EXPLANATORY STATEMENT
STATUTORY RULES 1984 NO. 161
ISSUED BY AUTHORITY OF THE MINISTER FOR HEALTH
NATIONAL HEALTH ACT 1953
NATIONAL HEALTH REGULATIONS (AMENDMENT)
Section 140 of the National Health Act 1953 (‘the Act’) provides that the Governor-General may make regulations prescribing all matters which are required or permitted by the Act to be prescribed, or which are necessary or convenient to be prescribed for carrying out or giving effect to the Act.
Sub-section 82ZGA(1) of the Act requires a registered hospital benefits organization or a registered medical benefits organization (“an organization”) which had not been granted registration as a registered health benefits organization before 1 February 1984 to apply as soon as practicable after that date, but not later than 31 July 1984, to the Federal Court of Australia (‘the Court’) under section 82ZG of the Act for a medical benefits fund or a hospital benefits fund conducted by it to be wound up. Where an organization does not make such an application in relation to a fund conducted by it by 31 July 1984, sub-section 82ZGA(2) of the Act requires that the Minister make application to the Court under section 82Z of the Act for that fund to be wound up.
An application to the Court by an organization under section 82ZG of the Act after 1 October 1983, or by
the Minister under section 82Z of the Act after 31 July 1984 for the winding up of a hospital benefits fund or a medical benefits fund must be accompanied by a scheme for the winding up of that fund. Sub-section 82ZGA(3) of the Act provides that this scheme shall make provision for the payment to each person who was a “relevant contributor” a proportion of any amount by which the assets of the fund exceed its liabilities on its winding up. This proportion is to be calculated by reference to the proportion that the sum of the contributions paid by the “relevant contributor” during the “relevant period” bears to the sum of the contributions paid by all “relevant contributors” during the “relevant period”.
Sub-section 82ZGA(5) of the Act defines the terms “relevant contributor” and “relevant period”. A “relevant contributor” is defined to mean, in respect of a hospital benefits fund or a medical benefits fund in relation to which an application for winding up is made, a person who was a contributor to that fund immediately prior to the period of six months, or such other period as is prescribed by the regulations, immediately preceding the making of that application. In the absence of such regulations, in the event, for example, of an application to the Court on 1 January 1984, a “relevant contributor” would have been one who was a contributor to the fund on 30 June 1983, that is, immediately prior to the period of
six months preceding the application. The “relevant period” is defined to mean such period as is prescribed for the purposes of that definition. No periods are presently prescribed for the purposes of the two definitions.
All organizations except one, the Commercial Banking Company Health Society, had either become registered health benefits organizations pursuant to section 68A of the Act, merged pursuant to section 82ZP of the Act with other organizations that have become registered health benefits organizations, or made application to the Federal Court for the winding up of funds conducted by them prior to the commencement of section 82ZGA of the Act on 1 October 1983. It was therefore feasible to have regard to the circumstances, of that particular organization in the prescribing of periods for the purposes of the definitions of “relevant contributor” and “relevant period”. This remaining organization was expected to make application to the Court under section 82ZG of the Act on 27 July 1984.
The regulations amend the National Health Regulations to prescribe for the purposes of the definition of “relevant contributor”, a period of 22 months 26 days, and, for the purposes of the definition of “relevant period”, the period between 1 July 1955 and 31 August 1982. This meant that the application of the Commercial Banking
Company Health Society to the Court on 27 July 1984 would cause, for the purposes of the scheme accompanying that application, a “relevant contributor” to be one who was a contributor on 31 August 1982, that is, 22 months 26 days immediately prior to the date of the application. That scheme would therefore be required to provide for the refund to a person who was a contributor on 31 August 1982, a proportion of the surplus of the fund, being the proportion that the sum of the contributions made by that person during the “relevant period”, between 1 July 1955 and 31 August 1982, bears to the sum of all the contributions paid by all the “relevant contributors” to the fund during that period. The prescribed periods reflect the fact that the Commercial Banking Company Health Society commenced operations on 1 July 1955 and that its membership is regarded as being most equitably represented at 31 August 1982.
The regulations came into effect on the date of their notification in the Commonwealth of Australia Gazette.