Exempt Lump Sum (Queensland Indigenous Reparation Payment) Determination 2005 (DEST)

Administered by Department of Social Services

Legislation au F2005L01970 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

 

Education, Science and Training Exempt Lump Sum (Queensland Indigenous Reparation Payment) Determination 2005

Background

Under social security law all income earned, derived or received for a person’s own use or benefit, is counted as income.  The only exceptions are items specifically exempted under the social security law.

Paragraph 8(11)(d) of the Social Security Act 1991 (the Act) allows the Secretary to determine that an amount, or class of amounts, is an exempt lump sum for the purposes of the Act.  An exempt lump sum is not included in the definition of “ordinary income” under subsection 8(1) of the Act, so any such amount would not be taken into account under the social security income test.

Under the Indigenous Wages and Savings Reparations Process, the Queensland Government compensates Indigenous people whose wages and salaries were controlled under the Queensland Protection Acts.  Such people were paid lower wage rates than other workers, were forced to make compulsory savings, and had to seek the Government’s permission to access their own money.  A previous instrument made in 2003 (the Social Security Exempt Lump Sum Determination Number 2 of 2003) excluded payments made under this process in respect of the period 1897 to 1965.  However, some affected people actually received these payments in respect of periods up to 1986.  This instrument extends to payments received up to 1986 to ensure that all recipients of these payments are treated consistently.

The purpose of this instrument is to ensure that a payment made by the Queensland Government under the Indigenous Wages and Savings Reparations Process, is an exempt lump sum for the purposes of paragraph 8(11)(d) of the Act.

The effect of this instrument is that people who are in receipt of a social security payment for which the Department of Education, Science and Training is responsible will not have their social security payments reduced because of the Queensland payments that they receive as these payments will not be regarded as income for the purposes of the social security income test.

Explanation of the provisions

Part 1

Clause 1 of the instrument states the name of the instrument.

Clause 2 states that the instrument applies from 7 March 2003.  This ensures that the instrument applies from the same date that the previous instrument, the Social Security Exempt Lump Sum Determination Number 2 of 2003, commenced.

Clause 3 contains interpretation provisions.  In particular, the term “Queensland Government Indigenous Wages and Savings Reparations Process” is defined as a process by the Queensland Government to offer monetary compensation to certain Aboriginal and Torres Strait Islander (and any other) persons whose wages and salaries were controlled under a Queensland Government regime known as the “Protection Acts” during the period 1897 to 1986.

The term “reparation payment” is defined in clause 3 as a payment made by the Queensland Government in respect of the Indigenous Wages and Savings Reparation Process.

Clause 4 revokes the previous instrument, the Social Security Exempt Lump Sum Determination Number 2 of 2003, which was made on 7 March 2003.  This current instrument is the same as the previous 2003 instrument, however, the current instrument extends to payments made in respect of a period up to 1986.

Part 2

Subclause 5(1) states that paragraph 8(11)(d) of the Act allows the Secretary to determine that an amount, or class of amounts, received by a person is an exempt lump sum.

Subclause 5(2) provides that if a person accepts a “reparation payment”, then that payment is an exempt lump sum.  Such an amount will be regarded as an exempt lump sum from the date that the amount was received by the person.  Subclause 5(2) is expressed to operate subject to clause 6. 

Clause 6 specifies that it is appropriate to determine that an amount, or class of amounts, paid to a person under the “Queensland Government Indigenous Wages and Savings Reparations Process” (as defined in clause 3), is an exempt lump sum for the purposes of paragraph 8(11)(d) of the Act.  Such an amount or class of amounts will be regarded as an exempt lump sum from the date that the payment is made to the person. 

Consultation

This instrument was made at the request of the Queensland Department of Aboriginal and Torres Strait Islander Policy.

The Australian Government Department of Family and Community Services and the Australian Government Department of Employment and Workplace Relations were also consulted to ensure a co-ordinated and consistent approach to the administration of these Queensland payments for all social security payments under the Act.

This instrument is beneficial to customers because it exempts certain Queensland payments from the social security income test.  Public consultation was therefore regarded as unnecessary.

