Matthew Canavan (Queensland, Liberal National Party) Share this | Link to this | Hansard source

I move:

That this bill be now read a first time.

I seek leave to have the second reading speech incorporated in Hansard.

Leave granted.

The speech read as follows—

This bill introduces a number of minor 'housekeeping' amendments in the Social Services portfolio – contributing to general maintenance of the substantial suite of legislation administered by the portfolio.

In this case, amendments will be made to the social security law and family assistance law. The amendments will correct technical errors and clarify intended policy by removing minor ambiguities and anomalies.

The measures in this bill are technical in nature. These amendments are an important part of the ongoing management of these legislative frameworks.

One of the amendments in this bill will clarify that people serving an Income Maintenance Period for a mainstream income support payment, such as Newstart Allowance, cannot access special benefit during that period.

An Income Maintenance Period is a period of time during which payments, for example, redundancy or leave payments, are apportioned and treated as income for certain social security payments.

The effect of the Income Maintenance Period is to either reduce the person's payment rate, or fully preclude them from receiving a social security payment for the period that the termination or leave payment represents. During this period the person is expected to draw on the resources provided by their other payment.

A single person without children would be fully precluded from receiving Newstart Allowance if their termination payment is equivalent to at least $1014 per fortnight. This amount is higher if the person is paying rent.

In addition to Newstart Allowance, the Income Maintenance Period applies to Youth Allowance, Partner Allowance, Austudy Payment, Widow Allowance, Parenting Payment, Disability Support Pension and Sickness Allowance.

A person who is required to serve an Income Maintenance Period may have it reduced or waived if he or she is in severe financial hardship due to unavoidable or reasonable expenditure. You

Unavoidable or reasonable expenditure includes, but is not limited to, things such as the reasonable costs of living such as food, rent and utilities bills, as well as school and funeral expenses, essential repairs to the home, whitegoods and car, insurance premiums, medical expenses and any other costs that are considered unavoidable or reasonable taking into account the individual circumstances of the person.

Special Benefit is a discretionary income support payment available to people in severe financial hardship who are unable to earn a sufficient livelihood for themselves, due to reasons beyond their control. Special Benefit is generally paid at the same rate as Newstart Allowance but is not subject to an Income Maintenance Period.

However, it has been longstanding policy that a person who is unable to have an Income Maintenance Period for another income support payment waived or reduced, because the expenditure of their funds is neither unavoidable nor reasonable, should not be paid Special Benefit instead, as this circumvents the purpose of the Income Maintenance Period and may encourage people to spend their termination payments too quickly.

This amendment confirms this policy position – people should use their own resources before drawing on taxpayer-funded support.

A further amendment in this bill will realign the time period for income reconciliation for certain Family Tax Benefit recipients. That is, for families who are not required to lodge a tax return, or have types of income not included in a tax return, the bill will introduce a one year timeframe for individuals to notify their non-lodger status or provide income details. This is consistent with the equivalent timeframe currently applying to families who are required to lodge a tax return.

The reduction to the timeframe from two years to one year is also consistent with the intent of the family assistance programme, which is to deliver financial assistance to families to help with the cost of raising children when it is needed.

One year is considered a reasonable amount of time for families to notify Centrelink that they are not required to lodge and/or provide details of types of income not included in a tax return in order for reconciliation of their Family Tax Benefit entitlement to occur.

It is also important to note that this amendment will have very little practical effect on families, as the one year timeframe for to provide income details or notify of non-lodger status has been communicated to recipients since the implementation of the broader realignment of time periods amendments in 2013.

As such, these amendments will not result in any unexpected or unforeseen outcomes for families, as they have been familiar with the rules for some time. However, the amendments will ensure it is clear that all Family Tax Benefit recipients have the same time period to meet the reconciliation conditions to receive supplements and top-up payments.

This bill will also make several amendments to the administration of certain student payments.

Firstly, the student payment eligibility criteria will be changed to remove the current requirement for new apprentices to have a Commonwealth Registration Number. The amendment alters payment eligibility criteria so that the requirements for new apprentice can be determined by the Minister in a legislative instrument.

This administrative detail has proved to cause delays in accessing and cancelling payments for apprentices. For example, an apprentice who is receiving Austudy payment ceases his apprenticeship and leaves his employer, but there is a delay in cancelling his Commonwealth Registration Number which means he continues to be paid Austudy.

There can be delays of weeks or even months before a Commonwealth Registration Number is cancelled, which means when his Austudy payment is cancelled, he may have been overpaid and incur a debt. The change in definition of new apprentice removes any link to the person having a Commonwealth Registration Number which removes the delay in cancelling payment and avoids incurring a social security debt.

