Senate

Revised Explanatory Memorandum

(Circulated by the authority of the Minister for Families and Social Services, the Hon Paul Fletcher MP)

Outline

The Bill introduces the following measures:

1. Increase existing newly arrived resident's waiting periods and introduce a newly arrived resident's waiting period for carer allowance, bereavement allowance and parenting payment

2. Increase existing newly arrived resident's waiting periods for farm household allowance

3. Introduce a newly arrived resident's waiting period for family tax benefit Part A

4. Introduce a newly arrived resident's waiting period for parental leave pay and dad and partner pay

5. Introduce a one-off increase to the higher income free area for family tax benefit Part A

6. Maintain the increased higher income free area for family tax benefit Part A and the higher income limits for family tax benefit Part B, parental leave pay and dad and partner pay

7. Introduce a new taper structure for the maximum rate of family tax benefit Part A

Schedule 1 - Social security amendments

This Schedule:

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increases existing newly arrived resident's waiting periods from 104 weeks to 208 weeks for various working age social security payments and concession cards

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introduces a 208 week newly arrived resident's waiting period for bereavement allowance and parenting payment

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introduces a 52 week newly arrived resident's waiting period for carer allowance.

Schedule 2 - Farm household support amendments

This Schedule increases the existing newly arrived resident's waiting period from 104 weeks to 208 weeks for farm household allowance.

Schedule 3 - Family assistance amendments

This Schedule introduces a newly arrived resident's waiting period of 52 weeks for family tax benefit Part A.

Schedule 4 - Paid parental leave amendments

This Schedule introduces a newly arrived resident's waiting period of 104 weeks for parental leave pay and dad and partner pay.

Schedule 5 - Other amendments

This Schedule increases the higher income free area for family tax benefit Part A and pauses indexation for a range of family assistance and paid parental leave income limits until 1 July 2021. This Schedule also revises the taper rate for the Part A rate of family tax benefit (Method 2).

Financial Impact Statement

The Bill will achieve savings of approximately $1.3 billion (Department of Social Services administered impacts only) over four years to 2021-22.

The impacts on the fiscal balance for each schedule in the Bill are as follows (Department of Social Services administered impacts only):

Note: the above figures represent estimated savings based on the commencement date specified in the Bill.

STATEMENTS OF COMPATIBILITY WITH HUMAN RIGHTS

The Statements of Compatibility with Human Rights appear at the end of this explanatory memorandum.

Notes on Clauses

Abbreviations used in this explanatory memorandum

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Social Security Act means the Social Security Act 1991;

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Family Assistance Act means the A New Tax System (Family Assistance) Act 1999;

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Paid Parental Leave Act means the Paid Parental Leave Act 2010;

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Farm Household Support Act means the Farm Household Support Act 2014;

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NARWP means newly arrived resident's waiting period.

Clause 1 sets out how the new Act is to be cited - that is, as the Social Services and Other Legislation Amendment (Promoting Sustainable Welfare) Act 2018.

Clause 2 provides a table setting out the commencement date of the new Act.

Clause 3 provides that each Act that is specified in a Schedule is amended or repealed as set out in that Schedule.

Schedule 1 - Social security amendments

Summary

This Schedule will increase the existing newly arrived resident's waiting period (NARWP) from 104 weeks to 208 weeks for various working age social security payments and concession cards, introduce a 208 week NARWP for bereavement allowance and parenting payment and introduce a 52 week NARWP for carer allowance.

Background

Waiting periods for newly arrived migrants are a long standing feature of the social security system. A NARWP was first introduced for certain payments in 1993, with the current 104 week NARWP introduced in 1997. The NARWP aims to encourage new migrants to make provisions to be self-sufficient when they first settle in Australia.

The 104 week NARWP applies to newstart allowance, youth allowance, austudy, sickness allowance, carer payment, special benefit, mobility allowance, pensioner education supplement, health care card (low income) and seniors health card.

In most cases, the NARWP applies to people settling permanently in Australia. This is because eligibility for these social security payments and concession cards is generally restricted to people who are Australian residents (that is, a person who resides in Australia and is an Australian citizen, the holder of a permanent visa or a Special Category Visa (SCV) holder who is a protected SCV holder). However, in some cases, a person may qualify for special benefit or certain concession cards if they are the holder of a temporary visa. These temporary visa holders may also be subject to a NARWP.

This Schedule will increase the current NARWP from 104 weeks to 208 weeks for the above working age social security payments and concession cards, except carer payment (the NARWP for carer payment is not being amended and will remain at 104 weeks).

A 208 week NARWP will also be introduced for bereavement allowance and parenting payment to align these payments with other working age social security payments. These payments are not currently subject to a NARWP, although they do have qualifying residence requirements, including a 104 week qualifying residence period (unless other conditions are satisfied). The qualifying residence period affects a person's qualification for payment, whereas the NARWP affects payability. The new NARWP provisions for these payments mirror the existing provisions for social security payments already subject to a NARWP.

The current 104 week qualifying residence period for bereavement allowance and parenting payment will continue to be a factor for qualification, and will run concurrently with the 208 week NARWP to be consistent with other working age social security payments. The other existing qualification requirements will be retained in the relevant provisions so that the qualification requirements are not broadened by these amendments. The new NARWP will be applied in addition to the existing qualification requirements, to affect payability rather than qualification.

A 52 week NARWP will also be introduced for carer allowance. Currently, there is no waiting period or qualifying residence period for carer allowance, there is only a requirement that both the carer and care receiver must be Australian residents.

Introducing a NARWP to additional social security payments will enhance the self-sufficiency expectation for newly arrived migrants.

Under the amendments in this Schedule, a person will be required to serve a NARWP of between 52 and 208 weeks before a relevant social security payment is payable, or before a person will qualify to receive a seniors health card or health care card (low income).

Existing exemption provisions from the NARWP will continue to apply to the payments currently subject to a NARWP and will also apply to the NARWP for bereavement allowance, parenting payment and carer allowance. This includes for people who have a qualifying residence exemption, people who are a refugee or former refugee at the time of claim and people who are an Australian citizen at the time of claim. Certain additional exemptions will also continue to apply for particular payments. For example, certain specified carer visas are exempt from the NARWP for carer payment and this exemption will also apply to the new NARWP for carer allowance. People who have become a lone parent may be exempt from the NARWP for parenting payment, newstart allowance and youth allowance and people who experience a substantial change in circumstances may be exempt from the NARWP for special benefit. There will be no change to the substantial change in circumstances exemption. The existing exemption will remain in place and will continue to provide protections for those in Australia - including, for example, where a person has applied for a temporary partner visa - who experience a substantial change in circumstances through access to special benefit payments. This provides certainty that there are no detrimental changes included in the legislation to the substantial change in circumstances exemption for special benefit.

The amendments made by the Schedule will apply to all newly arrived residents who first become the holder of a permanent visa (or in some cases, the holder of certain temporary visas) on or after 1 January 2019.

The application provisions mean that a person who became the holder of a permanent visa (or temporary visa if applicable) prior to the commencement date will continue to be subject to the current rules. For example, a person granted a permanent visa before commencement would be subject to the existing 104 week NARWP for social security payments that are currently subject to a NARWP, such as newstart allowance, and would be subject to no NARWP for payments that are not currently subject to a NARWP, such as carer allowance.

Applying this measure only to those granted a relevant visa on or after commencement is intended to enable individuals and families seeking to migrate to Australia to make informed decisions when applying for a visa, including making arrangements to support themselves during the waiting period.

The amendments made by this Schedule will not apply to people granted an Orphan Relative or Remaining Relative visa on or after commencement. These visa holders are often young people who have experienced refugee-type experiences or other trauma and who may be disproportionally affected if subject to the changes in the Bill. These visa holders will continue to be subject to the current rules, that is, the existing 104 week NARWP for social security payments that are currently subject to a NARWP, such as newstart allowance, and no NARWP for payments that are not currently subject to a NARWP, such as carer allowance.

The amendments made by this Schedule will not apply to those people who are protected SCV holders. Protected SCV holders are generally those who were the holder of a SCV on or prior to 26 February 2001 and who were excluded from changes to access to social security payments that occurred from 26 February 2001. This cohort of people will be subject to the current NARWP rules, as in place prior to these amendments being introduced. Maintaining existing rules for protected SCV holders is consistent with the principle that people granted a relevant visa before commencement should not be affected by this measure. The exclusion of protected SCV holders from the amendments in this Schedule reflects the existing legislative intent for these SCV holders.

In addition, all SCV holders will be excluded from the changes to the NARWP for the health care card (low income) and the seniors health card. SCV holders will remain subject to the current 104 week NARWP for these concession cards.

Explanation of the changes

Part 1 - Extending existing newly arrived resident's waiting periods

Social Security Act

Items 3 to 16 amend various provisions of the Social Security Act to extend the existing NARWPs of 104 weeks to 208 weeks for the following payments:

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youth allowance

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austudy payment

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newstart allowance

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sickness allowance

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special benefit

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mobility allowance

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pensioner education supplement.

Items 17 to 20 amend various provisions of the Social Security Act, to extend the existing NARWPs of 104 weeks to 208 weeks for the seniors health card and the health care card (low income).

Item 21 provides the application provisions for the amendments in Part 1.

Sub-item 21(1) provides that the amendments made by items 3 to 10 and 13 to 16 apply in relation to a person who becomes the holder of a permanent visa on or after the commencement of these items. This provision covers the payments listed above, except for special benefit (see separate sub-items below for special benefit). Temporary visa holders are generally not qualified for these payments and are therefore not affected by these amendments regardless of this application provision. The exception are protected special category visa holders which are covered by a separate application provision.

Sub-items 21(2) and 21(3) provide that the amendments made by item 11 for special benefit apply in relation to a person who applies for a visa covered by paragraph 739A(3)(b) or who becomes the holder of a visa covered by paragraph 739(4)(b) of the Social Security Act, on or after the commencement of this item. This provision covers people who become the holder of a relevant temporary visa for special benefit. Certain temporary visa holders are qualified for special benefit by virtue of a determination under paragraph 729(2)(f)(v). For holders of temporary visa types also covered by a determination under paragraph 739A(3)(b) or 739A(4)(b), the NARWP starts from the date on which the person applied for that visa. The current determination for the purposes of paragraph 739A(3)(b) covers temporary partner and partner (provisional) visas. There is no current determination under paragraph 739A(4)(b).

Sub-item 21(4) provides that the amendments made by item 12 for special benefit apply in relation to a person who becomes the holder of a permanent visa on or after the commencement of this item.

Sub-item 21(5) provides that the amendments made by items 17 to 20 apply in relation to a person who becomes the holder of a permanent visa on or after the commencement of these items. These provisions cover the seniors health card and health care card (low income). SCV holders are qualified for these cards but are not affected by these amendments, whether granted before or after commencement. This reflects the policy intent that SCV holders not be affected by any waiting period changes in this Bill. Holders of other temporary visas are not qualified for these cards.

Sub-item 21(6) provides that the amendments made by this Part do not apply in relation to a protected SCV holder. It is possible that a person was in Australia on a SCV on 26 February 2001 and therefore was a protected SCV holder, but subsequently left Australia before completing a 104 week NARWP. If that person were to subsequently return to Australia after the commencement date, they will be subject to the current rules (a 104 week NARWP) rather than the new rules (a 208 week NARWP). These amendments reflect the principle that people granted a relevant visa prior to commencement should not be subject to this measure.

Sub-item 21(7) provides that the amendments made by Part 1 of Schedule 1 to the Bill do not apply in relation to a person who becomes the holder of a specified Orphan Relative (subclasses 117 and 837) or Remaining Relative (subclasses 115 and 835) visa or a visa of a kind determined by the Minister. Sub-item 21(8) authorises the Minister to determine, by legislative instrument, a kind of visa for the purposes of paragraph 21(7)(c). The inclusion of the capacity to determine additional visas by legislative instrument will accommodate any changes to the name or subclass of these visa types without requiring further amendments.

Part 2 - New newly arrived resident's waiting periods

This Part makes amendments to various provisions of the Social Security Act to create new NARWPs for bereavement allowance, parenting payment and carer allowance.

Social Security Act

Item 22 makes a consequential amendment to the Australian residence definitions in subsection 7(6AA) to include carer allowance as a payment to which the qualifying residence exemption will apply, where the person holds or was the former holder of a visa that is in a class of visas determined by legislative instrument by the Minister. This will have the effect that such persons will not be subjected to a NARWP. This is consistent with existing exemptions for people with a qualifying residence exemption for other payments.

Items 23 and 24 make consequential amendments to the definition of newly arrived resident's waiting period to include the following payments:

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bereavement allowance

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parenting payment

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carer allowance.

Items 25 to 27 make consequential amendments to the definition of waiting period to include the following payments:

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bereavement allowance

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parenting payment

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carer allowance.

Item 28 introduces a NARWP for bereavement allowance by inserting new section 322. New subsection 322(1) provides that a person who has entered Australia and has not been an Australian resident and in Australia for a period of (or periods totalling) 208 weeks is subject to a NARWP. The effect of this provision is that a person will be required to be an Australian resident and in Australia for 208 weeks before bereavement allowance will be payable to that person.

New subsections 322(2) and (3) provide exemptions from the NARWP. These exemptions mirror long standing exemptions that currently apply in relation to payments subject to an existing NARWP.

