Explanatory Memorandum
(Circulated by the authority of the Minister for Social Services, the Hon Kevin Andrews MP)Schedule 1 - Energy supplement replacing clean energy supplement
Summary
This Schedule ceases indexation of the clean energy supplement, and renames the clean energy supplement as the energy supplement from 20 September 2014. The energy supplement is then set at the amount of clean energy supplement, as applicable from 1 July 2014 or 20 September 2014. This Schedule also makes minor changes to the partner income free area from 20 September 2014.
Commencement on 20 September 2014 merely reflects the fact that the various rates of energy supplement are dependent on primary payments whose rates were indexed on that date (or on 1 July 2014 for family payments). All rates of energy supplement are fixed at the rates applying after that indexation process. No person will be adversely affected by any apparent retrospectivity in the commencement of the Schedule.
Background
The clean energy supplement is a component of the former Government's clean energy package, and paid as compensation to offset the impact of the carbon tax. The clean energy supplement is being renamed as the energy supplement and retained to provide ongoing assistance to government payment recipients. The value of the renamed energy supplement will not be subject to indexation from 20 September 2014. These changes commence on 20 September 2014.
Minor amendments are also made to the partner income free area (PIFA), which is part of the income testing arrangements for social security benefits. In broad terms, the PIFA is the amount of income that would preclude payment of the relevant allowance or benefit to a person's partner. If the partner's ordinary income exceeds the PIFA, the amount of the excess reduces the person's rate of social security benefit. The amendments ensure that, where the partner is not receiving a social security benefit, the PIFA is calculated taking into account partner's maximum basic rate, energy supplement and pension supplement (if relevant). This will better align the legislation with existing policy which disregards other rate components, such as pharmaceutical allowance, rent assistance and youth disability supplement (as applicable), when calculating the PIFA. These amounts are disregarded as it is not possible to establish reasonably whether the partner would meet the qualification requirements for these components while the partner is not receiving a social security benefit. These changes commence on 20 September 2014.
Explanation of the changes
Part 1 - Energy supplement under the social security law
Amendments to the Social Security Act
Subsection 17(8) of the Social Security Act provides a formula that is used to define the income cut-out amount for the purposes of the compensation provisions in the social security law. The formula refers to a clean energy supplement component and defines that term. Item 1 recasts subsection 17(8) to reflect the changed name of the clean energy supplement.
Subsection 23(1) of the Social Security Act defines clean energy pension rate by reference to section 20B, which then provides a formula for working out the amount. The clean energy pension rate is effectively the amount of clean energy supplement to be added to a pensioner's rate of payment. These provisions become redundant because the amount of energy supplement will be specified in the relevant pension rate calculator by other amendments made by this Schedule (see, for example, the amendments to point 1064-C3 made by item 46). Item 2 therefore repeals section 20B and item 6 repeals the definition.
The definitions of clean energy (under pension age) rate and clean energy (youth disability) rate are similarly repealed by items 8 and 9 because the relevant amounts of energy supplement will be specified in the applicable rate calculator by other amendments made by this Schedule.
Items 3, 4, 5, 7, 10, 11 and 12 also amend, or repeal and replace, various clean energy-related definitions in subsection 23(1) of the Social Security Act to reflect the renaming.
Items 13 to 26 amend various payment modules to reflect the renaming. Existing references to quarterly clean energy supplement are replaced with references to quarterly energy supplement.
Division 2 of Part 2.18A sets out the circumstances in which a person can be paid their clean energy supplement as a quarterly payment and a method for working out the amount of the quarterly payment. The same rules will apply in relation to the energy supplement. Items 27 to 38 replace existing references to clean energy supplement and quarterly clean energy supplement in Division 2 with references to energy supplement and quarterly energy supplement.
Items 39 and 40 omit references to clean energy supplement in paragraph 916D(5)(c) and in the method statement in subsection 1061ECA(2), and substitute references to energy supplement.
Items 40A to 40H provide for the calculation of the clean energy component of seniors supplement, and effect renaming of the supplement, by inserting the rate of energy supplement into the rate calculator for seniors supplement in section 1061UB.
