Mark Arbib (NSW, Australian Labor Party, Minister for Social Housing and Homelessness) Share this | Hansard source

In the Families, Housing, Community Services and Indigenous Affairs and Other Legislation Amendment (Further Election Commitments and Other Measures) Bill 2011, the government is pleased to deliver on three further commitments made during the 2010 election to Australian families. In the first of the election commitments, we are overhauling the arrangements for advance payments of family tax benefit to better meet family needs. From 1 July 2011, the system will be much more flexible and families will have more scope to choose the size and timing of their advance payments. Under the new system, families will have help in meeting unexpected costs such as having to replace a broken down fridge or damaged school uniform and generally managing their family budget around unexpected expenses such as car registration. This new flexibility could mean some families will avoid higher credit card bills or high-interest small loans.

Between certain minimum and maximum amounts, families will be able to choose the value of their own advance payment. The minimum amount will be the same for all families: 3.75 per cent of the maximum standard rate for a child aged under 13, giving a minimum advance amount of around $160. The maximum amount will be linked to each separate family's usual rate of payment. Generally this will mean that a maximum of 7.5 per cent of that rate will be available for advance payment. For a family with one child under 13 and not receiving rent assistance, this would give a maximum advance amount of around $320. For a family with two children under 13 and not receiving rent assistance, the maximum advance would be around $640. The maximum advance would be higher for a family that is receiving rent assistance. An overall maximum will apply for all families. This will be set initially at $1,000 in 2011-12 and will be maintained at the same percentage of the maximum standard rate for one child under 13 as in the first year. Repayment of the advance will be through adjustments to families' ongoing fortnightly family tax benefit part A entitlements.

This new system will free families from the current confines of receiving and repaying advances within two set periods of the year: 1 January to 30 June and 1 July to 31 December. Families will be able to request more of their entitlements in advance at any point in the year and the advance will be recovered in the following six months. However, advance payment requests will not be approved by Centrelink if they would result in financial hardship. Families making repeated requests will also be assessed to see whether they may benefit from financial advice or financial counselling.

In the second of the election commitments delivered by this bill, a new requirement will be set up for income support recipient parents or carers of four-year-olds to give their children a healthy start for school. This initiative will make the family tax benefit part A supplement conditional for these families on their children going through a health assessment such as the Healthy Kids Check. In this way, we will ensure that children are healthy, fit and ready to learn when they start school. The check will help early detection of lifestyle risk factors and delayed development and illness such as vision and hearing problems. The health check will also offer guidance for families on healthy lifestyles and early intervention strategies. Research tells us these opportunities will be particularly important for low-income families, where a good education is so important in helping to break the patterns of disadvantage. In working with this new arrangement from 1 July 2011, parents will need to show Centrelink that the check has been done. There will be provision to waive the new requirement in exceptional circumstances such as when the child has a severe disability or terminal illness.

In the third election commitment delivered by this bill, the current policy of child support assessments of using a default income figure when a parent fails to lodge or is late with his or her tax return will be replaced with a more accurate process. Under current arrangements, the child support assessment for a parent in these situations is based on a figure equal to two-thirds of male total average weekly earnings. However, this figure often understates the parent's actual income. A more accurate child-support assessment and therefore better support for children will be produced by the new process, which will generally be the parent's last known taxable income indexed by the growth in average wages. However, if the current two-thirds method would produce a higher income, that figure will be used instead. Lastly, there are some minor clarifications that will be made to several family assistance and child support provisions. These minor amendments do not change existing policy.

Question agreed to.

Bill read a second time.