Exempt Lump Sum (South Australian Fishery Payment) Determination 2005 (DEST)

Administered by Department of Social Services

Legislation au F2005L01966 Not in force Legislative Instrument

Legislation content

EXPLANATORY STATEMENT

 

Education, Science and Training Exempt Lump Sum (South Australian Fishery Payment) Determination 2005

 

Background

Under the 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) allow 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. 

As a result of a restructure of the River Murray fishery, the use of gill nets by commercial fishery licence holders was banned, and the number of commercial fishery licences was reduced.  The South Australian Government paid some of these licence holders an ex gratia payment to give up their licence and exit the River Murray fishing industry.  Some of these people may also be in receipt of a social security payment.

The purpose of this Determination is to ensure that an ex gratia payment made by the South Australian Government to certain commercial fishery licence holders to exit the River Murray fishing industry is an exempt lump sum for the purposes of paragraph 8(11)(d) of the Act.

The effect of this instrument is that if a social security customer receives such a payment and also is in receipt of a social security payment for which the Department of Education, Science and Training is responsible, it will be exempt from the social security income test.

 

These South Australian ex gratia payments are similar to other exit payments that have previously been exempted from 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 commences on 13 January 2005 but it can have effect in relation to amounts received, or assistance provided, before that date.  This means that amounts or other assistance received by a person before 13 January 2005 can still be exempt from the social security income test in accordance with this instrument.

Clause 3 contains interpretation provisions.  In particular, the term “ex gratia payment” is defined as a payment made by the South Australian Government in accordance with the “River Murray fishery licence holders restructure adjustment package”.  This includes ex gratia payments made to River Murray licence holders to completely relinquish their commercial fishing licences, i.e. to exit the River Murray fishing industry.  Specifically, the term “ex gratia payment” in this instrument does not include payments made to River Murray licence holders who elect to remain holders of a limited commercial River Murray fishery non-native license.  The instrument is only intended to extend to ex-River Murray commercial licence holders who have exited the River Murray fishing industry in accordance with the restructure adjustment package referred to in this definition.

The term “River Murray fishery licence holders restructure adjustment package” is also defined in clause 3 as a process by which the South Australian Government offers monetary compensation to certain River Murray commercial fishery licence holders to exit the River Murray fishery.

Part 2

Subclause 4(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 4(2) provides that if a person has received an “ex gratia payment” as defined in clause 3 of the instrument, and they are also in receipt of a social security payment, then any amount received by the person as an ex gratia payment is an exempt lump sum.

Clause 5 specifies that an amount, or class of amounts, received by a person referred to in subclause 4(2) 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 amount was received by the person.  Any ex gratia payment received by a person to whom this instrument applies will be exempt from the social security income test regardless of when that payment was received by the person.  This may be either before or after the commencement of this instrument (see clause 2).

Consultation

This instrument was made at the request of Primary Industries and Resources South Australia.

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 South Australian ex gratia payments for all social security payments under the Act.

This instrument is beneficial to customers because it exempts South Australian ex gratia payments from the social security income test.  In addition, this instrument only affects a small group of ex-River Murray commercial fishers.  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. 1 of 2005).  However, that instrument can also have effect in relation to amounts received before 13 January 2005.  Similarly, this current instrument will have effect from 13 January 2005, but it is expressly stated that this instrument can also have effect in relation to amounts received before 13 January 2005.  This will ensure that recipients of South Australian ex gratia payments are treated beneficially by exempting their ex gratia payment from the income test from the date that they received it, regardless of whether this was before or after 13 January 2005.  This instrument is entirely beneficial and does not disadvantage social security recipients in any way.

