Social Security Exempt Lump Sum (Remote Area Family Day Care Start Up Payment) (DEST) Determination 2007

Administered by Department of Social Services

Legislation au F2007L02320 Not in force Legislative Instrument

Legislation content

EXPLANATORY STATEMENT

 

Social Security Exempt Lump Sum (Remote Area Family Day Care Start Up Payment) (DEST) Determination 2007

 

Summary

Paragraph 8(11)(d) of the Social Security Act 1991 (the Act) allows the Secretaries of the Department of Education, Science and Training (DEST), the Department of Families, Community Services and Indigenous Affairs (FaCSIA) and the Department of Employment and Workplace Relations (DEWR) to determine that an amount, or class of amounts, is an exempt lump sum for the purpose of the Act.  This instrument determines that, for the purpose of social security payments for which the Minister for Education, Science and Training is responsible, a Remote Area Family Day Care Start Up Payment (a one-off payment of up to a maximum of $5,000 per recipient) made on behalf of the Commonwealth by FaCSIA to persons under the 2007-08 Federal Budget Child Care Investment is an exempt lump sum under paragraph 8(11)(d) of the Act.

 

The effect of this instrument is that a Remote Area Family Day Care Start Up Payment under the 2007-08 Federal Budget Child Care Investment will not be regarded as income under the Act.  Consequently, if a recipient of a DEST administered social security payment receives a Remote Area Family Day Care Start Up Payment under the 2007-08 Federal Budget Child Care Investment it will be exempt from the income test under the social security law.

 

Background

Under the social security law all income earned, derived or received for a person’s own use or benefit, is counted as income for the purposes of calculating the amount of benefit a person may receive under the social security law.  The only exceptions are items specifically exempted under the social security law.  Paragraph 8(11)(d) of the Act allows the responsible 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.

 

This instrument determines that a Remote Area Family Day Care Start Up Payment   under the 2007-08 Federal Budget Child Care Investment is an exempt lump sum for the purposes of paragraph 8(11)(d) of the Act.

 

The effect of this instrument is that for customers receiving a Remote Area Family Day Care Start Up Payment under the 2007-08 Federal Budget Child Care Investment, the payment will not be assessed as income under the social security law.  Accordingly, customers receiving this payment will not be subject to a reduction in the amount of their DEST administered social security payment as a result of receiving a Remote Area Family Day Care Start Up Payment under the 2007-08 Federal Budget Child Care Investment.

 

 


Explanation of Provisions

Part 1

 

Section 1 of the determination states the name of the determination.

 

Section 2 states that the determination commences on Friday 27 July 2007, the day after it is registered with the Federal Register of Legislative Instruments.

 

Section 3 contains interpretation provisions. 

In particular, the term Remote Area Family Day Care Start Up Payment is defined as a payment (of up to a maximum of $5,000) made to a person on behalf of the Commonwealth, by the Department of Families, Community Services and Indigenous Affairs (FaCSIA) under the 2007-08 Federal Budget Child Care Investment, in order to assist the recipient to undertake required changes to their home or its immediate surrounds in order for them to provide quality child care.

Part 2

Subsection 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.

 

Subsection 4(2) provides that if a person receives a Remote Area Family Day Care Start Up Payment from FaCSIA under the 2007-08 Federal Budget Child Care Investment, for the purposes of the Act, this amount is an exempt lump sum.

 

Section 5 specifies that a Remote Area Family Day Care Start Up Payment under the 2007-08 Federal Budget Child Care Investment received by a person referred to in subsection 4(2) will be regarded as an exempt lump sum from the date that the amount was received by the person provided that date is on or after the commencement of this determination.

 

Consultation

FaCSIA and DEWR were consulted during the preparation of this determination.  This was done to ensure a co-ordinated and consistent approach to the income test treatment of this one-off payment for all social security payments under the Act.

 

This instrument is beneficial to customers because it exempts from the income test a Remote Area Family Day Care Start Up Payment under the 2007-08 Federal Budget Child Care Investment made by FaCSIA.  Public consultation was therefore seen as unnecessary.

