Thursday, 13 May 2010
Indigenous Education (Targeted Assistance) Amendment Bill 2010; Tax Laws Amendment (2010 Measures No. 2) Bill 2010; 1998 Budget Measures Legislation Amendment (Social Security and Veterans' Entitlements) Bill 1998
That these bills be now read a second time.
I seek leave to have the second reading speeches incorporated in Hansard.
The speeches read as follows—
The Indigenous Education (Targeted Assistance) Amendment Bill 2010 makes amendments to the Indigenous Education (Targeted Assistance) Act 2000.
The Bill amends the table in subsection 14B(1) of the Indigenous Education (Targeted Assistance) Act 2000 to include additional funding for the Sporting Chance program, in order to bring it into the Commonwealth’s suite of targeted assistance measures and to adjust the 2010 to 2012 appropriations agreed as part of the new Federal Financial Relations Framework.
By amending the appropriations under the Indigenous Education (Targeted Assistance) Act 2000 the Australian Government can continue working with a range of stakeholders to develop and implement innovative measures to close the gap.
In education the gap between indigenous and non-indigenous students is stark.
Most indigenous students meet minimum standards of reading, writing and numeracy – but not nearly as many as their non-indigenous classmates.
For example, the 2009 NAPLAN results reveal a gap of 26.4 percentage points between the reading levels of indigenous and non-indigenous Year 5 students.
When they reach Year nine, NAPLAN reveals a 30 point gap between the writing levels of indigenous and non-indigenous students.
The Act provides an excellent vehicle to action good ideas – ideas that deliver results.
The Act maintains commitments to initiatives introduced by the former Government including the Indigenous Youth Mobility Program and the Sporting Chance program.
$10.93m over three years will be used to extend the activities under the Sporting Chance Program – using sport to engage with Indigenous students and show them the value of education.
An example of the program’s achievements can be found in the work of the Clontarf Foundation.
The Foundation has been the major single provider of school-based sports academies for boys under the Sporting Chance Program since projects commenced operations in 2007.
They consistently achieve improvements in attendance, and reports significant success in attainment to Year 12 in schools of which they operate.
Mid year 2009 reporting indicates that average attendance of students in Clontarf academies was 76 per cent compared with 70 per cent.
Record Australian Government investment in education is geared towards giving students from all backgrounds and all locations a chance to access a good education.
By focussing on programs—like the Sporting Chance—that are delivering better education outcomes for indigenous students the Australian Government is actively working to close the gap.
The Indigenous Education (Targeted Assistance) Amendment Bill 2010 can make an important contribution to that effort and I commend it to the House.
This bill amends various taxation laws to implement a range of improvements to Australia’s tax laws.
Schedule 1 amends the non-commercial loan rules in Division 7A of the Income Tax Assessment Act 1936 to prevent a shareholder of a private company (or an associate of the shareholder) accessing tax-free dividends through the use of company assets, for less than their market value.
This Schedule also makes a range of other technical amendments to strengthen the non-commercial loan rules by ensuring that they cannot be circumvented by the use of corporate limited partnerships or by interposing entities between a private company and its shareholders.
The Government announced that it would tighten the non-commercial loan rules in Division 7A as part of the 2009-10 Budget. After listening to the community, particularly the farming and small business communities, the Government has introduced a number of exceptions into this measure to cover the minor use of company assets, the use of assets for income producing purposes where that use would otherwise be deductible and the use of certain dwellings for private purposes.
These amendments will strengthen the operation of Division 7A as an integrity measure, providing greater equity and fairness to taxpayers.
Schedule 2 amends the taxation laws to extend tax file number withholding arrangements to closely held trusts, including family trusts.
Generally, the new tax file number withholding arrangements will apply to the trustees of closely held trusts and family trusts where the trustee makes a payment of income to the beneficiary or the beneficiary is presently entitled to be paid a share of the income of the trust and the beneficiary of the trust has not provided their tax file number to the trustee.
To allow the Australian Tax Office data matching and ensure the effective operation of the system, the new tax file number withholding framework includes various reporting and remittance obligations.
This measure will improve the fairness and integrity of the taxation system by equipping the Tax Office with the information necessary to match amounts assessable to beneficiaries of these trusts, with amounts reported in the beneficiary’s income tax return and thus help ensure that beneficiaries of these trusts pay their fair share of tax
The HECS-HELP benefit, or Higher Education Contribution Scheme-Higher Education Loan Programme benefit, was an initiative first introduced in the 2008-09 Budget. The benefit gives eligible recipients a reduction in their HECS debt repayment and/or their HELP debt repayment or, in some cases where a repayment is not required due to low income, a direct reduction in their HELP debt.
The benefit was initially introduced for mathematics and science graduates and early childhood education teachers. In the 2009-10 Budget it was announced that the benefit had been extended to nurses and teachers generally.
The amendments ensure that no income tax is payable on the value of the benefit received by eligible recipients.