Removing the requirement is a sensible improvement. This change ensures payments are not unduly delayed to new apprentices needing financial support and that payments cease promptly when they cease to be apprentices so debts do not occur. This is expected to benefit all new apprentices seeking financial support through Youth Allowance or Austudy payments.

The change is also needed in light of Commonwealth Registration Numbers being replaced from 1 July 2016 as part of the Department of Education and Training's apprenticeship reforms.

The second student payment amendment is to clarify that only one course of education is taken into account in assessing 'undertaking full-time study' or 'undertaking qualifying study' for student payments at the same institution or across multiple institutions.

This measure aims to prevent students from being supported financially to undertake multiple unrelated courses of education that do not contribute to their employment or career prospects. It is estimated that this measure will affect only a small number of individuals.

It has always been the intention that students are only assessed against one course of education under the full-time study requirements of Youth Allowance (Student) and the qualifying study requirements of Austudy. The amendment will make the law clearer in this area, so that students are not assessed as undertaking full-time study on the basis of more than one course of education during a single study period.

The third amendment relating to student payments is to clarify exemptions from the Austudy assets test for people with a partner receiving a relevant payment.

A person is intended to be exempt from the Austudy assets test if their partner is receiving a relevant pension, benefit, allowance or compensation payment. The exemption is not intended to apply if the partner has received the relevant payment at any time in the past, unless the payment relates to lump sum compensation received as an armed services widow or widower under the Military Rehabilitation Compensation Act 2004, which has been received in the past.

This will ensure the appropriate application of the assets test to the assets of partners of individuals receiving financial support through Austudy payments.

The bill will also make a series of other minor amendments, clarifying and simplifying matters such as the indexation of Pharmaceutical Allowance, the allowable income limits for the Health Care Card, and certain decision-making and delegation framework provisions.

In the case of Pharmaceutical Allowance, the bill will make some small corrections and additions to cross-referencing in the indexation tables to ensure the legislation accurately reflects long-standing indexation policy. Pharmaceutical Allowance, which is added into the rate of some social security payments, or may in some circumstances be paid as a separate payment, is indexed or adjusted each year under Part 3.16 of the Social Security Act 1991. No change is proposed to current policy and practice.

The Social Security Act 1991 does not currently specify exactly what components of Newstart Allowance are to be included in the calculation of allowable income limits for the Health Care Card but current and past policy and practice is, and has been, to include only the maximum basic rate and energy supplement.

The amendment contained in this bill seeks to clarify the components of Newstart Allowance to be included in the calculation of allowable income in a way which gives undoubtable legislative support to the current and past practice of calculating allowable income. That is, the amendment seeks to make it clear that the Pension Supplement, Pharmaceutical Allowance and Rent Assistance are all to be excluded from that calculation.

Nobody currently holding the Health Care Card will lose it because of this amendment. This is because the amendment contained in the bill does nothing more than provide clearer legislative support for the current practice of calculating allowable income. Furthermore, nobody acquiring the card in the future will be prevented from doing so because of the same amendment. This is because in the future the law will be applied as it is currently.

The amendments regarding the delegation framework will remove the requirement for the Secretary of the Department to seek the agreement of the Secretary of the Department of Human Services to the delegation of the Secretary's powers to officers of the 'Human Services Department' under the family assistance law. Departmental officers would continue to consult closely to ensure delegation instruments drafted are in line with the Human Services Department requirements.

These amendments will reduce the administrative burden and the time taken in the making of instruments of delegation under the family assistance law. It will also bring the relevant delegation provisions in the family assistance law into line with those in the Social Security (Administration) Act 1999.

Lastly, there are a small number of technical amendments.

These technical amendments include amending paragraph 8(8) (z) of the Social Security Act 1991 to change incorrect references in the note of the paragraph and repealing clause 49 of Schedule 1A of the Social Security Act 1991. These technical amendments will allow for corrections to cross-references, which will make the law easier to understand for individuals, and will repeal a spent clause from the legislation which is no longer used.

While these amendments are minor in nature, they are worth bringing forward to minimise confusion for payment recipients and stakeholder groups contending with legislative provisions that are sometimes unclear.

Such amendments are also an important part of ongoing responsible management of this important core legislative framework, and within the established policy to ensure consistency and clarity.

Claire Moore (Queensland, Australian Labor Party, Shadow Minister for Women) Share this | Link to this | Hansard source

This very cleverly titled bill, the Social Services Legislation Amendment (Miscellaneous Measures) Bill 2015, was introduced by Minister Porter in the other place as a bill to fix up anomalies and to bring into line some changes that needed to be made, making the social services legislation clearer. We totally support that aim. A community affairs committee consideration of this particular piece of legislation led to one major change. But what I thought I would do is put in place the intent of the bill in the first place, seeing that we have had the second reading speech tabled by the government, in terms of understanding exactly what this bill does.

