment to provide additional support to carers participating in work, training or study.

 

Background

 

At the present time, people caring for an adult or a child with a disability, and who receive carer payment under Part 2.5 of the Social Security Act, do not lose qualification for that payment if they temporarily cease providing care in order to undertake training, education, unpaid voluntary work or paid employment (subsections 198AC(4) and 198AC(5) of the Social Security Act).  However, the maximum length of time that a carer may temporarily cease providing care in order to undertake any of these activities, and still retain their qualification for carer payment under these provisions, is 20 hours per week (paragraphs 198AC(4)(c) and 198AC(5)(c)).

 

Explanation of changes

 

Item 1 increases the 20 hour limit referred to in paragraphs 198AC(4)(c) and 198AC(5)(c) to 25 hours.  This means that carers may temporarily cease providing care in order to undertake training, education, unpaid voluntary work or paid employment for up to 25 hours per week, without losing their qualification for carer payment.  This is intended to provide more opportunities and flexibility for carers to combine caring with work, training or study.  This will allow carers to have increased involvement in these activities, to assist their participation in the workforce, and to provide more of a break from caring, without affecting their eligibility for carer payment.

 

Item 2 is an application provision which clarifies how the amendments made by item 1 are to be applied after their commencement.  Item 2 provides that the item 1 amendments to paragraphs 198AC(4)(c) and 198AC(5)(c) will allow a carer payment recipient who undertakes training, education, unpaid voluntary work or paid employment for up to 25 hours in any seven-day period to remain qualified for carer payment, as long as the seven-day period (or ‘week’) in which those activities are undertaken commences on or after the commencement of item 1 , that is, on or after 1 April 2005.

 



Schedule 4 - Special child care benefit rate for grandparents on income support

 

Summary

 

The amendments made by this Schedule will make child care more affordable for grandparents who are receiving an income support payment by enabling them to have access to a special rate of child care benefit.  The special rate will cover the full cost of child care fees charged to eligible grandparents by approved child care services.

 

A ‘grandparent’ who will benefit from these amendments is a biological, adoptive and step grandparent and great grandparent of a child (grandchild).

 

A grandparent will be eligible for the special child care benefit rate in respect of a grandchild if the grandparent or the grandparent’s partner is the principal carer of the grandchild and is conditionally eligible, or eligible, for child care benefit by fee reduction for the grandchild.

 

If a grandparent is eligible for the special grandparent rate for a grandchild, other children who are in the care of the grandparent, or the grandparent's partner, will also attract the special rate if the grandparent, or the grandparent's partner, is conditionally eligible, or eligible, for child care benefit by fee reduction for the other children.

 

These amendments do not affect the current conditions of conditional eligibility, or eligibility, for child care benefit by fee reduction.

 

The amendments made in this Schedule include amendments that specify the ‘special grandparent rate’, the conditions of eligibility for that rate, when a determination of eligibility for the special rate must be made or varied, eg as a result of changes in the claimants’ circumstances, and the obligations of approved child care services related to the provision of fee-free care to eligible grandparents’ children.  A number of consequential amendments is also made; for example, to ensure that determinations of eligibility of the special grandparent rate are reviewable.

 

Background

 

During the 2004 election campaign, the Government made a commitment to make child care more affordable for grandparents on income support and who are the primary carers for their grandchildren, by providing a special rate of child care benefit covering the full cost of the child care fees that approved child care services charge grandparents.

 

Currently, the child care benefit rate (an hourly rate) for care provided to a child by an approved child care serviced depends, among other things, on the claimant’s income.  A claimant receiving an income support payment (such as, a social security pension or benefit, a service pension or an income support supplement under Part IIIA of the Veterans’ Entitlements Act) is entitled to the maximum rate of child care benefit.  The difference between the amount of child care benefit and the amount of fees an approved child care service charges for care provided to a child for the period constitutes a claimant’s out-of-pocket expense.

 

As a result of the amendments made by this Schedule, a rate of child care benefit applicable to a claimant who is eligible for the special grandparent rate for a child will equal the rate of child care fees which a service providing care to the child charges the claimant.  The claimant to whom the amendments apply will not incur any out-of-pocket expenses for the hours of care provided to the child within the weekly limit of hours applicable to the claimant and the child.

 

Explanation of changes

 

Amendments to the Family Assistance Act

 

Items 1 to 13 make amendments to Part 3, Division 4 of the Family Assistance Act.

 

Items 1 and 2 amend the definition of ‘receiving’ in subsection 3(1), relevant to new sections 50S and 50T inserted in the Family Assistance Administration Act by item 16 .

 

Division 4 deals with child care benefit rates, including the rates relevant to a claim for child care benefit by fee reduction, that is, a fee reductions rate and the rate of child care benefit by fee reduction.

 

If a claimant makes a claim for child care benefit by fee reduction (paragraph 49B(a) of the Family Assistance Administration Act), and a determination of conditional eligibility for child care benefit by fee reduction is made in respect of the claimant and the child (section 50F of the Family Assistance Administration Act), the claimant‘s child care fees are reduced by the child care service providing care to the child by the amount of ’fee reductions’, the rate of which is calculated in accordance with the relevant provisions of Division 4.  After the end of the income year during which the claimant was conditionally eligible for child care benefit by fee reduction, a determination of entitlement to child care benefit by fee reduction is made for the claimant in respect of the income year (section 51B of the Family Assistance Administration Act).  As part of the entitlement determination, a ‘child care benefit’ rate is determined in accordance with the provisions of Division 4.  The fee reductions rate and the child care benefit rate are calculated in the same way.

