House of Representatives

Explanatory Memorandum

(Circulated by the authority of the Minister for Family and Community Services, Senator the Hon Kay Patterson)

Outline and financial impact statement

This Bill amends the social security law, the family assistance law and the Veterans' Entitlements Act 1986 to give effect to 2004 election commitments in respect of self funded retirees, older Australians and carers on income support, grandparents caring for children and certain disability pensioners. The bill will:

•

establish the new utilities allowance, generally $100 a year for singles and $50 for each member of a couple, payable to senior Australians of age pension or veteran pension age who are in receipt of income support, to help this group to pay regular household bills;

•

establish the new seniors concession allowance, a payment of $200 a year to holders of a Commonwealth Seniors Health Card, in recognition of the fact that most self funded retirees do not receive concessions for energy, rates, water and sewerage, and motor vehicle registration from state and territory governments and also to acknowledge the contribution made by self funded retirees in providing for their own retirement;

•

improve opportunities and flexibility for carers by increasing the number of hours (from 20 to 25 hours per week) that carers may spend in work, training or study, without losing qualification for carer payment;

•

make child care more affordable for grandparents who have primary care of a grandchild and who are receiving income support, by enabling them to have access to a special rate of child care benefit that will cover the full cost of child care fees charged to eligible grandparents by approved child care services; and

•

amend the Veterans' Entitlements Act 1986 to increase bereavement payments in respect of persons receiving above general rate disability pension.

Schedule 1 (Utilities Allowance)

Commencement: 1 December 2004 or Royal Assent (whichever earlier)

Financial impact:

Administered resourcing

2004-05 $80.4 m

2005-06 $168.0 m

2006-07 $175.5 m

2007-08 $183.0 m

Departmental resourcing

2004-05 $1.7 m

2005-06 $1.3 m

2006-07 $0.1 m

2007-08 $0.1 m

Schedule 2 (Seniors Concession Allowance)

Commencement: 1 December 2004 or Royal Assent (whichever earlier)

Financial impact:

Administered resourcing

2004-05 $57.8 m

2005-06 $61.6 m

2006-07 $65.7 m

2007-08 $70.1 m

Departmental resourcing

2004-05 $1.0 m

2005-06 $0.6 m

2006-07 $0.7 m

2007-08 $0.8 m

Schedule 3 (Carer payment)

Commencement: 1 April 2005

Financial impact:

Administered resourcing

2004-05 $0.1 m

2005-06 $2.3 m

2006-07 $5.9 m

2007-08 $10.2 m

Departmental resourcing

2004-05 $0.7 m

2005-06 $0.1 m

2006-07 $0.1 m

2007-08 $0.1 m

Schedule 4 (Special child care benefit rate for grandparents on income support)

Commencement: 1 January 2005

Financial impact:

Administered resourcing

2004-05 $7.4 m

2005-06 $18.0 m

2006-07 $22.9 m

2007-08 $28.1 m

Departmental resourcing

2004-05 $1.3 m

2005-06 $0.3 m

2006-07 $0.3 m

2007-08 $0.3 m

Schedule 5 (Increase in bereavement payments in respect of above general rate disability pensioners)

Commencement: 1 January 2005

Financial impact:

Administered resourcing

2004-05 $1.9 m

2005-06 $4.1 m

2006-07 $4.3 m

2007-08 $4.5 m

Departmental resourcing

nil