EXPLANATORY STATEMENT
Social Security Foreign Currency Exchange Rate Determination 2006 (No. 3)
Purpose
Section 1100 of the Social Security Act 1991 (the Act) allows Secretaries (or their delegates) to provide for how the value of a payment received by a person in a foreign currency is to be determined.
The Instrument is made under subsection 1100(5) and it amends the principal instrument, namely, the Social Security Foreign Currency Exchange Rate Determination 2006 (No. 1) which was made on 17 January 2006, with effect from 1 February 2006.
Background
The principal instrument specifies various sources where an amount received in a foreign currency can have an appropriate market exchange rate applied to that currency in order to convert it to Australian dollars.
The sources are:
- the on-demand airmail buying rate from the Commonwealth Bank of Australia (Part 3, Table A);
- the miscellaneous exchange rate from the Commonwealth Bank of Australia (Part 4, Table B);
- the telegraphic transfer rate from the Commonwealth Bank of Australia (Part 5, Table C);
- the Reserve Bank of Australia rate from the Reserve Bank of Australia (Part 6, Table D);
- the Bank of America rate from the Bank of America (Part 7, Table E); and
- the Central Bank of Bosnia and Herzegovina rate from the Central Bank of Bosnia and Herzegovina (Part 8).
This instrument specifically determines that amounts received by a person in Australia from specified foreign countries are sourced from one of the Parts specified above to determine the appropriate market exchange rate to be applied.
Consultation
No consultation in relation to the instrument was undertaken because this legislative instrument is of a minor or machinery nature that does not substantially alter existing arrangements.
Explanation of the provisions
Section 1 of the instrument states the name of the instrument.
Section 2 provides that the instrument commences 1 July 2007.
Section 3 provides that Schedule 1 amends the principal instrument.
Schedule 1 contains 6 amendments to the principal instrument.
Amendment 1 omits “Azerbaijani Manat” from Table D of Part 7 of the
Social Security Foreign Currency Exchange Rate Determination 2006(No. 1)
Amendment 2 adds “Azerbaijan Manat” to Table D of Part 7 of the
Social Security Foreign Currency Exchange Rate Determination 2006(No. 1)
Amendment 3 omits “Serbia and Montenegro” from Table D of Part 7 of the
Social Security Foreign Currency Exchange Rate Determination 2006(No. 1)
Amendment 4 adds “Serbia” to Table D of Part 7 of the
Social Security Foreign Currency Exchange Rate Determination 2006(No. 1)