Post by Banjo on Jan 5, 2011 13:47:42 GMT 7
The Senate will next meet at 12.30 pm on Tuesday, 8 February 2011.
Interestingly they only sit for 4 days in February, 8th, 9th, 10th and 28th, then the first three days in March.
www.aph.gov.au/senate/work/sitting/2011/sitting.htm
This is part of the digest, for the life of me I cannot see what they intend to do.
Portability of DSP
The Family and Community Services and Veterans' Affairs Legislation Amendment (2003 Budget and Other Measures) Act 2003 extended the limited portability period to DSP recipients who had previously enjoyed the same unlimited period as those on the Age Pension. Prior to these changes, severely disabled DSP recipients could be paid for any length of absence from Australia for any reason. From 2004, only DSP recipients who are severely disabled and terminally ill can continue to receive their payment beyond the limited portability period and only if their absence is or will be permanent and is in order to be with or near family or to return to the person’s country of origin. Unlimited portability in these circumstances is only granted to those considered to be in the terminal phase of a terminal illness (where life expectancy is less than two years) and is decided on a case-by-case basis.
All other recipients of DSP are subject to the same general rules regarding limited portability. This means that payment will only be made for 13 weeks of either a temporary or permanent absence. Recipients undertaking study as part of a full time Australian course can be paid for the duration of their overseas study as can Australian apprentices who are working or training overseas as part of their apprenticeship.
An absence from Australia is considered temporary if a recipient permanently resides in Australia. Section 7 of the SSA lists the factors for determining whether or not a recipient does reside in Australia including: the nature of the accommodation used by the person in Australia, the nature and extent of the family relationships the person has in Australia and the frequency and duration of the person’s travel outside Australia. The Department of Families, Housing, Community Services and Indigenous Affairs’ (FaHCSIA) Guide to Social Security Law explicitly states in its explanation in regards to temporary absences that ‘recipients in receipt of payments that have a limited portability period who frequently travel overseas and return to Australia only to renew their portability period MAY NOT satisfy the qualifying residence criteria for the payment’. The issue that the proposals in this Bill are targeting is in regards to the qualifying residence criteria for DSP. Part 2.3 of the SSA outlines the qualifying criteria for DSP including the residency criteria. These include:
* that they are an Australian resident at the time when the person first satisfies the disability criteria for DSP; or
* has ten years qualifying Australian residence, or has a qualifying residence exemption for a disability support pension; or
* is born outside Australia and, at the time when the person first satisfies the disability criteria for DSP, the person:
– is not an Australian resident; and
– is a dependent child of an Australian resident; and
* the person becomes an Australian resident while a dependent child of an Australian resident.
Thus, under the current provisions of the SSA, a payment recipient could continue to meet the qualifying residence criteria for the payment despite frequent travels to and from Australia as the current residency criteria are concerned with residency status at the time when a person first meets the disability criteria. The proposed amendments in this Bill will make Australian residency an ongoing requirement for DSP qualification.
The proposals contained in this Bill do not amend the portability rules for DSP recipients. Rather, they introduce an ongoing residency requirement which will affect the ability of certain DSP recipients to live overseas and still qualify for the payment. The residency criteria for DSP are currently anomalous with other payments that have limited portability. While the proposed amendments will restrict the ability of some DSP recipients to move overseas permanently, the amendments fit within the framework of Australia’s residency-based income support system (as opposed to contribution-based or social insurance models).
Who will be affected?
It is not clear how many current DSP recipients are residing permanently overseas and returning to Australia every 13 weeks to continue qualifying for the payment. The Minister for Families, Housing, Community Services and Indigenous Affairs, Jenny Macklin, stated in a media release marking the introduction of this Bill that:
Analysis of data from the 2007–08 financial year shows that of DSP recipients who undertook more than three overseas trips, 154 spent less than eight weeks in Australia over the year. Of these 71 spent less than four weeks in Australia and eight spent less than a week here.[9]
In 2009–10, there were 792 581 DSP recipients.[10] As such, the proposed amendments will affect only a very small percentage of DSP recipients who are spending the majority of their time outside of Australia. The proposed amendments will not affect DSP recipients who only travel overseas temporarily as the existing 13 week portability period will remain. It will also not affect those who have portability under an international social security agreement, those who are grandfathered from previous changes to portability rules and those entitled to reside permanently overseas under existing criteria.
