Explanatory Memorandum
(Circulated by authority of the Assistant Minister for Education, the Honourable Sussan Ley MP)Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Family Assistance Legislation Amendment (Child Care Measures) Bill 2014
This Bill is 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 .
Background
The Child Care Rebate (CCR) is a payment that provides assistance for families who use approved child care by covering half of all their out-of-pocket fees (after Child Care Benefit (CCB), a means tested payment), up to a maximum limit per child per income year. The CCR limit is currently capped at $7,500 until 30 June 2014. To be eligible for the CCR, families must be eligible for CCB, have used approved child care and met the CCR work, training, study test . CCR is not income tested and eligibility for CCR includes families who are entitled to CCB at the 'zero rate' due to their income.
In 2011 legislative amendments were made to paragraph 84F of the A New Tax System (Family Assistance) Act 1999 (the FA Act) by the Family Assistance Legislation Amendment (Child Care Budget Measures) Act 2011 (the Budget Measures Act) to set a cap and to pause the indexation of the CCR limit. These amendments took effect on 15 September 2011.
The CCB is a means-tested payment that provides financial assistance to help families with child care costs. The CCB upper and lower income thresholds are used as part of calculating the rate of an individual's CCB. The lower and upper CCB income thresholds are currently $41,902 and $97,632 respectively and are indexed each year on 1 July in line with CPI increases.
The Child Care Rebate (CCR) measure in this Bill was first put forward in the Social Services and Other Legislation Amendment Bill 2013 (at Schedule 9) by the Honourable Kevin Andrews MP and was examined by the Parliamentary Joint Committee on Human Rights. In the Committee's first report of the 44th Parliament, dated 10 December 2013, the Committee considered that the amendments proposed in Schedule 9 of that Bill, which included the CCR measure, did not give rise to human rights compatibility issues.
Overview of the Bill
The Bill will maintain the current CCR limit at $7,500 per financial year per child, by continuing to pause the indexation of the CCR limit for a further three income years to 30 June 2017. The Bill amends paragraph 84F(ea) of, and clause 3 of Schedule 4 to, the FA Act to preserve the current CCR limit and pause the indexation of the CCR limit that was originally introduced through the Budget Measures Act in 2011.
The Bill will also maintain the CCB income thresholds at the amount applicable as at 30 June 2014, for the three income years to 30 June 2017. The Bill amends Schedule 4 to the FA Act to maintain the CCB income thresholds at the amounts in place as at 30 June 2014.
Human Rights Implications
The Bill engages the following human rights: Rights of the child
The rights of the child are contained in the Convention of the Rights of the Child (CRC).
Article 3 of the CRC requires that in all actions concerning children, the best interests of the child shall be a primary consideration.
To the extent that the Bill engages the rights of the child, it does not limit those rights as it maintains the provision of payments to assist the affordability of child care for families.
Right to social security
In the context of providing additional payments to families for child care the Bill also engages the right to social security contained in Article 9 of the International Covenant on Economic, Social and Cultural Rights (ICESCR), as well as article 26 of the CRC, which specifically recognises the right of a child to benefit from social security.
Article 9 of the ICESCR requires amongst other things 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. Article 26 of the CRC requires countries to recognise the right of the child to benefit from social security. Benefits should take into account the resources and the circumstances of the child and persons having responsibility for the maintenance of the child.
The right to social security is not absolute and may be subject to permissible limitations. The UN Committee on Economic, Social and Cultural Rights has said that the right to social security includes the right not to be subject to arbitrary and unreasonable restrictions of existing social security coverage. [1] Any removal in entitlements must be justified in line with Article 4 of the ICESCR (limitations are to be determined by law, be compatible with the nature of these rights and be solely for the purpose of promoting the general welfare in a democratic society) in the context of the full use of the maximum available resources of the State party. [2]
The Government considers that maintaining the current CCR limit until 1 July 2017 is a reasonable, necessary and proportionate measure that is in the interest of Australia's current fiscal and economic position, given savings from the measure have already been taken by the previous government.
The current limit of $7,500 per child per financial year is currently set out in the legislation and will be retained in this measure. This maximum amount of CCR is not being reduced through this Bill.
The Government also considers that the overall effect of maintaining the CCB income thresholds until 1 July 2017 will, in relation to the families whose children attend approved child care, be limited by continued indexation of the CCB standard hourly rate, the minimum hourly amount and the multiple child loadings, which are not affected by this measure. For many of the families impacted by maintaining the CCB income thresholds, half of their additional out-of-pocket child care costs will be met by CCR.
To the extent the Bill limits the right to social security, this limitation is reasonable and proportionate to achieving a legitimate aim.
Conclusion
To the extent that the Bill engages the rights of the child and to the extent it engages and places any limitation on the right to social security, such limitation is reasonable, necessary and proportionate to achieving a legitimate aim.
The Bill is compatible with human rights.