The Pension Rate Calculator at the end of section 1064 is used to calculate the rate of age, wife and carer pensions, disability support pension for a person who has turned 21 or is under 21 with a dependent child, mature age allowance in certain circumstances and mature age partner allowance. Under the current rules, an amount of clean energy supplement, calculated by reference to formulas and definitions, is added in working out a person's rate of pension.
Items 41 to 45 amend various provisions in the Rate Calculator at the end of section 1064 to omit existing references to clean energy supplement and quarterly clean energy supplement and substitute references to energy supplement and quarterly energy supplement.
Item 46 repeals point 1064-C3, which currently provides for the calculation of the clean energy supplement, and replaces it with a table setting out the amount of the energy supplement, depending on the person's family situation. The amounts in the table are current as at 20 September 2014 and will not be subject to indexation.
The Rate Calculator at the end of section 1065 is used to calculate the rate of age pension for a person who is permanently blind and disability support pension for a blind person who has turned 21 or is under 21 with a dependent child. The Rate Calculator at the end of section 1066 is used to calculate the rate of bereavement allowance and widow B pension.
Items 47 to 58 amend these pension rate calculators in the same way as section 1064 is amended (as described above).
The Rate Calculator at the end of section 1066A is used to calculate the rate of disability support pension for a person who has not turned 21 and has no dependent children.
Items 59 to 63 amend various provisions in the Rate Calculator at the end of section 1066A to omit existing references to clean energy supplement and quarterly clean energy supplement and substitute references to energy supplement and quarterly energy supplement.
Item 64 repeals points 1066A-BA2 and BA3, which currently provide for the calculation of the clean energy supplement. These provisions are replaced by new point 1066A-BA2, which includes a table setting out the amount of a person's energy supplement, depending on their family situation. The family situations in the table refer to the family situations relevant in determining the person's maximum basic rate, rather than reproducing all relevant family situations. The amounts in the table are current as at 20 September 2014 and will not be subject to indexation.
The Rate Calculator at the end of section 1066B is used to calculate the rate of disability support pension for a permanently blind person who has not turned 21 and has no dependent children.
Items 65 to 70 amend this rate calculator in the same way as section 1066A is amended (as described above).
The Youth Allowance Rate Calculator in section 1067G is used to calculate the rate of youth allowance.
Items 71 to 75 amend various provisions in the Youth Allowance Rate Calculator to omit existing references to clean energy supplement and quarterly clean energy supplement, and substitute references to energy supplement and quarterly energy supplement.
Item 76 repeals points 1067G-BA2 to BA6, which currently provide for the calculation of the clean energy supplement. These provisions are replaced by two new tables in new points 1067G-BA2 and BA4, the first applicable where an amount of youth disability supplement is not added to the person's rate, and the second where youth disability supplement is added. The tables set the amount of a person's energy supplement, depending on their family situation. Again, the family situations in the tables refer to the family situations relevant in determining the person's maximum basic rate, rather than reproducing all relevant family situations.
Item 76 also inserts a new point 1067G-BA3, which sets the amount of energy supplement for certain people whose maximum basic rate is worked out by reference to parenting payment single. The amounts in the tables and new point 1067G-BA3 are current as at 20 September 2014, and will not be subject to indexation.
The Austudy Payment Rate Calculator in section 1067L is used to calculate the rate of austudy payment.
Items 77 to 81 amend various provisions in the Rate Calculator in section 1067L to omit existing references to clean energy supplement and quarterly clean energy supplement, and substitute references to energy supplement and quarterly energy supplement.
Item 82 repeals points 1067L-BB2 to BB4, which currently provide for the calculation of the clean energy supplement. These provisions are replaced by two new tables in new points 1067L-BB2 and BB3. The table in new point 1067L-BB2 sets out the amount of energy supplement for a person who has reached pension age, by reference to the same family situations that are relevant in determining the amount of energy supplement for age pension. The table in new point 1067L-BB3 sets out the amount of energy supplement for a person who has not reached pension age, by reference to their family situation for maximum basic rate. The amounts set out in these tables are current as at 20 September 2014 and will not be subject to indexation.
The Rate Calculator at the end of section 1068 is used to calculate the rate of newstart, sickness, partner and widow allowances and mature age allowance in some circumstances.
Items 83 and 85 to 88 amend various provisions in the Rate Calculator at the end of section 1068 to omit existing references to clean energy supplement and quarterly clean energy supplement, and substitute references to energy supplement and quarterly energy supplement.
