Senate

Revised Explanatory Memorandum

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

Schedule 13 - Removal of exemptions for drug or alcohol dependence

Summary

This Schedule provides that exemptions from the activity test and participation requirements will no longer be available in relation to circumstances directly attributable to drug or alcohol misuse (including abuse of drugs or alcohol) for certain social security recipients.

Background

This Schedule applies to recipients of:

•

Newstart Allowance,

•

Youth Allowance (other) (that is, a Youth Allowance recipient who is a job seeker and not a Youth Allowance full-time student or a Youth Allowance Australian apprentice), disability support pension (under 35 with participation requirements),

•

special benefit (with activity test requirements), and

•

parenting payment single (with participation requirements).

Under current arrangements, these social security recipients may be granted an exemption from their activity test or participation requirements in some circumstances that may be directly attributable to drug or alcohol misuse or abuse. For example, exemptions may be granted in circumstances of temporary incapacity or special circumstances where these circumstances were potentially caused by drug use. It is not in line with community expectations that someone on welfare payments is exempt from their mutual obligation requirements primarily due to alcohol or drug usage.

From 1 January 2018, recipients of these activity tested payments will no longer have access to exemptions from their mutual obligation or participation requirements where the reason for the exemption is wholly or predominantly attributable to drug or alcohol dependency or misuse. For example, an exemption would not be granted where a person applies for an incapacity exemption relating to a drug or alcohol dependency condition or for a special circumstances exemption due to a major personal crisis because they have been evicted from their home due to drug or alcohol misuse.

Recipients who are not eligible for an exemption will remain connected to their employment services provider and will have to satisfy their mutual obligation or participation requirements as per existing arrangements, although their requirements will be tailored to take into account their particular barriers (for example, engaging in appropriate drug or alcohol treatment).

Recipients who fail to meet their requirements without a reasonable excuse may be subject to the job seeker compliance framework, including the new targeted compliance framework from 1 July 2018.

A person who is a 'declared program participant' (as determined in an instrument made by the Secretary under new section 28C of the Social Security Act will not be subject to the amendments made by this Schedule. It is intended that a declared program participant will include remote job seekers participating in the Community Development Program.

The amendments made by this Schedule commence on 1 January 2018 if the Act receives Royal Assent before 1 January 2018. If the Act receives Royal Assent on or after 1 January 2018 this Schedule will commence on the first 1 January, 1 April, 1 July or 1 October to occur after the day this Act receives Royal Assent.

Explanation of the changes

Social Security Act

Item 1 inserts a definition of declared program participant into subsection 23(1). This new definition provides that 'declared program participant' means a person who is a participant, in accordance with the applicable provisions (if any) of a determination made under section 28C, in an employment services program specified in that determination.

Item 2 inserts new section 28C after section 28B. New section 28C provides that the Secretary may, by legislative instrument, make a determination for the purposes of the new definition of declared program participant in subsection 23(1). The purpose of this instrument is to prevent participants in certain employment services programs from being subject to the amendments made in items 3 to 12 of this Schedule.

Item 3 inserts new subsection 94C(1A) after subsection 94C(1). Subsection 94C(1) provides that a person who claims or receives disability support pension is covered by a participation exemption if the Secretary is satisfied that the person is temporarily unable to meet the participation requirements because of illness or an accident. New subsection 94C(1A) provides that subsection 94C(1) does not apply to illness, or an accident, wholly or predominantly attributable to the person's dependence on alcohol or another drug, unless the person is a declared program participant.

Item 4 inserts new subsection 94F(1A) after subsection 94F(1). Subsection 94F(1) provides that a person who claims or receives disability support pension is covered by a participation exemption for a period determined by the Secretary if:

(a)

the Secretary is satisfied that special circumstances, beyond the person's control, exist; and

(b)

the Secretary is satisfied that in those circumstances it would be unreasonable to expect the person to meet the participation requirements for that period.

New subsection 94F(1A) provides that the exemption in subsection 94F(1) does not apply to circumstances wholly or predominantly attributable to the person's misuse of alcohol or another drug, unless the person is a declared program participant.

Item 5 inserts new subsection 502F(1A) after subsection 502F(1). Subsection 502F(1) provides that a person who claims or receives parenting payment is covered by a participation exemption in respect of a period if:

(a)

the Secretary is satisfied that special circumstances, beyond the person's control, exist; and

(b)

the Secretary is satisfied that in those circumstances it would be unreasonable to expect the person to meet the participation requirements for that period.

New subsection 502F(1A) provides that the exemption in subsection 502F(1) does not apply to circumstances wholly or predominantly attributable to the person's misuse of alcohol or another drug, unless the person is a declared program participant.

