Explanatory Memorandum
Circulated By the Authority of the Minister for Families, Housing, Community Services and Indigenous Affairs, the Hon Jenny Macklin MPOUTLINE
This Bill will introduce three further election commitments affecting families, a 2010-11 Budget measure streamlining the notification processes for compensation recipients, and some minor family assistance amendments.
Family tax benefit advance
The Bill introduces a further element from the election commitment package titled Better Access to Family Payments. This will provide for more flexible advance payments of family tax benefit, to help families meet unexpected costs.
Health checks for young FTB children
As one of its election commitments, the Government announced the Healthy Start for School measure for family tax benefit (FTB) recipients on income support payments. This measure will make the payment of the FTB Part A supplement for a child turning four in a particular income year conditional on the child undertaking a health check. The measure will commence on 1 July 2011.
Determinations of adjusted taxable income
The Bill introduces an election commitment from the Government's package , Strengthening Compliance - child support. The measure modifies the current rules applicable to the Child Support Registrar in determining a person's adjusted taxable income where a parent's taxable income has not been formally assessed. A new, more accurate, default income arrangement will be introduced that uses a parent's previous taxable income, indexed by growth in wages, instead of a lower default income (two-thirds of Male Total Average Weekly Earnings), in cases where they have not lodged a tax return.
Notice of payments of recompense for personal injuries
The 2010-11 Budget measure , Streamline the Notification Processes for Compensation Recipients, is included in this Bill. The new provisions require payers of compensation, such as insurance companies, to notify Centrelink of proposed payments of compensation. Centrelink will then use this information to determine the social security entitlements of the compensation recipient or their partner. This will reduce the risk of individuals incurring unnecessary debt to the Commonwealth and receiving income support payments to which they or their partner are not entitled.
Other amendments
The Bill also makes minor amendments to the family assistance law and child support legislation to clarify technical or drafting matters, and ensure the legislation operates as intended. There are no policy changes from these amendments.
Financial impact statement
Family tax benefit advance
Total resourcing
| 2010-11 | 2011-12 | 2012-13 | 2013-14 | 2014-15 |
|---|---|---|---|---|
| $3.5 m * | $22.0 m * | $11.6 m | $11.2 m | $11.2 m |
* Does not include Centrelink capital costs of $1.6 m in 2010-11 and $1.3 m in 2011-12.
Health checks for young FTB children
Total resourcing
| 2010-11 | 2011-12 | 2012-13 | 2013-14 | 2014-15 |
|---|---|---|---|---|
| $4.0 m * | $2.8 m * | $1.2 m | $1.2 m | $1.4 m |
* Does not include Centrelink capital costs of $0.8 m in 2010-11 and $0.7 m in 2011-12.
Determinations of adjusted taxable income
Total change in resourcing *
| 2010-11 | 2011-12 | 2012-13 | 2013-14 |
|---|---|---|---|
| - $18.7 m | - $19.4 m | - $20.1 m | - $20.4 m |
* Includes impacts for the Department of Human Services and the Department of Families, Housing, Community Services and Indigenous Affairs.
Notice of payments of recompense for personal injuries
Total resourcing *
| 2010-11 | 2011-12 | 2012-13 | 2013-14 |
|---|---|---|---|
| $0.2 m | - $7.1 m | - $12.8 m | - $14.3 m |
* As a result of amendments made in the House to this measure (relating to the period within which notice must be given of payments of recompense), it is estimated that there is a reduction in savings of approximately $1.1 million for the forward estimates period. The main reason for this is potential delay in negotiating and entering into agreements with compensation payers to provide data.
Other amendments
Nil.