Item 84 makes a technical correction to the method statement in point 1068-A1.
Item 89 repeals points 1068-C2 to C5, which currently provide for the calculation of the clean energy supplement. These provisions are replaced by two new tables (in new points 1068-C2 and C3) and a new point 1068-C4. The table in new point 1068-C2 sets out the amount energy supplement for a person who has reached pension age, by reference to the same family situations that are relevant in determining the amount of energy supplement for age pension. The table in new point 1068-C3 sets out the amount of energy supplement for a person who has not reached pension age, by reference to their family situation for maximum basic rate. However, if the person's maximum basic rate is determined by reference to parenting payment (single), then their amount of energy supplement is the amount specified in new point 1068-C4. The amounts set out in these new provisions are current as at 20 September 2014 and will not be subject to indexation.
The Rate Calculator at the end of section 1068A is used to calculate the rate of parenting payment - pension (PP) single.
Items 90 to 94 amend various provisions in the Rate Calculator at the end of section 1068A to omit existing references to clean energy supplement and quarterly clean energy supplement, and substitute references to energy supplement and quarterly energy supplement.
Item 95 repeals points 1068A-BB2 to BB4, which currently provide for the calculation of the clean energy supplement. These provisions are replaced by new point 1068A-BB2, which sets the amount of energy supplement for a person who has reached pension age, and new point 1068A-BB3, which sets the amount of energy supplement for a person who has not reached pension age. These amounts are current as at 20 September 2014 and will not be subject to indexation.
The Rate Calculator at the end of section 1068B is used to calculate the rate of parenting payment - benefit PP (partnered).
Items 96 to 101 amend various provisions in the Rate Calculator in section 1068B to omit existing references to clean energy supplement and quarterly clean energy supplement, and substitute references to energy supplement and quarterly energy supplement.
Item 102 repeals points 1068B-DB2 to DB4, which currently provide for the calculation of the clean energy supplement. These provisions are replaced by two new tables in new points 1068B-DB2 and DB3. The table in new point 1068B-DB2 sets out the amount of energy supplement for a person who has reached pension age, by reference to the same family situations that are relevant in determining the amount of energy supplement for age pension. The table in new point 1068B-DB3 sets out the amount of energy supplement for a person who has not reached pension age, by reference to their family situation for maximum basic rate. The amounts set out in these tables are current as at 20 September 2014, and will not be subject to indexation.
Items 1AD to 1AI in the indexed and adjusted amounts table in section 1190 of the Social Security Act identify the clean energy amounts that are indexed or adjusted and provide a relevant abbreviation. That abbreviation is then used in the CPI indexation table in section 1191 to identify amounts that are to be indexed in accordance with movements in the Consumer Price Index (CPI). The clean energy amounts are listed in items 1D to 1J of the CPI indexation table. Items 103 to 107 remove these items from the tables, and make some amendments consequential on the removal of these items. The new energy amounts specified in the relevant Rate Calculators will not be subject to indexation.
Section 1210 sets out the order in which relevant components of rate, including the clean energy supplement, are affected by means testing and how the reduction works if a person elects to receive certain payments on a quarterly basis. Items 108 to 119 make consequential amendments to reflect the renaming. Existing references to clean energy supplement and quarterly clean energy supplement are replaced with references to energy supplement and quarterly energy supplement. References to CE Module are changed to ES Module.
There are some references to clean energy supplement in clauses 146 and 149 of Schedule 1A to the Social Security Act (savings and transitional provisions). Items 120 to 123 make consequential amendments to reflect the renaming. Existing references to clean energy supplement are replaced with references to energy supplement.
Amendments to the Social Security Administration Act
There are a number of references to the clean energy supplement and quarterly clean energy supplement in the Social Security Administration Act. An example is section 48, which sets out the payment rules for a quarterly clean energy supplement.
Items 124 to 137 make consequential amendments to reflect the renaming. Existing references to clean energy supplement and quarterly clean energy supplement are replaced with references to energy supplement and quarterly energy supplement. Otherwise, the operation of amended provisions would not change.