 

Section 73 of Subdivision B provides that, if a determination of conditional eligibility is in force in respect of a claimant and a child, the rate of fee reductions, and child care benefit by fee reduction, is the rate calculated under Schedule 2 to the Family Assistance Act (Child care benefit rate calculator).  However, this rate does not apply when the child is determined to be at risk or the claimant is determined to be in hardship.  In such a situation, the applicable rate is the rate certified by the relevant service under subsection 76(1) of the Family Assistance Act, or by the Secretary under subsections 81(2) and (3) of the Family Assistance Act (as the case may be).

 

Subdivision C deals with the rate applicable when the child is determined to be at risk or the claimant is determined to be in hardship.

 

Item 13 amends Division 4 by inserting a new Subdivision CA dealing with the special grandparent rate.  New Subdivision CA includes a new section 82A, which provides that the special grandparent rate applies if a determination under new subsection 50T(1) of the Family Assistance Administration Act is in force with effect that the claimant is eligible for the special grandparent rate for the child in respect of a session of care provided to the child.  If a determination of the special grandparent rate is in force, the rate of fee reductions, and child care benefit by fee reduction, applicable to the individual, the child and the session of care is 100% of the hourly rate charged by the service for the session.

 

Item 5 inserts a new subsection 69(4A) in section 69, which provides an overview of Division 4.  New subsection 69(4A) provides that new Subdivision CA deals with the special grandparent rate of fee reductions and child care benefit.  It specifies that the rate is applicable to a session of care provided by an approved child care service to a child if a determination of conditional eligibility for child care benefit by fee reduction, under section 50F of the Family Assistance Administration Act, is in force in respect of the individual with effect that the individual is conditionally eligible for child care benefit by fee reduction in respect of the child and a determination under subsection 50T(1) of the Family Assistance Administration Act is in force with effect that the individual is eligible for the special rate for the child.

 

Items 3 and 4 make consequential amendments to section 69 to include cross-references to new Subdivision CA inserted by item 13 .

 

As a consequence of the introduction of new Subdivision CA dealing with the special grandparent rate, items 6, 7 and 8 make amendments to subsection 73(1).  This subsection specifies that a Schedule 2 (Child care benefit rate calculator) rate applies to a fee reduction rate unless a different fee reduction rate certified by a service or determined by the Secretary applies (in the cases when a child is at risk or an individual is in hardship).  Amendments made by items 6, 7 and 8 ensure that, if a determination under subsection 50T(1) is in force with the effect that the individual is eligible for the special grandparent rate for a child and a session of care occurs while the determination is in force, the hourly rate of fee reductions for the session of care provided to the child is the special rate worked out under new Subdivision CA.  In that case, the Schedule 2 rate does not apply.

 

Items 9, 10 and 11 make similar amendments to subsection 73(2) to ensure that, if a determination under subsection 50T(1) is in force with the effect that the individual is eligible for the special grandparent rate for a child and a session of care occurs while the determination is in force, the hourly rate of child care benefit for the session of care provided to the child is the special rate worked out under new Subdivision CA.  In that case, the Schedule 2 rate does not apply.

 

Amendments to the Family Assistance Administration Act

 

Section 49C specifies the conditions for a claim for child care benefit to be an effective claim (if a claim is not effective, it is taken not to have been made).  One of the conditions of an effective claim is that the information requested by the Secretary is provided.  Subsection 49C(2) makes a claim for child care benefit by fee reduction effective even though the information specified in this subsection is not provided.  Item 14 amends subsection 49C(2) to ensure that a claim for child care benefit by fee reduction is effective even though the information requested by the Secretary in relation to the eligibility for the special grandparent rate is not provided in the claim.  In such a case, if a determination of conditional eligibility is made in respect of the claimant, the rate of fee reductions will be the rate calculated under Schedule 2 to the Family Assistance Act and not the special grandparent rate.

 

If a claim for child care benefit by fee reduction is made, and the claimant is determined to be conditionally eligible for that benefit for a child (determination under section 50F), section 50C requires the Secretary to determine, at the same time, the weekly limit of hours applicable to the claimant (determination under section 50H), CCB % (determination under section 50J) and schooling % (determination under section 50K).

 

As a result of the amendment made by item 16 , new subsection 50T(1) will require the Secretary to make, at the time of determining the claim, a determination of eligibility for the special grandparent rate if the claimant informs the Secretary that he/she wants the determination to be made.  Item 15 therefore adds a note at the end of section 50C to draw the reader’s attention to the fact that a determination of the special grandparent rate may also need to be made at the time a claim for child care benefit by fee reduction is determined.

 

Division 4 of Part 3 of the Family Assistance Administration Act deals with the child care benefit, and, more specifically, with the provisions relevant to making and determining child care benefit claims.

 

Item 16 inserts in Division 4 of Part 3 new Subdivision CA dealing with determination of eligibility for the special grandparent rate if the individual is determined to be conditionally eligible for child care benefit by fee reduction.

 

The new Subdivision CA specifies the conditions that have to be met for a claimant to be eligible for the special grandparent rate for the child, the situations in which the Secretary is required to make a determination of eligibility for the special rate, the requirements relating to the notification of the determination, and when the determination is in force.

 

New section 50Q - determination of eligibility for special grandparent rate

 

This section provides that Subdivision CA deals with the determination of eligibility for the special grandparent rate the Secretary must make if a claimant is determined to be conditionally eligible for child care benefit by fee reduction in respect of a child.

 

New section 50R - Grandparents and great grandparents

 

This section defines the meaning of ‘grandparent’ and ‘great grandparent’, for the purposes of the new Subdivision which includes new section 50S dealing with the eligibility of grandparents and great grandparents for the special grandparent rate.

