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Social Security (Helping Pensioners Hit by the Skills Shortage) Bill 2006

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Social Security (Helping Pensioners Hit by the Skills Shortage) Bill 2006

 

Explanatory Memorandum

 

 

This Bill amends the Social Security Act 1991 to provide the Secretary of the Department with the discretion to extend the period in which people have to construct a new home.

 

Under the current arrangements, under section 1118(2) of the Act, a person has 12 months to sell their existing home and construct a new home, before the funds raised from the sale of the existing home become assessable assets.

 

Because of the national skills shortage in the building trades, people in some areas are now unable to construct a new home within that 12 month time frame.

 

As a result some people are disadvantaged under the current arrangements, suffering a cut in their pension, if they cannot complete the construction of their new home within 12 months.

 

Under the amendment the Secretary of the Department would have to be satisfied that the delay in construction was beyond the control of the person. An example of such a situation would be where the person has purchased a block of land and signed a contract for the construction of a new home to be completed within 12 months, but the builder has then informed the person that they will be unable to complete the new home within that time.