The bill will make a number of changes. The first one is to clarify that people serving an income maintenance waiting period for a mainstream income support payment cannot access special benefit. This is the part of the bill where I believe the government is going to be moving an amendment to remove this from the legislation. In our Senate inquiry, this element of the bill was the one that engaged a large number of responses from people within the welfare system and also from individuals who felt that this component of the bill was actually unfair. I will identify exactly what the proponent was.

Special benefit is a payment for people in financial hardship due to circumstances beyond their control. I think it was National Welfare Rights Network, an organisation that is always interested in these issues and that has a strong record of understanding the social security system, that called special benefit the payment of last resort. When I worked in the department, this was the payment that people got when they could not get anything else. Special benefit is for people in financial hardship due to circumstances beyond their control. The proposal in the original legislation was the longstanding intent that it should not be paid to a person who is serving an income maintenance waiting period for a mainstream income payment due to receiving a termination payment or leave payment. The intent of the original legislation was that there would be an absolute preclusion in legislation for anyone who was serving the income maintenance waiting period to receive special benefit. We expect the amendment put forward by the government will change that.

The other elements of the bill are really in terms of a number of tidy-up processes. One of the other elements of the bill is to align time frames for meeting the family tax benefit reconciliation conditions and related amendments. Also, it passed the proposal that we alter student payment eligibility criteria so that the requirements for new apprentices can be determined by the minister in a legislative instrument. The bill will amend the definition of the new apprentice in the Social Security Act to remove the requirement for a Commonwealth Registration Number. It alters requirements for that definition so it can be determined by the minister in a legislative instrument.

I have spoken many times in this place about my concerns about essential elements of consideration of legislation not being in the core legislation, but rather being put into regulation. In fact, I think there is hardly a bill that comes forward in this area where I do not make comments of that kind. However, in consideration of this particular proposal about having the definition of an apprentice and the details of that put into legislation, we support that. We think it is the most effective and most flexible way to ensure that the proposals can be considered by the department and that changes around definitions can be defined more quickly and in a more appropriate way in regulation. We are supporting it in this way, but I could not miss the chance to put my normal opposition to having large chunks of detail put into regulation rather than legislation.

In the student area, this confirms that students are only assessed against one course of education under the full-time study requirements of youth allowance as a student and the qualifying study requirements of Austudy and not against more than one course of part-time study during a single study period. This is a matter of clarification and ensures that the claimants fully understand the basis on which they are claiming Austudy and receiving that payment, so having that assessment of only one course of education makes that clearer and people are able to work through that in the claimant process.

The explanatory memorandum also states that the bill will:

Clarify the policy intention relating to a person's exemption from the austudy payment assets test if their partner is receiving or has received a relevant pension, benefit, allowance, compensation or has received lump sum compensation as an armed services widow or widower under the Military Rehabilitation Compensation Act 2004 in the past.

Even reading it out indicates how complex these areas are. The proposal in this bill is to clarify the proposal on which someone can receive Austudy.

The next point is to simplify, consolidate, and remove inconsistencies and redundant provisions in relation to the indexation of pharmaceutical allowance. This is actually a clean-up clause, again clarifying and simplifying exactly how that pharmaceutical allowance is defined in the legislation. The second last point is:

•   clarify which components of newstart allowance are taken into account under the allowable income limits for the health care card;

Again, this is a clarification element, and we totally support that so that both the people who are claiming payment and the people who are determining the payment are clear about exactly what components of Newstart allowance are available to be taken into account under the limits of the health care card. The bill will also:

•   remove an administrative restriction in the family assistance delegation provisions;

This is again a clarification. It will also:

•   correct cross-references and similar technical errors.

This is always important but, because of the way legislation is put together and the way that the process operates, when some of these errors are found, the only way that they can be clarified is to bring them back through the process here in parliament, identify them and make sure they are fixed. It is a natural part of what we do.

That is what the bill does. I think it is relevant in the discussion here to look at some of the issues that were raised around the original bill when the Committee Affairs Legislation Committee considered this bill. The issues that caused the most concern were around the payment of special benefit while someone is serving a waiting period. That caused a great deal of correspondence around concerns about the impact that the simple and complete removal of that option in legislation would have on people who are in hardship in the community. In terms of concern about the proposal that the government had put forward, it is worthwhile quoting some of the evidence that was put forward about. People with Disabilities Australia, an organisation that looks at a range of community members who have disabilities and their carers:

… expressed concern that the proposed amendments to the rules governing IMPs and special benefit will have a disproportionate impact on people with disability and may result in potential harm to people with disability:

They said:

People with disability who receive large payouts, for example as compensation for an injury, may not have, or may no longer have the skills to manage such a large amount of money, nor be sufficiently informed about the IMP duration, given they are unlikely to know about IMP until they apply for Centrelink support. Their IMP—

which is that waiting period for payment—

may continue for years, whether their payout has been sufficient to cover their expenses during this time.