Item 138 sets out the application and transitional rules that apply in relation to the amendments made by Part 1. These rules facilitate the transition from clean energy supplement to energy supplement on 20 September 2014. This item includes provisions which ensure that an energy supplement or quarterly energy supplement is paid (as appropriate) in relation to days occurring on or after 20 September 2014 and that the existing provisions continue to apply, despite the amendments, after commencement, in relation to days occurring before commencement. Also included is provision to ensure that an election by a person to receive their clean energy supplement as a quarterly payment has effect as if it were an election to receive their energy payments quarterly.
Part 2 - Energy supplement under the family assistance law
Amendments to the Family Assistance Act
An approved care organisation's clean energy supplement for an individual is worked out under subsection 58(2B). Item 140 repeals this provision and sets the annual rate of energy supplement. The specified rate is current as at 1 July 2014, and is not subject to indexation. Item 139 makes a consequential amendment to paragraph 58(2)(b) to reflect the renaming of clean energy supplement to energy supplement.
Section 58A allows certain individuals to elect to receive their clean energy supplements quarterly. There is a reference to clean energy supplement quarterly in the heading of the section and other references to clean energy supplement in note 1 at the end of subsection 58A(1). Items 141 and 142 update these references to reflect the renaming of clean energy supplement as energy supplement. Item 143 repeals a spent note.
There are numerous references to clean energy supplement in Schedule 1 to the Family Assistance Act. There are also terms and definitions that refer to clean energy (such as the clean energy supplement amount referred to in step 4A of the method statement in clause 24N and the base FTB clean energy child amount referred to in clause 38AB of Schedule 1). With the renaming of clean energy supplement to energy supplement, consequential changes are required to these provisions, terms and definitions to reflect the new name. The relevant amendments are made by items 144 to 159, 161 to 164, 166 to 179 and 181 to 183.
Clause 31B of Schedule 1 to the Family Assistance Act provides a method for determining the amount of clean energy supplement (Part B) to be added in working out an individual's Part B rate. Item 160 repeals subclauses 31B(1) and (2), and substitutes a new subclause 31B(1), which sets the amount of energy supplement (Part B) to be added in working out an individual's Part B rate, depending on whether the individual's youngest child is aged under five years or five years and over. The specified amounts are current as at 1 July 2014 and will not be subject to indexation.
Clause 38AA of Schedule 1 provides a method for determining the amount of clean energy supplement (Part A) to be added in working out an individual's Part A rate under Method 1. Item 165 repeals subclauses 38AA(1) and (2), and substitutes a new subclause 38AA(1). The new provision specifies an FTB energy child amount for each category of FTB child and provides a method for calculating an individual's energy supplement (Part A). An individual's energy supplement (Part A) is the sum of the relevant FTB energy child amounts for each FTB child of the individual. The specified amounts are current as at 1 July 2014, and will not be subject to indexation.
Clause 38AF of Schedule 1 provides a method for determining the amount of clean energy supplement (Part A) to be added in working out an individual's Part A rate under Method 2. Item 180 repeals subclause 38AF(2), and substitutes a new provision, which specifies the FTB energy child amount. An individual's energy supplement (Part A) is the sum of the FTB energy child amounts for each FTB child of the individual. The specified amount is current as at 1 July 2014 and will not be subject to indexation.
Item 184 makes a consequential amendment to paragraph 7(j) of Schedule 3 to reflect the renaming of the clean energy supplement as the energy supplement.
Items 185 to 188 repeal provisions in Schedule 4 to the Family Assistance Act that currently apply to index the various clean energy supplement amounts. The equivalent energy amounts will not be subject to indexation.
Amendments to the Family Assistance Administration Act
Section 32A of the Family Assistance Administration Act sets out the FTB reconciliation conditions that must be satisfied before the FTB Part A and Part B supplements can be added in working out an individual's rate of family tax benefit. However, existing subsection 32A(2) ensures that this rule does not apply in working out the amount of an individual's clean energy advance, clean energy supplement (Part A) or clean energy supplement (Part B). As the renamed energy supplement (Part A) and energy supplement (Part B) will be specified amounts, they do not need to be mentioned in subsection 32A(2). Item 189 makes the required amendment.
The heading of section 105B and a note at the end of subsection 105B(1) refer to clean energy supplement. Items 190 to 191 change these references to energy supplement. Item 192 repeals a spent note.
