EXPLANATORY STATEMENT
Social Security Act 1991
Social Security (Exempt Lump Sums – Disability Sporting Grants) Determination 2019
Purpose
Paragraph 8(11)(d) of the Social Security Act 1991 (the Act) allows the Secretary of the Department of Social Services (DSS) to determine, by legislative instrument, that an amount or class of amounts received by a person is an exempt lump sum for the purposes of the Act. The effect of the Social Security (Exempt Lump Sums – Disability Sporting Grants) Determination 2019 (the instrument) is that, for disability support pension recipients, the receipt of a one-off payment, for the purpose of athlete support, where made by:
- the Australian Sports Commission (ASC);
- the Australian Paralympic Committee (APC);
- the Commonwealth Games Australia (CGA); or
- a national sporting organisation (NSO)
using funds provided by the ASC, will be an exempt lump sum under paragraph 8(11)(d) of the Act.
Background
Under the social security law, an income test is used to determine eligibility for a social security payment and, if they are eligible, the rate of a social security payment that is payable. Income received for a person’s own use or benefit is generally assessable. However, some amounts that would otherwise be income are specifically exempted.
Paragraph 8(11)(d) of the Act allows the Secretary of DSS 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 excluded from the definition of ‘ordinary income’ under subsection 8(1) of the Act, meaning the lump sum amount is not to be taken into account under the social security income test.
There is a variety of payments available to eligible athletes for the purpose of athlete support, using funds provided by the ASC. The direct athlete support scheme payments are examples of such payments. Direct athlete support scheme payments are administered by the ASC. Payments made under this scheme are one-off payments, targeted at athletes based on their medal potential at a major sporting event, such as the Olympics or Paralympics, as well as their individual need. These payments are intended to support the athletes to prepare for a major sporting event or events.
This instrument provides that payments to disability support pension recipients for the purpose of athlete support, where made by the Australian Sports Commission (ASC); or the Australian Paralympic Committee (APC), Commonwealth Games Australia (CGA), or a national sporting organisation (NSO), using funds provided by the ASC, will be exempt lump sums for the purposes of the Act. This means that disability support pension recipients of these payments will not have such amounts taken into account under the social security income test.
Commencement
This instrument commences on the day after registration.
Consultation
This instrument will operate beneficially and only affects persons who receive the disability support pension, which falls wholly within the portfolio and responsibility of DSS. As such public consultation was considered unnecessary for this matter.
Regulatory Impact Statement
This instrument does not require a Regulatory Impact Statement or Business Cost Calculator Figure. The instrument is not regulatory in nature, will not impact on business activity and will have no, or minimal, compliance costs or competition impact (OBPR ID: 25249).
Explanation of the provisions
Section 1 provides how the instrument is to be cited, that is, as the Social Security (Exempt Lump Sums – Disability Sporting Grants) Determination 2019.
Section 2 provides that the instrument commences on the day after registration. This means that the instrument will have effect on and from that date.
Section 3 provides that the authority for making the instrument is paragraph 8(11)(d) of the Act.
Section 4 makes provision for definitions of certain terms used in the instrument.
Section 5 provides that each instrument specified in a Schedule to this instrument is repealed as set out, and that any other item has effect according to its terms.
Section 6 provides that if a person who is receiving a disability support pension in respect of a day also receives a disability sporting grant on the same day, the disability sporting grant will be an exempt lump sum in respect of that person for the purpose of the Act.
Example 1: If a person is receiving a disability support pension in respect of 10 January 2020, and also receives a disability sporting grant on 10 January 2020, the disability sporting grant is an exempt lump sum with respect to that person.
Example 2: If a person receives a disability sporting grant on 10 January 2020, and starts to receive a disability support pension on 11 January 2020, the disability sporting grant is not an exempt lump sum with respect to that person.
Schedule 1 repeals the Social Security Exempt Lump Sum (Disability Sporting Grants) (FaHCSIA) Determination 2009.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Social Security (Exempt Lump Sums – Disability Sporting Grants) Determination 2019
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 effect of the Determination is that a disability support pension recipient who receives a one-off payment, for the purpose of athlete support, where made by the Australian Sports Commission (ASC); or the Australian Paralympic Committee (APC), Commonwealth Games Australia (CGA), or a national sporting organisation (NSO), using funds provided by the ASC, 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 disability support pension recipient who receives a one-off payment, for the purpose of athlete support, where made by the Australian Sports Commission (ASC); or the Australian Paralympic Committee (APC), Commonwealth Games Australia (CGA), or a national sporting organisation (NSO), using funds provided by the ASC, will not be taken into account when assessing a person’s eligibility or rate of disability support pension under the social security income test. If this payment is not exempted, a person in receipt of this payment may not be eligible for the disability support pension or, if they are eligible, their rate of payment might be reduced. The Determination is therefore consistent with promotion of the right to social security.
Conclusion
The Determination is compatible with human rights as they do not raise any human rights issues.
Mary McLarty, Acting Group Manager, Pensions and Housing Group,
as a delegate of the Secretary of the Department of Social Services