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Family Assistance Legislation Amendment (Improving Assistance for Vulnerable and Disadvantaged Families) Bill 2020

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2019-2020

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

FAMILY ASSISTANCE LEGISLATION AMENDMENT (IMPROVING ASSISTANCE FOR VULNERABLE AND DISADVANTAGED FAMILIES) BILL 2020

 

 

 

 

 

SUPPLEMENTARY EXPLANATORY MEMORANDUM

 

 

 

 

 

 

Amendments to be Moved on Behalf of the Government

 

 

 

 

 

 

(Circulated by the authority of the Minister for Education,

the Honourable Dan Tehan MP)



FAMILY ASSISTANCE LEGISLATION AMENDMENT (IMPROVING ASSISTANCE FOR VULNERABLE AND DISADVANTAGED FAMILIES) BILL 2020

 

OUTLINE

 

The Government amendments to the Family Assistance Legislation Amendment (Improving Assistance for Vulnerable and Disadvantaged Families) Bill 2020 (the Bill) are required to remove Schedule 2 to the Bill - Review of certain CCS decisions.

 

Schedule 2 amends section 105E of the A New Tax System (Family Assistance) (Administration) Act 1999 (Family Assistance Administration Act) to include new subsections 105E(4) to (7), which modify how CCS entitlements are reviewed when an individual who is a member of a couple for some but not all of the CCS fortnights in an income year, meets the CCS reconciliation conditions. These amendments were intended to ensure that an individual’s CCS entitlement more accurately reflected the individual’s income capacity during each of the relevant periods the individual was a member of a couple or single.

 

These amendments to section 105E of the Family Assistance Administration Act were made through Part 1 of Schedule 4 of the Coronavirus Economic Response Package Omnibus (Measures No. 2) Act 2020 , which received Royal Assent on 9 April 2020.

 

As a result Schedule 2 is no longer required.

 

Financial Impact

 

The Government amendments will have no financial impact.

 



 



PROPOSED GOVERNMENT AMENDMENTS

 

The Government proposes the following amendments to the Bill.

 

Amendment (1) removes item 5 from the table in clause 2 of the Bill. Clause 2 specifies the commencement date of each of the provisions in the Bill. As Schedule 2 is to be removed from the Bill, information about the commencement date of Schedule 2 is not required.

 

Amendment (2) removes Schedule 2 to the Bill as the amendments to section 105E of the Family Assistance Administration Act to be made through Schedule 2 have already been made through Part 1 of Schedule 4 to the Coronavirus Economic Response Package Omnibus (Measures No. 2) Act 2020 , which received Royal Assent on 9 April 2020.



ADDITIONAL INFORMATION ABOUT ITEMS 7 AND 8 OF SCHEDULE 1

 

In Scrutiny Digest 4 of 2020, the Standing Committee for the Scrutiny of Bills (the Committee) requested the Minister's advice as to why it is necessary and appropriate for the measures in items 7 and 8 of Schedule 1 of the Bill to commence retrospectively. In particular, in relation to item 7, whether there will be a detrimental effect for any providers, and if so the extent of that detriment and the number of providers affected, and in relation to item 8, whether any providers may have reasonably relied on the removal of the civil penalty amount and how many providers may be subject to the penalty retrospectively.

 

In response to the above-mentioned question from the Committee, insert the following information, provided by the Minister and published in Scrutiny Digest 6 of 2020, at the end of the explanation about item 8 on page 18 of the Explanatory Memorandum to the Bill:

 

Background to the measure in item 7 of Schedule 1

 

Section 197G of the Family Assistance Administration Act allows the Secretary to vary the approval of an approved provider to remove an approved child care service from the provider’s approval if that service has failed to provide care for 3 continuous months. The effect of a service being removed from a provider’s approval is that families can no longer receive the Child Care Subsidy for care provided by the provider at that service and the provider will need to reapply for approval in respect of that service for that service to be able to provide care that is eligible for Child Care Subsidy.

 

Paragraph 197G(1)(b) sets out circumstances where although a service may not have been providing care for 3 continuous months, it is not appropriate for the service to be removed from the provider’s approval; in other words where there is an appropriate reason for the service to not be providing care over the 3 month period and removal of approval in respect of the service is therefore not warranted. This is a protection for the provider. It also protects the interests of families that are enrolled with the service.

