Louise Markus (Greenway, Liberal Party, Shadow Minister for Veterans' Affairs) Share this | Hansard source

The Family Assistance and Other Legislation Amendment (2008 Budget and Other Measures) Bill 2009 legislation is an example of a work in progress. The purpose of this bill is to reform a number of legislative arrangements to deliver better outcomes for families and for individuals in the income management regime and the Community Development Employment Projects scheme. It is a sensible approach that will have important outcomes.

The first part of the legislation amends legislation that streamlines the family tax benefit payment arrangements and it is estimated that this measure will save the government $101 million. Currently, eligible families claiming the family tax benefit A and family tax benefit B can elect to have their payments paid either fortnightly through Centrelink, or annually in a lump sum when they lodge a tax return with the Australian Taxation Office. There was also the flexibility to receive fortnightly payments from Centrelink for part of the year, as well as a lump sum payment at the end of the year. This legislation will stop the annual claim with the Australian Taxation Office in their tax assessment at the end of the year. However, they will still be able to elect to receive a lump sum payable through Centrelink or the Medicare office.

Family tax benefit A and B were included in a suite of reforms of family assistance developed by the Howard government when introducing the goods and services tax in July 2000. The GST provided an opportunity to reform a number of payments. Family tax benefit A replaced, for example, the family allowance, family tax payment A and family tax assistance part A. Family tax benefit B was established to provide extra assistance to single parent families and to families with one main income. This meant one parent could stay at home, and it was especially helpful to families with small children or where there was an illness dependent person in the household. Family tax benefit B also replaced several income supplements and tax programs. Eligibility for either payment is subject to an income test using an adjusted taxable income.

Just as the changes brought about by family tax benefit A and B were a work in progress, replacing and streamlining the family payments system, so too are the proposed changes to the payment arrangement of these two payments. In the 2006-07 year, the breakdown of payment choices shows that 90 per cent of claimants chose to have their payments paid fortnightly through Centrelink, three per cent chose to have a lump sum paid through Centrelink and seven per cent chose to have a lump sum paid through the taxation system when lodging a tax return. Based on those figures, it is clear that families appreciate the regular payment system rather than waiting for a lump sum payment at the end of the year. By the same token, 10 per cent of families liked the lump sum arrangement.

The legislation will transfer all of the responsibility for paying family tax benefit A and B to Centrelink. Recipients will still have the choice of fortnightly payments and still retain the capacity to claim a lump sum payable through Centrelink or Medicare offices. Family tax benefit recipients will face minimal change and the measure will simplify the payment arrangements, reduce duplication and save—as has already been mentioned—approximately $101 million in administrative costs.

The second element of the legislation delivers equity to Indigenous individuals under an income management regime. The income management regime was introduced with the passing of the Social Security and Other Legislation Amendment (Welfare Payment Reform) Act 2007 and was included in the Northern Territory emergency response strategy introduced by the Howard government in 2007. Under the income management regime, a welfare recipient can be required to have their welfare payments paid into an account controlled by Centrelink and access to moneys from that account is provided to the individual for needs considered to be priority needs of the person and particularly of their dependants. This was particularly helpful for children where their parents may not have been ensuring that they received what was essential for their growth and development. As at March 2009, there were 15,204 welfare payment recipients under IMR provision in the Northern Territory.

When the IMR was introduced in 2007, there were provisions expressly excluding persons subject to these arrangements in the Northern Territory and residing in designated areas in the NT from appealing against the application of the IMR provisions to the Social Security Administrative Tribunal. Time has moved forward. The reasoning at the time, it was suggested, was that the unique circumstances of the emergency response meant that the potential for appeals was large, given that people would no longer be directly receiving all of their welfare payments. We have since moved on and the amendment being introduced now is to enable the Social Security Appeals Tribunal to review a decision made under Part 3B of that act relating to a person who is subject to the Northern Territory IMR. As a consequence, the Administrative Appeals Tribunal will also be able to review such a decision. The appeals will not be retrospective. This will only apply to those who are newly income managed.

The third and final element of this proposed legislation reforms the payment arrangement under the Community Development Employment Projects scheme. The thrust of the reforms is to improve the employment participation of Indigenous Australians, something that both sides of the House are committed to. This will involve a gradual change to payment arrangements so that new starters of CDEP programs will receive income support payments and still be entitled to access CDEP programs. Continuing CDEP participants will continue to receive CDEP wages from CDEP providers up until 30 June 2011 and in some cases also receive the CDEP supplement. It needs to be said—and in this I agree with my colleague the member for Warringah—that the outcome that we want from any program provided by the federal government for people who are struggling to find employment is real employment.

These and other reforms, such as extra funding for services and support, will be introduced on 1 July 2009. Reforms that assist families and that give people a hand rather than a handout so that they can live dignified and productive lives, contribute to their community and participate in the economy are to be supported. I support this bill and commend it to the House.

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