 

Subsection 50R(1) defines the ‘grandparent’ and ‘great grandparent’ by reference to a biological child-parent relationship.  It also treats the relationship between an adopted child and the adoptive parent, and between a step child and the step parent, as a biological relationship.

 

Subsection 50R(2) contains definitions relevant to the concept of a grandparent and great grandparent. ‘Adoptive parent’ is defined as the person who adopted the child under a law of any place, whether in Australia or not, relating to adoption of children.  ‘Step parent’ is defined as the current or former partner of the biological or adoptive parent of the child, the step parent not being the biological or adoptive parent of the child.

 



New section 50S - Eligibility for special grandparent rate

 

This section specifies when a grandparent or great grandparent who is conditionally eligible for child care benefit by fee reduction in respect of a child is eligible for the special grandparent rate for a session of care provided to the child by an approved child care service.

 

New subsection 50S(1) provides that a grandparent or a great grandparent (as defined in new section 50R) of a child is eligible for the special grandparent rate for the child if he or she, or his/her partner, is the principal carer of the grandchild and he or she, or his/her partner, is receiving a social security pension, a social security benefit, a service pension or an income support supplement under Part IIIA of the Veterans’ Entitlements Act.

 

‘Principal carer’ is defined in new subsection 50S(2) as the person who is the sole or major provider of ongoing daily care for the child and who has substantial autonomy for the day-to-day decisions about the child’s care, welfare and development.

 

A social security pension, a social security benefit, a service pension and an income support supplement under Part IIIA of the Veterans’ Entitlements Act are the payments that are defined as ‘income support payment’ in subsection 23(1) of the Social Security Act.

 

‘Social security pension’, ‘social security benefit’ and ‘service pension’ are defined in subsection 3(1) of the Family Assistance Act by reference to the relevant definitions in the Social Security Act (subsection 23(1) refers).

 

For the purposes of the existing references (in Schedule 2 clause 7 of the Family Assistance Act) to ‘receiving’ a social security pension and social security benefit, the meaning of ‘receiving’ is specified in subsection 3(1) of the Family Assistance Act.  Items I and 2 amend the definition of ‘receiving’ so it also operates for the purposes of new section 50S.

 

New subsection 50S(3) provides that, if a grandparent or a great grandparent (as defined in new section 50R) is eligible under new subsection 50S(1) for the special grandparent rate for a grandchild, he or she, or his/her partner, is also eligible for the special grandparent rate in respect of another child.  To be eligible for the special rate for that other child, the grandparent or great grandparent, or his/her partner, must be is conditionally eligible for child care benefit by fee reduction for that other child.

 

New section 50T - Secretary must determine claimant’s eligibility for special grandparent rate in certain circumstances

 

New subsection 50T(1) provides that the Secretary must determine the eligibility for the special grandparent rate in circumstances specified in new subsections (2), (3) and (4).

 



·          request at claim

 

New subsection 50T(2) provides that the Secretary must determine the special grandparent rate if, on or after 1 January 2005, a determination of conditional eligibility is made in respect of a claimant and a child, and the claimant informed the Secretary, in the claim or in connection with the claim, that he wanted the determination of the special grandparent rate to be made (new subsection 50T(2) refers).

 

If the Secretary determines a form and manner of the request, the request must be made in that form and manner (new subparagraph 50T(2)(a)(ii) refers).

 

A determination under this subsection may come into force up to 4 weeks before the day of claim in connection with which the determination was made, but not earlier than on 1 January 2005 (new subsections 50X(2) and (3) refer).

 

·          subsequent application

 

New subsection 50T(3) provides that the Secretary must determine the special grandparent rate for a child if a claimant, in respect of whom a determination of conditional eligibility is in force in respect of the child, subsequently applies for the determination of rate to be made.

 

A determination under this subsection may come into force up to 4 weeks before the day the application was made but not earlier than on 1 January 2005 (new subsections 50X(2) and (3) refer).

 

·          transitional situation

 

New subsection 50T(4) provides that the Secretary must determine the special grandparent rate for a child if, immediately before 1 January 2005, a determination of conditional eligibility and a determination of the weekly limit of hours are in force in respect of the claimant and the child, and the determination of hours is based on the claimant, or the claimant’s partner, being taken to have satisfied the work /training/study test as a result of the determination made under subsection 14(2) and gazetted on 28 October 2004, and the claimant or the claimant’s partner, is receiving a social security pension, a social security benefit, a service pension or an income support supplement under Part III of the Veterans’ Entitlements Act 1986 .

 

This subsection operates to require the Secretary to make a determination of special grandparent rate, without any request from the claimant for that purpose.  The Secretary is required to make this determination in respect of claimants who, on 31 December 2004, are conditionally eligible for child care benefit by fee reduction in respect of a child, whose determination of weekly limit of 50 hours is due to the exemption from the work/training/study test under the Child Care Benefit (Work/Training/Study test Exemption) Amendment Determination 2004 (No.1) and who are receiving one of the income support payments (or whose partners are receiving such a payment).

 

A determination made under this subsection is to be backdated to 1 January 2005 (new subsection 50X(4) refers).

 

New section 50U - Criteria for making determination

 

This section specifies two criteria that must be satisfied before the Secretary must determine that a claimant is eligible for the special grandparent rate for a child.  One criterion is that there is a determination of conditional eligibility in force in respect of the claimant and the child.  The second criterion is that the claimant must be eligible for the special grandparent rate under new section 50S.  If these criteria are not satisfied, the Secretary must determine that the claimant is not eligible for the special rate.

