EXPLANATORY STATEMENT
Social Security (Administration) (Declared income management areas) Determination 2012
The Social Security (Administration) (Declared income management areas) Determination 2012 (the Determination) is made under section 123TFA of the Social Security (Administration) Act 1999 (the Act). The Minister for Families, Community Services and Indigenous Affairs and Minister for Disability Reform, as well as making the Determination in her own capacity, is also making it on behalf of the Minister for Education and the Minister for Employment and Workplace Relations.
Background
As part of the 2011-12 Budget, the Australian Government is implementing the Building Australia’s Future Workforce package. This includes introducing new measures to promote long term economic participation in various of the nation’s most disadvantaged communities. The measures involve extra responsibilities and more assistance for teenage parents on income support, jobless families and other vulnerable groups, to support children and families and help parents enter or return to the workforce.
As part of this package, income management is being introduced into five new sites from 1 July 2012. These sites were chosen because they demonstrated a high level of disadvantage, based on a number of factors including unemployment levels, youth unemployment, skills gaps, educational achievement, the numbers of people receiving welfare payments, and the length of time people have been on income support payments.
Income management will apply to vulnerable families and individuals in these communities, including:
- people referred for income management by State child protection authorities, where they assess that a child is at risk of neglect (the child protection measure);
- people assessed by Centrelink Social Workers as being vulnerable by reference to factors including financial crisis and risk of homelessness (vulnerable welfare payment recipient measure); and
- people who volunteer for income management (voluntary income management).
This Determination gives effect to the implementation of the vulnerable welfare payment recipient measure in the five sites. Separate determinations commence the child protection measure, and voluntary income management in these sites.
Declaration of these areas also commences income management measures applying to disengaged youth and long-term welfare payment recipients in the five areas. However, exemptions from these measures may be granted where an individual is included in a class of persons specified by legislative instrument to be exempt welfare payment recipients. A separate instrument specifies classes of persons for the purposes of the exemptions.
Purpose
This Determination specifies five local government areas located in New South Wales, Queensland, South Australia and Victoria as ‘declared income management areas’. Schedule 1 covers New South Wales, Schedule 2 covers Queensland, Schedule 3 covers South Australia and Schedule 4 covers Victoria.
The Determination is a legislative instrument and commences on 1 July 2012, as provided for in section 2 of the Determination.
Consultation
Ongoing consultations have been undertaken with State child protection and housing authorities with a view to entering into bilateral agreements between the Commonwealth and State governments that finalise referral protocols to income management. In conjunction with these consultations, the Commonwealth has held regular meetings with stakeholders in the five sites, including community organisations that have raised concerns, with a particular focus on income management.
Consultation on the Determination was undertaken with the Department of Employment and Workplace Relations and with the Department of Industry, Innovation, Science, Research and Tertiary Education.
Regulatory Impact Analysis
The Determination is not regulatory in nature, will not impact on business activity and will have no, or minimal, compliance costs or competition impact.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Social Security (Administration) (Declared income management areas) Determination 2012
This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Legislative Instrument
Part 3B of the Social Security (Administration) Act 1999 (the Act) establishes an income management regime that applies to recipients of certain welfare payments. If a person is subject to the income management regime under Part 3B, the Secretary will deduct amounts from the person’s relevant welfare payments and credit those amounts to the person’s income management account. The Secretary may then debit amounts from the person’s income management account, in accordance with Part 3B, for the purpose of taking actions directed to meeting the priority needs of the person or his or her dependants.
The purpose of this instrument is to determine that the identified Local Government Areas of: Bankstown, New South Wales; Logan and Rockhampton, Queensland; Playford, South Australia; Greater Shepparton, Victoria; are each a ‘declared income management area’ for the purposes of Part 3B of the Act.
The effect of the Determination is that once each of the identified Local Government Areas becomes a declared income management area, a person residing in that area, who is in receipt of a category H welfare payment, may be required to be subject to the income management regime, as mentioned in section 123UCA of the Act. If the various criteria in section 123UCA are satisfied (including that the person is a vulnerable welfare payment recipient), a portion of the person’s relevant welfare payments will be redirected to the priority needs, such as food, clothing and shelter, of the person and his or her dependants.