Retrospectivity

A delegate of the Secretary of the Department of Family and Community Services signed a similar instrument on 13 January 2005 in relation to social security payments within the Family and Community Services portfolio (the Social Security Exempt Lump Sum Determination No. 2 of 2005).  That instrument applied from 7 March 2003, which is the date that the previous instrument, the Social Security Exempt Lump Sum Determination Number 2 of 2003, commenced.  This current instrument will also apply from 7 March 2003 to ensure that these Queensland payments are treated consistently for all social security payments under the Act from the same date.  This retrospective commencement is beneficial to social security recipients in that it exempts their payments from the income test from an earlier date (that is, 7 March 2003).  This instrument is entirely beneficial and does not disadvantage social security recipients in any way.

 

 

Overview

The Education, Science and Training Exempt Lump Sum (Queensland Indigenous Reparation Payment) Determination 2005 was enacted to address the issue of income classification for social security recipients in Queensland who were compensated under the Indigenous Wages and Savings Reparations Process. This process was initiated by the Queensland Government to provide monetary reparations to Indigenous people who were subjected to wage and savings controls under the Queensland Protection Acts from 1897 to 1986. The determination ensures that these reparation payments are treated as exempt lump sums under the Social Security Act 1991, thereby not affecting the social security income test for recipients. This policy objective aims to provide consistent treatment of these reparation payments across all social security payments under the Act. The instrument was made by the Secretary of the Department of Education, Science and Training, at the request of the Queensland Department of Aboriginal and Torres Strait Islander Policy, and with consultations from relevant Australian Government departments.

Scope and Application

The Education, Science and Training Exempt Lump Sum (Queensland Indigenous Reparation Payment) Determination 2005 applies to persons who receive reparation payments made by the Queensland Government under the Indigenous Wages and Savings Reparations Process. This instrument ensures that these reparation payments are treated as exempt lump sums for the purposes of the Social Security Act 1991, meaning they are not counted as income for the purposes of the social security income test. This exemption benefits individuals who receive social security payments managed by the Department of Education, Science and Training by preventing a reduction in their social security payments due to the receipt of these reparation payments. The instrument is applicable from 7 March 2003, the same commencement date as the previous instrument, the Social Security Exempt Lump Sum Determination Number 2 of 2003, to ensure consistent treatment of these payments across all social security payments under the Act. The instrument extends to reparation payments made up until 1986, ensuring all eligible recipients are treated equally. Any subordinate instruments that may extend or restrict the application of this determination would need to be reviewed in accordance with the Social Security Act 1991.

Key Provisions

The Education, Science and Training Exempt Lump Sum (Queensland Indigenous Reparation Payment) Determination 2005 (the Determination) primarily provides that certain payments made by the Queensland Government to Indigenous people under the Indigenous Wages and Savings Reparations Process are to be treated as exempt lump sums for the purposes of the Social Security Act 1991 (the Act). Under section 8(11)(d) of the Act, the Secretary has the authority to determine that an amount, or class of amounts, is an exempt lump sum (section 5(1)). This means that such amounts will not be included in the definition of "ordinary income" under subsection 8(1) of the Act and will not be taken into account under the social security income test (section 5(2)). The Determination specifically covers reparation payments made under the Queensland Government Indigenous Wages and Savings Reparations Process, which compensates Indigenous people whose wages and salaries were controlled under the Queensland Protection Acts from 1897 to 1986. The Determination imposes obligations on the parties it governs by ensuring that reparation payments made by the Queensland Government are treated as exempt lump sums. This is crucial for Indigenous people who receive these payments as it prevents their social security benefits from being reduced due to the receipt of these reparation payments (section 6). The Determination also mandates that these payments are exempt from the social security income test from the date they were received by the person (section 5(2)). In terms of consequences for non-compliance, the Determination does not explicitly state any offences, penalties, or consequences for breach. However, given that the Determination aims to ensure the consistent treatment of reparation payments under the social security income test, any failure to properly classify these payments as exempt lump sums could potentially lead to incorrect assessments of social security benefits, thereby impacting the eligibility and amount of social security payments. The implications of such errors would be governed by the provisions of the Social Security Act 1991, which may include requirements for beneficiaries to repay any overpayments, as well as potential administrative or legal actions to rectify the situation.

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.