EXPLANATORY STATEMENT
Issued by the authority of the Secretary of the Department of Social Services
Social Security Act 1991
Social Security (Exempt Lump Sum – Lived Experience Reference Group Incentive Payment) Determination 2026
Purpose
The Social Security (Exempt Lump Sum – Lived Experience Reference Group Incentive Payment) Determination 2026 (the Determination) ensures that incentive payments made by, or on behalf of, the Commonwealth, to attendees of meetings of the Lived Experience Reference Group (the Group) are an exempt lump sum under paragraph 8(11)(d) of the Social Security Act 1991 (the Act).
By determining an incentive payment is an exempt lump sum under the Act, the payments will not be assessed as ordinary income for the purposes of the recipient’s social security payment.
Background
Exempt lump sums
An income amount earned, derived or received for a person’s own use or benefit is generally assessed as income under the social security law. However, paragraph 8(11)(d) of the Act allows the Secretary of the Department of Social Services, or their delegate, to determine that an amount, or class of amounts, received by a person is an exempt lump sum for the purposes of the Act.
An exempt lump sum is excluded from the definition of “ordinary income” in subsection 8(1) of the Act. This means the amount is not taken into account under the social security income test and will not have any effect on the person’s social security payment.
The exemption of a lump sum payment from the income test does not affect the assessment of any ongoing income generated by the lump sum, nor any assessable asset produced from the lump sum. These will be counted under the social security income and assets tests respectively. This is consistent with the treatment of other amounts as exempt lump sums under paragraph 8(11)(d) of the Act.
Lived Experience Reference Group
The Group was established in response to Recommendation 12.2 of the Royal Commission into the Robodebt Scheme, that the Australian Government should consider establishing a customer experience reference group to provide streamlined insight regarding the experiences of people accessing income support.
The Group is coordinated by Services Australia and attendees of Group meetings include current and former income support claimants and recipients. The first meeting of the Group was held on 23 September 2025.
Attendees are provided with gift cards for attending meetings of the Group. The value of the gift card is the incentive payment for the purpose of the Determination. Since the meetings of the Group commenced, the value of the gift card provided as an incentive for participation has been $300 per session.
Authority
The Determination is made under paragraph 8(11)(d) of the Act, which provides that the Secretary may determine an amount, or class of amounts, to be an exempt lump sum for the purposes of the Act.
The Determination is a legislative instrument for the purposes of the Legislation Act 2003 and is subject to disallowance.
Retrospective Commencement
The Determination commences on 23 September 2025, when the first meeting of the Group was held.
The retrospective commencement is beneficial to income support recipients and ensures that a payment received for attendance of meetings of the Group is treated as an exempt lump sum under the Act, from the date those payments commenced.
The retrospective operation of the Determination does not infringe section 12 of the Legislation Act 2003 because the retrospective operation does not disadvantage any person or impose a liability on a person other than the Commonwealth.
Consultation
The Department of Social Services consulted Services Australia on the text of the Determination, given the impact on income support recipients and because Services Australia coordinates the Group. Services Australia supported the Determination.
The Department of Social Services also consulted the following agencies on the intention to make the Determination:
- the Department of Veterans’ Affairs because determinations under paragraph 8(11)(d) of the Act apply automatically under the Veterans’ Entitlements Act 1986; and
- the Department of Agriculture, Fisheries and Forestry because paragraph 8(11)(d) determinations apply automatically under the Farm Household Support Act 2014.
The above agencies supported the Determination.
The Department of Social Services did not consult with income support recipients likely to be affected by the Determination, given it is beneficial in nature.
Availability of independent review
A decision made under the social security law, as informed by the Determination, is subject to internal and external review under Parts 4 and 4A of the Social Security (Administration) Act 1999.
Explanation of the provisions
Details of the Social Security (Exempt Lump Sum – Lived Experience Reference Group Incentive Payment) Determination 2026
Section 1 – Name
Section 1 states how the instrument is to be cited, that is, as the Social Security (Exempt Lump Sum –– Lived Experience Reference Group Incentive Payment) Determination 2026 (the Determination).
Section 2 - Commencement
Section 2 specifies that the Determination commences retrospectively on 23 September 2025.
Section 3 – Authority
Section 3 provides that the Determination is made under paragraph 8(11)(d) of the Social Security Act 1991 (the Act).