Item 193 sets out the application and transitional rules that apply in relation to the amendments made by Part 2. These rules facilitate the transition from clean energy supplement to energy supplement on 20 September 2014.
Subitems 193(1) and (2) ensure that the amendments made to rate provisions for approved care organisations apply in working out their energy supplement for days on or after commencement (20 September 2014). The old rules would continue to apply after commencement in relation to days occurring before commencement.
Subitems 193(3) and (4) ensure that amendments to rate provisions in Schedule 1 to the Family Assistance Act apply in working out an individual's energy supplement (Part A) or energy supplement (Part B) for days on or after commencement (20 September 2014). The old rules would continue to apply after commencement in relation to days occurring before commencement.
Subitem 193(5) provides that the specified amendments apply in working out an individual's maintenance income ceiling day on or after commencement.
Subitem 193(6) provides that the amendment made to the definition of tax free pension or benefit applies in relation to a payment made on or after commencement.
Subitem 193(7) provides that an election under section 58A of the Family Assistance Act (to receive clean energy payments quarterly) that was in force before commencement continues to be in force on and after commencement.
Part 3 - Energy supplement under the Veterans' Entitlements Act
Amendments to the Veterans' Entitlements Act
Item 197 repeals section 5GB. Section 5GB of the Veterans' Entitlements Act defines and provides the formula for working out the clean energy pension rate for recipients of a service pension and the various rates of clean energy supplement that are payable to disability pensioners and war widows and war widowers.
The provisions of section 5GB become redundant because the amount of energy supplement will be specified in the service pension rate calculators by other amendments made by this Schedule (see, for example, the amendments to point SCH6-BB3 made by item 260).
The rates of energy supplement for disability pensioners are set out in amendments to subsection 62A(3) (made by item 216).
The rates of energy supplement for war widows and war widowers are set out in amendments to subsection 62B(3) (made by item 221).
Items 194, 195 and 196 make consequential amendments to the section 5 (index of definitions) by omitting the references to the determination of the CES 22(3), CES 22(4), CES 23(4), CES 24(4) and the CES 30(1) rates of clean energy supplement in subsection 5GB(1) and omitting the references to clean energy pension rate, clean energy supplement and quarterly clean energy supplement in subsections 5GB(6) and 5Q(1).
Items 198, 199, 200, 201, 202, 203 and 204 also amend, or repeal and replace, various clean energy-related definitions in subsection 5Q(1) of the Veterans' Entitlements Act to reflect the renaming of clean energy payments.
Item 205 makes consequential amendments to subparagraphs 58A(6)(a)(ii) and 58A(6)(c)(ii) to reflect the renaming of clean energy supplement as energy supplement.
Item 206 amends the indexed and adjusted amounts table in section 59A of the Veterans' Entitlements Act to remove table item 2C referring to the clean energy pension rate.
Item 207 amends the CPI indexation table in subsection 59B(1) to remove table item 2, referring to the clean energy pension rate.
Item 208 repeals subsection 59C(2AC), referring to the initial indexation of the clean energy pension rate on 20 September 2013.
The new amounts of the energy supplement specified in the relevant Rate Calculators and the provisions of Part IIIE will not be subject to indexation.
Item 209 is a consequential amendment to the definition of point SCH6-BB3 amount in paragraph 59Q(7)(b) to replace a reference to clean energy supplement with a reference to energy supplement.
Subdivision A of Division 2 of Part IIIE provides for the payment of clean energy supplement to recipients of a disability pension or a war widow or war widower pension. Items 210 to 215 and 217 to 220 replace existing references to clean energy supplement in the headings and sections 62A and 62B of Subdivision A of Division 2 of Part IIIE with references to energy supplement.
Item 216 repeals subsection 62A(3), and substitutes a new subsection, including a table which sets out the fortnightly rate of energy supplement payable to recipients of a disability pension.
Item 221 repeals subsection 62B(3), and substitutes a new subsection, which sets out the fortnightly rate of energy supplement payable to a person in receipt of a war widow or war widower pension.
Items 222 to 225 replace existing references to clean energy supplement in section 62D with references to energy supplement.