I have already mentioned the valuable work that the National Welfare Rights Organisation do and continue to do looking at the issues of social security and welfare in our community. They Community Affairs Committee report stated that they:

… submitted that a review of IMP laws, policy and administration is necessary to addresses poverty traps before access to special benefit is removed.

They suggested a number of ways that that could be done, but it focussed on the fact that there needs to be this constant review about exactly how the system interacts and impacts on the community.

The way the social security system operates is very much a result of personal impact on people who are seeking support, often when they are in serious trouble or unsure of their rights within the system. That is very important particularly when we are talking about the payment of special benefit. The National Welfare Rights Organisation highlighted the impacts of financial hardship. We talked about the impact on people with disabilities who received a large payout for their disability in a compensation process. They had to tell that to Centrelink, or the Department of Human Services, when they were looking at ongoing pension requirements but the people receiving the income may not have been able to understand how the two systems interacted. The National Welfare Rights Organisation said:

The consequences of running out of money cannot be understated. It can lead to homelessness, social isolation, exacerbation of mental and physical illnesses, economic and social exclusion. Being without money can be a barrier to participation in the paid work force.

The focus must always be on the impact on the person.

Another submission to the inquiry that talked about the impact of payment of special benefit during IMPs was from Professor Whiteford and Ms Regan, who do research in this area. They put forward the proposition that people could experience financial difficulty while serving an IMP as a result of a lack of awareness of IMPs, spending behaviour and adverse life events and ongoing problems. The system as it now operates, and the way that the minister presented the original legislation, is that it is current practice within the social welfare system, within the Centrelink process, that people cannot receive special benefit while they are serving this waiting period. On the basis of that current practice the department and the minister indicated that they would change the legislation to confirm that practice. Our community affairs investigation found that, whilst it could be current practice, there had been a number of cases put through the appeal process which highlighted that there should not be an absolute preclusion of payment of special benefit during the waiting period, but that individual circumstances must be taken into account so that any decision would reflect the individual circumstances of the person. On that basis, when we did consider the proposals that were put forward to us, we rejected the application from the minister to say that they should confirm current practice. We felt that it should do the reverse and remain the same—individual circumstances must always be taken into account by decision makers when they are looking at decisions on people's social welfare. So we rejected the proposition that people should be unable to receive the special benefit while they were in the waiting period.

The other issue—I really want to talk about this in a more general way—is making sure that people understand and know their rights. As I just said, Professor Whiteford and Ms Regan suggested that one of the issues around this special benefit process was a feeling that people just did not understand how the waiting periods operated. Whilst you can never actually enforce understanding, I think there must be ongoing consideration by the department of putting in place as best they can ways of ensuring that people truly understand the way the system operates. That is particularly clear with the waiting period.

With respect to another part of the legislation, regarding student payments and Austudy, again it was put forward by the National Union of Students and other contributors to the committee that one of the concerns could be that people were confused—they did not really understand their own circumstances and how the system operated. I think it is worthwhile ensuring that this issue of understanding the system is considered, as this was raised in a number of ways during this committee inquiry and is a consistent element of community discussion when we have discussions in our own electorates about issues around social welfare, as it has been in previous community affairs committee hearings. This element of understanding the system comes out very regularly. This particular bill is a mechanics bill, and we support it to make sure that we are moving towards clarification. It is most important that all of us here get the message to the department that the issue of communication, the issue of awareness-raising, and the issue of personal understanding—all of those together are absolutely critical for any way of working with government in terms of social welfare.

The other thing that is very clear again in this piece of legislation, and in the way that the community affairs committee operates, is the knowledge and the engagement of organisations such as the National Welfare Rights Network, People With Disability, and ACOSS. These organisations work closely with a range of community members, many of whom are closely involved with the social welfare system—sometimes through decisions that they have made in their lives; sometimes through things over which they have no control, such as injury or illness. I think it is an essential element of the way the Senate operates that we have this interaction with community organisations, so that we can best understand their needs and also best understand the impact of legislation on them.

One of the other things that came out in the discussions around this piece of legislation was ongoing concern about other pieces of legislation that are currently before the Senate. They have been rejected by the Senate, but we know from the budget last night that these measures are still in the minds of the government. People giving evidence to this inquiry talked about their concerns about their family payments—Family Tax Benefit A, Family Tax Benefit A, and payments that have been cut by the government. One of the witnesses talked about the paid parental leave process, and said that their opportunities to be involved in their work and also in their community would be impacted by those cuts. When we talk about any element of social welfare, naturally people come forward with their own experiences generally; with what is happening to them. We saw again last night in the budget that there was no change to the circumstances of people who are reliant on social welfare, except the cut for people who are newly going onto payments, who will have lower payments because of the reduction of the allowance that was in place to cover the carbon reduction scheme compensation.

