Revised Explanatory Memorandum
(Circulated by the authority of the Minister for Social Services, the Hon Christian Porter MP)Schedule 14 - Changes to reasonable excuses
Summary
This Schedule amends the Social Security Administration Act to provide the Secretary with a new power to make a legislative instrument setting out matters that must not be taken into account when deciding whether a person has a reasonable excuse for committing a no show no pay failure, a connection failure, a reconnection failure, a serious failure, or a non-attendance failure.
It is envisaged that the Secretary would exercise this new power to close a loophole in the current provisions surrounding reasonable excuse, so that income support recipients will be unable to repeatedly use drug or alcohol abuse or dependency as a reasonable excuse for relevant participation failures, without seeking treatment if it is available and appropriate as part of their Employment Pathway Plan.
Background
Under social security law, job seekers can be penalised for committing relevant participation failures, unless they have a reasonable excuse. Currently, there is no restriction on the number of times that an individual can use a reasonable excuse, which means that individuals can repeatedly avoid their mutual obligation requirements due to drug and alcohol abuse or dependency. This provides no incentive for them to address their drug and alcohol issues.
From the commencement of this Schedule, job seekers will be given the option of voluntarily undertaking treatment for their drug or alcohol use or dependency (if appropriate and available), following a relevant participation failure due to such abuse or dependency. Alternatively, they may continue with their normal mutual obligation requirements as managed by their employment services provider. For job seekers who choose treatment, participating in this treatment will reduce, or in some circumstances fully meet, their mutual obligation requirements. Once a job seeker has commenced treatment, failure to participate would not be treated as a participation failure but, if the job seeker is exited from or discontinues the treatment without good reason, they would again need to meet their usual mutual obligation requirements and would be subject to compliance action if they failed to do so.
Where job seekers refuse to participate in available treatment, the employment services provider will pass this information to the Department of Human Services.
However, if a job seeker commits another relevant participation failure, drug or alcohol abuse or dependency will not be a consideration when Human Services determines if the job seeker has a reasonable excuse for doing so, and they may be subject to financial penalties consistent with the compliance framework. This is because it is envisaged that the Secretary will exercise the new power provided for in this Schedule to make a legislative instrument determining that where a person's abuse of, or dependency on, drugs or alcohol is used once as a reasonable excuse for a relevant participation failure, such abuse or dependency must not be used in relation to determining whether the person has a reasonable excuse for committing a second or subsequent participation failure if they have previously refused available and appropriate treatment.
However, if the job seeker has other valid reasons for the relevant participation failure, these will be considered in assessing a reasonable excuse.
It is intended that existing reasonable excuse provisions will continue to apply following the initial relevant participation failure due to drug or alcohol misuse or dependency where treatment is unavailable/inappropriate, including where the job seeker:
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- is ineligible or unable to participate;
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- has already participated in all available treatment;
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- has agreed but not yet commenced in treatment; or
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- has relapsed since completing treatment and is seeking further treatment.
The amendments made by this Schedule commence on the later of 1 January 2018, and the day after the Act receives the Royal Assent.
Explanation of the changes
Social Security Administration Act
Items 1 - 5 amend the notes in subsections 42C(4), 42E(4), 42H(3), 42N(2) and 42SC(2).
Currently, among other things, the notes in subsections 42C(4), 42E(4), 42H(3), 42N(2) and 42SC(2) inform the reader that the Secretary must take certain matters into account for the purposes of determining whether a person has a reasonable excuse for committing a no show no pay failure, a connection failure, a reconnection failure, a serious failure, or a non-attendance failure (respectively). These notes direct the reader to section 42U, which currently contains the requirement for the Secretary to make a legislative instrument determining the matters that must be taken into account.
Items 1 - 5 amend the notes in subsections 42C(4), 42E(4), 42H(3), 42N(2) and 42SC(2) to inform the reader that the Secretary may also be prohibited from taking certain matters into account for the purposes of determining whether a person has a reasonable excuse for committing a no show no pay failure, a connection failure, a reconnection failure, a serious failure, or a non-attendance failure (respectively).
These amendments are consequential to the amendment that item 7 in this Schedule makes to section 42U. Item 7 amends section 42U to insert new subsection 42U(3), to provide that the Secretary may make a legislative instrument setting out the matters that must not be taken into account in deciding whether a person has a reasonable excuse for committing the relevant participation failures.
Item 6 inserts the heading 'Matters to be taken into account' before subsection 42U(1).
Subsection 42U(1) provides that the Secretary must, by legislative instrument, determine matters that the Secretary must take into account in deciding whether an individual has a reasonable excuse for committing the participation failures listed in subsection 42U(1). Item 6 inserts a heading above this subsection, to inform the reader of the content of the provision.
Item 7 amends section 42U to insert new subsection 42U(3).
Subsection 42U(3) enables the Secretary to make a legislative instrument determining the matters that the Secretary must not take into account when deciding whether a person has a reasonable excuse for committing certain participation failures. These failures are: a no show no pay failure (see paragraph 42C(4)(a)); a connection failure (see paragraph 42E(4)(a)); a reconnection failure (see paragraph 42H(3)(a)); a serious failure (see paragraph 42N(2)(a)); and a non-attendance failure (see subsection 42SC(2)).
The power to make the legislative instrument under subsection 42U(3) is discretionary. That is, it would be for the Secretary to decide whether to exercise the power make an instrument under subsection 42U(3) or not.
It is envisaged that one exercise of the power in proposed subsection 42U(3) would be for the Secretary to determine that where a person's misuse of, or dependency on, drugs or alcohol is used once as a reasonable excuse for a relevant participation failure, such misuse or dependency must not be considered in relation to determining whether the person has a reasonable excuse for committing a second or subsequent participation failure.