Income management under section 123UCB (disengaged youth) or 123UCC (long‑term welfare payment recipients) will also commence as a result of this Determination. However, only persons who are not exempt welfare payment recipients will become subject to income management under these provisions. The separate Social Security (Administration) (Exempt Welfare Payment Recipients) Specification 2012 will enable all persons resident in the declared income management areas to be determined to be exempt.
The key objectives of income management under the Act are:
- reduce immediate hardship and deprivation by directing welfare payments to the priority needs of recipients, their partner, children and any other dependents,
- help affected welfare payment recipients to budget so that they can meet their priority needs,
- reduce the amount of discretionary income available for alcohol, gambling, tobacco and pornography,
- reduce the likelihood that welfare payment recipients will be subject to harassment and abuse in relation to their welfare payments, and
- encourage socially responsible behaviour, particularly in the care and education of children.
Human rights implications
The right to social security
Article 9 of the International Covenant on Economic, Social and Cultural Rights (ICESCR) recognised ‘the right of everyone to social security, including social insurance’. That right requires a country to, within its maximum available resources; provide a minimum essential level of benefits to all individuals and families that will enable them to acquire at least essential health care, basic shelter and housing, water and sanitation, foodstuffs, and the most basic forms of education. People subject to income management retain their same right to social security whilst being provided a mechanism to acquire the essential items outlined in Article 9 of the ICESCR. The requirement to apply an allocated percentage of their social security payments on the maintenance of themselves and their children via food, clothing and housing supports this right.
The right to an adequate standard of living
Article 11.1 of the ICESCR states that everyone has the right to ‘an adequate standard of living for himself and his family, including adequate food, clothing and housing, and to the continuous improvement of living conditions’ and that ‘appropriate steps’ be taken to ‘ensure the realization of this right’. Further to this, article 11.2 of the ICESCR states that ‘measures, including specific programmes,’ should be taken in ‘recognizing the fundamental right of everyone to be free from hunger’. Through the vulnerable welfare payment recipient income management measure, 50 per cent of a person’s income support and family payments are directed to pay for life’s essentials. Income management is a tool to stabilise people’s circumstances and easing immediate financial stress. It ensures that money is available for priority goods such as food, clothing and housing, and provides a tool to help people budget. Income management can also help people stabilise their lives, so they can care for their children, and join or return to the workforce.
The right to self-determination
Article 1 of the ICESCR states that ‘all peoples have the right of self-determination. By virtue of that right they freely determine their political status and freely pursue their economic, social and cultural development’. The expansion of income management will not deprive people of their means of subsistence or political status, but will require that 50 per cent of their social security payments must be spent on priority goods and services such as food and rent. Whilst this does limit people’s ability to freely dispose of all of their resources it does not impact on their right to freely pursue their economic, social or cultural development, this limitation is to ensure that the essential needs of vulnerable people are met and that they are protected against risks of homelessness or financial exploitation.
Right to a fair hearing
The Act allows for review of the Secretary’s decisions to refer a person to compulsory income management. Decisions impacting on social security benefits engage a person’s right to a fair hearing in Article 14 of the International Covenant on Civil and Political Rights (ICCPR) and review mechanisms for these decisions will act as a safeguard. Decisions made by the Commonwealth are reviewable through the Commonwealth appeals and reviews system.
The right to privacy
Article 17 of the ICCPR provides that no one shall be subjected to arbitrary or unlawful interference with their privacy. Privacy guarantees a right to secrecy from the public of personal information. For interference with privacy not to be arbitrary, it must be in accordance with the provisions, aims and objectives of the ICCPR and should be reasonable in the particular circumstances. Reasonableness in this context incorporates notions of proportionality to the end sought and necessity in the circumstances. This instrument will not change any existing disclosure of information legislation.
Conclusion
The Social Security (Administration) (Declared income management areas) Determination 2012 is compatible with human rights. Income management will advance the protection of human rights by ensuring that income support payments are spent in the best interests of welfare payment recipients whilst also helping to improve their budgeting skills so they can meet their priority needs. To the extent that it may limit human rights those limitations are reasonable, necessary and proportionate to achieving the legitimate objective of reducing immediate hardship and deprivation, encouraging socially responsible behaviour, and reducing the likelihood that welfare payment recipients will be subject to harassment and abuse in relation to their welfare payments.
Minister for Families, Community Services and Indigenous Affairs