House of Representatives

Explanatory Memorandum

(Circulated by the authority of the Minister for Social Services, the Hon Christian Porter MP)

STATEMENTS OF COMPATIBILITY WITH HUMAN RIGHTS

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

SOCIAL SERVICES LEGISLATION AMENDMENT (FAMILY ASSISTANCE ALIGNMENT AND OTHER MEASURES) BILL 2016

SCHEDULE 1 - MAIN AMENDMENTS

This Schedule 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.

Overview of the Schedule

This Schedule introduces amendments to the A New Tax System (Family Assistance Administration) Act 1999 (the Family Assistance Administration Act) for the purpose of ensuring that clear date of effect rules operate for certain merit review decisions that create new or increased entitlement for Family Tax Benefit (FTB), for example, through top-up payments or FTB supplements. Generally, most of the amendments apply with respect to the 2012-2013 and/or later income years.

Human rights implications

The Schedule engages the following human rights:

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the right of everyone to social security in Article 9, and the right of everyone to an adequate standard of living for an individual and their family, including adequate food, clothing and housing, and the continuous improvement of living conditions in Article 11 of the International Covenant on Economic, Social and Cultural Rights (ICESCR); and

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the rights of the child in Article 26 of the Convention on the Rights of the Child.

Rights to social security and the right to an adequate standard of living

Article 9 of the ICESCR recognises the right of everyone to social security. Article 11 of the ICESCR recognises the right of everyone to an adequate standard of living and to the continuous improvement of living conditions.

The right to social security requires that a system be established under domestic law, and that public authorities must take responsibility for the effective administration of the system. The social security scheme must provide a minimum essential level of benefits to all individuals and families that will enable them to cover essential living costs.

Under section 32A of the Family Assistance Administration Act, the Secretary must disregard FTB Part A and FTB Part B supplements unless and until the individual has satisfied the relevant FTB reconciliation conditions that apply to them. This Schedule ensures that all recipients are treated equally, regardless of the relevant reconciliation conditions that apply to them.

Those people who are not required to lodge a tax return in order for reconciliation to take place will be treated in the same manner as those required to lodge a tax return.

It is acknowledged there is potential that some individuals will miss out on amounts of FTB such as the supplements, due to notifying their adjusted taxable income after the confirmation timeframe, however, this outcome is consistent with the intent of the policy and is a proportional and reasonable requirement to ensure that individuals are paid their correct entitlement at the time they need it most.

While most of the amendments have retrospective effect from the 2012-2013 income year, individuals have been aware of these notification timeframes for a number of years already. There have been extensive communications of the requirements; the individuals have been advised of these timeframes regularly in letters sent directly to them, and on government websites. These changes ensure that the law is aligned with the practice as intended.

The rights of the child

Article 26 of the Convention on the Rights of the Child 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.

Families who meet their relevant reconciliation conditions and lose entitlement to any supplement or top-up will still have access to their overall family assistance entitlement. However, they will cease to be eligible for an end of year lump sum payment.

The changes will ensure the family payments system is sustainable and support is better targeted to assist with the direct costs of raising dependent children for families that have limited resources.

Conclusion

The Schedule is compatible with human rights because people are not being restricted from accessing social security payments. The amendments proposed ensure additional FTB entitlement calculated at income reconciliation would not be paid to a person who has failed to notify they are not required to lodge in time for the 2012-2013 and later income years.

There is no material effect on individuals as a result of these amendments, as they are intended to clarify and strengthen the current law.

SCHEDULE 2 - CONTINGENT AMENDMENTS

This Schedule 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.

Overview of the Schedule

Schedule 2 proposes amendments to repeal or revise the measures proposed in Schedule 1 of this Bill in the event that Part 3 of Schedule 3 of the Structural Reform Bill commences. If this event occurs, FTB supplements would be phased out by 1 July 2018. This would mean that any references to FTB supplements in the amendments proposed by Schedule 1 would be redundant with respect to FTB entitlements in respect of the 2018-2019 and later income years.

These are contingent amendments only. They rise and fall with the enactment of Schedule 3 of the Structural Reform Bill.

Human rights implications

The Explanatory Memorandum to the Structural Reform Bill contains a Statement of Compatibility with Human Rights for Schedule 3 of that Bill. That document notes that the amendments proposed by that Bill are likely to engage:

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the right to social security, particularly Articles 9 and 11 of the International Covenant on Economic, Social and Cultural Rights; and

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the rights of the child, particularly Article 26 of the Convention on the Rights of the Child.

The Explanatory Memorandum to the Structural Reform Bill states that the amendments proposed by Schedule 3 of that Bill are compatible with human rights because they do not limit or preclude people from gaining or maintaining access to social security in Australia and, to the extent that those changes limit access to family payments, the limitations are reasonable and proportionate.

Conclusion

As the amendments proposed by Schedule 2 of this Bill are consequential to the amendments proposed by Schedule 3 of the Structural Reform Bill, they are compatible with human rights for the same reasons as specified above.

SCHEDULE 3 - OTHER AMENDMENTS

This Schedule 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.

Overview of the Schedule

Schedule 3 corrects an unintended consequence in a provision of the More Generous Means Testing for Youth Payments Act and ensures that the aim to align the parental means testing arrangements for youth allowance more closely with those for Family Tax Benefit Part A will be met.

Human rights implications

Schedule 3 engages the following human rights:

Right to social security

The Schedule is consistent with supporting the right to social security and consistent with the means tested nature of the social security system in Australia.

From 1 January 2017, maintenance income will be assessed under a new maintenance income test for Youth Allowance.

This measure was part of a package of changes that included removing maintenance income from the Youth Allowance parental income test from 1 January 2016 and replacing it with a maintenance income test, similar to that applying to Family Tax Benefit Part A, from 1 January 2017.

This Schedule corrects a minor technical error in the Social Security Act and gives effect to the intended outcome from that reform package.

Conclusion

The amendments in the Schedule are compatible with human rights because they do not limit access to social security.