New subsection 322(2) provides that the NARWP will not apply to a person where the person has a qualifying residence exemption for bereavement allowance. Qualifying residence exemption in relation to bereavement allowance is defined in subsection 7(6) to include a person who resides in Australia and is either a refugee or a former refugee.

New subsection 322(3) provides that the NARWP will not apply to a person if the person is a refugee or a former refugee at the time the person claimed bereavement allowance. The NARWP will similarly not apply to a person who was the family member of a refugee when they became a refugee and:

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the person is still a family member of the refugee when they claim bereavement allowance, or

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where the refugee has died, the person was a family member of the refugee immediately before their death.

The NARWP will not apply to a person who is an Australian citizen at the time they claim bereavement allowance.

New subsection 322(4) defines the terms 'family member', 'former refugee' and 'refugee' by reference to the relevant definitions in section 7.

New section 323 provides for the start day and duration of the NARWP. New subsection 323(1) provides that if a person is subject to a NARWP, the period starts on the day the person first became an Australian resident. New subsection 323(2) provides that the duration of the NARWP is 208 weeks, and that the NARWP ends when the person has been in Australia and an Australian resident for a period of, or periods totalling, 208 weeks after that day. The start day and duration of the NARWP mirror the provisions that currently apply in relation to payments subject to an existing NARWP.

Item 30 introduces a NARWP for parenting payment by inserting new section 500X. New subsection 500X(1) provides that a person who has entered Australia and has not been an Australian resident and in Australia for a period of (or periods totalling) 208 weeks is subject to a NARWP. The effect of this provision is that a person will be required to be an Australian resident and in Australia for 208 weeks before parenting payment will be payable to that person.

New subsections 500X(2), (3) and (4) provide exemptions from the NARWP. The exemptions at subsection 500X(2) and (4) mirror long standing exemptions that currently apply in relation to payments subject to an existing NARWP.

New subsection 500X(2) provides that the NARWP will not apply to a person where the person has a qualifying residence exemption for parenting payment. Qualifying residence exemption in relation to parenting payment is defined in subsection 7(6) and paragraph 7(6AA)(f) to include a person who resides in Australia and is either a refugee or a former refugee, or where the person holds or was the former holder of a visa that is in a class of visas determined by the Minister.

New subsection 500X(3) provides that the NARWP will not apply to a person where the person is the principal carer of one or more children and since becoming an Australian resident, they have become a lone parent. This exemption mirrors an existing qualifying residence requirement for parenting payment and provides that a person who becomes a lone parent since becoming an Australian resident is both immediately qualified and payable for parenting payment (subject to meeting other qualification and payability requirements). This exemption also mirrors the existing exemption from the NARWP for the other main payments paid to people who are the principal carer of one or more children, that is, newstart allowance and youth allowance.

New subsection 500X(4) provides that the NARWP will not apply to a person if the person is a refugee or a former refugee at the time the person claimed parenting payment. The NARWP will similarly not apply to a person who was the family member of a refugee when they became a refugee and:

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the person is still a family member of the refugee when they claim parenting payment, or

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where the refugee has died, the person was a family member of the refugee immediately before their death.

The NARWP will not apply to a person who is an Australian citizen at the time they claim parenting payment.

New subsection 500X(5) defines the terms 'family member', 'former refugee' and 'refugee' by reference to the relevant definitions in section 7.

New section 500Y provides for the start day and duration of the NARWP. New subsection 500Y(1) provides that if a person is subject to a NARWP, the period starts on the day the person first became an Australian resident. New subsection 500Y(2) provides that the duration of the NARWP is 208 weeks, and that the NARWP ends when the person has been in Australia and an Australian resident for a period of, or periods totalling, 208 weeks after that day. The start day and duration of the NARWP mirror the provisions that currently apply in relation to payments subject to an existing NARWP.

Item 31 introduces a NARWP for carer allowance by inserting new section 966. New subsection 966(1) provides that a person who has entered Australia and has not been an Australian resident and in Australia for a period of (or periods totalling) 52 weeks is subject to a NARWP. The effect of this provision is that a person will be required to be an Australian resident and in Australia for 52 weeks before carer allowance will be payable to that person.

New subsections 966(2), (3), (4) and (5) provide exemptions from the NARWP. The exemptions at subsection 966(2), (3) and (5) mirror long standing exemptions that currently apply in relation to payments subject to an existing NARWP.

New subsection 966(2) provides that the NARWP will not apply to a person where the person has a qualifying residence exemption for carer allowance. Qualifying residence exemption in relation to carer allowance is defined in paragraph 7(6AA)(f) to include a person who holds or was the former holder of a visa that is in a class of visas determined by the Minister.

New subsection 966(3) provides that the NARWP will not apply to a person where the person holds a visa that is in a class of visas determined by the Minister for the purposes of subsection 201AA(5). Subsection 201AA(5) refers to subsection 201AA(5B), which is an instrument making power, whereby the Minister may, by legislative instrument, determine a class of visas for the purposes of new subsection 201AA(5). The class must not be a class covered by paragraph 7(6AA)(f). The exemption in 966(3) mirrors the existing exemption from the NARWP for carer payment. This will apply consistent exemptions across the main payments for people with caring responsibilities for a person with disability.

New subsection 966(4) provides that the NARWP will not apply to a person if the person is receiving a social security benefit or pension, or a farm household allowance under the Farm Household Support Act; or if paid parental leave pay or dad and partner pay under the Paid Parental Leave Act is payable to that person. The rationale for this exemption is that if a new migrant is receiving one of the payments referred to in the provision, they are receiving that payment because they are exempt from the NARWP (or other qualifying residence) requirements for that payment. This exemption allows these people to also access carer allowance if they have caring responsibilities for a person with disability (provided all other carer allowance requirements are met).

New subsection 966(5) provides that the NARWP will not apply to a person if the person is a refugee or a former refugee at the time the person claimed carer allowance. The NARWP will similarly not apply to a person who was the family member of a refugee when they became a refugee and:

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the person is still a family member of the refugee when they claim carer allowance, or

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where the refugee has died, the person was a family member of the refugee immediately before their death.

The NARWP will not apply to a person who is an Australian citizen at the time they claim carer allowance.

New subsection 966(6) defines the terms 'family member', 'former refugee' and 'refugee' by reference to the relevant definitions in section 7.

New section 967 provides for the start day and duration of the NARWP. New section 967 provides that if a person is subject to a NARWP, the period starts on the day the person first became an Australian resident and that the NARWP ends when the person has been in Australia and an Australian resident for a period of, or periods totalling, 208 weeks. The start day and duration of the NARWP mirror the provisions that currently apply in relation to payments subject to an existing NARWP.

Item 32 provides the application provisions for the amendments in Part 2.

Sub-item 32(1) provides that the amendments made by items 28 to 31 apply in relation to a person who becomes the holder of a permanent visa on or after the commencement of these items. Temporary visa holders are generally not qualified for these payments and are therefore not affected by these amendments regardless of this application provision. The exception is protected special category visa holders which are covered by a separate application provision.

Sub-item 32(2) provides that the amendments do not apply in relation to a protected SCV holder. It is possible that a person was in Australia on an SCV on 26 February 2001 and therefore was a protected SCV holder, but subsequently left Australia without spending a total of 208 weeks physically present in Australia. If that person were to subsequently return to Australia after the commencement date, they will not be subject to a new NARWP. These amendments reflect the principle that people granted a relevant visa prior to commencement should not be subject to this measure.

Sub-item 32(3) provides that the amendments made by Part 2 of Schedule 1 do not apply in relation to a person who becomes the holder of a specified Orphan Relative (subclasses 117 and 837) or Remaining Relative (subclasses 115 and 835) visa or a visa of a kind determined by the Minister. Sub-item 32(4) authorises the Minister to determine, by legislative instrument, a kind of visa for the purposes of paragraph 32(3)(c). The inclusion of the capacity to determine additional visas by legislative instrument will accommodate any changes to the name or subclass of these visa types without requiring further amendments.

Schedule 2 - Farm household support amendments

Summary

This Schedule will increase the existing newly arrived resident's waiting period (NARWP) from 104 weeks to 208 weeks for farm household allowance.

Background

The farm household allowance is currently subject to a 104 week NARWP. The NARWP for farm household allowance mirrors the NARWP that applies to working age social security payments. This reflects the policy intent, as set out in the Explanatory Memorandum to the Farm Household Support Bill 2014 which introduced farm household allowance, that farm household allowance is aligned where possible with social security payments, particularly newstart allowance and youth allowance.

This Schedule will increase the current NARWP for farm household allowance from 104 weeks to 208 weeks, consistent with the amendments to the NARWP for working age social security payments as outlined in Schedule 1. This approach maintains the alignment between farm household allowance and social security payments, such as newstart allowance, and provides consistency across these payments.

A person will therefore be required to serve a 208 week NARWP before a farm household allowance is payable.

Existing exemption provisions from the NARWP will continue to apply, including for people who become a lone parent, people who are a refugee or former refugee at the time of claim and people who are a citizen at the time of claim. These exemptions mirror the exemptions applicable to newstart allowance.

The amendments in this Schedule will apply to people who first become a permanent resident on or after 1 January 2019.

The application provisions mean that a person who is the holder of a permanent visa prior to the commencement date will continue to be subject to the current NARWP rules.

Applying this measure only to those granted a relevant visa on or after commencement is intended to enable individuals and families seeking to migrate to Australia to make informed decisions when applying for a visa, including making arrangements to support themselves during the waiting period.

The amendments made by this Schedule will not apply to people granted an Orphan Relative or Remaining Relative visa on or after commencement. These visa holders are often young people who have experienced refugee-type experiences or other trauma and who may be disproportionally affected if subject to the changes in the Bill. These visa holders will continue to be subject to the current rules for farm household allowance, that is, the existing 104 week NARWP.

Explanation of the changes

This Schedule will increase the existing NARWP from 104 weeks to 208 weeks for farm household allowance.

Farm Household Support Act

Items 1 and 2 amend subsection 42(1) and paragraph 43(b) of the Farm Household Support Act, to extend the existing NARWP of 104 weeks to 208 weeks for farm household allowance.

Item 3 provides the application provisions for the amendments in Schedule 2.

Sub-item 3(1) provides that the amendments made by items 1 and 2 apply in relation to a person who becomes the holder of a permanent visa on or after the commencement of these items. Temporary visa holders are generally not qualified for farm household allowance and are therefore not affected by these amendments regardless of this application provision. The exception is protected special category visa holders which are covered by a separate application provision.

Sub-item 3(2) provides that the amendments do not apply in relation to a Special Category Visa (SCV) holder who is a protected SCV holder. It is possible that a person was in Australia on an SCV on 26 February 2001 and therefore was a protected SCV holder, but subsequently left Australia before completing a 104 week NARWP. If that person were to subsequently return to Australia after the commencement date, they will be subject to the current rules (a 104 week NARWP) rather than the new rules (a 208 week NARWP). These amendments reflect the principle that people granted a relevant visa prior to commencement should not be subject to this measure.

Sub-item 3(3) provides that the amendments made by items 1 and 2 of Schedule 2 do not apply in relation to a person who becomes the holder of a specified Orphan Relative (subclasses 117 and 837) or Remaining Relative (subclasses 115 and 835) visa or a visa of a kind determined by the Minister. Sub-item 3(4) authorises the Minister to determine, by legislative instrument, a kind of visa for the purposes of paragraph 3(3)(c). The inclusion of the capacity to determine additional visas by legislative instrument will accommodate any changes to the name or subclass of these visa types without requiring further amendments.

Schedule 3 - Family assistance amendments

Summary

This Schedule introduces a newly arrived resident's waiting period (NARWP) for family tax benefit Part A. The change does not affect family tax benefit Part B, child care related payments, double orphan pension or stillborn baby payment.

Background

Currently, there is no waiting period for family assistance payments for newly arrived migrants, there is only a requirement that the person is an Australian resident (that is, a person who resides in Australia and is an Australian citizen, the holder of a permanent visa or a Special Category Visa (SCV) holder who is a protected SCV holder), an SCV holder or the holder of a visa that is qualified for special benefit under the Social Security Act.

This is inconsistent with social security payments and farm household allowance which are currently subject to a NARWP. The NARWP aims to encourage migrants settling in this country to make provisions to be self-sufficient when they first settle here.

This Schedule will introduce a NARWP of 52 week's duration for family tax benefit Part A. This will reinforce expectations across the welfare system that new migrants settling in Australia should be in a position to support themselves and their families during their initial settlement period. The amendments generally reflect the NARWP provisions contained in the Social Security Act for special benefit. This is because family tax benefit Part A can be paid to holders of certain temporary visas that are eligible for special benefit. This will help to align the operation of the NARWP across multiple payments where applicable.

Under the amendments in this Schedule, individuals who become the holder of a permanent visa, or a temporary visa which would provide qualification for special benefit, will be required to wait until they have been in Australia for a period of, or periods totalling 52 weeks before they can be paid family tax benefit Part A at a rate more than nil. Family tax benefit Part B will not be subject to a NARWP and single parent and single income families will still have immediate access to family tax benefit Part B where eligible.

The NARWP for family tax benefit Part A will not prevent an individual being eligible for stillborn baby payment or double orphan pension. This means that migrants who have experienced a stillbirth, or are caring for a child who has lost both their parents, will still have access to financial support to help them meet the unexpected associated costs.