Overview

The Education, Science and Training Exempt Lump Sum (South Australian Fishery Payment) Determination 2005 was enacted to address a specific issue arising from the restructuring of the River Murray fishery in South Australia. Under the Social Security Act 1991, all income earned by a person is typically counted as income for the purposes of social security benefits, with only certain exemptions allowed. The South Australian Government made ex gratia payments to commercial fishery licence holders who exited the River Murray fishing industry as a result of the restructure, which involved the banning of gill nets and a reduction in the number of commercial fishery licences. The primary objective of this determination is to ensure that these ex gratia payments are treated as exempt lump sums under the Social Security Act, thereby excluding them from the social security income test. This ensures that recipients of these payments are not disadvantaged by having their social security benefits reduced as a result of receiving the payment. The determination was made at the request of Primary Industries and Resources South Australia, with consultation between the Australian Government Department of Family and Community Services and the Australian Government Department of Employment and Workplace Relations to ensure a coordinated approach. The instrument was deemed beneficial and did not require public consultation as it only affects a small group of individuals. It is entirely retrospective, applying to payments received before the instrument's commencement date of 13 January 2005, ensuring that all recipients of the South Australian ex gratia payments are treated equitably.

Scope and Application

The Education, Science and Training Exempt Lump Sum (South Australian Fishery Payment) Determination 2005 applies to individuals who are recipients of social security payments administered by the Department of Education, Science and Training, and who have also received an ex gratia payment from the South Australian Government as part of a restructuring of the River Murray fishery. This restructuring involved the banning of gill net use and a reduction in the number of commercial fishery licences. The purpose of this Determination is to ensure that the ex gratia payments made by the South Australian Government to certain commercial fishery licence holders who exited the River Murray fishing industry are treated as exempt lump sums under the Social Security Act 1991. Consequently, these payments are exempt from the social security income test, meaning they will not be considered as ordinary income for the purposes of assessing eligibility for social security payments. The instrument applies to payments received on or after the commencement date of 13 January 2005, but it also has retrospective effect, applying to payments received before this date. The Determination is beneficial to the affected individuals as it exempts their ex gratia payments from the income test, ensuring they are not disadvantaged due to their receipt of social security payments.

Key Provisions

The Education, Science and Training Exempt Lump Sum (South Australian Fishery Payment) Determination 2005 outlines the specific circumstances under which payments made by the South Australian Government to certain commercial fishery licence holders, who have exited the River Murray fishing industry, are exempt from being counted as income for social security purposes. According to clause 4(2) of the Determination, if a person who is receiving a social security payment also receives an “ex gratia payment” as defined in clause 3, this payment will be considered an exempt lump sum under paragraph 8(11)(d) of the Social Security Act 1991. Clause 5 further clarifies that this exemption applies to any amount received by the person, regardless of when it was received, whether before or after the commencement of the Determination on 13 January 2005. This ensures that the exemption applies retrospectively to payments received prior to the Determination’s commencement, providing continuity and fairness to affected recipients. The Determination imposes specific obligations on the parties it governs, primarily focusing on the eligibility criteria for the exempt lump sum. According to clause 3, an “ex gratia payment” is defined as a payment made by the South Australian Government under the “River Murray fishery licence holders restructure adjustment package,” specifically to those licence holders who have completely relinquished their commercial fishing licences to exit the River Murray fishing industry. This means that the exemption applies only to those who have fully exited the industry, not to those who have retained any form of commercial fishing licence. The Determination also ensures that the payments are regarded as exempt lump sums from the date they were received, regardless of the timing in relation to the Determination’s commencement. In terms of consequences for breach, the Determination does not explicitly state any offences, penalties, or civil/criminal consequences for non-compliance. However, it is implied that any misuse or misapplication of the provisions could lead to administrative or legal repercussions, given the nature of social security laws. The primary focus of the Determination is to provide clarity and certainty to eligible recipients, ensuring that their payments are correctly classified and exempt from the social security income test. This helps to avoid any potential financial penalties or incorrect social security assessments that could arise from misclassification of these payments. The overarching goal is to ensure that affected individuals are supported fairly and accurately within the social security system.

Legal classification tags

Area of Law
Social Security Law
Instrument
Statutory Instrument
Concepts
Definitions & Interpretation
Commencement Provisions
Exempt Lump Sum
Retrospective Effect

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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.