Senate

Addendum to the Explanatory Memorandum

(Circulated by authority of the Minister for Education and Youth, the Honourable Alan Tudge MP)

Senate Standing Committee for the Scrutiny of Bills

In Scrutiny Digest 10 of 2021, the Senate Standing Committee for the Scrutiny of Bills requested the Minister's advice about provisions in the Bill which allow delegated legislation to modify the operation of the A New Tax System (Family Assistance) Act 1999 and the A New Tax System (Family Assistance) (Administration) Act 1999 in relation to prescribing different numbers of weeks in relation to items 10, 11 and 13 of Schedule 2 to the Bill, which relate to paragraphs 67CC(2)(b) and 67CC(2)(d) of the A New Tax System (Family Assistance) (Administration) Act 1999 and proposed paragraph 3B(1)(d) of the A New Tax System (Family Assistance) Act 1999.

In Scrutiny Digest 11 of 2021, the Committee requested the key information provided by the Minister to the Committee in response to its request for advice be included in an Addendum to the Explanatory Memorandum to the Bill. That information is as follows.

Items 11 and 13

Item 11 provides additional circumstances when the Secretary may make a cessation of eligibility determination. This includes where no sessions of care have been provided to the child for at least 26 consecutive weeks, or a different number of consecutive weeks as prescribed by Minister's Rules. The purpose of this amendment is to address the risk that a parent makes a claim for Child Care Subsidy (CCS) for their eldest child aged five years or under, with no intention of that child ever using child care, in order to receive a higher rate of subsidy for any younger children.

Item 13 requires that in order for a child to receive a higher rate of subsidy, at least one session of care has to have been provided to the 'other child' (that is, an eldest child aged five years or under), in at least one week out of the past 14 weeks, or a different number of weeks as prescribed by Minister's Rules. This item is intended to supplement the amendment at item 11 and provide an additional safeguard for the measure.

Including the ability to be able to change the time periods set out in item 11 and 13 is critical to ensure policy integrity is maintained. The intent of the Bill is to provide increased support to families who actively use child care for multiple children aged five years and under. Following implementation, the Department of Education, Skills and Employment and Services Australia will monitor the number of individuals who receive CCS eligibility determinations for their eldest child aged five years and under, but do not enrol or use care for this child. This will allow the Department to identify where the Multiple Child Subsidy is being paid to families who are not actively using child care for their multiple children, and respond to this through potential changes to the time periods in items 11 and 13. This is appropriate to ensure the Australian Government's investment is spent in line with policy intent.

The ability to change the time periods through Minister's Rules will also allow the Government to quickly respond if it becomes evident the provisions are negatively impacting families who are genuinely accessing child care. A contemporary example of when these timeframes may require expeditious adjustment is where, because of an extended COVID-19 related lockdown, or a period of local emergency, no sessions of care have been provided to children enrolled at a service for more than 14 weeks. In such circumstances, it would be essential for the Government to be able to immediately extend the 14 week period via Minister's Rules, to ensure families and child care providers are not adversely affected.

Item 10

Item 10 amends an existing provision in A New Tax System (Family Assistance) (Administration) Act 1999, which allows the Secretary to make a cessation of eligibility determination if the individual has not been entitled to be paid CCS for at least 52 weeks. The item will allow the Minister to prescribe a different number of weeks in Minister's Rules.

As this provision also affects CCS eligibility, it is appropriate that this period should also be amended by Minister's Rules. This will enable the appropriateness of the period to be considered alongside any changes to the time periods in items 11 and 13 of Schedule 2 of the Bill. Looking at these three time periods together will ensure that the cumulative impact on families of the three provisions can be considered and that there is policy consistency around CCS eligibility determinations.