 

New section 50V - Notice of determination that the claimant eligible for special grandparent rate

 

If a determination is made that the claimant is eligible for the special grandparent rate for a child, this section requires the Secretary to give notice of the determination to the claimant and the relevant approved child care service (new subsection 50V(1)).

 

The notice must state the names of the claimant and the child, that the claimant is eligible for the rate for the child and the date from which the determination comes into force, and it must inform the claimant of the review rights under Part 5 of the Family Assistance Administration Act (new subsection 50V(2)).

 

The determination is effective even if the notice is not given or the information specified in subsection (2) is not provided in the notice (new subsection 50V(3)).

 

New section 50W - Notice of determination that the claimant not eligible for special grandparent rate

 

If a determination is made that the claimant is not eligible for the special grandparent rate for a child, this section requires the Secretary to give notice of the determination to the claimant (new subsection 50W(1)).

 

The notice must state that the claimant is not eligible for the special grandparent rate for the child and inform the claimant of the review rights under Part 5 of the Family Assistance Administration Act (new subsection 50W(2)).

 

The determination is effective even if the notice is not given or the information specified in subsection (2) is not provided in the notice (new subsection 50W(3)).

 



New section 50X - When determination that claimant is eligible for special grandparent rate is in force

 

This section specifies when a determination under new subsection 50T(1) that a claimant is eligible for the special grandparent rate comes into force, and when it ceases to be in force.

 

New subsection 50X(1) specifies that such a determination comes into force either on the day specified in the notice of determination; otherwise, on the day the determination is made.

 

If a determination under new subsections 50T(1)) is made at claim or as a result of a subsequent application for the determination of the rate, the day on which the determination comes into force may be a day not earlier than 4 weeks before the day the on which the claim or the application was made (new subsection 50X(2) refers) but it cannot be earlier than 1 January 2005 (new subsection 50X(3) refers).

 

Whether a day earlier than the day of the determination may be specified as the day from which the determination comes into force will depend on whether the claimant was eligible for the special grandparent rate for the child on and since that day (new subsection 50X(3) refers).

 

If a determination is made in the transitional situation to which new subsection 50T(4) applies, the determination comes into force on 1 January 2005 (new subsection 50X(4) refers).

 

New subsection 50X(5) provides that a determination under new subsection 50T(1) that a claimant is eligible for the special grandparent rate may be varied in accordance with this Division (new sections 59G, 62CA and 65DA refer).

 

New subsection 50X(6) provides that a determination under new subsection 50T(1) that a claimant is eligible for the special grandparent rate remains in force as varied (if varied) while the determination of conditional eligibility under section 50F is in force in relation to the claimant and the child.  The effect of this provision is that if the determination of conditional eligibility under section 50F in relation to the claimant and the child ceases to be in force, the determination under new subsection 50T(1) that a claimant is eligible for the special grandparent rate ceases to have any effect.

 

New section 50Y - When a determination that claimant is not eligible for the special grandparent rate is in force

 

This section specifies when a determination under new subsection 50T(1) that a claimant is not eligible for the special grandparent rate comes into force, and when it ceases to be in force.

 

New paragraph 50Y(a) specifies that such a determination comes into force on the day it is made.

 

New paragraph 50Y(b) specifies that such a determination cannot be varied.

 

New paragraph 50Y(c) specifies that such a determination remain in force while the determination of conditional eligibility in respect of the claimant and the child remains in force.

 

However, new paragraph 50Y(d) specifies that, if a subsequent determination is made that the claimant is eligible for the special grandparent rate for the child, the previous determination that the claimant is not eligible for that rate ceases to have effect once the subsequent determination comes into force.

 

A Note at the end of new section 50Y informs the reader that the situation referred to in new paragraph (d) may arise when the claimant, in respect of whom a determination was made under new subsection 50T(1) that the claimant is not eligible for the special grandparent rate for a child, subsequently made a new successful application for the determination of such a rate in respect of the child.

 

Obligation to notify change of circumstances

 

Item 17 inserts new subsections in section 56C dealing with obligations of an individual to notify change of circumstances.

 

Section 56C requires individuals, in respect of whom a determination of conditional eligibility is in force, to notify changes in circumstances that adversely affect the determination of conditional eligibility or other determinations in force in respect of the individual (the CCB % determination, the limit of hours determination and the schooling % determination).

 

As a result of the amendments that provide for the making of a determination of the special grandparent rate in respect of individuals who are conditionally eligible for child care benefit by fee reduction, item 17 inserts new subsection 56C(7) that requires the claimant in respect of whom a determination of the special rate is in force to notify the Secretary if anything happens that causes the claimant to cease to be eligible for the special rate or if the claimant becomes aware that anything is likely to happen that will have that effect.

 

New subsection 56C(7) requires the claimant to provide notification in the manner specified in a written notice given to the claimant under section 57 (section 57 requires the Secretary to approve the manner of notification and to give the claimant notice of the approved manner of the notification).

 

New subsection 56C(7) requires the claimant to provide notification as soon as possible after the claimant becomes aware that something has happened or is likely to happen that will have an adverse effect on the claimant’s eligibility for the special rate.

 

The same criminal penalty applies for failure to comply with this notification requirement as it applies for failure to comply with other existing notification requirements of this section.  New subsection 56C(8) specifies that strict liability applies to the following elements of an offence against new subsection 56C(7): that a determination is the determination under subsection 50T(1) and that a notice (specifying the manner of notification) is the notice given under section 57.

