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Monday, 20 March 2017
Page: 1416

Senator RYAN (VictoriaSpecial Minister of State and Minister Assisting the Prime Minister for Cabinet) (17:10): I move:

   That these bills be now read a second time.

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

Leave granted.

The speeches read as follows—


The Farm Household Support Amendment Bill 2017 is a Bill to amend the Farm Household Support Act 2014.

The Bill proposes to assist farmers in financial hardship by removing unnecessary waiting periods once they have been approved for payment of Farm Household Allowance. The Bill also resolves a technical anomaly in the definition of farm assets in the Farm Household Support Act whereby some types of assets used wholly or mainly for the purpose of a farm enterprise - such as water rights or shares in marketing co-operatives - are not assessed as farm assets.

The Farm Household Allowance Programme provides up to three years of income support paid at the same rate as Newstart Allowance, to farmers and their partners in hardship. Since its introduction in July 2014 over 7000 farmers have been granted access to the programme which allows them to access income support payments, case management services and improvement activity supplements. The safety net provided by this programme is essential to ensure the Government can appropriately support farmers in hardship.

The Government's general position is that conditions for receipt of Farm Household Allowance should be aligned with those for mainstream income support payments, unless there are good reasons for departure.

The programme settings recognise that farmers are often excluded from mainstream income support payments by the size of the assets they use in operating their farm, yet they cannot realise those assets for self-support without taking away some, or all of the income producing capacity of the farm enterprise.

Farm Household Allowance is therefore subject to a two-tiered asset test. The first, applied to non-farm assets, is the same as that applied to Newstart recipients. The second tier permits the farmer and their partner to hold up to $2.55 million in net farm assets.

The mutual obligation provisions for Farm Household Allowance also differ from those for Newstart Allowance, recognising that the aim is to provide income support for a limited time while the farm household seeks to move to a more sustainable financial position. To this end, recipients receive case management support and financial assistance to obtain advice or training to improve their situation.

When the Farm Household Allowance Programme was introduced in 2014, the same Ordinary Waiting Period and Liquid Asset Waiting Period that apply for other Australian Government income support programmes were retained. These are generally applied to ensure that social welfare applicants use their own readily available resources before drawing on public monies, and have incentives to continue to seek work.

Experience has shown that the normal considerations around waiting periods are no longer appropriate for Farm Household Allowance.

Farmers are an integral part of the farm business enterprise. If a farmer has qualified for Farm Household Allowance, this means they are experiencing hardship. Requiring this farmer, or their partner, as a Farm Household Allowance recipient, to wait additional time, notwithstanding they have been found eligible, could lead to additional hardship which risks a reduction in their capacity to operate the farm enterprise.

The Bill therefore proposes the removal of the requirements for recipients of Farm Household Allowance to serve an Ordinary Waiting Period or Liquid Assets Waiting Period.

Farm Household Allowance is also time limited, so removing the standard waiting periods generate no costs to the Budget.

The Bill also seeks to clarify the legislative treatment of certain assets necessary for the operation of the farm enterprise.

Under the Farm Household Support Act certain assets, which are necessary for the operation of the farm enterprise, are currently excluded from the definition of farm assets. Therefore they must be assessed as non-farm assets, and are subject to the lower tier one test that does not account for the illiquid nature of farm assets. Examples include water rights and shares in marketing cooperatives.

This is contrary to the intent of the Farm Household Allowance Programme in respect of the assessment of assets, and this Bill therefore provides for the definition of farm assets to include water rights and shares in marketing cooperatives used or held substantially for the purposes of operating the farm enterprise. This change will apply to new customers of the Farm Household Allowance Programme. It will not affect existing customers who may have been assessed under the current Minister's Rules applying to these assets.

The clarification of the treatment of assets will not change the maximum asset holding limits to be eligible for the Farm Household Allowance. It will therefore have minimal impact on the Budget.

In seeking to remove unnecessary waiting periods for farmers and their partners approved to receive Farm Household Allowance, and in clarifying the treatment of assets within the Farm Household Support Act, this Bill further demonstrates this Government's responsiveness to the needs of the farm community and rural and regional Australia as well as our willingness to streamline the assessment of Farm Household Allowance applications where appropriate and possible.