Currently, families that are receiving family tax benefit Part A fortnightly and have income below the low income free area are automatically eligible for a health care card. Health care cards provide access to a range of concessional health benefits under the Medicare Benefits Scheme and Pharmaceutical Benefits Scheme. Families serving a NARWP for family tax benefit Part A will not be eligible for this card. However, to ensure that access to concessional health benefits are not impacted, families with a family tax benefit eligible child will be exempt from the NARWP for the low income health care card. This will enable these families to receive the low income health care card, provided all other card qualification requirements are met, including the income limits.

Exemptions of a similar nature to those applying to special benefit under the Social Security Act will apply to allow immediate access to family tax benefit Part A in particular circumstances. Holders of visa types that are exempt from the NARWP for special benefit will be exempt from the effect of the NARWP for family tax benefit Part A. These are generally temporary visas issued for humanitarian reasons. Holders of one of these visas who subsequently become the holder of a permanent visa will continue to be exempt from the effect of the NARWP for family tax benefit, ensuring access for this group is maintained. Similarly, refugees (or former refugees) and family members of refugees are also exempt from the effect of the NARWP for family tax benefit Part A. These exemptions are designed to enable potentially vulnerable families, who may not be in a position to arrange for their own support prior to coming to Australia, to access family tax benefit Part A immediately, provided they meet all other eligibility requirements.

If the individual is receiving a social security pension or benefit or farm household allowance, they will also be exempt from the effect of the NARWP for family tax benefit Part A. The rationale for this exemption is that if a new migrant is receiving one of the payments referred to in the provision, they are receiving that payment because they are exempt from the NARWP (or other qualifying residence) requirements for that payment. This exemption allows these people to also access family tax benefit Part A if they have an eligible child (provided all other family tax benefit requirements are met). For example, if a person is receiving parenting payment as the result of becoming a lone parent since the start of their current period as an Australian resident, that decision will also exempt them from the effect of the NARWP for family tax benefit Part A. Similarly, if the individual is receiving special benefit because the Secretary is satisfied the individual has suffered a substantial change of circumstances beyond the individual's control since the start of their waiting period, the decision will exempt the person from the effect of the NARWP for family tax benefit Part A. These exemptions will provide consistent access to relevant social security payments and family tax benefit Part A for families who experience a change in circumstances and who may no longer be able to support themselves as originally planned.

People will be exempt from the effect of the NARWP for family tax benefit Part A in respect of any day on which they are an Australian citizen. This enables people who are eligible for and are granted citizenship after coming to Australia as a permanent resident but before the end of the NARWP, to be exempt from the remainder of the NARWP. Similarly, anyone who is already an Australian citizen at the start of the NARWP and remains a citizen will be exempt throughout the NARWP.

The NARWP will not apply to individuals who are the holder of an SCV. SCVs are issued to New Zealand citizens when they enter Australia. The visa allows these New Zealanders to live and work in Australia indefinitely. While SCV holders are generally ineligible for social security payments, they currently have immediate access to family tax benefit, provided they meet all other qualification requirements. Not applying the NARWP for family tax benefit Part A to SCV holders is designed to allow this group to retain this access to family tax benefit. This reflects the unique arrangements in place between Australia and New Zealand under the Trans-Tasman Travel Arrangement. In addition, SCV holders who subsequently become the holder of a permanent visa after the commencement date will continue to be exempt from the NARWP for family tax benefit Part A, again ensuring access for this group is maintained.

The amendments made by this Schedule will apply to individuals who first become the holder of a permanent visa (or in some cases, the holder of certain temporary visas) on or after 1 January 2019.

Application provisions mean that an individual who became the holder of a permanent visa (or temporary visa if applicable) prior to the commencement date will continue to be subject to the current rules. For example, an individual granted a permanent visa before commencement would not be subject to a NARWP for family tax benefit Part A.

Applying the measure only to individuals granted a relevant visa on or after commencement is intended to enable families seeking to migrate to Australia to make informed decisions when they apply for a visa, including making arrangements to support themselves and their children during the waiting period.

In addition, the application provisions mean that the NARWP for family tax benefit Part A will not apply to a person who becomes the holder of an Orphan Relative or Remaining Relative visa. These visa holders are often young people who have experienced refugee-type experiences or other trauma and who may be disproportionately affected if subject to the changes in the Bill.

Further application provisions mean that individuals who held a relevant temporary visa before commencement do not become subject to the NARWP for family tax benefit Part A when they subsequently become the holder of a permanent visa. This provides a consistent exclusion from the application of the NARWP.

Explanation of the changes

Item 1 Inserts a definition of permanent visa into subsection 3(1), to support the substantive change in item 2.

Item 2 introduces a newly arrived resident's waiting period, by inserting new section 61AA into the Family Assistance Act. Subsection 61AA(1) overrides the rate calculation of an individual's Part A rate of family tax benefit in Schedule 1 to the Family Assistance Act and provides that that rate is nil on a day if the day occurs in a NARWP for the individual..

Subsection 61AA(2), subject to the remaining subsections, provides the circumstances in which an individual is subject to a NARWP for family tax benefit Part A.

Subsection 61AA(2) deals with individuals who, on or after commencement of the subsection:

•

become the holder of a visa determined by the Minister for the purposes of subparagraph 729(2)(f)(v) of the Social Security Act, or

•

become the holder of a permanent visa.

Subsection 61AA(2) also specifies that the NARWP for family tax benefit Part A will not apply to a person who becomes the holder of a specified Orphan Relative (subclasses 117 and 837) and Remaining Relative (subclasses 115 and 835) visa or a visa of a kind determined by the Minister. Subsection 61AA(2A) empowers the Minister, by legislative instrument, to determine a kind of visa for the purposes of subsection 61AA(2). The inclusion of the capacity to determine additional visas by legislative instrument will accommodate any changes to the name or subclass of these visa types without requiring further amendments.

Subsections 61AA(3), (4) and (5) provide for the length of the waiting period.

Subsection 61AA(3) applies (unless subsection 61AA(4) applies) where an individual is subject to a NARWP and they hold a visa that is in a class of visas determined by the Minister for the purposes of paragraph 739A(3)(b) of the Social Security Act (dealing with the NARWP for special benefit). The current determination for the purposes of paragraph 739A(3)(b) covers temporary visa subclass 820 (partner) and subclass 309 (partner (provisional)). A person may apply for these visas prior to entering Australia. For such persons, the waiting period starts on the day on which the individual applied for that visa. The waiting period for family tax benefit Part A then ends when the individual has been in Australia for a period of, or periods totalling, 52 weeks after that day.

Subsection 61AA(4) applies where an individual is subject to a NARWP for family tax benefit Part A and, prior to their current visa, they held one or more visas in a class of visas determined by the Minister for the purposes of paragraph 739A(4)(b) of the Social Security Act (dealing with the NARWP for special benefit). For such persons, the waiting period starts on the day on which the individual applied for the last of those visas. This allows time in Australia under an earlier visa to count for the purposes of the NARWP. For example, where a person held a temporary visa specified under paragraph 739A(4)(b) and then subsequently moved to a permanent visa, the NARWP for family tax benefit Part A would start from the date they applied for the temporary visa, ensuring they are not required to serve a second NARWP in respect of the permanent visa. The waiting period then ends when the individual has been in Australia for a period of, or periods totalling, 52 weeks after that day. There is currently no determination in force under paragraph 739A(4)(b); however, new subsection 61AA(4) ensures that if such a determination is made in the future, the NARWP for family tax benefit Part A and special benefit will operate consistently for the relevant visa holders.

Subsection 61AA(5) applies in all remaining circumstances in which a person is subject to a NARWP for family tax benefit Part A. For such persons, the waiting period starts on the day on which the individual first entered Australia, or became the holder of a permanent visa, whichever occurred last. For persons who hold a temporary visa in circumstances not covered by subsection 61AA(3) and (4) above, this will start the waiting period when the person first entered Australia. The waiting period then ends when the individual has been in Australia for a period of, or periods totalling, 52 weeks after that day.

Subsections 61AA(6), (7) and (8) provide exemptions from the effect of the NARWP for family tax benefit Part A.

Subsection 61AA(6) allows an individual to receive family tax benefit Part A despite a NARWP applying in respect of a day, if on that day the individual holds a visa in a class of visas determined by the Minister for the purposes of subsection 739A(6) of the Social Security Act. This means that ministerial determinations made exempting various visa holders from the NARWP for special benefit will also apply to exempt the person from the effect of the NARWP for family tax benefit Part A. The current determination under subsection 739A(6) includes the following visa types: subclass 060 (Bridging F), subclass 070 (Bridging (Removal Pending)), subclass 449 (Humanitarian Stay (Temporary)), subclass 785 (Temporary Protection), subclass 786 (Temporary (Humanitarian Concern)), subclass 790 (Safe Haven Enterprise) and if certain circumstances are met, a criminal justice stay visa. Former holders of such visas are similarly exempt. The new subsection focuses on a day. An individual may not receive family tax benefit Part A for any days where an exemption does not apply, but can be paid once the exemption exists.

Subsection 61AA(7) allows an individual to receive family tax benefit Part A despite a NARWP applying in respect of a day, if on that day the individual is receiving a social security pension or benefit, farm household allowance or if parental leave pay or dad and partner pay is payable to the individual. This exempts the individual from the effect of the NARWP for family tax benefit Part A on days when the person is receiving their welfare payment, but not on days when they are not receiving the payment. This reflects the intention that where a person is receiving a welfare payment (for example, because they are exempt from any waiting period for that payment) they are also exempt from the NARWP for family tax benefit Part A.

Subsection 61AA(8) allows an individual to receive family tax benefit Part A despite a NARWP applying in respect of a day (termed the 'assessment day'), if the individual meets one of the specified conditions. This exempts the individual from the effect of the NARWP for family tax benefit Part A.

The first condition is that the individual is a refugee or former refugee. The second is that the individual was a family member of another individual at the time the other individual became a refugee before the assessment day. If so, the individual may receive family tax benefit Part A despite the NARWP applying on that day if they remain the family member of that other individual on the assessment day, or if the other individual has died, the individual was a family member of the other individual immediately before the other individual died. The third is that the person is an Australian citizen on the assessment day. The last is that the individual is residing in Australian on the assessment day, and has held an SCV on any day before the assessment day.

The assessment day has flexible application, and means any day on which rate of family assistance Part A is being calculated. An individual may not receive family tax benefit for any days where an exemption does not apply, but can be paid once the exemption exists, and while the person continues to meet the condition to be exempt.

Subsection 61AA(9) defines the terms 'family member', 'former refugee' and 'refugee' by reference to the relevant definitions in the Social Security Act.

Items 6 to 7 make consequential amendments to the Social Security Act to maintain the qualification for a health care card for persons who become subject to a NARWP for family tax benefit Part A.

Item 6 makes a consequential amendment to the Social Security Act to provide an additional exemption from the NARWP for the health care card (low income) imposed by section 1061ZQ by adding new paragraph 1061ZQ(2)(b) covering a person who has an FTB child. This will allow persons who will no longer qualify for an automatically issued health care card as the result being subject to a NARWP for family tax benefit Part A to claim a health care card (low income) where they meet all other requirements for this card.

Item 7 provides for the application of the amendment of section 1061ZQ. Item 7 provides that the amendments apply to working out if a person is qualified for a health care card for days on or after the commencement of the relevant items.

Schedule 4 - Paid parental leave amendments

Summary

This Schedule introduces a newly arrived resident's waiting period (NARWP) for parental leave pay or dad and partner pay.

Background

Currently, there is no waiting period for parental leave pay or dad and partner pay for newly arrived migrants. There is only a requirement that the person is an Australian resident (that is, a person who resides in Australia and is an Australian citizen, the holder of a permanent visa or a Special Category Visa (SCV) holder who is a protected SCV holder), an SCV holder or the holder of a visa that is qualified for special benefit under the Social Security Act.

This is inconsistent with social security payments and farm household allowance which are currently subject to a NARWP. The NARWP aims to encourage migrants settling in this country make provisions to be self-sufficient when they first settle here.

This Schedule will introduce a NARWP of 104 weeks' duration for parental leave pay and dad and partner pay. This reflects expectations that new migrants settling in Australia should be in a position to support themselves and their families during their initial settlement period, including any new children born or adopted during this period. The amendments generally reflect the NARWP provisions contained in the Social Security Act for special benefit. This is because parental leave pay and dad and partner pay can be paid to holders of certain temporary visas that are eligible for special benefit. This will help to align the operation of the NARWP across multiple payments where applicable.

Under the amendments in this Schedule, individuals who become the holder of a permanent visa, or a temporary visa which would provide qualification for special benefit, will be required to wait until they have been in Australia for a period of, or periods totalling 104 weeks in order to be paid parental leave pay and dad and partner pay. For primary claimants for parental leave pay who under the current rules must be eligible for parental leave pay for each day from the date of birth of their child until the last day of their PPL period, this will require that the child is born after the waiting period is finished.