Subdivision B of Division 2 of Part IIIE sets out the circumstances in which a person in receipt of a service pension can be paid their clean energy supplement as a quarterly payment and a method for working out the amount of the quarterly payment. The same rules will apply in relation to the energy supplement. Items 226 to 233 replace existing references to quarterly clean energy supplement in Subdivision B of Division 2 of Part IIIE with references to quarterly energy supplement.
Division 4 of Part IIIE sets out the circumstances in which a person who is dissatisfied with a decision of the Repatriation Commission in relation to a clean energy payment, except quarterly clean energy supplement, may request the Repatriation Commission to review the decision. Items 234 to 236 replace existing references to quarterly clean energy supplement in Division 4 of Part IIIE with references to quarterly energy supplement.
Items 236A to 236E provide for the calculation of the clean energy component of seniors supplement for Veterans payments, and effect renaming of the supplement, by inserting the rate of energy supplement into the rate calculator for seniors supplement in section 118PB.
Items 237 to 241 amend section 121, which provides for the payment of pensions and other benefits under the Veterans' Entitlements Act by instalments. The amendments replace existing references to clean energy supplement and quarterly clean energy supplement with references to energy supplement and quarterly energy supplement.
Items 242 and 243 replace the heading to section 198, and repeal subsections 198(9), (9A) and (11) to remove the reference to the indexation of clean energy supplements and the provisions that indexed the rates payable to recipients of disability pension and war widow or war widower pension under Part IIIE.
There are some references to clean energy supplement in clauses 30 and 34 of Schedule 5 to the Veterans' Entitlements Act (which houses savings and transitional provisions). Items 244 to 248 make consequential amendments to reflect the renaming. Existing references to clean energy supplement are replaced with references to energy supplement.
Items 249 to 252 are minor consequential amendments to subclauses 1(1) and 4(5) of Schedule 6 to replace existing references to clean energy supplement and quarterly clean energy supplement with references to energy supplement and quarterly energy supplement.
Items 253 to 259 amend payment modules A and BB of Schedule 6 to reflect the renaming. Existing references to clean energy supplement and quarterly clean energy supplement are replaced with references to energy supplement and quarterly energy supplement.
Item 260 repeals and substitutes point SCH6-BB3 of Schedule 6, which currently provides for the calculation of the clean energy supplement and replaces it with a table setting out the amount of energy supplement payable to a person in receipt of a service pension, depending on the person's family situation. The amounts in the table are current as at 20 September 2014 and will not be subject to indexation.
Item 261 sets out the application and transitional rules that apply in relation to the amendments made by Part 3. These rules facilitate the transition from clean energy supplement to energy supplement on 20 September 2014. This item includes provisions which ensure that an energy supplement or quarterly energy supplement is paid (as appropriate) in relation to days occurring on or after 20 September 2014, and that the existing provisions continue to apply, despite the amendments, after commencement, in relation to days occurring before commencement. Also included is provision to ensure that an election by a person to receive clean energy supplement as a quarterly payment has effect as if it were an election to receive their energy payments quarterly.
Part 4 - Energy supplement under the Military Rehabilitation and Compensation Act
Amendments to the Military Rehabilitation and Compensation Act
Items 262 to 266 amend, or repeal and replace, various clean energy-related definitions in subsection 5(1) of the Military Rehabilitation and Compensation Act to reflect the renaming of the energy supplement.
Section 83A provides for the payment of clean energy supplement to recipients of permanent impairment compensation under Part 2 of Chapter 4 of the Military Rehabilitation and Compensation Act. Items 267 to 269 replace existing references to clean energy supplement in the heading and in subsection 83A(1) with references to energy supplement.
Item 270 repeals subsection 83A(3), and substitutes a new subsection, which sets out the daily rate of energy supplement payable to a person in receipt of permanent impairment compensation.
Item 271 is a consequential amendment to subsection 204(2) to replace a reference to a person in receipt of a clean energy supplement under section 83A with a reference to the receipt of an energy supplement.
Section 209A provides for the payment of clean energy supplement to recipients of a Special Rate Disability Pension under Part 6 of Chapter 4 of the Military Rehabilitation and Compensation Act. Items 272 to 274 replace existing references to clean energy supplement in the heading and in subsection 209A(1) with references to energy supplement.
