House of Representatives

Explanatory Memorandum

Jenny Macklin Mp (Minister for Families, Housing, Community Services and Indigenous Affairs)

Schedule 1 - Training and learning bonus and farmers hardship bonus

Summary

This Schedule provides for a training and learning bonus and farmers hardship bonus of $950. Recipients of youth allowance, austudy payment, special benefit, sickness allowance, ABSTUDY payment and education allowance under the Veterans' Children Education Scheme or the Military Rehabilitation and Compensation Act Education and Training Scheme may qualify for the training and learning bonus. Certain individuals who receive FTB Part A in relation to children aged 21 to 24 can also qualify for the training and learning bonus for each such child. Additionally, people in receipt of certain financial assistance to farmers and farm-related small business will also be eligible for a farmers hardship bonus of $950.

Background

The Government is providing, as part of its Household Stimulus Package, a one-off bonus payment to specified recipients of income support payments and FTB. This training and learning bonus is intended to assist with the costs associated with study or training.

The Government is also providing, as part of part of its Household Stimulus Package, a one-off bonus payment to recipients of certain income support and like payments under farm household assistance schemes administered by the Department of Agriculture, Fisheries and Forestry.

This Schedule commences on Royal Assent.

Explanation of the changes

Item 1 provides that the Military Rehabilitation and Compensation Act Education and Training Scheme (MRCAETS) means the scheme determined under section 258 of the Military Rehabilitation and Compensation Act 2004 .

Item 2 provides that the Veterans' Children Education Scheme (VCES) means the scheme determined under section 117 of the Veterans' Entitlements Act 1986 .

Training and learning bonus

Item 3 sets out qualification for the training and learning bonus in new Part 2.18. Under new subsection 910(2), a person is qualified for a training and learning bonus if the person was paid an instalment in respect of a period that included 3 February 2009 of youth allowance, austudy, special benefit, sickness allowance, a payment under the ABSTUDY Scheme that included an amount identified as living allowance, an education allowance for primary, secondary, tertiary and homeless students and double orphan students under the VCES, or an education allowance for primary, secondary, tertiary and homeless students under the MRCAETS.

However, a person receiving youth allowance is only qualified if, on 3 February 2009, the person was undertaking full-time study or was qualified for youth allowance as a new apprentice. A person receiving special benefit is only qualified for the training and learning bonus if, on 14 October 2008, the person was not of pension age. (People receiving special benefit who had reached pension age on 14 October 2008 received the economic security strategy payment under Part 2.17 of the Social Security Act. This measure will ensure that special beneficiaries who missed out on the economic security strategy payment because of their age on 14 October 2008 will receive the training and learning bonus.)

A person is qualified for the training and learning bonus if, on 3 February 2009, the person was entitled to FTB which included a Part A rate on 3 February 2009 that was greater than nil (worked out taking into account at least one FTB child who was aged 21 or more and less than 25) and the person would have been entitled to back to school bonus if that child had been aged four or more and less than 19 on 3 February 2009.

New subsection 910(5) acknowledges that there may be situations where a person qualifies for the training and learning bonus under more than one criterion outlined above. However, regardless of how many times a person qualifies, they can only receive the training and learning bonus once. Furthermore, an FTB child for whom another person is entitled to the back to school bonus, a person who is entitled to a back to school bonus, or a person who is entitled to a back to school bonus in their own right is not qualified for a training and learning bonus.

A person who qualifies for the training and learning bonus because they receive a payment identified in subsection 910(2) receives a training and learning bonus of $950. This recognises that the bonus for a person qualified under subsection 910(2) is to contribute to that person's own education expenses.

A person who qualifies for the training and learning bonus because they have one or more qualifying FTB children, as determined by subsection 910(4), receives a training and learning bonus of $950 for each qualifying FTB child. This recognises that the bonus for a person qualified under subsection 910(4) is to contribute to the education expenses of each FTB child of that person aged 21 to 24.

If the person also qualifies for the training and learning bonus because they receive a payment identified in subsection 910(2), they receive a training and learning bonus equal to the sum $950 (to offset their personal education expenses) and $950 for each qualifying FTB child (to offset their children's education expenses).

Subsection 911(2) provides that, where a person is only receiving a portion of FTB Part A, they will only receive the equivalent portion of the training and learning bonus.

Farmers hardship bonus

Proposed Division 2 of Part 2.18 of the Social Security Act will allow individuals in receipt of payment that is from an eligible payment type, to receive a one-off bonus payment under the farmers hardship bonus. Eligible payments under the farmers hardship bonus are the Exceptional Circumstances Relief Payment, Farm Help Income Support, Transitional Income Support and Interim Income Support payments.

These provisions are necessary to allow individuals in receipt of the Exceptional Circumstances Relief Payment, Farm Help Income Support, Transitional Income Support or Interim Income Support payments, access to the one-off farmers hardship bonus that is a component of this bill.

Items 4 and 5 amend paragraph 1231(1AA)(b) to include the training and learning bonus and farmers hardship bonus so that the Secretary cannot make a determination to reduce the bonus to nil, unless the criteria in subsection 1231(1AA) are complied with.

Amendments to the Social Security ( Administration ) Act 1999

Item 6 amends section 12AB to provide that a claim is not required for a training and learning bonus or a farmers hardship bonus.

Items 7 and 8 amend section 47 to provide that a training and learning bonus and a farmers hardship bonus are lump sum benefits and, subject to new subsection 47C(3) and (4), are to be paid to the person who is qualified for them.

Items 9 and 10 amend section 47C to include the training and learning bonus and the farmers hardship bonus in the section and to add new subsections 47C(2), (3) and (4).

Subsection (2) provides that the bonus is paid in a single lump sum on the date that the Secretary considers to be the earliest date on which it is reasonable practicable to do so and in the manner the Secretary considers is appropriate.

However, a person qualified for youth allowance, ABSTUDY living allowance, or education allowance under the VCES or MRCAETS will not always be the actual recipient of that allowance. The allowance may be paid to the person's parent, guardian or, in some cases, to a boarding house or residential college where the person lives while studying. Subsections (3) and (4) allow the Secretary to pay the training and learning bonus that a person on youth allowance, ABSTUDY, VCES or MRCAETS is qualified for to that person's parent or another appropriate person.

Under subsection (3), if an individual is qualified for the training and learning bonus because they receive youth allowance and the whole or part of the instalment of youth allowance for the period including 3 October 2009 is paid to a parent of the individual in accordance with section 45 of the Social Security Administration Act, the Secretary may pay the whole or same proportion of the bonus to the parent or to any other person.

Under subsection (4), if an individual is qualified for the training and learning bonus because they receive a payment under the ABSTUDY Scheme or an education allowance under the VCES or the MRCAETS, as identified in new paragraph 910(2)(f) or (g), and the whole or part of an instalment of the payment is paid to a person ('recipient') other than the individual, the Secretary may pay the whole or same proportion to the recipient or to any other person.