Exemptions of a similar nature to those applying to special benefit under the Social Security Act will apply to allow immediate access to parental leave pay and dad and partner pay in particular circumstances. Holders of visa types that are exempt from the NARWP for special benefit will be exempt from the effect of the NARWP for parental leave pay and dad and partner pay. These are generally temporary visas issued for humanitarian reasons. Holders of one of these visas who subsequently become the holder of a permanent visa will continue to be exempt from the NARWP for parental leave pay and dad and partner pay, ensuring access for this group is maintained. Similarly, refugees (or former refugees) and family members of refugees will be exempt from the effect of the NARWP for parental leave pay and dad and partner pay. These exemptions are designed to enable potentially vulnerable families, who may not be in a position to arrange for their own support prior to coming to Australia, to access parental leave pay and dad and partner pay immediately, provided they meet all other eligibility requirements.

If the individual is receiving a social security pension or benefit, or farm household allowance on the day before their PPL or DAPP period starts, they will be exempt from the NARWP for parental leave pay and dad and partner pay. If they are a primary claimant for parental leave pay, they must have been receiving the social security pension or benefit or farm household allowance on the date of the birth or adoption and continue to receive it on every day up to the day prior to their PPL period. The rationale for this exemption is that if a new migrant is receiving one of the payments referred to in the provision, they are receiving that payment because they are exempt from the NARWP (or other qualifying residence) requirements for that payment. This exemption enables these people to access parental leave pay and dad and partner pay if they have an eligible child while receiving one of these payments (provided all other parental leave pay and dad and partner pay requirements are met).

For example, if on the day before the start of their PPL or DAPP period a person is receiving parenting payment single (because they are exempt from the NARWP), they will be exempt from the NARWP for parental leave pay and dad and partner pay. If the person is a primary parental leave pay claimant, they must also have been receiving parenting payment (or another relevant payment) on the date of birth or adoption and every day up to the day prior to their PPL period. The exemption will allow them to move from parenting payment to parental leave pay or dad and partner pay (provided all other eligibility requirements are met). Similarly, if the individual is receiving special benefit because the Secretary is satisfied the individual has suffered a substantial change of circumstances beyond the individual's control since the start of their waiting period, they may be exempt from the NARWP for parental leave pay and dad and partner pay if the same conditions are met. The exemption will provide consistent access to relevant social security payments and parental leave pay or dad and partner pay for families who experience a change in circumstances and who may no longer be able to support themselves as originally planned.

People will be exempt from the effect of the NARWP for parental leave pay and dad and partner pay in respect of any day on which they are an Australian citizen. This enables people who are eligible for and are granted citizenship after coming to Australia as a permanent resident but before the end of the NARWP, to be exempt from the remainder of the NARWP. Similarly, anyone who is already an Australian citizen at the start of the NARWP and remains a citizen will be exempt throughout the NARWP.

The NARWP will not apply to individuals who are the holder of an SCV, or the former holder of an SCV. SCVs are issued to New Zealand citizens when they enter Australia. The visa allows these New Zealanders to live and work in Australia indefinitely. While SCV holders are generally ineligible for social security payments, they currently have immediate access to family tax benefit and parental leave pay and dad and partner pay, provided they meet all other qualification requirements. Not applying the NARWP to SCV holders for parental leave pay and dad and partner pay is designed to maintain this access for this group. This reflects the unique arrangements in place between Australia and New Zealand under the Trans-Tasman Travel Arrangement.

The amendments made by this Schedule will apply to individuals who first become the holder of a permanent visa (or in some cases, the holder of certain temporary visas) on or after 1 January 2019.

An individual who became the holder of a permanent visa (or temporary visa if applicable) prior to the commencement date will continue to be subject to the current rules. For example, a person granted a permanent visa before commencement would not be subject to a NARWP for parental leave pay or dad and partner pay.

Applying the measure only to individuals granted a relevant visa on or after the commencement date is intended to enable families seeking to migrate to Australia to make informed decisions when applying for a visa, including making arrangements to support themselves and their children during the waiting period.

The amendments made by this Schedule will not apply to people who become the holder of a specified Orphan Relative or Remaining Relative visa. These visa holders are often young people who have experienced refugee-type experiences or other trauma and who may be disproportionately affected if subject to the changes in the Bill. This means that these visa holders will continue to have no waiting period for parental leave pay and dad and partner pay.

The amendments made by this Schedule will not apply to people who become a permanent visa holder where they have held a relevant temporary visa before commencement (such as a temporary partner visa). This provides a consistent exclusion from the application of the NARWP by allowing people who are grandfathered in respect of a temporary visa to remain grandfathered if they transition to a permanent visa.

In addition, the measure will not apply to persons whose baby is born prior to commencement, or during the first 6 months after commencement. This will mean that people who may have already made leave plans prior to the changes commencing are not disadvantaged and can still access parental leave pay or dad and partner pay.

Explanation of the changes

Parental leave pay

Item 1 inserts a definition of permanent visa into section 6, to support the substantive change in item 2.

Item 1A amends section 15 of the Paid Parental Leave Act. The amendment clarifies that for the full amount of parental leave pay for a child to be paid to a secondary claimant, the primary claimant must not be subject to a NARWP or must be exempt from the NARWP on the day the child is born. This ensures no ambiguity arises from the fact section 15 does not refer to the primary claimant being 'eligible'.

Item 2 removes eligibility for parental leave pay for newly arrived residents by adding new subsection 31(6) to the Paid Parental Leave Act. New subsection 31(6) provides that a person is not eligible for parental leave pay in respect of a day in a NARWP for the person.

Item 3 inserts new section 31A, providing for the NARWP.

Subsection 31A(1), subject to the remaining subsections, provides the circumstances in which an individual is subject to a NARWP.

Subsection 31A(1) deals with persons who, on or after commencement of the subsection:

•

become the holder of a visa determined by the Minister for the purposes of subparagraph 729(2)(f)(v) of the Social Security Act, or

•

become the holder of a permanent visa.

Such persons are subject to a NARWP.

Subsection 31A(1) also specifies that the NARWP for parental leave pay will not apply to a person who becomes the holder of a specified Orphan Relative (subclasses 117 and 837) and Remaining Relative (subclasses 115 and 835) visa or a visa of a kind determined by the Minister.

Subsection 31A(1A) gives the Minister a power to determine a kind of visa for the purposes of new subparagraph 31A(1)(b)(iii). The inclusion of the capacity to determine additional visas by legislative instrument will accommodate any changes to the name or subclass of these visa types without requiring further amendments.

Subsection 31A(1B) provides that a person who becomes the holder of a visa determined by the Minister for the purposes of subparagraph 729(2)(f)(v) of the Social Security Act before commencement of the subsection is not subject to the NARWP for parental leave pay where they subsequently become the holder of a permanent visa. This applies a consistent exclusion from the application of the NARWP.

Subsections 31A(2), (3) and (4) provide for the length of the waiting period.

Subsection 31A(2) applies (unless subsection 31A(3) applies) where a person is subject to a NARWP and they hold a visa that is in a class of visas determined by the Minister for the purposes of paragraph 739A(3)(b) of the Social Security Act (dealing with the NARWP for special benefit). The current determination for the purposes of paragraph 739A(3)(b) covers temporary visa subclass 820 (partner) and subclass 309 (partner (provisional)). A person may apply for these visas prior to entering Australia. For such persons, the waiting period starts on the day on which the individual applied for the visa they currently hold. The waiting period then ends when the individual has been in Australia for a period of, or periods totalling, 104 weeks after that day.

Subsection 31A(3) applies where a person is subject to a NARWP and, prior to their current visa, they held one or more visas in a class of visas determined by the Minister for the purposes of paragraph 739A(4)(b) of the Social Security Act (dealing with the NARWP for special benefit). For such persons, the waiting period starts on the day on which the individual applied for the last of those visas. This allows time in Australia under an earlier visa to apply to accruing time in Australia for the purposes of the NARWP. For example, where a person held a temporary visa specified under paragraph 739A(4)(b) and then subsequently moved to a permanent visa, the NARWP would start from the date they applied for the temporary visa, ensuring they are not required to serve a second NARWP in respect of the permanent visa. The waiting period then ends when the individual has been in Australia for a period of, or periods totalling, 104 weeks after that day. There is currently no determination in force under paragraph 739A(4)(b); however, new subsection 31A(3) ensures that if such a determination is made in the future, the NARWP for parental leave pay and special benefit will operate consistently for the relevant visa holders.

Subsection 31A(4) applies in all remaining circumstances in which a person is subject to a NARWP. For such persons, the waiting period starts on the day on which the individual first entered Australia, or became the holder of a permanent visa, whichever occurred last. For persons who hold a temporary visa in circumstances not covered by subsection 31A(2) and (3) above, this will start the waiting period when the person first entered Australia. The waiting period then ends when the individual has been in Australia for a period of, or periods totalling, 104 weeks after that day.

Subsections 31A(5), (6), (7) and (7A) provide exemptions from the NARWP or exemptions from the effect of the NARWP.

Subsection 31A(5) provides that a NARWP does not apply to a person if on the day before the day that would be the start of the person's PPL period if a payability determination were made, the person is receiving either a social security pension, a social security benefit or farm household allowance. Additionally, if the person is the primary claimant, the person must have been receiving a social security pension or benefit, or farm household allowance on the day of the child's birth or adoption and on each day after the child's birth up to the day prior to the start of the person's PPL period. The receipt of welfare up to the day prior to the start of the person's PPL period indicates that the person is in need of support, which should include parental leave pay if they otherwise are eligible for the payment.

Subsection 31A(6) limits the operation of the exemption in subsection 31A(5) to situations in which a payability determination would not be made under section 15, which allows the full amount of parental leave pay to be paid to the secondary claimant. Instead, for the cases covered by section 15, a NARWP does not apply if the person is in circumstances prescribed by the PPL rules. The drafting of this element will be complex but only apply to relatively unusual cases, and so more appropriately sits with other more unusual situations currently dealt with in the PPL rules.

Subsection 31A(7) allows a person to be eligible for parental leave pay despite the NARWP applying in respect of a day, if on that day the individual holds a visa in a class of visas determined by the Minister for the purposes of subsection 739A(6) of the Social Security Act. This exempts the person from the effect of the NARWP. The current determination under subsection 739A(6) includes the following visa types: subclass 060 (Bridging F), subclass 070 (Bridging (Removal Pending)), subclass 449 (Humanitarian Stay (Temporary)), subclass 785 (Temporary Protection), subclass 786 (Temporary (Humanitarian Concern)), subclass 790 (Safe Haven Enterprise) and if certain circumstances are met, a criminal justice stay visa.

Former holders of such visas are similarly exempt. The new subsection focuses on a day. If parental leave pay being payable is dependent upon eligibility being established for a range of days in a NARWP, an exemption would need to apply for all of those days.

Subsection 31A(7A) allows a person to be eligible for parental leave pay despite the NARWP applying in respect of a day (termed the 'assessment day'), if the individual meets one of the specified conditions. This exempts the person from the effect of the NARWP.

The first condition is that the person is a refugee or former refugee. The second is that the person was a family member of another person at the time the other person became a refugee before the assessment day. If so, the person may be eligible for parental leave pay despite the NARWP applying on that day if they remain the family member of that other person on the assessment day, or if the other person has died, the person was a family member of the other person immediately before the other person died. The third is that the person is an Australian citizen on the assessment day. The last is that the person is residing in Australian on the assessment day, and has held a special category visa on any day before the assessment day.

The assessment day has flexible application, and can mean any day on which eligibility for parental leave pay needs to be established. A person is not eligible for parental leave pay for any days where an exemption does not apply. This means if parental leave pay being payable is dependent upon eligibility being established for a range of days in a NARWP, an exemption would need to apply for all those days. Once the PPL period has started, eligibility for parental leave pay would cease if the exemption does not apply on any day.

Subsection 31A(8) defines the terms 'family member', 'former refugee' and 'refugee' by reference to the relevant definitions in the Social Security Act.

Dad and Partner Pay

Item 4 removes eligibility for dad and partner pay for newly arrived residents, by adding new subsection 115CB(9) to the Paid Parental Leave Act. New subsection 115CB(9) provides that a person is not eligible for dad and partner pay in respect of a day in a NARWP for the person.

Item 5 inserts new section 115CBA, providing for the NARWP.

Subsection 115CBA(1), subject to the remaining subsections, provides the circumstances in which an individual is subject to a NARWP.

Subsection 115CBA(1) deals with persons who, on or after commencement of the subsection:

•

become the holder of a visa determined by the Minister for the purposes of subparagraph 729(2)(f)(v) of the Social Security Act, or

•

become the holder of a permanent visa.

Such persons are subject to a NARWP. Persons who would be subject to a NARWP for special benefit, are also subject to a NARWP for dad and partner pay.

Subsection 115CBA(1) also specifies that a NARWP will not apply to a person who becomes the holder of a specified Orphan Relative (subclasses 117 and 837) or Remaining Relative (subclasses 115 and 835) visa or a visa of a kind determined by the Minister.

Subsection 115CBA(1A) gives the Minister a power to determine a kind of visa for the purposes of new subparagraph 115CBA(1)(b)(iii). The inclusion of the capacity to determine additional visas by legislative instrument will accommodate any changes to the name or subclass of these visa types without requiring further amendments.

Subsection 115CBA(1B) provides that a person who becomes the holder of a visa determined by the Minister for the purposes of subparagraph 729(2)(f)(v) of the Social Security Act before commencement of the subsection is not subject to the NARWP for parental leave pay where they subsequently become the holder of a permanent visa. This applies a consistent exclusion from the application of the NARWP.