In relation to people in the community, people who will be affected by some of the changes we are putting forward in this piece of legislation will continue to be the most disadvantaged, and they will not see much benefit from what happened in the budget that we heard last night—nor in the raft of legislation that continues to be unresolved, which contains payment cuts from previous budgets that have come before this place.

Labor supports the legislation, provided that the government brings forward the amendment to remove schedule 1. We support the need to ensure that every effort continues to simplify and consolidate the very complex system under which we operate. We also reaffirm the importance, when there are legislative changes being put forward, of going through the Senate community affairs committee process because, consistently, the work that the committee does, including the interactions with the community organisations, improves the legislation that finally comes forward to the Senate. I cannot remember—and I am looking at Senator Siewert—where we have had recommendations come forward which do not actually reflect the impact on the community; recommendations which we as the Senate can then consider. We will not agree with everything, but at least we will have fulfilled the expectation of the community that the Senate is there—and the community affairs committee and the committee process is there—to ensure that community members who will be impacted by legislation will have the opportunity to have their say. It is also there to clarify any issues which may come forward in future bills which look at miscellaneous measures in social services.

Rachel Siewert (WA, Australian Greens) Share this | Link to this | Hansard source

I rise to also make a contribution in the debate on the second reading of the Social Services Legislation Amendment (Miscellaneous Measures) Bill 2015. We cannot support this bill in its current form, and that is why I have amendments that I have circulated and will discuss in the committee stage. This bill, on the surface, looks like it is about fixing up technical things in the act, but there are some schedules here that are, once again, a continuation of the government's approach to the most vulnerable members of our community: people living on income support. Either the government are purposely making life more difficult for people trying to survive on income support or they just do not get it and do not understand that making even small changes to people's payments means that people fall below the poverty line or, if they are already there, fall even further below the poverty line. They simply do not get it.

We see that again in the budget last night, which I am aware we will be talking about again this afternoon, because it is the subject of a matter of public importance that we will be talking about. But it is quite clear that this is a continuation of what really started under the Howard government, most significantly, when people were dropped onto Welfare to Work and single mothers were transferred off parenting payment single onto Newstart. That was continued by the Gillard government, who also dropped those single parents that were grandfathered onto Newstart, significantly dropping their income and therefore dropping them into poverty. Since then, the Abbott government made a number of harsh budget cuts that are still on the books. They did change the policy of dropping young people off income support for six months; they changed that to a month—or, when you add the normal waiting period, five weeks. That is still on the books. All those other cuts to people with disabilities and to students are still on the books, and that was confirmed in the budget last night.

In this particular bill, there are a number of changes that we are deeply concerned about. In particular, we are opposed to the changes to the special benefit. Schedule 1 of this bill would make changes to the special benefit. It would mean that people who are serving an income maintenance period for another payment cannot receive special benefit. I would like to quote comments that the National Welfare Rights Network made in their submission to the inquiry into this bill:

This is a bill that would give effect to a policy that has, in our opinion, been illegally applied for some time. It is not "minor housekeeping" but rather a decision to close of the "last resort" payment in our safety net which catches a very small number of deeply disadvantaged people.

Again, this is ripping into our safety net in this country, which unfortunately is being ripped and ripped and ripped so that is in fact no longer a safety net. This is a small but critical part of our safety net. The National Welfare Rights Network tells us that there are a small group who depend on this payment. They are people who are serving an income maintenance period, often a very long one, when, for whatever reason, something goes wrong.

Two academics, Susan Regan and Professor Whiteford, have examined the reasons why people fall through the system during an income maintenance period. These include lack of awareness of income maintenance periods; spending behaviour; and adverse life events and ongoing problems. Some examples of these were given to us during the inquiry. We believe we need a safety net that supports people in need. The safety net is meant to deal with situations where something goes terribly wrong. For the few people who need to use this, that is in fact what happens. Some people do not understand the restrictions that relate to income maintenance periods. Some people may not have the ability to manage large sums of money, and again something may go terribly wrong. Most of all, life happens. Things happen that have adverse impacts on your life: an illness, a divorce, a separation, a mental illness or an accident. These are things that can and do happen to all of us—challenges that we all encounter or have the potential to encounter. For people who are serving an IMP, an income maintenance period, this can be a devastating incident. Support networks can fall apart, or, for some people, they may have been non-existent in the first place. Who do people turn to then? That is why we have a safety net in this country. That is why we have systems in place—so that people do have a last resort to turn to. Basically, what this says is that people are going to be left out in the cold, and we do not agree that in this country we should be allowing that. If we can afford to give tax breaks to the rich we can afford to look after the most vulnerable—the very few people who actually need this as a last resort. We can afford that if we can afford those tax breaks for the wealthy in this country.