Item 6 inserts new subsection 502H(1AA) after subsection 502H(1). Subsection 502H(1) provides that a person who claims or receives parenting payment is covered by a participation exemption in respect of a period if throughout the period the person is incapacitated for work because of sickness or an accident, the person's incapacity meets the other criteria in subsection 502H(1) and the Secretary is satisfied that the incapacity has not been brought about with a view to obtaining an exemption from meeting the participation requirements. New subsection 502H(1AA) provides that subsection 502H(1) does not apply to sickness, or an accident, wholly or predominantly attributable to the person's dependence on alcohol or another drug, unless the person is a declared program participant.

Item 7 inserts new subsection 542A(1AA) after subsection 542A(1). Subsection 542A(1) provides that a person who claims or receives Youth Allowance has a temporary incapacity exemption for a period if, throughout the period, the person:

•

if the person is undertaking full-time study--does not have the capacity to undertake the course of education in respect of which he or she is undertaking full-time study; or

•

if the person is an early school leaver and a Youth Allowance Employment Pathway Plan is in force in relation to the person--does not have the capacity to undertake the required activities; or

•

in any other case--is incapacitated for work;

because of sickness or an accident.

The person's incapacity must also meet the other criteria in subsection 542A(1) and the Secretary must be satisfied that the incapacity has not been brought about with a view to obtaining an exemption from the activity test for Youth Allowance.

New subsection 542A(1AA) provides that subsection 542A(1) does not apply to sickness, or an accident, wholly or predominantly attributable to the person's dependence on alcohol or another drug, unless the person is a declared program participant, a new apprentice or undertaking full-time study.

Item 8 inserts new subsection 542H(1AA) after subsection 542H(1). Subsection 542H(1) provides that a person who claims or receives Youth Allowance has a specific circumstances exemption in respect of a period if:

(a)

the Secretary is satisfied that special circumstances beyond the person's control exist; and

(b)

the Secretary is satisfied that in those circumstances it would be unreasonable to expect the person to satisfy the activity test for that period.

New subsection 542H(1AA) provides that the exemption in subsection 542H(1) does not apply to circumstances wholly or predominantly attributable to the person's misuse of alcohol or another drug, unless the person is a declared program participant, a new apprentice or undertaking full-time study.

Item 9 inserts new subsection 603A(1A) after subsection 603A(1). Subsection 603A(1) provides that a person who claims or receives Newstart Allowance is not required to satisfy the activity test for a period if:

(a)

the Secretary is satisfied that special circumstances, beyond the person's control, exist; and

(b)

the Secretary is satisfied that in those circumstances it would be unreasonable to expect the person to comply with the activity test for that period.

New subsection 603A(1A) provides that the exemption in subsection 603A(1) does not apply to circumstances wholly or predominantly attributable to the person's misuse of alcohol or another drug, unless the person is a declared program participant.

Item 10 inserts new subsection 603C(1AA) after subsection 603C(1). Subsection 603C(1) provides that a person who claims or receives Newstart Allowance is not required to satisfy the activity test in respect of a period if throughout the period the person is incapacitated for work because of sickness or an accident, the person's incapacity meets the other criteria in subsection 603C(1) and the Secretary is satisfied that the incapacity has not been brought about with a view to obtaining an exemption from the activity test. New subsection 603C(1AA) provides that subsection 603C(1) does not apply to sickness, or an accident, wholly or predominantly attributable to the person's dependence on alcohol or another drug, unless the person is a declared program participant.

Item 11 inserts new subsection 731E(1A) after subsection 731E(1). Subsection 731E(1) provides that a person who claims or receives a special benefit is not required to satisfy the activity test for a period if:

(a)

the Secretary is satisfied that special circumstances, beyond the person's control, exist; and

(b)

the Secretary is satisfied that in those circumstances it would be unreasonable to expect the person to comply with the activity test for that period.

New subsection 731E(1A) provides that the exemption in subsection 731E(1) does not apply to circumstances wholly or predominantly attributable to the person's misuse of alcohol or another drug, unless the person is a declared program participant.

Item 12 inserts new subsection 731K(1AA) after subsection 731K(1). Subsection 731K(1) provides that a person who claims or receives a special benefit is not required to satisfy the activity test in respect of a period if throughout the period the person is incapacitated for work because of sickness or an accident, the person's incapacity meets the other criteria in subsection 731K(1) and the Secretary is satisfied that the incapacity has not been brought about with a view to avoiding any requirement to satisfy the activity test. New subsection 731K(1AA) provides that subsection 731K(1) does not apply to sickness, or an accident, wholly or predominantly attributable to the person's dependence on alcohol or another drug, unless the person is a declared program participant.

Item 13 is an application provision that provides that the amendments made by this Schedule apply in relation to circumstances, illness or sickness existing, and accidents occurring, on or after the commencement of this Schedule.