EXPLANATORY STATEMENT
Issued by the Authority of the Attorney-General
Bankruptcy Legislation Amendment (Superannuation Contributions) Act 2007
Proclamation
The purpose of the Proclamation is to fix 27 April 2007 as the date of commencement for item 1 of Schedule 2. The effect of was to remove from that Act the existing categories of payments pursuant to rural support schemes which are treated as non-divisible property upon the bankruptcy of a grant recipient and to provide that classes of payments pursuant to such schemes may be prescribed as non-divisible property by regulation.
The former paragraphs 116(2)(k) to (mcb) of the Bankruptcy Act 1966 (the Bankruptcy Act) provided that certain payments pursuant to specified rural support schemes were non-divisible property in bankruptcy. Non-divisible property does not vest in a person’s trustee in bankruptcy and cannot be seized and sold by the trustee for the benefit of creditors.
Item 1 of Schedule 2 to the Act inserted into the Act a definition for “rural support scheme”. Items 5 to 7 of Schedule 2 to the Act repealed paragraphs 116(2)(k) to (mcb) from the Bankruptcy Act and substituted provisions allowing the regulations to specify classes of payments pursuant to rural support schemes that are non-divisible in bankruptcy.
Subsection 2(1) of the Act provides that item 1 of Schedule 2 did not take effect until a day to be fixed by Proclamation or the expiry of the period of 6 months beginning on the day on which the Act received the Royal Assent, whichever is the earlier. The Act received Royal Assent on 16 April 2007. Subsection 2(1) also provided that items 5 to 7 of Schedule 2 commenced at the same time as the commencement of item 1. The commencement of these items did not effect the date of commencement of any other provisions in the Act.
A separate Explanatory Statement deals with amendments to the Bankruptcy Regulations 1996 that reproduced in the Regulations the classes of non-divisible property referred to in the current paragraphs 116(2)(k) to (mcb). These regulations also took effect on 27 April 2007. This maintained the status quo in respect of the existing classes of non-divisible rural support scheme payments.