I will now read from one of the case studies that was provided by the National Welfare Rights Network:

Ron received a termination payment of around $230,000 in July 2013. Although he had been granted a disability support pension it was not payable as he was required to serve an IMP to February 2017.

In March 2015, two years into his IMP, he lodged a claim for special benefit with the assistance of a welfare rights advocate. His claim was rejected by DHS—

the Department of Human Services—

one week later. Four months later an Authorised Review Officer affirmed the rejection and the next day he lodged an appeal against the decision with the Administrative Appeals Tribunal (the tribunal).

…   …   …

At the time of the hearing Ron was living in Liverpool Hospital, unable to be discharged because he was homeless and could not be placed in assisted housing without an income support payment. He had a range of health issues, which met the medical criteria for DSP and had been admitted with suicidal ideation …

He had worked for his employer for 28 years when he was made redundant in July 2013. At that time, he was still grieving the loss of his mother. He was unaware of the IMP. He invested in online businesses which failed. He did not have the skills to manage large sums of money. His occupational therapist assessed him as partially dependent for personal care and basic activities of daily living, medication management, shopping and housework and fully dependent for money management … In March 2015 he was forcibly evicted. His occupational therapist explained that crisis accommodation was not suitable as it was not set up to support his physical needs.

…   …   …

The tribunal was satisfied that he had no reasonable means of support and was unable to earn a sufficient livelihood due to his health and homelessness. It noted his homelessness, isolation, unresolved grief and ongoing vulnerability to self-harm. While his spending had been unwise it needed to be considered in the context of his whole circumstances: his lack of awareness of the IMP, his impaired decision making capacity, his ongoing attempts to find work and absence of money management skills.

What would this government have happen to Ron if we got rid of this part of this legislation? What would they do? We oppose schedule 1 of the bill. It is ill thought out and an undisguised move to again reduce funding and our safety net for the most vulnerable in our community. It would cut away a small but important part of the safety net. It would stop people in need receiving the support that they need.

We also oppose schedule 3 of this bill. Under the current legislation, students can qualify for income support by studying a full-time load between two different courses. The change in the bill would mean that only one course of education would be considered. This legislation would allow for combined courses like an arts-science double degree. While the change only affects a small number of students, it would reduce the support for a small group. The National Union of Students wrote that the changes might:

… restrict student choice and undermine the rhetoric of student centred learning that has dominated higher education policy considerations over the last decade.

We are concerned about the impact this will have. Again, it might affect a smaller group of people than some of the other changes and policy approaches this government has taken with people who are trying to survive on some form of income support. These people are important. Again, in a nation as wealthy as Australia, where we can afford to give tax cuts to the well off, we can afford to support students who have a more complicated study schedule than others. We oppose this schedule, the same as we oppose schedule 1. We cannot support this legislation unless these changes are made.

Carol Brown (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Families and Payments) Share this | Link to this | Hansard source

The Social Services Legislation (Miscellaneous Measures) Bill introduces a number of minor amendments in the social services portfolio. Largely the amendments correct technical errors and clarify intended policy by removing minor ambiguities and anomalies. The uncontroversial elements of this bill:    align timeframes for meeting the family tax benefit reconciliation conditions and related amendments; alter student payment eligibility criteria so that the requirements for 'new apprentice' can be determined by the minister in a legislative instrument, and the bill will amend the definition of new apprentice in the Social Security Act to remove the requirement for a Commonwealth registration number and alter the requirements for that definition so it can be determined by the minister in a legislative instrument; confirm that students are only assessed against one course of education under the full-time study requirements of youth allowance (student) and the qualifying study requirements of Austudy, and not against more than one course of part-time study during a single study period; clarify the policy intention relating to a person's exemption from the Austudy payment assets test if their partner is receiving or has received a relevant pension, benefit, allowance, compensation or has received lump sum compensation as an armed services widow or widower under the Military Rehabilitation Compensation Act 2004 in the past; simplify, consolidate, and remove inconsistencies and redundant provisions in relation to the indexation of pharmaceutical allowance; clarify which components of Newstart allowance are taken into account under the allowable income limits for the health care card; remove an administrative restriction in the family assistance delegation provisions; and correct cross-references and similar technical errors.

However the remaining elements of the bill, contained in schedule 1, are of significant concern as they have the potential to have a devastating impact on a small number of people, leaving them without any support. This bill was considered by the Community Affairs Legislation Committee. In the course of that inquiry, it became clear that there is significant concern about schedule 1 of the bill. Schedule 1 of the bill has the effect of excluding people serving an income maintenance period from receiving special benefit. Special benefit is a payment intended for people experiencing financial hardship. According to the government, it is current Centrelink policy to reject applications for special benefit for people on an income maintenance period. The government have therefore argued that this legislation simply clarifies and implements the current policy.