 

Variation for failure to provide information in the data verification form relating to special grandparent rate

 

Section 57F authorises the Secretary to require a claimant who is determined to be conditionally eligible for child care benefit by fee reduction to provide information specified in the data verification form sent to the claimant.  If a data verification form is returned by the claimant but the claimant does not provide the information requested by the Secretary and relevant to any of the child care benefit determinations in force in respect of the claimant (conditional eligibility determination, CCB % determination, the limit of hours determination, the schooling % determination), the relevant determination is varied with an adverse effect from 1 July in the income year following the income year in which the request was made.

 

Item 18 inserts new section 59G in Subdivision N of Division 4 of Part 3 to provide a similar variation power in relation to a determination of the special grandparent rate.

 

New subsection 59G(1) provides that if a data verification form is returned by the claimant but the claimant does not provide the information requested by the Secretary and relevant to the special grandparent rate, the Secretary may vary the determination with the effect that the claimant is not eligible for the special grandparent rate for the child, from 1 July in the income year following the income year in which the request was made.

 

New subsection 59G(2) ensures that if the Secretary finds out the relevant information before the end of the income year following the one in which the variation took effect, the Secretary must vary the determination again to undo the adverse effect.

 

Variation for failure to meet requirements arising under Division 1 of Part 6

 

Variation of child care benefit determinations may occur if, under Division 1 of Part 6 of the Family Assistance Administration Act, the Secretary requires a claimant who is conditionally eligible for child care benefit by fee reduction, or the claimant’s partner, to give information or provide a document relevant to the matter dealt with by the determination and the claimant, or the partner, fails to provide the information or the document.  In such a situation, the relevant child care benefit determinations are varied with an adverse effect.

 

Item 19 inserts new section 62CA in Subdivision R of Division 4 of Part 3 to provide a similar variation power in relation to a determination of the special grandparent rate.

 

New subsections 62CA(1) and (2) provide that if the Secretary requires the claimant or the claimant partner to provide the information or document, that the Secretary requires to make a decision about the claimant’s eligibility for the special grandparent rate, and the claimant or the partner fails to comply with the requirement, the Secretary may vary the determination with the effect that the claimant is not eligible for the special grandparent rate for the child, from the Monday after the day the variation is made.

 

New subsection 62CA(3) ensures that if the claimant or the claimant’s partner gives the information, or document by the end of the income year following the one in which the variation took effect, the Secretary must vary the determination again to undo the adverse effect.

 

Further variations after certain variations that can be undone

 

Under section 62D, if a variation of a child care benefit determination may be undone within a specified period of time, and it had not been because the Secretary had not received the relevant information before the end of the specified period, but the Secretary received the information after that period ended the Secretary must vary the determination again using the received information.  This variation takes effect from the Monday after the variation is made.

 

Items 20 and 21 make consequential amendments to section 62D to include references to new sections 59G and 62CA, under which adverse variation that can be undone may be made in respect of the determination of eligibility for the special child care rate, so that the rate determination must be varied again using the relevant information obtained by the Secretary after the period within which the variation may be undone has ended.

 

Notice of variation determinations

 

Subsection 63(1) requires the Secretary to give a notice of any variation to the claimant.  Subsection 63(1) requires the Secretary to give a notice of specified variations to the relevant service.

 

Item 22 amends section 63 to insert new subsection (2A) which requires the Secretary to give to the relevant service a notice of variation of the eligibility for the special grandparent rate.

 

Subsection 63(3) provides that non-compliance with the requirements of subsections 63(1) and (2) do not make the variation ineffective.  Item 23 makes a consequential amendment to subsection 63(3) to insert a cross-reference to new subsection (2A).

 

Variation of determination of eligibility for the special grandparent rate - changes in circumstances

 

Subdivision V of Division 4 of Part 3 contains provisions dealing with variations of the existing child care benefit determinations that are in force when a change occurs that affects the determination.

 

As a result of the introduction, by item 16 , of a determination of the eligibility for the special grandparent rate (determination under new section 50T), item 24 inserts new section 65DA in Subdivision V to enable variation of that determination.

 

New subsections 65DA(1) and (2) apply in a situation when a determination of conditional eligibility for child care benefit by fee reduction is in force in respect of the claimant, and a determination of eligibility for the special grandparent rate is in force in respect of the claimant, and an event occurs that affects the claimant’s eligibility for that rate.  If the Secretary becomes aware of the occurrence, the Secretary must vary the determination of eligibility for the special rate with effect that the claimant is not eligible for the special rate from the date of the occurrence.

 

New subsections 65DA(3), (4), (5) and (6) apply in a situation when a determination of conditional eligibility for child care benefit by fee reduction is in force in respect of the claimant and a variation determination is in force that the claimant is not eligible for the special grandparent rate and an event occurs that makes the claimant eligible again for the special grandparent rate.  If the Secretary becomes aware of the occurrence, the Secretary must vary the determination again so that the claimant is eligible for the special rate grandparent rate.

 

If the occurrence is notified by the claimant - the variation takes effect from a day not earlier than 4 weeks from the day of the notification.  Otherwise, the variation takes effect from the day not earlier than 4 weeks before the day the variation is made.  The new variation can only be made from a day earlier than the day on which the variation is made if the Secretary is satisfied that the claimant was eligible for the special rate on and since that day.

 

New subsection 65DA(7) applies in a situation when, at the time when a variation under this new section takes place (that the claimant is eligible for the special rate or that the claimant is not so eligible), a variation under new sections 59G and 62CA (variations for non-compliance with a request for provision of information relevant to eligibility for the special rate) is in force with effect that the claimant is not eligible for the special rate.  New subsection 65DA(7) provides that in such a situation, the earlier variation prevails over the variation under this new section.

