EXPLANATORY STATEMENT
Veterans’ Entitlements (Special Disability Trust) Amendment Guideline 2016 (Instrument 2016 No. R48)
EMPOWERING PROVISION
Subsection 52ZZZWH(4) of the Veterans’ Entitlements Act 1986 (the Act).
PURPOSE
The purpose of the Veterans’ Entitlements (Special Disability Trust) Amendment Guideline 2016 is to update Part 3 of the Veterans’ Entitlements (Special Disability Trust) Guidelines 2011 (Principal Guidelines) to provide additional circumstances where the Repatriation Commission (the Commission) may issue a waiver notice in respect of a special disability trust.
The Principal Guidelines are made under section 52ZZZWH(4) of the Act. Section 52ZZZWH(4) provides that the Commission may, by legislative instrument, make guidelines for deciding any or all of the following:
a) whether or not to give waiver notices to trustees of trusts;
b) what conditions to include in waiver notices;
c) the periods during which waiver notices are to have effect.
In order for a trust to be a Special Disability Trust under Division 11B of Part IIIB of the Act, it must satisfy the requirements in Division 11B. The Act provides for the Commission, by issue of a waiver notice, to waive those requirements in circumstances set out in the Principal Guidelines.
The attached legislative instrument amends the Principal Guidelines to permit the Commission to give a waiver notice to the trustees of a trust in relation to a contravention of the trust property requirement under paragraph 52ZZZWE(1)(b) – transfer of certain assets (bequest or superannuation death benefit) to the trust by the principal beneficiary or partner within a 3 year period – in circumstances where the transferor can show there was an intention to transfer the asset to the trust within the 3 year timeframe.
In all cases, the Commission may only give a waiver notice if satisfied the contravention does not involve fraudulent conduct, and having regard to all the circumstances, including the nature of the contravention, a waiver is appropriate.
These changes bring the Principal Guidelines in line with the equivalent Department of Social Services Guidelines - Social Security (Special Disability Trust) (FaHCSIA) Guidelines 2011. It is desirable that the special disability trust guidelines in place for the veteran community remain consistent with the guidelines in place for clients receiving benefits under general social security law. The changes made by the attached instrument maintain the consistency.
The authority to amend the Principal Guidelines is found in subsection 33(3) of the Acts Interpretation Act 1901 which provides that where an Act confers a power to make, grant or issue any instrument of a legislative or administrative character (including rules, regulations or by-laws), the power shall be construed as including a power exercisable in the like manner and subject to the like conditions (if any) to repeal, rescind, revoke, amend, or vary any such instrument.
A special disability trust is a private trust, established by family members, to provide primarily for the reasonable care and accommodation needs of a family member with a severe disability. Assets of the trust up to an annually indexed limit ($647,500.00 as at 1 July 2016) and income from the trust do not affect any income support payment received by the principal beneficiary of the trust.
CONSULTATION
Section 17 of the Legislation Act 2003 requires a rule-maker to be satisfied, before making a legislative instrument that any consultation the rule-maker considered appropriate and reasonably practicable, has been undertaken.
The Department of Social Services (DSS) and the Department of Veterans’ Affairs (DVA) have virtually identical legislative instruments in place relating to the Special Disability Trust Guidelines. DSS was consulted in the course of this exercise. Consultation with DSS was by way of email correspondence.
In these circumstances, it is considered that the requirements of section 17 of the Legislation Act 2003 have been met.
RETROSPECTIVITY
None.
DOCUMENTS INCORPORATED-BY-REFERENCE
No.
REGULATORY IMPACT
None.
HUMAN RIGHTS STATEMENT
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
The attached instrument engages the following human rights:
- the right to social security as recognised in Article 9 of the International Covenant on Economic, Social and Cultural Rights (ICESCR); and
- the right to an adequate standard of living as recognised in Article 11 of ICESCR and Article 28 of the Convention on the Rights of Persons with Disabilities.
Overview
The Act provides that despite a trust contravening a particular requirement it can still be a Special Disability Trust if the Commission waives the requirement by giving a waiver notice to the trustees of the trust. In waiving a requirement, the Commission must have regard to the guidelines set out in the Veterans’ Entitlements (Special Disability Trust) Guidelines 2011 (Guidelines).
The attached legislative instrument will promote the right to social security and the right to an adequate standard of living by providing additional circumstances for the giving of a waiver notice. A waiver means that a trust would not lose its status as a Special Disability Trust. This in turn means that the income and assets of the trust would not be assessed in the means test for the income support benefit for the principal beneficiary of the trust. In this way it can be said to assist in maintaining the level of the veteran’s benefit.
Conclusion
The attached instrument is compatible with human rights because it promotes the right to social security and the right to an adequate standard of living.
Repatriation Commission
Rule-Maker
FURTHER EXPLANATION OF PROVISIONS
See: Attachment A
Attachment A
FURTHER EXPLANATION OF PROVISIONS
Section 1 sets out the name of the instrument – Veterans’ Entitlements (Special Disability Trust) Amendment Guideline 2016.
Section 2 is the commencement provision. It provides that the instrument takes effect on the day after it is registered on the Federal Register of Legislation.
Section 3 provides that the Principal Guidelines are amended as outlined in Schedule 1.
Schedule 1
Schedule 1 - Variations to the Veterans’ Entitlements (Special Disability Trust) Guidelines
A new paragraph is inserted into subsection 3.2(3) of Part 3 (Waiver of contravention of requirements).
New paragraph (c) outlines additional circumstances where the Repatriation Commission may decide to give a waiver notice to the trustees of a trust in relation to a contravention of the trust property requirements under paragraph 52ZZZWE(1)(b) of the Act.
The new circumstances are where a transferor transferred the asset to a trust intended to be a special disability trust after the 3 year period mentioned in paragraph 52ZZZWE(1)(b) of the Act, if the transferor can show there was an intention to transfer the asset within that 3 year period.