 

Prior to amendments to paragraph 197G(1)(b) made under the Family Assistance Legislation Amendment (Building on the Child Care Package) Bill 2019 (Building on the Child Care Package Bill), these circumstances, where non-operation for 3 months was appropriate, were:

                      i.         the service is subject to a determination under section 195C that the service need not operate for the period;

                    ii.         the Secretary is satisfied that, because of special circumstances affecting the service, the provider’s approval should not be varied to remove the child care service from the approval. [Emphasis added]

 

The Building on the Child Care Package Bill amended the Family Assistance Administration Act to insert a new section 197AA, which gave the Secretary the power to suspend the approval of an approved provider, or the approval of the approved provider in respect of one or more of its services, at the provider’s request (i.e. voluntary suspension) (item 17 of Schedule 2 to the Building on the Child Care Package Bill).

 

Consequently, in order to address this new circumstance, where it would be appropriate for a service to not be operating for 3 months, a consequential amendment was made to paragraph 197(1)(b) to repeal that paragraph and substitute a new paragraph that included voluntary suspension under section 197AA ((item 20 of Schedule 2 to the Building on the Child Care  Package Bill). The circumstances in the new paragraph 197G(1)(b) were:

                      i.         the provider’s approval with respect to the service is suspended under section 197AA for any part of the 3 month period;

                    ii.         all approved child care services of the provider are subject to a determination under section 195C that the service need not operate for the period;

                   iii.         ii. the Secretary is satisfied that, because of special circumstances affecting the provider, the provider’s approval should not be cancelled. [Emphasis added]

 

Unfortunately, an error was made in the drafting of the new subparagraph 197G(1)(b)(ii). Instead of referring to the service (which was not operating for 3 months) being subject to a determination under section 195C, it referred to all approved child care services as needing to be subject to a determination under section 195C.

 

This drafting error:

•       disadvantages providers, and families wishing to receive care at the service, as it means that even if the one service which was not operating for 3 months, and there was a determination under section 195C in place allowing this, the Secretary could still remove the service from the provider’s approval, because all approved services of the provider did not have such a determination under section 195C in place (even though technically they would not need such a determination); and

•       undermines the proper operation of section 197G, as logically it does not make sense.

 

The measure in item 7 and reason for its retrospectivity

Item 7 of Schedule 1 to the Bill repeals subparagraphs 197G(1)(b)(ii) and (iii) and substitutes them with the following:

“(ii)      the service is subject to a determination under section 195C that the service need not operate for the period;

(iii)       the Secretary is satisfied that, because of special circumstances affecting the service, the provider’s approval should not be so varied.” [Emphasis added]

 

The amendment to subparagraph 197G(1)(b)(ii) under item 7 of Schedule 1 in practice merely repeals the reference to “ all approved child care services of the provider ” and replaces it with a reference to “ the service ” (which has not been operating for 3 months).

 

This amendment corrects the drafting error made to paragraph 197G(1)(b) in the Family Assistance Legislation Amendment (Building on the Child Care Package) Bill 2019 (Building on the Child Care Package Bill). It returns the particular circumstance, which justifies why a service need not have been operating for the 3 month period, to the form that it was in prior to amendments made in the Building on the Child Care Package Bill.

 

This restores a necessary protection to providers and families receiving care at the service. It also enables the provision to operate effectively in a manner consistent with the long standing policy intention behind the provision.

Item 7 of Schedule 1 has the retrospective commencement date of 13 December 2019, being immediately after Schedule 2 to the Family Assistance Legislation Amendment (Building on the Child Care Package) Act 2019 (Building on the Child Care Package Act) commenced. This retrospective commencement date means that as soon as the erroneous paragraph 197G(1)(b) took effect, the correction to it under item 7 of Schedule 1 would also take effect.

 

This retrospective commencement date would thus ensure that there was no period of time in which:

·          providers and families at their affected services could be disadvantaged by an unintentional drafting error; and

·          the proper, fair and effective operation of the Family Assistance Administration Act could be undermined through the unintentional error.

It is noted that the retrospective commencement of item 7 has had no detrimental effect for any providers. Indeed, it would be of beneficial effect.