However, evidence provided to the Senate committee inquiry into this bill, from various welfare agencies, illustrated that there have been a number of successful appeals of decisions of Centrelink in relation to this policy. In these decisions, the Administrative Appeals Tribunal has found that access to special benefit is warranted for people on an income maintenance period if they are in severe financial hardship due to circumstances beyond their control

This might occur due to costs associated with illness, disability or other circumstances.

A significant number of the submissions to the inquiry expressed concern that by removing the discretion of Centrelink and the AAT to grant special benefit, this bill has the potential to leave a group of people without a social safety net. While this is only expected to be a very small group of people, it is distressing that these changes would leave them without any assistance at all. For this reason, Labor senators on the Community Affairs Legislation Committee recommended that the bill be amended to remove schedule 1.

The impact of an income maintenance period is to reduce a person's rate of income support or to preclude them from receipt of any payment for a period following receipt of a payment for retrenchment. The Social Security Act provides that an income maintenance period can be reduced or waived if a person is in 'severe financial hardship' as a result of 'unavoidable or reasonable expenditure'. The special benefit can be granted to people in severe financial hardship due to circumstances beyond their control who are unable to earn enough income to support themselves and their dependants and who are not able to receive any other income support payment. It is a discretionary payment. The circumstances under which the payment is granted and the amount paid are determined by a delegate of the secretary of the Department of Social Services.

In their submission to the Community Affairs Legislation Committee inquiry into the bill, the National Welfare Rights Network rightly described the payment as a payment of 'last resort'. The evidence of the National Welfare Rights Network and their concerns about this schedule was based on their experience of advocating for clients seeking payment of the special benefit. The National Welfare Rights Network specifically cited two complaints that they had made to the Commonwealth Ombudsman in relation to the practice of automatically rejecting special benefit claims. These complaints led to the Ombudsman's examination of the policy instructions provided by the Department of Social Services to the Department of Human Services.

A report by the Ombudsman, Income Maintenance Periods and Special Benefit, was released on 7 March 2016. The Ombudsman's report stated that, for many people, the size of the termination payment will mean they must serve an income maintenance period, which may extend for some months, as an income maintenance period applies for the equivalent number of weeks that the employment related termination payment represents. The report also noted that there is no obligation on employers to advise employees about income maintenance periods and other waiting periods and that employers are only required to notify the DHS if 15 or more employees are being made redundant. Further to this, the Ombudsman stated that it is not uncommon for people to spend all of their termination payment before they contact the DHS to apply for income support, some having found themselves in severe financial hardship. The Ombudsman's report noted:

The Act does not currently apply IMPs to Special Benefit and there is nothing in the Act that says Special Benefit cannot be paid while a person is serving an IMP for another payment. Contrary to this, DSS had issued a policy instruction that Special Benefit should not be paid to a person who is serving an IMP in relation to another income support payment. Due to this instruction, DHS could not grant Special Benefit to someone serving an IMP. However, if the person sought review of that decision before an external tribunal, it was and remains possible that Special Benefit would be granted.

The Ombudsman's report recommended that DSS amend the policy instruction for IMP reduction so that it takes account of each person's circumstances, including the portion of the termination payment that was spent on non-permitted items in relation to the actual size of the payment and the length of the IMP. It also recommended that it amend its instruction about the grant of special benefit during an IMP so that the Department of Human Services is permitted to properly consider and, where appropriate, grant claims in that situation. The Ombudsman's report also recommended that DSS    raise community awareness of the impact of employment termination upon income support non-payment and waiting periods—which anyone here should agree is obviously a very sensible thing to do.

Based on the findings of the Ombudsman's report it is clear that this schedule of the bill does not 'correct technical errors and clarify intended policy by removing minor ambiguities and anomalies'; rather, it gives effect to the policy that has been applied by the department contrary to the current act. It is quite clear. This will have the effect of removing the final safety net, Special Benefit, which supports people in rare cases of extreme hardship that cannot be remedied by existing IMP waivers.