Subsections 115CBA(2), (3) and (4) provide for the length of the waiting period.

Subsection 115CBA(2) applies (unless subsection 115CBA(3) applies) where a person is subject to a NARWP and holds a visa that is in a class of visas determined by the Minister for the purposes of paragraph 739A(3)(b) of the Social Security Act (dealing with the NARWP for special benefit). The current determination for the purposes of paragraph 739A(3)(b) covers temporary visa subclass 820 (partner) and subclass 309 (partner (provisional)). A person may apply for these visas prior to entering Australia. For such persons, the waiting period starts on the day on which the individual applied for the visa they currently hold. In general, a person will apply for the visas covered by paragraph 739A(3)(b) prior to entering Australia. The waiting period then ends when the individual has been in Australia for a period of, or periods totalling, 104 weeks after that day.

Subsection 115CBA(3) applies where a person is subject to a NARWP and, prior to their current visa, they held one or more visas in a class of visas determined by the Minister for the purposes of paragraph 739A(4)(b) of the Social Security Act (dealing with the NARWP for special benefit). For such persons, the waiting period starts on the day on which the individual applied for the last of those visas. This allows time in Australia under an earlier visa to apply to accruing time in Australia for the purposes of the NARWP. For example, where a person held a temporary visa specified under paragraph 739A(4)(b) and then subsequently moved to a permanent visa, the NARWP would start from the date they applied for the temporary visa, ensuring they are not required to serve a second NARWP in respect of the permanent visa. The waiting period then ends when the individual has been in Australia for a period of, or periods totalling, 104 weeks after that day. There is currently no determination in force under paragraph 739A(4)(b); however, new subsection 115CBA(3) ensures that if such a determination is made in the future, the NARWP for dad and partner pay and special benefit will operate consistently for the relevant visa holders.

Subsection 115CBA(4) applies in all remaining circumstances in which a person is subject to a NARWP. For such persons, the waiting period starts on the day on which the individual first entered Australia, or became the holder of a permanent visa, whichever occurred last. For persons who hold a temporary visa in circumstances not covered by subsection 115CBA(2) and (3) above, this will start the waiting period when the person first entered Australia. The waiting period then ends when the individual has been in Australia for a period of, or periods totalling, 104 weeks after that day.

Subsections 115CBA(5), (6) and (7), provide exemptions from the NARWP or exemptions from the effect of the NARWP.

Subsection 115CBA(5) provides that a NARWP does not apply to a person if on the day before the day that would be the start of the person's DAPP period if a payability determination were made, the person is receiving either a social security pension, a social security benefit or farm household allowance.

Subsection 115CBA(6) allows a person to be eligible for dad and partner pay despite the NARWP applying in respect of a day, if on that day the individual holds a visa in a class of visas determined by the Minister for the purposes of subsection 739A(6) of the Social Security Act. This exempts the person from the effect of the NARWP. The current determination under subsection 739A(6) includes the following visa types: subclass 060 (Bridging F), subclass 070 (Bridging (Removal Pending)), subclass 449 (Humanitarian Stay (Temporary)), subclass 785 (Temporary Protection), subclass 786 (Temporary (Humanitarian Concern)), subclass 790 (Safe Haven Enterprise) and if certain circumstances are met, a criminal justice stay visa. Former holders of such visas are similarly exempt. The new subsection focuses on a day. If dad and partner pay being payable is dependent upon eligibility being established for a range of days in a NARWP, an exemption would need to apply for all of those days.

Subsection 115CBA(7) allows a person to be eligible for dad and partner pay despite the NARWP applying, in respect of a day (termed the 'assessment day'), if the individual meets one of the specified conditions. This exempts the person from the effect of the NARWP.

The first condition is that the person is a refugee or former refugee. The second is that the person was a family member of another person at the time the other person became a refugee before the assessment day. If so, the person may be eligible for dad and partner pay despite the NARWP applying on that day if they remain the family member of that other person on the assessment day, or if the other person has died, the person was a family member of the other person immediately before the other person died. The third is that the person is an Australian citizen on the assessment day. The last is that the person is residing in Australian on the assessment day, and has held a special category visa on any day before the assessment day.

The assessment day has flexible application, and means any day on which eligibility for dad and partner pay needs to be established. A person is not eligible for dad and partner pay for any days where an exemption does not apply. This means that dad and partner pay is not payable for days prior to the exemption applying, but can be paid once the exemption exists, and while the person continues to meet the condition to be exempt. Subsection 115CBA(8) defines the terms 'family member', 'former refugee' and 'refugee' by reference to the relevant definitions in the Social Security Act.

Item 6 provides that the measure will not apply where the child is born (or entrusted to the person's care) during the first 6 months after commencement. This means that people who may have already made leave plans prior to the changes commencing are not disadvantaged and can still access parental leave pay or dad and partner pay.

Schedule 5 - Other amendments

Summary

Schedule 5 contains amendments to the Family Assistance Act and Paid Parental Leave Act to implement:

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the Consistent Treatment for Families Receiving Family Tax Benefit Part A measure announced as part of the 2017-18 Budget, which was originally contained in the Social Services Legislation Amendment (Payment Integrity) Bill 2017

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elements of the Family Tax Benefit and Paid Parental Leave - Maintaining Income Thresholds measure announced as part of the 2017-18 Mid-Year Economic and Fiscal Outlook, which was originally contained in the Social Services Legislation Amendment (Maintaining Income Thresholds) Bill 2018.

This Schedule implements a one-off increase of $4,672 to the family tax benefit Part A higher income free area, bringing the amount to $98,988.

Additionally, this Schedule extends the current pause on indexation of the family tax benefit Part A higher income free area, the family tax benefit Part B primary earner income limit, the parental leave pay income limit and the dad and partner pay income limit for a further year from 1 July 2020.

This Schedule also implements a new family tax benefit Part A taper structure for the maximum rate of family tax benefit Part A which provides a consistent 30 per cent rate reduction for income above the family tax benefit Part A higher income free area.

Background

Family tax benefit Part A higher income free area

Schedule 5 to the Bill introduces, from 1 July 2019, a new taper structure for the maximum rate of family tax benefit Part A which provides consistency in how family tax benefit Part A is income tested for families with income above the FTB higher income free area.

From 1 July 2019, the maximum rate would be reduced by 20 cents for every dollar earned between the family tax benefit Part A lower income free area (currently $53,728) and higher income free area and 30 cents for every dollar earned above the higher income free area.

The higher income free area amount is currently $94,316. This Schedule provides for a one-off increase to the family tax benefit Part A higher income free area to $98,988.

Schedule 17 to the Budget Savings (Omnibus) Act 2016 amended subclause 3(7) of Schedule 4 to the Family Assistance Act to extend the pause on indexation of the family tax benefit Part A higher income free area in clause 2 of Schedule 1 for an additional three years. The amendments in that Act provided that, in addition to 1 July 2016, there was to be no indexation of the higher income free area amount on 1 July 2017, 1 July 2018 and 1 July 2019, with indexation to resume on 1 July 2020.

This Schedule further extends the pause on indexation of the family tax benefit Part A higher income free area for another year, with indexation now to resume on 1 July 2021. At this time, indexation will apply to the increased family tax benefit Part A higher income free area amount.

FTB Part B primary earner income limit

Schedule 17 to the Budget Savings (Omnibus) Act 2016 amended subclause 3(7) of Schedule 4 to the Family Assistance Act to extend the pause on indexation of the family tax benefit Part B income limit in clause 28B of Schedule 1 (often referred to as the 'primary earner income limit') for an additional three years. The amendments in that Act provided that, in addition to 1 July 2016, there was to be no indexation of this income threshold amount on 1 July 2017, 1 July 2018 and 1 July 2019.

This Schedule further extends the pause on indexation for the family tax benefit Part B primary earner income limit amount for an additional year by pausing the indexation that would otherwise occur on 1 July 2020. The indexation would next occur on 1 July 2021.

Parental leave pay income limit and dad and partner pay income limit

To be eligible for parental leave pay and dad and partner pay, a person must satisfy, among other things, an income test. The Paid Parental Leave Act covers both parental leave pay and dad and partner pay, with the same income test applying to both payments. To satisfy this income test, a person's income for a particular income year must not exceed the PPL income limit in section 41 of the Paid Parental Leave Act. Currently, the PPL income limit is $150,000 until 30 June 2020 and is then to be indexed.

The amendments made by this Schedule will maintain the current PPL income limit until 30 June 2021, with indexation of the income limit to occur on 1 July 2021.

Explanation of the changes

Amendments to the Family Assistance Act - Higher income free area and indexation

Clause 1 of Schedule 5 repeals and substitutes a figure of $98,988 for the higher income free area when calculating rate of family tax benefit Part A.

Clause 2 affects indexation of the higher income free area for family tax benefit Part A, (known as the FTB basic HIFA (A) for indexation purposes). The higher income free area amount substituted by clause 1 is not to be indexed on 1 July 2019 and 1 July 2020, but indexation of the higher amount will resume in 2021. The income limit for family tax benefit (Part B) for the primary earner (described for indexation purposes as the FTB income limit (B)) is also not to be indexed on 1 July 2019 and 1 July 2020, but indexation will resume thereafter.

Clause 3 is an application provision, providing that the new amount will apply in working out the Part A rate of family tax benefit for days on or after commencement.

Amendments to the Paid Parental Leave Act - income limits

Clause 4 amends the guide to Part 2-3 in section 30 to reflect the extension of the pause on the indexation of the PPL income limit from 30 June 2020 to 30 June 2021.

Clauses 5 and 6 amend the references to 1 July 2020 in sections 41 and 42 to 1 July 2021. The effect is that the PPL income limit will not be subject to indexation until 1 July 2021.

Clause 7 amends the guide to Part 3A-3 in section 115CA to reflect the extension of the pause on the indexation of the PPL income limit from 30 June 2020 to 30 June 2021.

Amendments to the Family Assistance Act - Taper rate for Part A rate of family tax benefit (Method 2)

Clause 25 provides the method statement that is to be used in calculating an individual's family tax benefit Part A rate where Method 2 applies. Under step 3 of the method statement, an individual's income and maintenance tested rate is worked out under step 3 of the method statement in clause 3 of Schedule 1 as if the individual's Part A rate were worked out using Method 1 (but disregarding clause 24G). The result is the Method 2 income and maintenance tested rate.

Clause 8 is a consequential amendment that makes the method statement in clause 25 of Schedule 1 subject to the new clause 25D.

Clause 9 inserts a note at the end of the method statement in clause 25 referring the reader to new clause 25D which modifies the application of step 3 of the method statement in clause 25.

Clause 10 then inserts a new clause 25D which sets out those modifications. In effect, the income test that applies in working out an individual's Part A rate under method 1 (step 2 of the method statement in clause 3) is modified for the purposes of working out the individual's Method 2 income and maintenance tested rate so that a taper of 30% applies in relation to an individual's ATI that exceeds the higher income free area. A taper of 20% would continue to apply in relation to ATI that exceeds the individual's income free area and does not exceed the higher income free area.

Clause 25D provides that in applying step 3 of the method statement in clause 25, step 2 of the method statement in clause 3 is replaced by new steps 2 to 2D.

Step 2 requires the individual's income free area to be subtracted from the individual's higher income free area.

Step 2A applies a 20% taper to the result in step 2.

Under step 2B, the individual's higher income free area is subtracted from their ATI.

Step 2C applies a 30% taper to the result in step 2B.

Under step 2D, the sum of the amounts at steps 2A and 2C is the individual's reduction for adjusted taxable income. This amount is then deducted from the individual's maximum rate to arrive at the individual's income tested rate.

Step 3 of the method statement in clause 3 then applies, as modified, to work out the individual's Method 2 income and maintenance tested rate for the purposes of step 3 of clause 25.

Clause 11 provides for the application of the amendments made by this Schedule. The amendments apply in relation to working out an individual's family tax benefit Part A rate for days on or after commencement.

Statements of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Social Services Legislation Amendment (Promoting Sustainable Welfare) Bill 2018

Schedule 1 - Social security amendments

Schedule 2 - Farm household support amendments

Schedule 3 - Family assistance amendments

Schedule 4 - Paid parental leave amendments

These Schedules are compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

The following instruments are considered to be impacted by the Schedules:

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the International Covenant on Civil and Political Rights (ICCPR);

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the International Covenant on Economic, Social and Cultural Rights (ICESCR);

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the International Convention on the Elimination of All Forms of Racial Discrimination (CERD);

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the Convention on the Elimination of All Forms of Discrimination against Women (CEDAW);

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the Convention on the Rights of the Child (CRC); and

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the Convention on the Rights of Persons with Disabilities (CRPD).

Overview of the Schedules

The Schedules implement the Encouraging Self Sufficiency for Newly Arrived Migrants measure (the measure) announced in the 2017-18 Mid-Year Economic and Fiscal Outlook (MYEFO) and extended in the 2018-19 Budget with some subsequent adjustments.

As outlined in the MYEFO and Budget papers, Budget repair and a return to surplus remain a key priority for the Australian Government in order to maintain continued economic growth in Australia. In this context, it is important that Australia's welfare payments system provides the best possible encouragement for people to support themselves where they are able so that the system remains sustainable into the future. This includes migrants settling permanently in this country.

