EXPLANATORY STATEMENT
Social Security (Personal Care Support– Direct Payments Project) (FaCSIA) Determination 2007
Summary
Section 35A of the Social Security Act 1991 (the Act) allows Ministers to determine that a scheme for the provision of personal care support is an “approved scheme” for the purposes of the Act. This determination provides that the ‘Direct Payments Project’, that provides personal care support, administered by the Victorian Department of Human Services, is an “approved scheme” under section 35A of the Act.
The effect of this determination is that people who receive a payment under the Direct Payments Project, and who also receive a social security payment, will not have their payments under the Direct Payments Project taken into account for the purposes of the social security income test.
Background
Under the social security law all income earned, derived or received for a person’s own use or benefit, is generally counted as income. However, items can be specifically exempted under the social security law from the income test. Specific provisions in the Act allow Ministers to exempt certain kinds of payments from the social security income test, within principles defined in the Act, without the need for legislative change.
In particular, section 35A of the Act allows Ministers to determine that a scheme or project for the provision of personal care support is an ‘approved scheme’ for the purposes of the Act. Payments made under an ‘approved scheme’ are exempt from the income test in relation to the person who is receiving care under paragraph 8(8)(zi) of the Act. Since 1992, a number of schemes have been approved for the purposes of section 35A of the Act.
Explanation of the determination
This determination approves the Direct Payments Project as an ‘approved scheme’ under section 35A of the Act.
The Victorian Department of Human Services makes payments under the Direct Payments Project to people with disabilities to pay specifically for their personal care support. Payments under the Direct Payments Project do not provide income support for people with disabilities. Instead, these payments help these people to live independent lives outside of a public institution by contributing toward the cost of their long-term personal care support.
The effect of this determination is that these customers will not have their social security payments reduced because the payments, in relation to the person who is receiving care under the Direct Payments Project, will not be regarded as income.
Payments made under the Direct Payments Project are similar to personal care support payments made by other State and Territories, including Western Australia, Queensland, Victoria and the Northern Territory, which have already been exempted from the social security income test under similar determinations.
Payments made under approved personal care support schemes are only exempt when the funds are those of the person with a disability, paid either to the person with the disability or to a person they have agreed can administer the payments for them.
Commencement
This determination will take effect the day after its registration with the Federal Register of Legislative Instruments.
Consultation
This determination was made in response to a request from the Victorian Department of Human Services.
The Commonwealth Department of Employment and Workplace Relations and the Commonwealth Department of Education, Science and Training were also consulted to ensure a co-ordinated and consistent approach to the administration of Direct Payments Project payments for all social security payments under the Act. Each of these Departments’ Ministers will sign corresponding determinations.
This determination is beneficial to customers because it exempts these Direct Payment Project payments from the social security income test. Public consultation was therefore seen as unnecessary.
Business Cost Calculator
This determination does not require a Regulatory Impact Statement (RIS) and/or a Business Cost Calculator Figure. This determination 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 determination.