Section 4 – Definitions
Section 4 contains definitions of certain terms used in the Determination. “Lived Experience Reference Group” and “incentive payment” are defined for the purpose of the Determination.
Section 5 – Exempt lump sum
Section 5 specifies amounts determined by the Secretary to be exempt lump sums, in accordance with paragraph 8(11)(d) of the Act.
In particular, section 5 provides that where a person has received an incentive payment, that amount is an exempt lump sum. The incentive payment is the value of a gift card provided as an incentive for participation at meetings of the Lived Experience Reference Group (Group). Since the meetings of the Group commenced, the value of the gift card has been $300 per session.
By determining that an incentive payment is an exempt lump sum under the Act, the amount of such a payment will not be assessed as ordinary income for the purposes of the recipient’s social security payment.
Statement Of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Social Security Act 1991
Social Security (Exempt Lump Sum – Lived Experience Reference Group Incentive Payment) Determination 2026
The Social Security (Exempt Lump Sum – Lived Experience Reference Group Incentive Payment) Determination 2026 (the Determination) 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
The Determination ensures that payments made by, or on behalf of, the Commonwealth, to attendees for their attendance at meetings of the Lived Experience Reference Group (the Group) are an exempt lump sum under paragraph 8(11)(d) of the Social Security Act 1991 (the Act).
By determining an incentive payment is an exempt lump sum under the Act, the payment will not be assessed as income for the purposes of the recipient’s social security payment.
Human rights implications
Right to social security and right to an adequate standard of living
The Determination engages the right to social security and the right to an adequate standard of living.
Article 9 of the International Covenant on Economic, Social and Cultural Rights (ICESCR) recognises the right to social security and requires a social security scheme be established under domestic law that provides 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.
The Group has the aim of improving delivery of the social security system to customers. The Determination encourages people to participate in the Group by ensuring the incentive payment does not affect their social security payments.
Article 11 of the ICESCR recognises the right to an adequate standard of living, which provides that everyone is entitled to adequate food, clothing and housing and to the continuous improvement of living conditions.
Under the Act, social security payments are subject to a means test which assesses the person’s income and assets to determine their eligibility for the payment, and their rate of payment. The Determination operates beneficially as an incentive payment will not be taken into account when assessing a person’s eligibility or rate of social security entitlements under the social security income test. This exemption also flows through to means tested payments under the Veterans’ Entitlements Act 1986 and the Farm Household Support Act 2014.
If an incentive payment is not exempted, a person in receipt of such a payment may not be eligible for an income support payment or, if they are eligible, their rate of payment might be reduced. As a result, their standard of living may be adversely affected.
Right to freedom of expression
The Determination also engages the right to freedom of expression, the right to freedom of opinion and expression and ensuring that persons with disabilities can exercise the right to freedom of expression and opinion.
Article 19 of the International Covenant on Civil and Political Rights (ICCPR) recognises that everyone shall have the right to hold opinions without interference (subject to certain restrictions, but these are only such as provided by law and are necessary).
Article 5(d)(viii) of the International Convention on the Elimination of All Forms of Racial Discrimination recognises the right to freedom of opinion and expression.
Article 21 of the Convention on the Rights of Persons with Disabilities recognises that parties shall take all appropriate measures to ensure that persons with disabilities can exercise the right to freedom of expression and opinion, including the freedom to seek, receive and impart information and ideas on an equal basis with others and through all forms of communication of their choice.
The incentive payment under the Determination encourages attendance at meetings of the Group, which affords income support recipients with the opportunity to freely express their insights regarding their experiences of accessing income support. This includes advising attendees that everyone in the Group has the right to freely express their views and opinions. While the Group meetings are in progress, there are mechanisms in place to ensure this occurs, such as advising attendees that it is important to respect everyone’s unique views and experiences.
Services Australia facilitates diversity in the Group, and ensures that attendees from all backgrounds are welcome to attend the Group meetings. Reasonable adjustments are available for attendees, including attendees with disabilities or cultural or linguistic needs, which facilitates participation in the Group and supports freedom of expression and opinion.
Conclusion
This Determination is compatible with human rights as it promotes and supports a person’s right to social security, the right to an adequate standard of living and the right to freedom of expression.
Kirsty Johnson
Branch Manager of the Payment Structures and Seniors Branch
Delegate of the Secretary of the Department of Social Services