Waiting periods for newly arrived migrants already exist for a number of welfare payments. These waiting periods aim to encourage new permanent migrants to take steps to provide for their own financial support during their initial settlement period in Australia.

The measure will reinforce the Government's position that newly arrived migrants should be financially self-sufficient or rely on family members for support and should not expect to be immediately supported by Australian taxpayers.

This will enhance the residence-based nature of Australia's welfare payments system, ensuring that it remains fair, is targeted to those most in need of support and is sustainable in the long term so that assistance remains available to future generations.

This measure strikes a balance between promoting self-reliance for newly arrived migrants and providing appropriate safeguards for those in vulnerable circumstances.

These Schedules will:

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increase the existing newly arrived resident's waiting period (NARWP) for certain working age social security payments and concession cards from 104 weeks to 208 weeks, with the exception of carer payment (Schedule 1);

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apply a 208 week NARWP to other working age payments (parenting payment and bereavement allowance) that currently have a 104 week qualifying residence period (Schedule 1);

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introduce a new NARWP of 52 weeks for carer allowance (Schedule 1);

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increase the existing NARWP for farm household allowance from 104 weeks to 208 weeks (Schedule 2);

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introduce a NARWP of 52 weeks for family tax benefit Part A (Schedule 3); and

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introduce a NARWP of 104 weeks for parental leave pay and dad and partner pay (Schedule 4).

The effect of these Schedules will be that people granted a permanent residency visa (or in some cases, certain temporary visas) on or after commencement will not be able to receive the affected payments and concession cards until they have served any applicable NARWP.

There will be a range of exemptions from the NARWP, including for individuals and families in particularly vulnerable circumstances. Those exempt will have immediate access to the relevant payments or concession cards.

Human rights implications

These Schedules have considered the human rights implications particularly with reference to:

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the right to social security as contained within article 9 under the ICESCR;

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the right to maternity leave as contained within article 10(2) of the ICESCR and article 11(2)(b) of the CEDAW;

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the right to an adequate standard of living, including food, water and housing as contained within article 11 of the ICESCR;

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the right to health as contained in article 12(1) of the ICESCR;

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the right to equality and non-discrimination as contained in articles 2, 16 and 26 of the ICCPR;

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the right to freedom of movement as contained in articles 12 and 13 of the ICCPR;

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the right to protection against exploitation, violence and abuse as contained in article 20(2) of the ICCPR, and article 19(1) of the CRC and article 16(1) of the CRPD;

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the right to respect for the family as contained in articles 23 and 17(1) of the ICCPR;

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the rights of parents and children as contained in article 3 of the CRC and article 24(1) of the ICCPR; and

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the right to work and rights at work as contained in articles 6(1), 7 and 8(1)(a) of the ICESCR.

These Schedules are compatible with these human rights. To the extent that a human rights obligation is engaged or limited, the impact is reasonable and proportionate in achieving the objectives of the measure and the welfare payments system more broadly.

Right to Social Security

The right to social security requires that a system be established under domestic law, and that public authorities must take responsibility for the effective administration of the system. The social security scheme must provide a minimum essential level of benefits to all individuals and families that will enable them to cover essential living costs.

The CRC requires countries to recognise the right of the child to benefit from social security. Benefits should take into account the resources and circumstances of the child and persons having responsibility for the maintenance of the child.

The primary purpose of Australia's welfare payments system - encompassing social security payments, family assistance payments and paid parental leave payments -is to provide financial support for individuals and families who are unable to fully support themselves. The welfare payments system is targeted to direct payments to those most in need and encourage those who are able to support themselves to do so.

The Australian welfare payments system is based on the key concepts of residency and need. For this reason, payments are already subject to residency qualification requirements designed to direct payments to people who are residing in Australia and who have an established and ongoing connection to Australia, that is, Australian citizens, holders of permanent visas and, in some limited circumstances, holders of certain temporary visas.

Waiting periods already exist for a number of welfare payments for newly arrived migrants as part of the residency requirements that apply to these payments. These waiting periods reflect the expectation that new permanent residents should be able to support themselves when they first settle here. The current waiting period of 104 weeks was introduced for these payments in 1997 and has not changed since then.

The waiting period applies primarily to new migrants settling in Australia under the skilled and family streams of Australia's migration program - those who are well placed to support themselves and their families, through existing resources, work or support from family already in Australia.

This is reflected in the eligibility criteria for permanent residency through the skilled and family visa streams of the migration program:

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The skilled visa stream provides a pathway for skilled overseas workers with skills needed in Australia to settle permanently in Australia with the expectation that they will support themselves and their families through work.

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The family visa stream provides a pathway for existing Australian citizens and permanent residents to bring family members to Australia with the expectation that they will support those family members.

It is important that Australia's welfare payments system remains sustainable into the future and continues to provide the best possible encouragement for people to support themselves where they are able. This includes migrants settling permanently in this country.

Returning the Budget to balance by living within our means remains a key element of the Government's economic plan. To achieve the Government's fiscal strategy, including a return to surplus in 2020-21, fiscally responsible decisions are required to keep spending under control.

In 2016-17, Australia's expenditure on welfare payments to individuals (including social security payments, family assistance payments and paid parental leave payments) was $109.5 billion, representing around a quarter of the overall Commonwealth Budget.

Given the substantial expenditure associated with the welfare payments system, maintaining the ongoing sustainability of the system is critical to the Government's fiscal strategy. The Encouraging Self Sufficiency for Newly Arrived Migrants measure - as reflected in this Bill - contributes to achieving this fiscal outcome.

In the context of the current fiscal environment, and the Government's priorities as outlined above, it is reasonable to increase the existing waiting period for some payments and apply a new waiting period for others in order to encourage new permanent migrants to support themselves and their families for longer when they first settle in Australia. This will reduce the burden placed on Australia's welfare payments system and improve its long-term sustainability.

The Schedules in this Bill do not affect eligibility for social security pensions or benefits, rather they affect the rules governing when those eligible for certain payments can start receiving their entitlements. The amendments focus on promoting self-support by requiring claimants to meet their own living costs during their initial settlement period.

The vast majority of people impacted by the changes are people who will come to Australia on skilled visas to work in a specific field. By the nature of their migration pathway they are well placed to support themselves and their families once they have moved here. In relation to migrants arriving on family related visas, these are people who have the support of family members and are making the decision to move here to be with them.

The impact of this measure will only be felt by those migrants who would have otherwise sought and received certain payments during the extended waiting period. The overall financial impact on affected individuals will depend on their circumstances and the payments they would otherwise have received.

Australia accepts up to 190,000 permanent migrants each year under the skilled and family visa streams. The majority of these migrants are able to support themselves and their families and do not seek to access welfare payments during their first four years in Australia.

The Productivity Commission' 2016 Migrant Intake into Australia report noted that permanent non humanitarian migrants who arrived between 2000 and 2011 and would have been subject to a two year waiting period (unless exempt) had lower take-up rates of income support in 2011 than the general population. In particular, only three per cent of permanent skilled migrants and 13 per cent of family migrants who arrived between 2000 and 2011 were receiving any form of income support in 2011, compared to 17 per cent for the general population. This research indicates that most new migrants who have come under the skilled and family streams of the migration program since the introduction of the two year waiting period have been able to support themselves without needing to rely on income support, both during and following their waiting period. This is consistent with the intention of the waiting period to encourage self-sufficiency for migrants coming to Australia.

The measure is not retrospective and will apply to people granted a permanent visa (or in some cases, certain temporary visas) on or after commencement. This timing is designed to enable individuals and families who may be seeking to migrate to Australia to make informed decisions when applying for a visa, including making arrangements to support themselves during the waiting period. Migrants already granted permanent residency (or a relevant temporary visa) before commencement will not be affected. This means that no one who is already eligible for or receiving payments will have those entitlements taken away.

Importantly, there is a comprehensive range of exemptions and other exclusions from the measure which continue to provide a safety net for those who find themselves in need. Some exemptions and exclusions apply to all payments, while others apply to specific payments based on the nature of the payment.

Humanitarian migrants and their family members will continue to be exempt from the existing waiting periods for all social security payments and will also be exempt from the new waiting periods for family tax benefit, parental leave pay and dad and partner pay. Temporary humanitarian-type visa holders will be exempt from the NARWP for special benefit, the low income health care card, family tax benefit, parental leave pay and dad and partner pay. These exemptions recognise that refugees and their family members are often particularly vulnerable and are not usually in a position to make plans for their own support prior to applying for a humanitarian visa.

There will also be exemptions for people whose circumstances change after becoming a permanent resident and who may no longer be able to support themselves as they planned.

Migrants who become a lone parent after becoming an Australian resident will continue to be exempt from the waiting period for parenting payment, newstart allowance and youth allowance. Those who receive an exemption from the waiting period for one of these payments will also be exempt from the waiting period for family tax benefit. Those who subsequently have a new child will also be able to transfer to parental leave pay or dad and partner pay if they are otherwise qualified. This provides parents who lose the support - financial and otherwise - of a partner with access to support for themselves and their children.

In addition, migrants who experience a substantial change in circumstances after the start of their waiting period, and are in financial hardship, will continue to be exempt from the waiting period for special benefit. Special benefit is a payment of last resort that provides a safety net for people in hardship who are not otherwise eligible for other payments. Special benefit provides a basic level of support, usually equal to newstart allowance (or youth allowance if the person is aged under 22 years). Supplementary payments such as rent assistance, may also be paid in addition to these basic rates. Recipients of special benefit are also entitled to an automatic health care card or pensioner concession card, depending on their circumstances.

Those who receive this exemption and have dependent children will also be exempt from the waiting period for family tax benefit.

Consistent with established policy (contained in the Guide to Social Security Law) this may include migrants:

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who are the victim of domestic or family violence;

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who experience a prolonged injury or illness and are unable to work, or whose partner or sponsor does;

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whose dependent child develops a severe medical condition, disability or injury; or

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whose sponsor or partner dies, becomes a missing person or is imprisoned leaving the migrant with no other means of support.

The exemption recognises that migrants who have made the decision to settle permanently in Australia and made plans to support themselves may experience a substantial change of circumstances that prevents them from realising those plans.

There are a number of new exemptions being introduced through this Bill in relation to the new payments that will be subject to a NARWP for the first time. This includes exemptions designed to enable the new NARWP to operate coherently with the existing exemptions outlined above:

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People with an family tax benefit eligible child will be exempt from the NARWP for the low income health care card. These families would previously have qualified for a health care card as part of their family tax benefit. The exemption means that they can still receive a concession card where eligible and access associated health concessions, including discounted items under the Pharmaceutical Benefits Scheme.

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People who are receiving a social security pension or benefit or farm household allowance (for example, because they are exempt from the NARWP for that payment) will also be exempt from the NARWP for family payments and carer allowance. This will allow the exemptions to operate consistently across welfare payments and those exempt can access both primary income support payments and supplementary assistance for dependent children and/or caring responsibilities where eligible.

Finally, New Zealand citizens on a Special Category Visa (SCV) will be exempt from the NARWP for family tax benefit Part A, parental leave pay and dad and partner pay. This exemption only applies for certain payments as SCV holders are generally not eligible for other payments. This exemption means that New Zealand citizens in Australia will continue to access the same benefits in recognition of the particular Trans-Tasman Travel arrangements between Australia and New Zealand. SCV holders who later move to a permanent visa will continue to be eligible for this exemption, ensuring they can continue to receive these payments while serving the NARWP for other payments.

In addition to the above exemptions, there are also some exclusions from the measure which apply to certain visa cohorts. These exclusions mean that these visa holders are not subject to the changes contained in this Bill and therefore remain subject to current rules.

Migrants who hold or are granted an Orphan Relative or Remaining Relative visa will be excluded from the changes to the NARWP for payments and concessions. They will continue to have a two year NARWP for working age payments and concession cards, rather than the increased four year NARWP, and will have no NARWP for family payments and carer allowance. This exclusion recognises that these visa holders are often young people who have refugee-type experiences and may be disproportionately disadvantaged compared to other skilled and family visa holders if subject to the measure.

SCV holders will also be excluded from the changes to the NARWP for concession cards. They will continue to have a two year NARWP for concession cards, rather than the increased four year NARWP. This exclusion is consistent with the above exemption from the NARWP for family payments and means that SCV holders will not be affected by any of the changes in the Bill.

In addition to these exemptions and exclusions, the NARWP applied for family tax benefit Part A will not affect a person's entitlement to double orphan pension or stillborn baby payment. This means that migrants who have a stillborn child or are caring for a child who has lost both its parents will still have access to financial support to assist them in meeting any costs associated with these circumstances.

Families will also have immediate access to family tax benefit part B, where eligible, as no waiting period is being introduced for this payment. This recognises that this payment provides additional support for single parent and single income families to assist them to balance work and family responsibilities, particularly when their children are young.

These exemptions and exclusions provide a safety net for potentially vulnerable individuals and families, including those who may be less able to support themselves. These exemptions and exclusions strike a balance between promoting self-reliance for migrants and providing appropriate safeguards for those in vulnerable circumstances.

As noted above, the amendments in these Schedules focus on encouraging people making the decision to settle permanently in Australia to take steps to provide for their own financial support during their initial settlement period. In this way, the amendments help to target access to payments to those most in need, with appropriate safeguards and exemptions for those unable to support themselves as planned.