The Senate Community Affairs Legislation Committee Inquiry into Schedule 2 of this Bill received a number of submissions from individuals concerned as to the possible adverse effects of the proposed amendments. These included an individual who is residing overseas with his family and returning to Australia every 13 weeks in order to remain eligible for DSP. Another was concerned with the issue of severely disabled DSP recipients who move overseas with a guardian who has taken up employment in another country and who will also be affected by the amendments in this Bill by not having the option to return home every 13 weeks to continue to qualify.[11] In their submission to the inquiry, FaHCSIA argued that ‘if portability for DSP recipients with a severe disability and a legal guardian was included in the Bill before the Committee it is estimated that none of the 1000 DSP recipients who travel overseas regularly would benefit’.[12] FaHCSIA’s submission did not respond directly to the situation of the individual living overseas with a family and who returned to Australia every 13 weeks to qualify. The department’s submission stated:
The main purpose of DSP is to assist people with the cost of living in Australia and support their social and economic participation. If a DSP recipient is living overseas then the DSP payments funded by Australian taxpayers are not helping them in this way ... The 13 week portability rules allow DSP recipients sufficient time to attend to personal business that might arise from time to time overseas or on holiday. Current exemptions provide a sound basis for ensuring that the social security system is fair and equitable for all.[13]
The proposed measure is expected to save around $3 million a year if enacted with FaHCSIA stating that these savings will derive from some individuals choosing to reside permanently overseas, forfeiting their DSP eligibility.[14] In calculating this saving, FaHCSIA assumes that 150 DSP recipients (or 15 per cent of the DSP population who travel overseas regularly each year) will choose to remain overseas and have their payment cancelled.[15] It is estimated that a further 15 DSP recipients in each year over the forward estimates will choose to remain overseas and lose their payment.[16] A number of witnesses at the hearing held as part of the Senate Community Affairs Committee inquiry into Schedule 2 of this Bill suggested that the savings could be considerably more if expenditure across government is taken into account.[17] A previous cost/benefit analysis of portability policy in Australia by the Department of Families and Community Services identified significant savings resulting from pension recipients having long-term or permanent absences, primarily in terms of reduced costs on health and social welfare infrastructure. However, that study did not examine DSP specifically and instead looked at the portability of all pensions.
FaHCSIA has stated that it did not include any other government programs or add-on costs outside of their portfolio in the costing model used for the proposed measures in this Schedule of the Bill.[18] The stated reason for the proposed amendments is not to produce savings, rather it is to ‘close a loophole’ and bring DSP into line with other workforce-age payments.[19]
www.aph.gov.au/library/pubs/bd/2010-11/11bd050.htm
Interestingly they only sit for 4 days in February, 8th, 9th, 10th and 28th, then the first three days in March.
www.aph.gov.au/senate/work/sitting/2011/sitting.htm
This is part of the digest, for the life of me I cannot see what they intend to do.
Portability of DSP
The Family and Community Services and Veterans' Affairs Legislation Amendment (2003 Budget and Other Measures) Act 2003 extended the limited portability period to DSP recipients who had previously enjoyed the same unlimited period as those on the Age Pension. Prior to these changes, severely disabled DSP recipients could be paid for any length of absence from Australia for any reason. From 2004, only DSP recipients who are severely disabled and terminally ill can continue to receive their payment beyond the limited portability period and only if their absence is or will be permanent and is in order to be with or near family or to return to the person’s country of origin. Unlimited portability in these circumstances is only granted to those considered to be in the terminal phase of a terminal illness (where life expectancy is less than two years) and is decided on a case-by-case basis.
All other recipients of DSP are subject to the same general rules regarding limited portability. This means that payment will only be made for 13 weeks of either a temporary or permanent absence. Recipients undertaking study as part of a full time Australian course can be paid for the duration of their overseas study as can Australian apprentices who are working or training overseas as part of their apprenticeship.
An absence from Australia is considered temporary if a recipient permanently resides in Australia. Section 7 of the SSA lists the factors for determining whether or not a recipient does reside in Australia including: the nature of the accommodation used by the person in Australia, the nature and extent of the family relationships the person has in Australia and the frequency and duration of the person’s travel outside Australia. The Department of Families, Housing, Community Services and Indigenous Affairs’ (FaHCSIA) Guide to Social Security Law explicitly states in its explanation in regards to temporary absences that ‘recipients in receipt of payments that have a limited portability period who frequently travel overseas and return to Australia only to renew their portability period MAY NOT satisfy the qualifying residence criteria for the payment’. The issue that the proposals in this Bill are targeting is in regards to the qualifying residence criteria for DSP. Part 2.3 of the SSA outlines the qualifying criteria for DSP including the residency criteria. These include:
* that they are an Australian resident at the time when the person first satisfies the disability criteria for DSP; or
* has ten years qualifying Australian residence, or has a qualifying residence exemption for a disability support pension; or
* is born outside Australia and, at the time when the person first satisfies the disability criteria for DSP, the person:
– is not an Australian resident; and
– is a dependent child of an Australian resident; and
* the person becomes an Australian resident while a dependent child of an Australian resident.
