House of Representatives

Second Reading Speech

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

I move:

That this bill be now read a second time.

This bill contains one 2010 budget measure and several other measures.

The budget measure in the bill will enhance the existing arrangements for special disability trusts as part of the government's ongoing commitment to people with disability, their families and carers.

Special disability trusts were established in 2006 to help families and carers provide for the care and accommodation needs of a family member with a severe disability. Special disability trusts differ from other forms of trust in that they have generous concessions from social security means-testing arrangements for the beneficiary and eligible contributors. This means that a person with a disability who is a beneficiary of a special disability trust will not lose any of their disability support pension unless their assets exceed a generous assets test threshold.

In 2008, the Senate Standing Committee on Community Affairs found that take-up of these arrangements has been lower than expected. The arrangements developed under the former coalition government were not working for people with disability, their families and carers.

In response to the committee's report, the government committed to a number of changes to special disability trusts in the 2010-11 budget to provide more flexibility for trust beneficiaries and to make special disability trusts more attractive for families.

Under the current rules, if a person with a disability works for as little as an hour for the 'relevant minimum wage' or above, they are not eligible to be a beneficiary of a special disability trust. This bill addresses this disincentive for people with disabilities to participate in work and the community. It will allow eligible people with a disability to work up to seven hours a week at or above the relevant minimum wage, or to work under the supported wage system, and still qualify as a beneficiary of a special disability trust.

Other amendments will significantly expand what trust funds can be used for, such as all medical expenses, including membership costs for private health funds, and maintenance expenses of special disability trust assets.

Amendments will also allow the trust to make up to $10,000 per year of discretionary spending for the beneficiary's wellbeing, recreation and independence. This change addresses the previous restrictive rules that trust funds could only be used for specified care and accommodation expenses, and will increase the social participation of beneficiaries.

The changes contained in this bill will build on the taxation concessions the government announced in the 2009-10 budget in response to the Senate committee's report.

The bill will also include amendments to close a loophole in qualification for disability support pension. This loophole has allowed continued payment of disability support pension to people who live permanently overseas but return to Australia every 13 weeks in order to retain their pension.

From 1 January 2011, only disability support pensioners permanently residing in Australia will continue to receive the pension, except under limited and specific circumstances. This change will bring disability support pension into line with other workforce age payments.

Closing this loophole will keep the disability support pension payment system fair and effective. Any pensioners who have a need to travel overseas for short periods will still have access to the 13-week temporary absence rule.

In a further measure, the bill will continue the government's program under land rights legislation for the Northern Territory by adding further parcels of land to schedule 1 to the Aboriginal Land Rights (Northern Territory) Act 1976. This will allow the land in question (that is, certain land near Borroloola, and the Port Patterson Islands) to be granted to relevant Aboriginal Land Trusts, helping to resolve two long-running and complex land claims.

The bill also amends the Aboriginal and Torres Strait Islander Act 2005 in relation to the Indigenous Land Corporation established under that act. The Indigenous Land Corporation was established shortly after the Native Title Act 1993 came into effect. In recognition that native title may not be established by all Indigenous Australians, the Indigenous Land Corporation's functions include helping Indigenous Australians to manage land, and to buy land, to provide long-term economic development and environmental, social and cultural benefits.

The amendments will allow the minister to issue guidelines that the Indigenous Land Corporation must take into account if it exercises its functions in supporting native title settlements. Given the complex context in which native title settlements are negotiated, the guidelines should help clarify the Indigenous Land Corporation's role in supporting native title settlements by providing guidance in the exercise of its functions. The guidelines may also provide guidance to the Indigenous Land Corporation that will enhance its reporting requirements on specific matters covered in the guidelines.

In making these amendments, the government recognises that the Indigenous Land Corporation can assist with the resolution of native title settlements, particularly where connection to the land in question is at issue and native title may not be established.

Another measure in the bill will clarify the eligibility for family tax benefit part A of some families with FTB children who are studying overseas full time. If the courses these young people are undertaking do not link to an Australian qualification, it is not clear under the current legislation that they should attract family tax benefit part A.

This bill puts that policy intention beyond doubt and ensures that young people studying overseas full time are treated for family tax benefit purposes in the same way as full time students undertaking Australian study.

Lastly, the bill makes some minor amendments, including to address two minor anomalies arising from the pension reform legislation enacted in 2009. Both amendments are to make sure people get the benefit of the new provisions that they were intended to have.

Debate (on motion by Mr Andrews) adjourned.