To the extent that this measure places any limitation on the rights to social security, this limitation is reasonable and proportionate in the context of achieving these fiscal objectives that benefit the nation, while ensuring a safety net is available for the most vulnerable.

In addition, permanent migrants will still have access to broader Government-funded services to support their integration and wellbeing, including health care and education services. Access to child care services will also be available for those who work or study and have children.

Right to maternity leave

The right to maternity leave includes an entitlement for working mothers to paid leave or social security benefits during a reasonable period before and after childbirth. It also requires countries, as a measure of prevention of discrimination against women, to provide maternity leave with pay or with comparable social benefits without loss of former employment or seniority. The right to maternity leave is contained in article 10(2) of the ICESCR and article 11(2)(b) of the CEDAW.

The Paid Parental Leave Act 2010 provides for the Paid Parental Leave scheme, comprised of Parental Leave Pay and Dad and Partner Pay, which complements the entitlement to unpaid leave under the National Employment Standards in the Fair Work Act 2009.

The Government remains committed to assisting parents to balance their work and family responsibilities through a range of programs and payments. However, this must be balanced with the responsibility to keep family assistance and social security payments well targeted and sustainable into the future.

The changes detailed in this Bill do not interfere with the existing rights and protections under the Fair Work Act 2009, including access to 12 months of unpaid parental leave without loss of employment or seniority within the workplace. The changes also do not limit parents' ability to access employer-provided leave following the birth or adoption of a child. In addition, parents who do return to work or study or other approved activities and are using approved child care will continue to have access to child care subsidies.

Waiting periods for new migrants already exist for a number of welfare payments, including parenting payment. These waiting periods reflect the expectation that new permanent residents should be able to support themselves. Introducing a waiting period for parental leave pay and dad and partner pay is consistent with the existing principle of self-reliance for new migrants.

While it is acknowledged that the upbringing of children requires a sharing of responsibility between men, women and society as a whole, it is reasonable to expect that migrants who make the decision to have a child during their initial settlement period should also allow for the costs of supporting themselves and their children during the waiting period.

The Australian welfare system is targeted so that those who most need help receive it. In order to sustain this, those who can support their children are expected to do so.

The majority of newly arrived migrants in scope for this measure are expected to be able to provide for themselves and their family members during the waiting period, as they are settling in Australia through the skilled and family streams of the migration program. These migrants are well placed to support themselves through work, existing resources or family support. Most are also expected to be able to make informed decisions about growing their families within the settlement period.

This measure does not affect humanitarian migrants and their family members, acknowledging these people are often particularly vulnerable and may have less capacity to plan for their own support prior to coming to Australia.

The duration of the waiting period for parental leave pay and dad and partner pay is set at two years, and once the waiting period has been served, and migrants have had an opportunity to contribute economically and socially to the nation, they will be subject to the same eligibility requirements as any other citizens for social welfare and family payments.

While the measure introduces a new waiting period for parental leave pay and dad and partner pay, migrants who have a baby born in the six months after commencement, and would otherwise be eligible for payment, will still be able to access these payments for that baby. This will mean that prospective parents who may already be pregnant prior to commencement and have made leave plans already based on the current rules are not disadvantaged.

In addition, as outlined above, there are a number of key exemptions to the NARWP for families with children who experience a change of circumstances and are unable to support themselves as originally planned, including those who become a lone parent after arrival and no longer have the support of their partner, and those in financial hardship.

These exemptions provide migrants in these circumstances, particularly migrant women, with access financial support through payments, such as parenting payment or special benefit, where eligible. Those who are granted one of these payments under an exemption will also be exempt from the effect of the waiting period for the Paid Parental Leave Scheme, family tax benefit and carer allowance. This means that migrants in these circumstances who have dependent children or caring responsibilities for a person with disability can also access additional support where eligible. For example, a woman granted special benefit because she is in hardship due to a change in circumstances would also be able to receive family tax benefit for any eligible children and would also be able to transfer to parental leave pay if she has a new baby and meets all the requirements.

Many employers, including the Australian, state and territory governments also provide paid parental leave entitlements which are unaffected by the measure. In addition, the Fair Work Act 2009 also provides for an entitlement of up to 12 months of unpaid parental leave under the National Employment Standards.

Access to a range of other government funded payments and services, including childcare subsidies, health care and education has also been retained for newly arrived migrants.

Families will also have immediate access to family tax benefit Part B, where eligible, as no waiting period is being introduced for this payment. This recognises that this payment provides additional support for single and single income families to enable them to balance work and caring responsibilities, particularly when their children are young.

Targeting expenditure remains an essential part of balancing the distribution of available resources with the most effective measures for addressing barriers and creating opportunity.

To the extent that this measure places any limitation on the right to maternity leave, this limitation is reasonable and proportionate in the context of encouraging self-reliance by new migrants and maintaining the ongoing sustainability of the Paid Parental Leave Scheme and the welfare payments system more broadly. The measure provides for a safety net for the most vulnerable through a comprehensive range of exemptions and transitional arrangements; and does not affect other non-Government funded parental leave which will continue to be available.

Right to an adequate standard of living, including food, water and housing

This measure engages the right to an adequate standard of living, including food, water and housing, contained in Article 11 of the ICESCR. The right to an adequate standard of living, including food, water and housing provides that everyone is entitled to adequate food, clothing and housing and to the continuous improvement of living conditions.

The amendments contained in this measure are an extension of the Government's existing policy on waiting periods and strengthen the expectation that new permanent residents should be able to support themselves upon arrival. To the extent that the measure impacts on a person's right to an adequate standard of living, including food, water and housing, by virtue of this measure, the impact is limited.

Australia's migration system is focused on skilled migration to attract people with the skills and talent to help build Australia's economy, increase productivity and create jobs. That means the majority of new permanent skilled migrants are coming here to work and will be well placed to support not only themselves, but also their families.

As noted above, research by the Productivity Commission indicates that the majority of new skilled and family migrants can and do support themselves when they first settle in Australia.

There is a comprehensive range of exemptions, including for those who are less able to plan for their own support prior to coming to Australia (such as humanitarian entrants and their families) or experience a change in circumstances that means they can no longer support themselves as planned. These exemptions provide a safety net through access to payments such as special benefit (and, where the person has children, family tax benefit Part A) to those people left without other means of support for reasons beyond their control so they are supported to meet their basic living costs.

The potential limitations on this right are considered proportionate to the policy objective of encouraging self-support in order to keep the system sustainable while providing exemptions for eligible people whose circumstances change and no longer have the capacity to support themselves.

Right to health

The right to health is the right to the enjoyment of the highest attainable standard of physical and mental health and is contained in article 12(1) of the ICESCR.

The Schedules engage the right to health through the extension of the waiting period for the low income health care card (HCC) and commonwealth seniors health card from two to four years. The Schedules also engage the right to health where entitlement to an automatically issued HCC is delayed because the payment to which it is linked is subject to a waiting period.

Delayed access to a HCC will not affect entitlement to benefits under the Medicare Benefits Scheme (MBS) and the Pharmaceutical Benefits Scheme (PBS). MBS benefits include a Medicare card, free treatment for public patients in a public hospital and rebates on MBS listed health services. PBS benefits include access to subsidised medicines through a 'co-payment', with further subsidies applying once a person has reached the relevant PBS safety-net threshold. All permanent visa holders, including those subject to a waiting period for welfare payments, will continue to have access to the MBS and PBS benefits (these benefits are also available to certain temporary visa holders).

It will, however, affect entitlement to the additional concessional benefits available to concession card holders. This includes access to bulk billing incentives, a lower Extended Medicare Safety Net, a lower PBS co-payment amount and a lower PBS safety-net threshold.

However, the vast majority of people impacted by this measure are people migrating to Australia under the skilled migration program to work in a specific field. By the nature of their migration pathway they are well placed to support themselves and their families once they have moved here.

There are a range of exemptions that enable potentially vulnerable migrants who have limited means and may face difficultly meeting health costs without concessional assistance to access a concession card.

Humanitarian entrants and their family members will be exempt from all waiting periods for social security payments and concession cards and will therefore retain access to the associated additional concessional health benefits.

New Zealand citizens on a SCV and holders of other certain other temporary visas (Temporary Protection Visas and Safe Haven Enterprise Visas) will be exempt from the waiting period for family tax benefit Part A , meaning they can continue to access this support if they have eligible children. Those on low incomes will also retain access to an automatic HCC as part of their family tax benefit entitlement.

Certain visa cohorts will be excluded from the changes to payments and/or concession cards. Orphan Relative and Remaining Relative visa holders will be excluded from the changes to the NARWP for all payments and concession cards. SCV holders will be excluded from the changes to the NARWP for the health care card (low income) and seniors health cards. These exclusions mean that these visa holders will not have their waiting periods increased and will not have to wait longer to access a concession card (whether linked to payment receipt or a stand-alone card, such as the health care card (low income)) and associated health concessions.

Families who have a family tax benefit eligible child but are serving a waiting period for family tax benefit Part A will be exempt from the waiting period for the low income HCC. This will allow low-income families to claim this card immediately and access the associated concessional health benefits.

Individuals and families who experience a change of circumstances and find themselves in hardship will be exempt from the waiting period for payments such as special benefit or parenting payment (depending on the change of circumstances) and will also have access to a concession card as part of their payment.

With regards to protections against infectious diseases, the Government has a clear position that immunisation is the safest way to protect children from vaccine-preventable diseases.

To give children the best protection against diseases such as whooping cough and measles, the Government is aiming towards an interim immunisation coverage target of 95 per cent for childhood vaccination rates. This target provides sufficient herd immunity to prevent the transmission of vaccine-preventable diseases and the

No Jab, No Pay policy that applies to family tax benefit is helping to achieve this.

Through awareness raising initiatives, the Government is encouraging all parents to immunise their children. The No Jab, No Pay provides financial incentives for parents to have their children appropriately immunised by making access to certain payments, such as family tax benefit end-of-year supplements and child care subsidies, contingent on meeting immunisation requirements. Families not in receipt of family tax benefit Part A (because they are serving a waiting period) will not be impacted by the financial incentives of immunising their children that the No Jab, No Pay policy provides. However, they may be covered when enrolling children in childcare and/or school through state and territory initiatives. This will continue to provide incentives for migrant families to make sure that their children are appropriately immunised. In addition, catch-up schedules are available to migrant families so that they can get their children fully immunised.

In addition, permanent migrants will still have access to broader Government-funded services, including health care services.

Right to freedom of movement

The right to freedom of movement includes the right to move freely within a country for those who are lawfully within the country, the right to leave any country and the right to enter a country of which you are a citizen. The right to freedom of movement is contained in articles 12 and 13 of the ICCPR.

While the measure builds on existing waiting periods required before a migrant can access social security, it does not impose restrictions or conditions on an individual's right to enter or leave Australia, or move freely within Australia.

The Schedules may place increased pressure on migrants to remain in the location of their employment, subsequently restricting their freedom of movement. However, any limitations are considered reasonable and proportionate and would be of a temporary nature, limited to the duration of the waiting period.

The measure is designed to maintain the sustainability of Australia's welfare system, and to encourage those seeking to settle permanently in Australia to make sure they have the capacity to support themselves. It is not intended to reduce the numbers of migrants coming to Australia, and no variation in migration patterns is predicted as a result of the amendments.

In addition, individuals and families take into account a number of different factors when deciding to migrate permanently to another country. This includes economic, demographic, social, political, cultural and environmental factors as well as the characteristics of the destination country. These amendments impact on only part of a much bigger consideration for potential migrants.

Right to equality and non-discrimination

This measure engages the rights of equality and non-discrimination contained in articles 2, 16 and 26 of the ICCPR. Equality affirms that all human beings are born free and equal. Equality presupposes that all individuals have the same rights and deserve the same level of respect. All people have the right to be treated equally.

Non-discrimination is an integral part of the principle of equality. It ensures that no one is denied their rights because of factors such as race, colour, sex, language, religion, political or other opinion, national or social origin, property or birth. In addition to those grounds, discrimination on certain other grounds may also be prohibited. These grounds include age, nationality, marital status, disability, place of residence within a country and sexual orientation.

These Schedules engage the right to equality and non-discrimination in that they will result in both direct and indirect differential treatment on the basis of national origin, visa class and sex.

Under existing rules, humanitarian migrants and their families are exempt from the waiting periods for all social security payments, and will continue to be exempt under the measure. They will also be exempt from the new waiting periods for family tax benefit, parental leave pay and dad and partner pay.

These exemptions acknowledge that welfare payments are key to the successful long term settlement of humanitarian entrants in particular as they are particularly vulnerable, generally have no other means of support and are not usually in a position to make plans for their own support prior to applying for a humanitarian visa.

The differentiation of treatment conferred to humanitarian migrants is considered legitimate for the purpose of addressing the interests of a particularly disadvantaged community group.

Orphan and Remaining Relative visa holders are also excluded from changes to all payments in recognition that these visa holders are young people who have often experienced refugee-type experiences or other trauma. The differential treatment for these visa holders is considered legitimate on the basis that this cohort may be disproportionately disadvantaged compared to other skilled and family visa holders if subject to the changes.

Under the Trans-Tasman Travel Arrangement (TTTA) introduced in 1973, Australian and New Zealand citizens are able to enter each other's country to visit, live and work indefinitely, without the need to apply for prior authority. New Zealand is the only country in the world that has such an arrangement with Australia.