Thus, under the current provisions of the SSA, a payment recipient could continue to meet the qualifying residence criteria for the payment despite frequent travels to and from Australia as the current residency criteria are concerned with residency status at the time when a person first meets the disability criteria. The proposed amendments in this Bill will make Australian residency an ongoing requirement for DSP qualification.
The proposals contained in this Bill do not amend the portability rules for DSP recipients. Rather, they introduce an ongoing residency requirement which will affect the ability of certain DSP recipients to live overseas and still qualify for the payment. The residency criteria for DSP are currently anomalous with other payments that have limited portability. While the proposed amendments will restrict the ability of some DSP recipients to move overseas permanently, the amendments fit within the framework of Australia’s residency-based income support system (as opposed to contribution-based or social insurance models).
Who will be affected?
It is not clear how many current DSP recipients are residing permanently overseas and returning to Australia every 13 weeks to continue qualifying for the payment. The Minister for Families, Housing, Community Services and Indigenous Affairs, Jenny Macklin, stated in a media release marking the introduction of this Bill that:
Analysis of data from the 2007–08 financial year shows that of DSP recipients who undertook more than three overseas trips, 154 spent less than eight weeks in Australia over the year. Of these 71 spent less than four weeks in Australia and eight spent less than a week here.[9]
In 2009–10, there were 792 581 DSP recipients.[10] As such, the proposed amendments will affect only a very small percentage of DSP recipients who are spending the majority of their time outside of Australia. The proposed amendments will not affect DSP recipients who only travel overseas temporarily as the existing 13 week portability period will remain. It will also not affect those who have portability under an international social security agreement, those who are grandfathered from previous changes to portability rules and those entitled to reside permanently overseas under existing criteria.
The Senate Community Affairs Legislation Committee Inquiry into Schedule 2 of this Bill received a number of submissions from individuals concerned as to the possible adverse effects of the proposed amendments. These included an individual who is residing overseas with his family and returning to Australia every 13 weeks in order to remain eligible for DSP. Another was concerned with the issue of severely disabled DSP recipients who move overseas with a guardian who has taken up employment in another country and who will also be affected by the amendments in this Bill by not having the option to return home every 13 weeks to continue to qualify.[11] In their submission to the inquiry, FaHCSIA argued that ‘if portability for DSP recipients with a severe disability and a legal guardian was included in the Bill before the Committee it is estimated that none of the 1000 DSP recipients who travel overseas regularly would benefit’.[12] FaHCSIA’s submission did not respond directly to the situation of the individual living overseas with a family and who returned to Australia every 13 weeks to qualify. The department’s submission stated:
The main purpose of DSP is to assist people with the cost of living in Australia and support their social and economic participation. If a DSP recipient is living overseas then the DSP payments funded by Australian taxpayers are not helping them in this way ... The 13 week portability rules allow DSP recipients sufficient time to attend to personal business that might arise from time to time overseas or on holiday. Current exemptions provide a sound basis for ensuring that the social security system is fair and equitable for all.[13]
The proposed measure is expected to save around $3 million a year if enacted with FaHCSIA stating that these savings will derive from some individuals choosing to reside permanently overseas, forfeiting their DSP eligibility.[14] In calculating this saving, FaHCSIA assumes that 150 DSP recipients (or 15 per cent of the DSP population who travel overseas regularly each year) will choose to remain overseas and have their payment cancelled.[15] It is estimated that a further 15 DSP recipients in each year over the forward estimates will choose to remain overseas and lose their payment.[16] A number of witnesses at the hearing held as part of the Senate Community Affairs Committee inquiry into Schedule 2 of this Bill suggested that the savings could be considerably more if expenditure across government is taken into account.[17] A previous cost/benefit analysis of portability policy in Australia by the Department of Families and Community Services identified significant savings resulting from pension recipients having long-term or permanent absences, primarily in terms of reduced costs on health and social welfare infrastructure. However, that study did not examine DSP specifically and instead looked at the portability of all pensions.
FaHCSIA has stated that it did not include any other government programs or add-on costs outside of their portfolio in the costing model used for the proposed measures in this Schedule of the Bill.[18] The stated reason for the proposed amendments is not to produce savings, rather it is to ‘close a loophole’ and bring DSP into line with other workforce-age payments.[19]
www.aph.gov.au/library/pubs/bd/2010-11/11bd050.htm