Item 275 repeals subsection 209A(2), and substitutes a new subsection, which sets out the daily rate of energy supplement payable to a person in receipt of a Special Rate Disability Pension under Part 6 of Chapter 4.
Section 238A provides for the payment of clean energy supplement to wholly dependent partners of deceased members under Part 2 of Chapter 5 of the Military Rehabilitation and Compensation Act. Items 276 to 278 replace existing references to clean energy supplement in the heading and in subsection 238A(1) with references to energy supplement.
Item 279 repeals subsection 238A(3), and substitutes a new subsection, which sets out the daily rate of energy supplement payable to wholly dependent partners of deceased members.
Items 280 and 281 replace the heading to section 404, repeal subsections 404(1A) and (2), and substitute a new subsection 404(2), to remove the reference to the indexation of clean energy supplements and the provision that indexed the rate of clean energy supplement payable to recipients of permanent impairment compensation under section 83A.
Item 282 is a consequential amendment to subsection 430(3AA) to replace the reference to the payment of quarterly clean energy supplement into a bank account with a reference to the payment of quarterly energy supplement.
Item 283 sets out the application and transitional rules that apply in relation to the amendments made by Part 4. These rules facilitate the transition from clean energy supplement to energy supplement on 20 September 2014. This item includes provisions which ensure that an energy supplement or quarterly energy supplement is paid (as appropriate) in relation to days occurring on or after 20 September 2014, and that the existing provisions continue to apply, despite the amendments, after commencement, in relation to days occurring before commencement. Also included is provision to ensure that an election by a person to receive clean energy supplement as a quarterly payment has effect as if it were an election to receive their energy supplement quarterly.
Part 5 - Energy supplement consequential amendments
Amendments to the Farm Household Support Act
Items 284 to 288 make consequential amendments to various provisions in the Farm Household Support Act to reflect the renaming of clean energy supplement. References to clean energy supplement and quarterly clean energy supplement are replaced with references to energy supplement and quarterly energy supplement.
Amendments to the Income Tax Assessment Act 1997
Items 289 to 293 make consequential amendments to various provisions in the Income Tax Assessment Act 1997 to replace existing references to clean energy supplement with references to energy supplement.
Item 294 sets out the necessary application and transitional rules that apply in relation to the tax amendments. These ensure that the tax provisions, as amended, apply on and after commencement as if they also still referred to the clean energy supplement.
Part 6 - Energy supplement under schemes
Military Rehabilitation and Compensation Act Education and Training Scheme 2004
Items 295 to 297 make consequential amendments to paragraphs 3A.13.1 and 3A.18.1 to remove references to the indexation of payments of clean energy supplement under the Scheme.
Veterans' Children Education Scheme
Items 298 to 300 make consequential amendments to paragraphs 3A.13.1 and 3A.18.1 to remove references to the indexation of payments of clean energy supplement under the Scheme.
Part 7 - Other amendments
Amendments to the Social Security Act
The partner income free area (PIFA) is part of the income testing arrangements for social security benefits. If a person's partner is receiving a social security benefit, the PIFA is the amount of income that would preclude payment of the relevant allowance or benefit to the partner. If a person's partner is not receiving a social security benefit, then the PIFA is the amount of income that would preclude payment to the partner of newstart allowance or youth allowance (depending on the partner's age), assuming that the partner were qualified for that payment.
Point 1067G-H26 defines the PIFA for the purposes of youth allowance. Item 301 inserts two new provisions (new points 1067G-H26A and 1067G-H26B), which set out how the PIFA is to be calculated in situations where the recipient's partner is not receiving a social security benefit. These provisions ensure that partner's maximum basic rate, energy supplement and pension supplement (if relevant) are taken into account in calculating the PIFA, by disregarding other possible components of the maximum payment rate.
Item 302 inserts similar provisions after point 1067L-D25, which defines the PIFA for the purposes of austudy payment.
Item 303 inserts similar provisions after point 1068-G9, which defines the PIFA for the purposes of newstart allowance and the other social security benefits calculated using Benefit Rate Calculator B.
Item 304 inserts similar provisions after point 1068B-D22, which defines the PIFA for the purposes of benefit (PP) partnered.
These changes apply for the purposes of working out the rate of a person's social security payment for days on or after 20 September 2014 (item 305 refers).