 



Review of decisions on the Secretary’s own initiative

 

Items 25 to 27 make amendments to sections 106 and 107 dealing with internal review of decisions made by the Secretary on the Secretary’s own initiative under section 105.

 

Section 106 requires the Secretary to give to the claimant and to the relevant service a notice of review of the specified child care benefit determinations made by the Secretary on own initiative under section 105.  Item 25 makes a consequential amendment to this section to ensure that if a determination of eligibility for the special grandparent rate is reviewed, the Secretary gives notice of the review decision to the claimant and the service.

 

Section 107(2) determines a date of effect of review decisions relating to the specified child care benefit determinations.  If a review decision has the effect of creating or increasing the entitlement and a review decision is made more than 52 weeks after the claimant was given the original decision, the date of effect of the review decision cannot be earlier than the first day of the income year before the income year in which the review decision was made.

 

Items 26 and 27 make consequential amendments to subsection 107(2) to ensure that if a determination of eligibility for the special grandparent rate is reviewed with the beneficial effect, the date of effect of the review decision is the same as the date of effect of review decisions of other child care benefit determinations, as provided for in section 107.

 

Review of decisions on application

 

Items 28 to 32 make amendments to sections 109B, 109D and 109G dealing with internal review of decisions initiated by the applicant.

 

Section 109B requires the Secretary to give to the applicant and to the relevant service a notice of review of the specified child care benefit determinations made by the Secretary under section 109A.  Item 28 makes a consequential amendment to section 109B to ensure that if a determination of eligibility for the special grandparent rate is reviewed on application, the Secretary gives notice of the review decision to the claimant and the service.

 

Subsection 109D(1) sets out the rule that an application for review under section 109A (internal review on application) must be made within 52 weeks after the applicant is notified of the decision concerned.  Subsection 109D(3) make exemptions from that rule for various decisions, including child care benefit determinations, and allows an application for review of these determinations to be made during the income year in which the determination took effect and during the following income year.

 

Item 29 makes a consequential amendment to section 109D to ensure that an application for review of a determination of eligibility for the special grandparent rate may be made in the extended period provided for in that section.

 

Items 30, 31 and 32 amend section 109G dealing with the Secretary’s power to continue payment etc pending outcome of an application for review.

 

Section 109G provides that if an application for review of certain specified ‘adverse family assistance decisions’ is made and the adverse decisions depend on the exercise of a discretion or holding of an opinion by a person, the Secretary may make a declaration to the effect that the adverse decision does not have that effect while the review of the adverse decision is pending.

 

The various child care benefit determinations are included in the definition of ‘adverse family assistance decision’ in subsection 109G(5).  Item 32 amends this definition to include a determination that the person is not eligible for the special grandparent rate.

 

Items 30 and 31 amend subsection 109G(2) to the effect that if an application is made for review of a decision that a determination that the person is not eligible for the special grandparent rate, the Secretary may declare that the eligibility of the person for the special grandparent rate continues as if the adverse decision has not been made.

 

Review by the Social Security Appeals Tribunal

 

Subsection 111(2) lists certain decisions that are not reviewable by the Social Security Appeals Tribunal.  Sections of the Act that provide for determinations of a form or manner of claims are included in the list.  Item 33 amends subsection 111(2) to include references to new subparagraph 50T(2)(a)(ii) and paragraph 50T(3)(b) dealing with a form and manner of a request or application for determination of eligibility for the special grandparent rate.

 

Items 34, 35 and 36 amend section 112.  Section 112 provides that if an application for review by the Social Security Appeals Tribunal of certain specified ‘adverse family assistance decisions’ is made and the adverse decisions depend on the exercise of a discretion or holding of an opinion by a person, the Secretary may make a declaration to the effect that the adverse decision does not have that effect while the review of the adverse decision is pending.

 

The various child care benefit determinations are included in the definition of ‘adverse family assistance decision’ in subsection 112(4).  Item 36 amends this definition to include a determination that the person is not eligible for the special grandparent rate.

 

Items 34 and 35 amend subsection 112(1A) to the effect that if an application is made for review of a decision that a determination that the person is not eligible for the special grandparent rate, the Secretary may declare that the eligibility of the person for the special grandparent rate continues as if the adverse decision has not been made.

 

Section 141A requires the Secretary to give to the relevant service a notice of review of the specified child care benefit determinations made by the Social Security Appeals Tribunal.  Item 37 makes a consequential amendment to section 141A to ensure that if a determination of eligibility for the special grandparent rate is reviewed by the Social Security Appeals Tribunal, the Secretary gives notice of the review decision to the service.

 

Information gathering

 

Section 154 contains general power for the Secretary to obtain information, from any person, if the information is relevant to the matters specified in this section.  Failure to comply with this requirement is an offence (section 159 refers).

 

Subsection 154(3) authorises the Secretary to require a person to provide information, or produce a document in the person’s control, if the Secretary considers that the information may be relevant to determine conditional eligibility, CCB %, weekly limit of hours or schooling % of a claimant for child care benefit by fee reduction.  Item 38 amends subsection 154(3) to ensure that the Secretary has the authority to request information, or a document, relevant to a claimant’s eligibility for the special grandparent rate.

 

Offences - false statement to deceive

 

Section 173 specifies when a person who recklessly makes a false or misleading statement contravenes this section.  Contravention of this section is an offence (section 177 refers).

 

A person contravenes this section if, among other things, the person is reckless as to whether the statement affects, or might affect, the rate of family assistance payment (this includes child care benefit by fee reduction), the conditional eligibility for child care benefit by fee reduction, CCB %, the weekly limit of hours or schooling %.