Submissions to the inquiry highlighted the types of financial hardships that can be experienced by someone serving an IMP that may not satisfy the waiver conditions, and identified a number of common factors that lead to this financial hardship. The common factors identified in the Welfare Rights Network submission were ill health or disability impacting capacity to make rational decisions; inability to re-enter the workforce, for example due to lack of skills diversity, health, disability and age discrimination; financial exploitation; poor financial literacy and/or inexperience in managing large sums of money; pre-existing debt; lack of English or low educational attainment; difficulty adjusting to unemployment, sometimes coinciding with adjustment to new disability, both emotionally and financially; addictions; incorrect advice affecting decision making; failed investments; strong personal and cultural obligations to financially provide for extended family; emotional issues such as depression and anxiety; and social isolation. This was, again, in the submission by Professor Peter Whiteford and Ms Sue Regan of the Social Policy Institute, Crawford School of Public Policy, Australian National University, who had been commissioned by the National Welfare Rights Network to undertake research relating to people excluded from income support because they are serving an IMP who are in financial difficulty.

The three main factors that were identified by Professor Whiteford and Ms Regan in their preliminary research as contributing to people experiencing financial difficulty while serving an IMP are lack of awareness of IMPs; spending behaviour; and adverse life events and ongoing problems. The submission from the National Welfare Rights Network highlighted the impacts of the resulting financial hardship. Their submission states:

The consequences of running out of money cannot be understated. It can lead to homelessness, social isolation, exacerbation of mental and physical illness, economic and social exclusion. Being without money can be a barrier to participation in the paid workforce.

So, while the Social Security Act does set out circumstances under which an IMP can be reduced or waived to respond to cases of 'severe financial hardships', submitters to the inquiry argued that these provisions are insufficiently flexible. In considering the adequacy of the current IMP waivers, the National Welfare Rights Network stated:

While we agree that ordinarily relief from an IMP should be assessed under the IMP waiver rules, the existence of those rules is not inconsistent with the policy intent behind special benefit which recognises that from time to time there are special circumstances under which a person should be paid income support despite not meeting the usual requirements or exemptions contained under the Act.

Also, the National Union of Students or NUS in their submission raised concerns about removing the safety net provided by special benefit. The NUS submission recommended that the committee:

… should confirm that alternative safety net provisions are in place to deal with exceptional circumstances that the Special Benefit was designed to deal with and that the alternative processes can be accessed in a timely manner.

The bill and the supporting documents provide no assurances or indication that there is any alternative assistance to be made available to people who, in exceptional circumstances, find themselves in financial hardship which does not meet the criteria for an IMP waiver.

It is clear that retaining special benefit for people serving an IMP is not inconsistent with the policy intention of the payment. Special benefit is designed to recognise that, in some rare instances, there are circumstances that should give rise to income support payments, even where a person does not meet the usual requirements. As People with Disabilities Australia stated in its submission:

Special benefit is designed to ensure that when all other income support payments are excluded, and if a person is in a dire financial position with no other prospect of supporting themselves, they are able to access this payment.

Their submission also went on to say:

This benefit recognises that there are some instances where the discretion to assist ensures that people with no support are not further financially disadvantaged.

It is clearly appropriate that the current arrangements remain in place with the broad discretion remaining with the delegate of the secretary of the department to grant special benefit to alleviate financial hardship experienced by somebody unable to qualify for another income support payment as they are serving an IMP. While Labor broadly supports this bill, we seek to have the bill amended to remove the schedule containing this measure. This might occur due to costs associated with illness, disability or other circumstances.

Of course, Labor continues to oppose other social service legislation that the government has tried to get through the parliament. We oppose the government's attempts to cut family payments from 1.6 million families and three million children. We oppose their unfair cuts to Paid Parental Leave which will leave thousands of new mothers worse off. We oppose the government's cuts to the pension and the proposal to force Australians to keep working until they are 70.

The government's record on supporting families, older people and vulnerable Australians is atrocious. Labor will continue to stand up for them and protect the fair go—unlike those opposite, who handed down a budget which prioritises businesses over battlers. The Turnbull government is giving tax cuts to millionaires and multinationals while cutting the household budgets of families and pensioners and, in the case of this bill, removing the last remaining safety net for people.

The budget that we saw handed down last night only adds to the cuts and unfairness of the Abbott budget. Under the Liberal government, it is clear that Australian families and pensioners really are the biggest losers. Even after Mr Turnbull's $6 tax cut, some families will still be as much as $4½ thousand a year worse off. We have seen Mr Turnbull break the Liberals' pre-election promises not to touch the clean energy supplement, for example. So what have they done? By abolishing the clean energy supplement for new entrants, families receiving family tax benefit A will be $116 a year worse off per child. Families receiving family tax benefit B will lose up to $73 a year. Single pensioners will lose $366 a year and couple pensioners will be $550 a year worse off. These new cuts are on top of the existing cuts Mr Turnbull is determined to inflict on low- and middle-income families. I say that— (Time expired)

Mitch Fifield (Victoria, Liberal Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

In light of the fact that there is still a reasonable amount of government business to transact and that we do not have much government business time left, I suspect, for the parliament, I might simply thank colleagues for their contributions and commend the bill to the Senate.

Question agreed to.

Bill read a second time.