In recognition of the unique arrangements between Australia and New Zealand under the long-standing TTTA, New Zealand citizens in Australia on a SCV will be exempt from the waiting period for family payments and will not have their current two year waiting period for certain concession cards increased. This means that New Zealanders on a SCV will retain access to the same entitlements they can currently access.

To the extent that differentiation of treatment on the basis of national origin is applied to this cohort, it is considered reasonable and proportionate and reaffirms the positive and important role that freedom of Trans-Tasman movement plays in strengthening the bilateral relationship between Australia and New Zealand.

This measure will apply a NARWP to new payment types, including family tax benefit Part A, parental leave pay, dad and partner pay and carer allowance. These changes are reasonable and proportionate to the objective of keeping Australia's welfare payments system sustainable.

By the nature of the payments, the introduction of a waiting period for family tax benefit Part A, parental leave pay and dad and partner pay will only affect those migrants with dependent children or those migrants who are planning to have children.

In addition, while these payments and carer allowance are not targeted specifically to women, it is acknowledged that women are more likely to access these payments as they often bear the majority of caring responsibilities for children and/or family members with a disability. As a result, women are more likely to have a NARWP applied in relation to these payments.

Consideration was also given to whether these changes, in particular, disproportionately affect women who are more likely to experience family and domestic violence. While the measure does not directly target women or families, to address the above mentioned concerns the measure contains a number of key safeguards that provide appropriate protections for this cohort.

For example, migrants who become a lone parent after becoming an Australian resident will continue to be exempt from the waiting period for parenting payment, newstart allowance and youth allowance. Migrants who experience another substantial change of circumstances after the start of their waiting period, and are in financial hardship, will also continue to be exempt from the waiting period for special benefit. Those who receive one of these exemptions and who have dependent children will also be exempt from the waiting period for family tax benefit.

Also, migrants who have a baby born in the six months after commencement, and would otherwise be eligible for parental leave pay and dad and partner pay, will still be able to access these payments for that baby.

While these exemptions from the waiting period are not specifically targeted to women, women are likely to benefit in particular given some circumstances that attract an exemption - for example becoming a single parent or experiencing a change in circumstances such as domestic violence - are more likely to be experienced by women.

The comprehensive range of exemptions and safeguards provide migrants, particularly migrant women, with access to payments where they find themselves in hardship.

As the majority of newly arrived migrants are from culturally and linguistically diverse (CALD) backgrounds, these Schedules will more significantly impact this cohort. While it is acknowledged that, generally, people from CALD backgrounds can face additional barriers to finding work, the vast majority of people impacted by this measure are people migrating to Australia under the skilled migration program to work in a specific field. By the nature of their migration pathway they are well placed to support themselves and their families once they have moved here.

This measure supports the Government's ongoing fiscal strategy to balance the Budget and enable continued economic growth, while providing a safety net for vulnerable cohorts. To the extent that the differential treatment of certain groups under this measure constitutes a limitation on the right to equality and non-discrimination, this limitation is considered to be reasonable and proportionate to the legitimate objective of achieving these fiscal objectives, by ensuring that newly arrived migrants meet their own living costs for a reasonable period before receiving Government assistance, in order to keep the system sustainable into the future.

Given the exemptions available, this measure is the least restrictive way of applying consistent rules and expectations for new migrants in order to improve the sustainability of the welfare payments system, both in the short and longer term.

Protection against exploitation, violence and abuse

Numerous provisions in human rights treaties require countries to take measures to protect persons from exploitation, violence and abuse. The right to protection against exploitation, violence and abuse is contained in article 20(2) of the ICCPR, and article 19(1) of the CRC and article 16(1) of the CRPD.

The UN Committee on the Elimination of all Forms of Discrimination against Women has stated that gender-based violence, including domestic violence is a form of discrimination that seriously inhibits women's ability to enjoy rights and freedoms on a basis of equality with men.

The Schedules provide exemptions to the waiting periods for special benefit and family tax benefit Part A (where relevant) for those migrants who experience a substantial change in circumstances, and are in financial hardship, following their arrival. This critical safety net is intended to cater for circumstances such as those who experience domestic violence, and their children.

Right to respect for the family

The right to respect for the family and freedom from interference with the family is contained in articles 23 and 17(1) of the ICCPR.

While the measure builds on existing waiting periods required before a migrant can access social security, it is not designed to impose restrictions or conditions which will impact on a dependent child's welfare.

The vast majority of people impacted by the changes are people who will come to Australia on skilled visas to work in a specific field. By the nature of their migration pathway they are well placed to support themselves and their families once they have moved here. In relation to migrants arriving on family related visas, these are people who have the support of family members and are making the decision to move here to be with them.

Safeguards have been included to enable parents to access financial support should their family experience a substantial change in circumstances resulting in financial hardship. The measure provides exemptions to the waiting periods for special benefit and family tax benefit Part A (where relevant) for those migrants who experience a substantial change in circumstances, and are in financial hardship, following their arrival. This critical safety net is intended to cater for circumstances such as those who experience domestic violence, and their children. Family tax benefit part B will also be available (where relevant).

Rights of parents and children

In addition to the rights enjoyed by all persons under human rights treaties, parents and children enjoy special rights, particular to their status. The rights are contained in article 3 of the CRC and article 24(1) of the ICCPR.

This measure has particular impacts on:

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best interests of the child;

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responsibilities, rights and duties of parents; and

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refugee children.

Many permanent skilled and family visa types also allow applicants to include dependent children in their visa applications. In relation to the measure's impact on the best interests of the child, it is reasonable to expect that permanent migrants choosing to bring their family with them to Australia should be in a position to support their family as well as themselves during their initial period of settlement.

The measure provides exemptions to the waiting periods for special benefit and family tax benefit Part A (where relevant) for those migrants who experience a substantial change in circumstances, and are in financial hardship, following their arrival.

In addition, the NARWP applied for family tax benefit Part A will not affect a person's entitlement to double orphan pension or stillborn baby payment. This provides migrants who have a stillborn child or are caring for a child who has lost both its parents with access to financial support so they can meet any costs associated with these circumstances.

As outlined above, families will also have immediate access to family tax benefit Part B, where eligible, as no waiting period is being introduced for this payment. This recognises that this payment provides additional support for single and single income families to enable them to balance work and caring responsibilities, particularly when their children are young.

In relation to the responsibilities, rights and duties of parents, the CRC recognises the principle that both parents have common responsibilities for the upbringing and development of the child. It also provides that there should be appropriate assistance to parents and legal guardians in the performance of their child-rearing responsibilities, in particular to ensure that children of working parents have the right to benefit from child-care services and facilities for which they are eligible.

Access to childcare subsidies will be retained for newly arrived migrants to help families to participate in work, study, training or other recognised activities. In addition there is a range of government funded payments and services which are made available to support participation, social cohesion, integration and wellbeing, such as health care and education, which contribute to safeguarding these rights.

Also, migrants who have a baby born in the six months after commencement, and would otherwise be eligible for parental leave pay and dad and partner pay, will still be able to access these payments for that baby.

The rights relating to refugee children (including their families) are addressed through the continuation of existing exemptions from waiting periods for all social security payments and additional exemptions from the new waiting periods for family tax benefit, parental leave pay and dad and partner pay.

The limitations on access to social security are considered reasonable and proportionate to achieving the objective of enhancing the residence-based nature of Australia's social security system, ensuring that it remains fair, is targeted to those most in need of income support and is sustainable in the long term so that social security remains available to future generations of Australians.

Right to work and rights at work

The right to work includes the right of everyone to the opportunity to gain his or her living by work which he or she freely chooses or accepts. Rights in work include the enjoyment of just and favourable conditions of work and to form and join trade unions. The right to work and rights in work is contained in articles 6(1), 7 and 8(1)(a) of the ICESCR.

Permanent visa holders under the skilled and family migration program, including those subject to a waiting period for welfare payments, will continue to have the right to work in Australia and will continue to be covered by the workplace protections provided by federal legislation, such as the Fair Work Act 2009, as well as state and territory based legislation.

Most newly arrived migrants are not currently entitled to job seeker payments, such as newstart allowance for two years after becoming an Australian resident. Under the measure, this will be extended to four years. However, these migrants will still be able to volunteer for jobactive services for up to six months to help them find a job.

Migrants will also be able to access the child care subsidy to help families to participate in work, study, training or other recognised activities.

These arrangements mean that affected migrants will continue to be eligible for assistance to find and maintain work, as well as reasonable conditions and protections in the workplace.

Conclusion

These Schedules are compatible with human rights. To the extent that a human rights obligation is engaged or limited, the impact is for a legitimate objective, and is reasonable, necessary and proportionate as outlined above.

Australia is a prosperous country with strong social and economic foundations. To maintain this, it is important that Australia's welfare payments system remains sustainable into the future and provides the best possible encouragement for people to support themselves where they are able.

While the Australian welfare payments system is already highly targeted, prudent and reasonable changes, such as those contained in this Bill, are required to maintain the stability and sustainability of the system in the longer term.

These Schedules support the Government's commitment to a sustainable, equitable and needs-based social security system. Introducing these changes to waiting periods will encourage new migrants to put arrangements in place to support themselves during their initial settlement period. This will, in turn, support the stability and sustainability of Australia's social security system.

It is reasonable to expect that people choosing to become permanent residents of Australia should be able to support themselves and their families through their existing resources, through work or through support from family members already in Australia.

The amendments in these Schedules will promote this by strengthening existing waiting periods for some Australian welfare payments and introducing new waiting periods for several others.

This is the least restrictive approach to achieving the reasonable objectives of encouraging self-support for new migrants, reducing the burden placed on Australia's welfare payments system and ensuring its ongoing sustainability.

Importantly, a number of exemptions and protections have been incorporated into the Schedules to enable potentially vulnerable groups to be appropriately supported through the welfare payments system.

To the extent that this measure places any limitation on a human rights obligation, this limitation is reasonable and proportionate in the context of achieving these fiscal objectives that benefit the nation, while ensuring a safety net is available for the most vulnerable.

Schedule 5 - Other amendments

The amendments insert Schedule 5 which amends the A New Tax System (Family Assistance) Act 1999, Paid Parental Leave Act 2010 to implement:

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the Consistent Treatment for Families Receiving Family Tax Benefit Part A measure announced as part of the 2017-18 Budget, which was originally contained in the Social Services Legislation Amendment (Payment Integrity) Bill 2017

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elements of the Family Tax Benefit and Paid Parental Leave - Maintaining Income Thresholds measure announced as part of the 2017-18 Mid-Year Economic and Fiscal Outlook, which was originally contained in the Social Services Legislation Amendment (Maintaining Income Thresholds) Bill 2018.

Overview of the measures

The amendments introduce a new taper structure for the maximum rate of family tax benefit Part A which provides consistency in how family tax benefit Part A is income tested for families with income above the higher income free area. Under these amendments, the maximum rate will be reduced by 20 cents for every dollar earned between the family tax benefit Part A lower income free area (currently $53,728) and higher income free area and 30 cents for every dollar earned above the higher income free area.

To balance the impact of increasing the taper rate for some families with higher incomes the amendments also provide a one-off increase to the family tax benefit Part A higher income free area to $98,988. The family tax benefit Part A higher income free area will be set at the new higher level until 30 June 2021. Together these changes create a simpler, fairer and better targeted system.

The measure also pauses indexation to the family tax benefit Part B primary earner income limit, the parental leave pay and dad and partner pay individual income limits.

Maintaining the higher income limits for family tax benefit Part B, parental leave pay and dad and partner pay at their current levels until 30 June 2021 will target Government assistance to low and middle-income families.

This measure will result in savings and help to keep family and parental payments sustainable into the future.

Human rights implications

These amendments are likely to engage the right to social security.

Article 9 of the ICESCR recognises 'the right of everyone to social security'. That right requires a social security system to be established, and states that a country must, within its maximum available resources, ensure access to a social security scheme that provides a minimum essential level of benefits to all individuals and families that will enable them to acquire at least essential health care, basic shelter and housing, water and sanitation, foodstuffs, and the most basic forms of education. Article 26 of the CRC ensures that right to 'every child' and requires that 'the benefits should, where appropriate, be granted, taking into account the resources and the circumstances of the child and persons having responsibility for the maintenance of the child'.

These amendments maintain the current income test that applies to the higher income limits for family and parental payments. These amendments will not affect the fortnightly assistance currently provided to low and middle-income families.

Lifting the family tax benefit Part A higher income free area from $94,316 to $98,988 and implementing a 30 per cent taper rate for all families with income above the higher income free area provides a more equitable and consistent method of means testing between families with the same income.

Families cease to be eligible for family tax benefit Part B once the primary earner's income exceeds $100,000 per year, and parents cease to be eligible for parental leave pay or dad and partner pay once their income reaches $150,000 per year.

Families at these income levels are considered to have reasonable levels of private income which would enable them to maintain their current living standards.

These amendments are compatible with human rights because they advance the protection of human rights. In particular, increasing the family tax benefit Part A higher income free area will provide more support to some working families while reductions through increasing the taper rate only impacts families with higher income and greater capacity for self-provision. These changes contribute to a fairer, simpler, better-targeted and more sustainable family payment system. To the extent that these changes limit access to family and parental payments, the impact is for a legitimate objective and is reasonable, necessary and proportionate as outlined above.