EXPLANATORY STATEMENT
Social Security Exempt Lump Sum (South Australian Stolen Generations Reparations Scheme) Determination 2016
Summary
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) allows the Secretary of the Department of Social Services (DSS) 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 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.
Under the South Australian Stolen Generations Reparations Scheme, the South Australian Government is providing one-off ex gratia lump sum payments to Aboriginal persons who were removed from their parents or family as children before 31 December 1975 without a court order and whose usual place of residence when removed was South Australia or who were removed by South Australian authorities.
This Determination provides that a payment made by the South Australian Government under the Stolen Generations Reparations Scheme is an exempt lump sum for the purpose of paragraph 8(11)(d) of the Act.
The effect of this Determination is that such a payment will not be regarded as income under the Act, so that if a social security recipient receives such a payment, it will be exempt from the social security income test.
Explanation of Provisions
Part 1
Section 1 of the Determination states the name of the Determination.
Section 2 states that the Determination commences on the day after it is registered.
Section 3 contains definitions of certain terms used in the Determination. The terms “South Australian Stolen Generations Reparations Scheme” and “reparation payment” are defined.
Part 2
Section 4 specifies that a payment made to a person under the South Australian Stolen Generations Reparations Scheme is an exempt lump sum for the purposes of paragraph 8(11)(d) of the Social Security Act 1991. Such an amount will be regarded as an exempt lump sum from the date the payment is received by the person.
Consultation
This determination was made at the request of the South Australian Department of State Development.
The Department of Veterans’ Affairs and the Department of Agriculture and Water Resources were consulted.
This determination will be beneficial to persons affected as it exempts certain South Australian Government payments from the social security income test. As a result, public consultation was considered unnecessary.
Regulatory Impact Analysis
The Determination does not require a Regulatory Impact Statement. 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 Exempt Lump Sum (South Australian Stolen Generations Reparations Scheme) Determination 2016
The effect of the Determination is that a person who receives a reparation payment from the South Australian Government under the Stolen Generations Reparations Scheme will not have that payment assessed as income under the social security law.
Human rights implications
The Determination engages the right to social security under Article 9 of the International Covenant on Economic, Social and Cultural Rights (ICESCR). The right to social security requires that a system be established under domestic law, and that public authorities must take responsibility for the effective administration of the system. The social security scheme must 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.
The Determination will operate beneficially as a reparation 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. If the reparation payment is not exempted, a person in receipt of the reparation payment may not be eligible for a social security payment or, if they are eligible, their rate of payment might be reduced. The Determination is therefore consistent with the promotion of the right to social security.
The exemption of the reparation payment from the income test on receipt does not alter the fact that any ongoing income generated by the lump sum is counted under the income test, and any assessable asset produced from the lump sum is counted under the social security assets test. This is consistent with the treatment of other lump sum payments exempted under paragraph 8(11)(d) of the Act.
Conclusion
This Determination supports a person’s human right to social security.
Andrew Whitecross, Branch Manager, Rates and Means Testing Policy Branch, as a delegate of the Secretary of the Department of Social Services.