This Bill will establish a new ongoing special account that will assist the Commonwealth to meet future financial commitments to the National Disability Insurance Scheme. The special account will be known as the National Disability Insurance Scheme Savings Fund Special Account and was announced in the 2016-17 Budget by the National Disability Insurance Scheme Savings Fund measure.

The National Disability Insurance Scheme (known as the NDIS) is one of the largest social and economic policy reforms in Australian history. The NDIS supports Australians who are born with, or acquire, a permanent and significant disability before the age of 65 to lead a more independent and inclusive life.

The NDIS provides this support by assisting people with disabilities to meet the costs associated with their conditions. Importantly, the scheme empowers people with disabilities to make their own decisions about how they are supported.

NDIS trials are well underway across Australia. At the completion of the trials in June 2016, there were around 30,000 people with disability participating in the scheme. On 1 July 2016 the NDIS commenced its transition phase, beginning a large-scale, staggered and well-managed expansion that will see it fully rolled out in every state and territory, with the exception of Western Australia, by 30 June 2019.

By 2019-20, the NDIS will be supporting around 460,000 Australians with disability. At that time, the NDIS will be injecting $22 billion each year into the Australian economy.

The NDIS provides the support directly to each eligible person, rather than to a service provider to then deliver the required support. As a result, the NDIS will also change the landscape of the disability sector. New opportunities will be created by empowering people with disability. A new source of demand will be created within the wider economy for disability support services. As the scheme grows, it will create a national market for care and support based on empowerment, choice and control - a market that drives innovation and creates greater efficiencies and effectiveness.

The Productivity Commission concluded that, over time, the economic benefits of the NDIS will outweigh its costs and will add close to one per cent to GDP. The NDIS is not only good for people with disability, it is good for the Australian economy and it will drive jobs growth over the long term.

In 2019-20, the NDIS reaches 'full scheme' with $22 billion of funding. The Commonwealth's share of the total funding will be around $11.2 billion per year. At that time, eligible people with disability who are currently receiving support through Commonwealth and state disability programs will be receiving support through the NDIS.

The Government is fully committed to properly, adequately and sustainably funding the NDIS. It is for these reasons that the Government is bringing forward the National Disability Insurance Scheme Savings Fund Special Account. The special account will give a clear line-of-sight of the funding set aside by Government for the NDIS.

It is critical that the Commonwealth manages its funding in a way that is transparent and quantifiable, and meets the Commonwealth's funding commitments to ensure the NDIS is fully funded.

The Government is 100 per cent committed to delivering and funding the NDIS in full. We have supported the NDIS from day one and this special account demonstrates that ongoing commitment.

In addition to this special account, the Commonwealth is redirecting existing disability-related spending and the DisabilityCare Australia Fund toward the cost of the NDIS. In 2019-20:

existing Commonwealth disability funding redirected to the NDIS is estimated to be $1.1 billion;

the Commonwealth share of the increase in the Medicare Levy through the DisabilityCare Australia Fund is estimated to be $3.9 billion; and

redirected funding, which is currently provided to the states for specialist disability services, is estimated to be $1.8 billion.

In total, the Commonwealth will direct $6.8 billion from these sources to the NDIS. Because of the failure of the previous Labor Government to specifically set aside funding for the NDIS, this will leave a funding shortfall of $4.4 billion from 2019-20 onwards, which this Government will meet.

While the Medicare levy is an important contribution to the NDIS, it only provides a portion of the Commonwealth's annual new contributions to the NDIS at full scheme.

It falls to this Government to set aside the remainder, which equates to $4.4 billion funding shortfall in 2019-20, and growing to over $5 billion in future years.

This special account is the mechanism for securing that funding shortfall. It's proof of the responsible and sustainable way that this Government follows through on its NDIS promises.

The National Disability Insurance Scheme Savings Fund Special Account, which will be created by this Bill, will be in the form of a special account. The special account will be administered by the Department of Social Services, with its funding sitting within the Consolidated Revenue Fund. This will ensure that savings deposited into the special account are not returned to the Consolidated Revenue Fund itself and effectively lost for NDIS purposes.