Schedule 4 amends the list of deductible gift recipients, or DGRs, in the Income Tax Assessment Act 1997. Taxpayers can claim income tax deductions for certain gifts to organisations with DGR status. DGR status assists the listed organisations to attract public support for their activities.
This Schedule adds two new organisations to the 1997 Act, namely the Sichuan Earthquake Surviving Children’s Education Fund and the Bali Peace Park Association Inc.
This Schedule also extends the period that the Yachad Accelerated Learning Project Limited can collect deductible gifts for another three years.
Schedule 5 amends the Income Tax Assessment Act 1997 to make the Global Carbon Capture and Storage Institute Limited income tax exempt for a four-year period.
The Institute is a not-for-profit-organisation that aims to accelerate the development and global adoption of safe, commercially and environmentally sustainable carbon capture and storage technology.
Carbon capture and storage technology aims to reduce greenhouse gas emissions from fossil fuels burnt during industrial processes, such as coal powered electricity generation. It involves the capture, compression, transport, long-term storage and monitoring of carbon emissions that would otherwise be released to the atmosphere.
The Institute’s purpose is to drive the commercial uptake and deployment of carbon capture and storage technologies, which would have significant positive consequences for the global environment.
There may also be an economic benefit to Australia of investing in environmentally sustainable industries through carbon capture and storage technologies. Australia has the fourth largest coal reserves in the world, and is the world’s largest exporter of coal.
The information and expertise developed by the Institute is to be disseminated broadly and globally to the benefit of both the Australian and the global carbon capture and storage communities.
Supporting the Institute by making it income tax exempt is a part of the Government’s strategy to mitigate the risks of climate change.
Schedule 6 repeals over one hundred provisions in the tax laws that provide the Commissioner of Taxation with an unlimited period to amend taxpayers’ assessments.
Generally, under the current law, amendments to the taxpayers’ assessments may be made within specific time periods, including in certain circumstances, time periods that are unlimited.
The repeal of the unlimited amendment period provisions within this Schedule include provisions where the standard two to four-year amendment period would provide sufficient time for the Commissioner to examine and make any necessary amendments to the relevant assessment. For these provisions, the standard amendment period will also retain an unlimited amendment period in cases of fraud and evasion.
This will have the effect of reducing the volume of unnecessary and redundant provisions in the taxation laws, as well as assisting in providing more certainty to taxpayers in their taxation affairs.
Full details of the measures in this Bill are contained in the explanatory memorandum.
I am pleased to present legislation addressing minor but necessary measures that will remove anomalies between veterans’ entitlements law and social security law.
These amendments are a demonstration of the Government’s commitment to continually review, update and improve the services and support we provide to our current and former military personnel.
They remove anomalies between related laws that might otherwise frustrate veterans and their families through inconsistent treatment of income and assets in certain circumstances.
The bill includes amendments that will exempt, from the veterans’ entitlements income test, payments associated with part-time work experience under a Labour Market Program.
This measure aligns the veterans’ entitlements law with the social security law and ensures the consistent treatment of these types of payments across both Acts.
The bill will also amend the Veterans’ Entitlements Act so that the partner of a service pension or income support supplement claimant or recipient, will be required to claim a comparable foreign pension if the partner is entitled to such a pension.
This provides consistency between the veterans’ entitlements law and the social security law and can result in a pensioner couple receiving more income overall.
For those persons currently receiving a service pension or income support supplement, their partners, where entitled to a comparable foreign pension, will be given six months to claim the pension.
The bill will also change the income test treatment of arrears payments of comparable foreign pensions so that the treatment of such arrears payments parallels that under the social security law.
This treatment generally provides a better result for the pensioner and will close a potential loophole in the legislation.
Instead of treating the arrears payment as income in the 12 month period from the date of grant of the comparable foreign pension, these amendments will mean that the arrears payment is treated as periodical payments for the period of the arrears.
The majority of cases will benefit from this change and the amendments will remove the opportunity for pensioners to change to a social security pension to potentially avoid the income test in relation to the arrears payment.
The bill will repeal from the Veterans’ Entitlements Act, all references to benevolent homes.
The provisions have become redundant as benevolent homes no longer exist and there are no longer any Veterans’ Affairs beneficiaries who are affected by these provisions.
Finally, the bill will clarify that the value of certain superannuation investments specified in a determination by the Minister to be disregarded for the purposes of the assets test, are not disregarded for the purposes of the deemed income rules and the asset deprivation rules.
The exceptions will ensure that the veterans’ entitlements means test will continue to operate so that those most in need will receive the most benefit from our repatriation pension system.
These corrections to the legislation will protect the integrity of the means test and the pension system by ensuring that specified superannuation investments are treated as originally intended and are counted as financial assets when calculating deemed income and will continue to be regarded as assets if the asset has been disposed of for less than adequate or no consideration.
This Bill continues the Government’s ongoing commitment to supporting Australia’s veteran community and their families and ensuring their well-being now and into the future.