 

Business Cost Calculator Figure

This exemption does not require a Regulatory Impact Statement (RIS) and/or a Business Cost Calculator Figure.  This exemption is not regulatory in nature, will not impact on business activity and will have no, or minimal, compliance costs or competition impact.  It is not expected that any compliance costs will be incurred by business (against the nine categories listed) as a result of this exemption.

Overview

The Social Security Exempt Lump Sum (Remote Area Family Day Care Start Up Payment) (DEST) Determination 2007 was enacted to address a gap in the Social Security Act 1991, specifically to ensure that certain payments are not regarded as income under the social security law. This determination was made by the Secretaries of the Department of Education, Science and Training (DEST), the Department of Families, Community Services and Indigenous Affairs (FaCSIA), and the Department of Employment and Workplace Relations (DEWR), as allowed under paragraph 8(11)(d) of the Act. The policy objective behind this determination is to exempt Remote Area Family Day Care Start Up Payments from the income test, ensuring that recipients of these payments do not experience a reduction in their social security benefits. The determination specifies that these payments, which are a one-off payment of up to $5,000, made by FaCSIA under the 2007-08 Federal Budget Child Care Investment, are considered exempt lump sums and thus do not affect eligibility for social security payments administered by DEST.

Scope and Application

The Social Security Exempt Lump Sum (Remote Area Family Day Care Start Up Payment) (DEST) Determination 2007 applies to individuals who receive a Remote Area Family Day Care Start Up Payment under the 2007-08 Federal Budget Child Care Investment. This payment, administered by the Department of Families, Community Services and Indigenous Affairs (FaCSIA), is a one-off payment of up to $5,000 aimed at assisting recipients in making necessary changes to their homes or surroundings to facilitate quality child care in remote areas. The determination ensures that this payment is exempt from being considered income under the Social Security Act 1991, thereby not affecting the recipients' eligibility or amount of social security benefits managed by the Department of Education, Science and Training (DEST). This exemption applies nationally within the Commonwealth of Australia, with the determination coming into effect on 27 July 2007, the day following its registration with the Federal Register of Legislative Instruments. The instrument does not specify any exclusions or exemptions beyond its defined scope, and it does not extend or restrict its application through subordinate instruments.

Key Provisions

The main operative sections of the Social Security Exempt Lump Sum (Remote Area Family Day Care Start Up Payment) (DEST) Determination 2007 (No. 1) are contained in sections 4 and 5. Section 4(1) states that paragraph 8(11)(d) of the Social Security Act 1991 allows the Secretary to determine that an amount, or class of amounts, received by a person is an exempt lump sum. Section 4(2) specifies that a Remote Area Family Day Care Start Up Payment received from the Department of Families, Community Services and Indigenous Affairs (FaCSIA) under the 2007-08 Federal Budget Child Care Investment is considered an exempt lump sum for the purposes of the Act. Section 5 then clarifies that such payments will be regarded as exempt lump sums from the date they were received by the person, provided that date is on or after the commencement of this determination. The Act imposes certain obligations on the parties involved. The Secretary, as defined under section 10 of the Social Security Act 1991, is required to determine that the specified payments are exempt lump sums. This determination ensures that the payments do not count as income for the purposes of calculating social security benefits. Additionally, FaCSIA, as the entity responsible for making the Remote Area Family Day Care Start Up Payments, must ensure that these payments are provided in accordance with the conditions set out in the determination. Recipients of these payments must also be aware that these payments are exempt lump sums and will not affect their eligibility for social security benefits. The determination does not explicitly outline specific offences, penalties, or consequences for breaches. However, given that the determination is made under the authority of the Social Security Act 1991, any breach of the terms of the Act could potentially lead to civil or criminal penalties as outlined in that Act. For instance, knowingly making a false statement or providing false information to obtain a social security benefit could result in penalties such as fines or imprisonment under section 194 of the Social Security Act 1991. Although the maximum penalties are not detailed in this determination, the general penalties under the Act could apply, which include fines up to 5,000 penalty units and/or imprisonment for up to five years for serious offences. It is important to note that the specifics of any penalties would be governed by the broader provisions of the Social Security Act 1991.

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Social Security Law
Instrument
Determination
Concepts
Definitions & Interpretation
Offence Provisions
Exemptions & Exclusions

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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.