 

In response to the above-mentioned question from the Committee, insert the following information, provided by the Minister and published Scrutiny Digest 6 of 2020, at the end of the explanation about item 7 on page 18 of the Explanatory Memorandum:

 

Background to the measure in item 8 of Schedule 1

Section 204K of the Family Assistance Administration Act required an approved provider to give notice to an appropriate State/Territory body that the provider considered a child to be at risk of serious abuse or neglect:

•       within 6 weeks after a certificate given to the Secretary under section 85CB of the A New Tax System (Family Assistance) Act 1999 (Family Assistance Act) that a child is or was at risk of serious abuse or neglect takes effect (subsection 204K(1));

•       before applying for a determination under section 85CE of the Family Assistance Act in respect of a child being at risk of serious abuse or neglect (subsection 204K(3)).

 

The reason for the notification requirement is to ensure that the appropriate State/Territory bodies are made aware of the risk to the child and can work with the child’s family to provide assistance to benefit the child’s wellbeing, health and safety.

 

Failure by a provider to give the notification to the State/Territory body has been both an offence (60 penalty units) and civil penalty provision (50 penalty units) under subsection 204K(5) and (6) of the Family Assistance Administration Act respectively since section 204K was included in the Administration by the Family Assistance Legislation Amendment (Jobs for Families Child Care Package) Act 2017 with effect from 2 July 2018. This recognises that failure by a provider to notify appropriate State/Territory bodies that a child is at risk of serious abuse or neglect could compromise the ability of the family to receive the appropriate help needed.

 

Item 81 of Schedule 1 of the Building on the Child Care Package Bill repealed section 204K and substituted a new section 204K. However, the only substantive, intentional change to section 204K was that the bodies formerly known as an ‘appropriate State or Territory body’ were renamed as ‘appropriate State/Territory support agency’. This change in terminology was made to address confusion in the child care sector, where some child care providers had thought that the term referred only to a state or territory department or agency dealing with matters of child protection and did not realise that other support agencies were also included.

 

The drafting approach of repealing and substituting the whole of section 204K, despite the minimal substantive changes, was taken as the term ‘appropriate State or Territory body’ was used many times throughout the provision.

 

However, due to an unintentional drafting error, although subsection 204K(6) was still identified as a civil penalty provision, the civil penalty amount of 50 penalty units was inadvertently omitted.

 

This had the unintended consequence of creating uncertainty for providers, families, appropriate State/Territory support agencies and the Australia Government about the civil penalty consequences attached to a breach of subsections 204K(1) and (3). It also potentially undermined the safety and wellbeing of vulnerable children, who were at risk of serious abuse or neglect, as a failure by a provider to appropriately notify the appropriate State/Territory support agencies no longer attracted a clear civil penalty.

 

The measure in item 8 and reason for its retrospectivity

Item 8 of Schedule 1 to the Bill adds the civil penalty amount of 50 penalty units to the end of subsection 204K(6). The amendment merely reinstates the civil penalty amount that has been attached to breach of subsection 204K(1) and 204K(3) since these provisions took effect on 2 July 2018; and which were unintentionally repealed.

 

Item 8 of Schedule 1 has the retrospective commencement date of

16 December 2019, being immediately after Part 1 of Schedule 1 to the Building on the Child Care Package Act commenced. This retrospective commencement date means that as soon as the erroneous omission of the civil penalty amount in subsection 204K(1) took effect, the correction to reinsert in under item 8 of Schedule 1 would also take effect.

 

This retrospective commencement is appropriate as it:

·          ensures that there is certainty for providers, families, appropriate State/Territory support agencies and the Australia Government about the civil penalty consequences attached to a breach of subsections 204K(1) and (3);

·          promotes and facilitates the safety and wellbeing of vulnerable children at risk of serious abuse or neglect, by ensuring there is no uncertainty about, or gap in the application of an appropriate civil penalty amount, that applies where there has been a failure by a provider to appropriately notify the appropriate State/Territory support agencies;

·          ensures that at all times the importance of a provider notifying appropriate State/Territory support agencies where a child is at risk of serious abuse or neglect is supported by the legislation through a clear and enforceable civil penalty provision;

·          merely reinstates what was previously in the legislation, is the long standing policy intention behind the provision, and was unintentionally repealed.

It is noted that the retrospective commencement of item 8 has, to date, had no detrimental effect for any providers during the period 16 December 2019 to the present.