 

Item 39 amends section 173 to ensure that recklessness in the making of a statement that affects, or might affect, a person’s eligibility for the special grandparent rate for a child constitutes an offence.

 

Obligation of approved child care services

 

Section 219A sets out obligations of approved child care services to act on notices given under this Act to the service.

 

Generally, when an approved child care service receives notices of determination of conditional eligibility in respect of an individual and a child, CCB %, the limit of hours of care and schooling %, the service has the following obligations: to calculate the amount of fee reductions applicable to the individual for a session of care provided by the service to the child, to reduce the amount of child care fees for the session by the amount of the fee reductions and to charge the individual only the reduced fees.  The service calculates the amount of the fee reductions applicable to the individual and the child using the provisions of the Family Assistance Act relevant to the calculation of fee reductions and using the notified CCB %, the limit of hours and the schooling %(subsection 219A(2), table item 1 refers).

 

An approved child care service has an obligation to take actions specified in the table in subsection 219A(2) if notices of variations of the determinations or review decisions or other notices are received by the service.

 

Failure to comply with the requirements to act as specified in subsection 219A(2) is an offence (subsection 219A(2) refers).

 

Items 40, 41 and 42 amend subsection 219A(2) by inserting new table items 3A, 3B and 9A and amending table item 10.  The amendments set out what services must do if they receive notices relevant to an individual’s eligibility for the special grandparent rate in respect of a session of care provided to a child.

 

New table item 3A (inserted by item 40 ) is relevant to notice under new section 50V that the individual is eligible for the special grandparent rate for the child, if the notice is given together with the notice of conditional eligibility of the individual given under section 50M.

 

New table item 3A provides that, once the service receives those notices, the service must calculate fee reductions using the rate applicable to an individual who is eligible for the special grandparent rate (it is the rate specified in a new section 82A of the Family Assistance Act, inserted by item 13 ) and the limit of hours in a week applicable to the individual.  The service must then reduce the child care fees that the individual is liable to pay by the amount of the fee reductions and must charge only the reduced fees.

 

If the individual is eligible for the special grandparent rate for sessions of care provided to a child in a week within the limit of hours applicable to the individual and the child, the amount of the individual’s fee reductions for those sessions will equal the amount of the fee charged for those sessions.  The effect of the obligations specified in new table item 3A will therefore be that the individual will not be charged by the service for the sessions of care provided to the child in that week.

 

When, in respect of an individual, a determination of conditional eligibility is made together with other determinations, the determinations may commence before the date on which the determinations are made.  If this occurs, table item 1 requires the service to reimburse the individual the amount of fee reductions in respect of the sessions of care provided by the service after the commencement day of the determinations and the day on which the service starts reducing fees. It is only in these circumstances (that is, when an individual starts receiving fee reductions) that a service has the obligation to reimburse the individual.

 

A determination of eligibility for the special grandparent rate may also be backdated (new subsection 50X(2) inserted by item 16 refers).  New table item 3A also includes the requirement that a service reimburses the individual the amount of fee reductions for sessions of care provided after the day the determination comes into force and before the day the service starts applying the special grandparent rate.

 

New table item 3B (inserted by item 40 ) is relevant to notice under new section 50V that the individual is eligible for the special grandparent rate for the child, if the notice is not given together with the notice of conditional eligibility of the individual.  This is the situation when an individual who receives fee reductions from a service is subsequently determined to be eligible for the special grandparent rate and the determination is backdated.  Obligations set out in new table item 3B are essentially the same as the obligations in table item 3A, except for the requirement to reimburse the individual for the period of backdating.

 

New table item 9A (inserted by item 41 ) is relevant to notices of variation of a determination of eligibility for the special grandparent rate.  These notices are given under new sections 59G, 62CA or 65DA.  New table 9A requires the service to act on the notice by applying the determination as varied to the calculation of fee reductions.  That is, if the variation is that an individual who was not eligible for the special rate is eligible for that rate, the service has to start calculate the fee reduction using the special grandparent rate. If the variation has the effect that an individual who was eligible for the special rate is not so eligible, the service has to cease using the special rate and start using the rate calculated under Schedule 2 of the Family Assistance Act.

 

Table item 10 is relevant to a notice of a review decision to vary a decision or substitute a new decision.  Item 42 amends this table item to include a reference to a notice of a review decision relating to the determination of eligibility for the special grandparent rate.  Such notices may be given under subsection 106(1), 109B or section 141A.  The amendments will create an obligation that a service receiving the notice acts on the notice in the manner specified in new paragraph (f) of table item 10.  Depending on the effect of the review decision, the service has to either start applying the special grandparent rate to fee reductions of the individual concerned, or cease using the special rate and start using the rate calculated under Schedule 2 of the Family Assistance Act.

 

In relation to obligations specified in new table item 3B, 9A and new paragraph (f) of table item 10, the service has the obligation to start applying the fee reductions rate based on the received notice only for sessions of care occurring on the days the service has not yet charged the individual when the notice is received.  In practical terms, the obligations imposed on services by new table items are prospective in character.

 

All new table items, 3A, 3B, 9A, and new paragraph (f) of table item 10, impose a requirement on a service receiving a notice that if an individual is eligible for the special grandparent rate for a child, the service has to ensure that the fees set by the service for a session of care provided to the child do not exceed the amount of the fees that the service would charge another individual, who was not eligible for the special grandparent rate, for the same child.

 

The intention behind this latest requirement is to ensure that a service does not charge an individual more than another individual would be charged for the same child (that is, the child of that age and of those care requirements using the same kind of care and the same sessions of care) only because the individual is eligible for the special grandparent rate and the individual’s child care fees are fully paid for via child care benefit entitlement.