The special account will allow the Government, over future budgets, to identify savings from existing programmes and set aside those savings to assist in meeting the Commonwealth's future financial commitments to the NDIS. Effectively, the Government will, over successive years, put aside savings that are clearly identified, quantified and defined so that the annual funding gap from 2019-20 is met within existing funding.

By clearly identifying savings in the special account, it will provide an enduring response to the concerns raised by the disability sector in relation to how Government will fund the shortfall for the NDIS. The previous Government had identified savings to assist in meeting the funding requirements of the NDIS from 2019-20. However, those savings were not set aside to meet future NDIS costs and were effectively lost for NDIS purposes.

The special account provides a sustainable way to meet the funding gap from 2019-20 onwards that does not require borrowings for the NDIS that would need to be paid back by future generations.

This Bill gives the Government the flexibility to identify savings from any portfolio, not just the Social Services portfolio. That approach will ensure that many areas of Government contribute to supporting people with disability.

There will be an upper limit on the balance of the special account - it will only hold enough money to fund the future value of the Commonwealth's NDIS commitment. Over the next few years, savings can accumulate in the special account to meet future funding commitments. From 2019-20, when the NDIS reaches full scheme, if the balance of the special account becomes greater than required, the excess will be returned to the Consolidated Revenue Fund. Further, a review of the special account will be conducted in 2026-27.

Identification of savings to be deposited into the special account will be a decision of Government. Those savings to be credited to the special account will be committed over a 10-year period. The quantum of individual savings will be consistent with the Budget Process Operational Rules. The Minister for Social Services will be the responsible Minister, with responsibility for the policy and management of the special account.

The Government will establish the special account with an opening balance of $343.7. million in 2016-17, from the Consolidated Revenue Fund and savings identified in the NationalDisability Insurance Scheme Savings Fund measure announced in the 2016-17 Budget. The Government will make further deposits into the special account over the coming financial years.

In bringing this Bill forward to create the National Disability Insurance Scheme Savings Fund Special Account, the Government is providing a robust and enduring solution to meeting the Commonwealth's funding commitments for the NDIS.

The Government urges passage of the National Disability Insurance Scheme Savings Fund Special Account Bill 2016, as recommended by the Senate Community Affairs Legislation Committee (the Committee) on 7 November 2016, following its inquiry into bill. In coming to this position, the Committee noted they were:

of the view that this legislation presents a significant step toward ensuring that NDIS funding is both adequate and sustainable.

The Committee also noted, that in their view:

concerns about where savings will be made, although important, do not reflect or address the purpose of the bill: namely, establishing a mechanism by which funding intended for the NDIS is secured to be available for that purpose, when and as needed.


Today, I introduce a bill to implement two Government measures.

Schedule 1 of this Bill makes minor technical amendments to the income tax law to ensure that two National Innovation and Science Agenda (NISA) measures operate in accordance with their original policy intent.

These measures are the Tax Incentives for Early Stage Investors measure and the New Arrangements for Venture Capital Limited Partnerships measure. Together, they are designed to promote a culture of entrepreneurship by connecting start-up companies with investors who have both the requisite funds and business experience to assist entrepreneurs to build successful, innovative companies.

These two measures, together with the minor technical amendments in Schedule 1, demonstrate the Government's commitment to encouraging and supporting innovative new businesses.

The amendments will clarify the tax law to provide certainty for investors who are looking to invest in start-ups and certain venture capital arrangements through a single interposed trust and will ensure these investors are able to access the capital gains tax concessions provided by the Tax Incentives for Early Stage Investors and the New Arrangements for Venture Capital Limited Partnerships measures.

Schedule 2 of the Bill amends the Australian Securities and Investments Commission Act 2011 to streamline the process by which the Australian Securities and Investments Commission may share confidential information with the Australian Taxation Office for its use in the performance of its functions.

The amendment mirrors the existing arrangements in place for the Australian Securities and Investments Commission to share information with the Reserve Bank of Australia and the Australian Prudential Regulation Authority. It will enable more timely collaboration between the Australian Securities and Investments Commission and the Australian Taxation Office during investigations into illegal or high risk activities, for example, illegal phoenixing activity.

Full details of the two measures are contained in the explanatory memorandum.

Debate adjourned.

Ordered that the bills be listed on the Notice Paper as separate orders of the day.