EXPLANATORY STATEMENT
Social Security (Fares Allowance for Private Transport) Determination 2002 (No. 2)
Fares allowance covers the cost of travel between a person’s permanent home and his or her educational institution at the beginning and end of the course and for certain journeys during the course of the study year. Fares allowance is only available for travel within Australia.
Fares allowance is available to a person who is either a full-time or concessional study-load tertiary student and who is receiving either youth allowance, austudy payment or pensioner education supplement. Only dependent youth allowance students are eligible for fares allowance. Independent students are qualified for fares allowance, if they live away from their permanent home, if they have a partner or dependent child who continues to live at their permanent home. Fares allowance is also available to external students to attend the educational institution where they are enrolled for a compulsory component of their course.
Students can also claim fares allowance if they use their own vehicle. The Motor Vehicle Allowance (MVA) rates are used to determine the rate of fares allowance reimbursement for travel by private vehicle. The amount of reimbursement depends on the kilometres travelled and the engine capacity of the car.
The rates need to be increased following increases in the Consumer Price Index that have occurred since 12 April 2002 the last time these rates were changed. The Department of Employment and Workplace Relations updates the MVA rates in September each year in line with the Consumer Price Index. They also provide a subscription service to government departments of the updates rates. The current rates are specified in Subscription Notice 2002/6 issued by that department.
Section 1061ZAAK of the Social Security Act 1991 (the Act) provides for fares allowance for private transport. Subsection 1061ZAAK(4) specifies the rate of fares allowance. The rate depends upon the type of engine and its capacity. Paragraph 1061ZAAK(8)(b) of the Act enables the Minister to amend or replace the Table in subsection 1061ZAAK(4). Subsection 1061ZAAK(9) specifies that a determination made under subsection 1061ZAAK(8) is a disallowable instrument.
The Social Security (Fares Allowance for Private Transport) Determination 2002 (No. 2) amends the Table in subsection 1061ZAAK(4) of the Act by replacing all of the Allowance per kilometre (cents) rates with higher rates.
The new rates for Fares Allowance for private transport will take effect on 1 January 2003.