 

Notice of decisions

 

Section 224 provides that if a notice of a decision, including the specified child care benefit decision, is given in the manner specified in this section, the notice is taken, for the purposes of the family assistance law, to have been given to the person.  Item 43 amends section 224 to include a reference to the decision of eligibility for the special grandparent rate.

 

Application

 

Item 44 states that the amendments made by this Schedule apply to sessions of care provided in a week that commences after 1 January 2005.

 



Schedule 5 - Increase in bereavement payments in respect of above general rate disability pensioners

 

Summary

 

These amendments to the Veterans’ Entitlements Act will increase bereavement payments in respect of persons receiving above general rate disability pension.

 

Background

 

Disability pensions are paid to veterans and members of the Defence Force or a Peacekeeping Force for incapacity from injuries or diseases (disabilities) that are accepted as war or defence caused.

 

There are multiple rates for the disability pension, which is paid in accordance with the degree and nature of incapacity.  ‘Above general rate’ disability pensions are defined in subsection 198(1) of the Veterans’ Entitlements Act as the following rates:

 

·          the rate under subsection 22(4)- Extreme Disablement Adjustment;

·          the rate under subsection 23(4) - Intermediate Rate; and

·          the rate under subsection 24(4) - Special Rate.

 

General rate, paid under section 22 of the Veterans’ Entitlements Act, is payable in increments of 10 per cent, up to 100 per cent.  Special rate, paid under section 24 of the Veterans’ Entitlements Act is the highest rate, paid to veterans assessed as unable to work more than eight hours a week as a result of their service-related incapacity.   Intermediate rate is set at approximately halfway between special rate and the 100 per cent general rate.  Extreme disablement adjustment is paid at approximately 50 per cent above the general rate.

 

Section 27 of the Veterans’ Entitlements Act provides for amounts that may be paid for certain disabilities in addition to pension payable under sections 22, 23 or 25.  However, the total amount of pension payable cannot exceed the Special rate.  Section 27 amounts are not defined as ‘above general rate’ disability pension and as such are not subject to the increased bereavement payment.

 

Under the existing VEA provisions in section 98A, where a disability pensioner dies, the surviving spouse or partner may receive a maximum lump sum bereavement payment equivalent to six fortnightly payments (12 weeks) of the 100 per cent general rate.  Thus, the existing bereavement payment for the surviving spouse or partner of a disability pensioner receiving special rate, intermediate rate or extreme disablement adjustment is less than that having been received by the deceased veteran or member.  The spouses or partners of those who were in receipt of 100 per cent general rate or less receive a payment calculated on the percentage at which the deceased veteran or member was paid.

 

The application of section 98A to members of the Defence Force or a Peacekeeping Force is provided for in section 96 of the VEA.

 

Explanation of changes

 

Item 1 repeals subsection 98A(2) and substitutes a new subsection 98A(2) .

 

New paragraph 98A(2)(a) provides that, if the veteran or member was receiving disability pension at a rate specified or worked out under subsection 22(4), 23(4), (5) or (6) or 24(4), (5) or (6), the widow or widower of the deceased veteran or member, is entitled, in respect of the period of 12 weeks after the deceased veteran or member’s death, to payments at the rate payable immediately before the veteran or member’s death.  Subsections 22(4), 23(4) and 24(4) refer to rates of disability pension that are above general rate.  Subsections 23(5) or (6) and 24(5) or (6), act to, in certain circumstances, reduce the amount of disability pension payable to a person in receipt of intermediate rate or special rate disability pension.  New paragraph 98A(2)(a) will ensure that the bereavement payment to a widow or widower of a deceased veteran or member will be calculated at the disability pension rate received by the veteran or member immediately before his or her death and is not limited to 100 per cent of the general rate.  The payment is to be made to the widow or widower on the first available payday after the Commission becomes aware of the veteran or member’s death.

 

New paragraph 98A(2)(b) provides that the widow or widower of a deceased veteran or member, other than a veteran or member receiving disability pension at a rate specified or worked out under subsection 22(4), 23(4), (5) or (6) or 24(4), (5) or (6), is entitled in respect of the period of 12 weeks after the deceased veteran or member’s death, to payments at the rate payable immediately before the veteran or member’s death, or at the general rate in force on that pension pay day, whichever is lower.  New paragraph 98A(2)(b) will ensure that, a bereavement payment in respect of a veteran or member receiving 100 per cent of the general rate or less, or a total amount that is higher than the general rate because of an additional amount payable under section 27, is calculated on the amount of disability pension received by the veteran or member immediately before his or her death or is limited to 100 per cent of the general rate, whichever is lower.  The payment is to be made to the widow or widower on the first available payday after the Commission becomes aware of the veteran or member’s death.

 

Item 2 repeals the definition of D eceased veteran’s amount in subsection 98A(3).

 

Item 3 inserts a new definition for deceased veteran’s amount in subsection 98A(3).

 

This item provides that, where the widow or widower dies within 12 weeks of the deceased veteran or member, and the Commission has not become aware of the death of the deceased veteran or member before the death of the widow or widower, the payment payable to such a person as the Repatriation Commission thinks is appropriate, is calculated in the same way as the bereavement payment to a widow or widower under new subsection 98A(2) .  The payment is to be made on the first available payday after the Commission becomes aware of the widow or widower’s death.

 

Item 4 is an application provision.  It provides that the amendments made by items 1, 2 and 3 apply only in relation to deaths of veterans or members that occur on or after the commencement of this Schedule.  The Schedule is taken to commence on 1 January 2005.