Source: http://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/bd/bd0001/01bd097
Timestamp: 2013-05-22 03:41:17
Document Index: 311996834

Matched Legal Cases: ['art 2', 'art 2', 'art 2', 'art 2', 'art 2', 'art 2', 'art 3']

Social Security Legislation Amendment (Concession Cards) Bill 2000 – Parliament of Australia
Browse Bills Digests Bills digests alphabetical index 2000-01 Social Security Legislation Amendment (Concession Cards) Bill 2000
Social Security Legislation Amendment (Concession Cards) Bill 2000
Bills Digest No. 97 2000-01
Commencement: 1 July 2001.
To consolidate legislative provisions and administrative guidelines regarding concession cards into a single part of the Social Security Act 1991.
Currently there are five main concession cards issued by the Commonwealth Government. These cards provide holders and some dependants with concessions for Commonwealth services relating to pharmaceuticals, health care, telephone charges and rail travel. The cards also form the basis of concessions for a wide range of State and Territory services.(1) Backgrounds on the history and entitlements of each card exist elsewhere.(2)
Centrelink issues three main cards:
Pensioner Concession Card (PCC): available to long term pensioners and provides the most comprehensive range of Commonwealth and State and Territory concessions
Health Care Card (HCC): available to recipients of short term payments and provides a more limited range of Commonwealth and State and Territory concessions, and
Commonwealth Seniors Health Card (CSHC): available to low income self-funded retirees and provides only one major Commonwealth concession.
All of these cards share a concession under the Pharmaceutical Benefits Scheme (PBS).(3)
The Department of Veteran's Affairs issues two cards:
Gold Repatriation Health Card: free treatment for all health conditions, and
White Repatriation Health Card: free treatment for service related conditions.
The cards are subject to a patchwork of legislative arrangements outlined below.
As indicated, all the cards share a concession under PBS. The National Health Act 1953 grants a concession to persons that fit within the category of 'concessional beneficiaries'. To be a 'concessional beneficiary' a person must be an 'eligible person' for the purposes of the Health Insurance Act 1973 (that is, s/he must be an Australian resident)(4) and must:(5)
receive a relevant pension, benefit or allowance under the Social Security Act 1991
receive a pension or income support under the Veterans' Entitlements Act 1986
hold a CSHC under the Social Security Act 1991 or Veterans' Entitlements Act 1986
be a 'disadvantaged person' for the purposes of the Health Insurance Act 1973, or
be a 'pensioner'.
A 'pensioner' under the National Health Act 1953 is a person who is in receipt of a pension, a person who is over 60 years and in receipt of a benefit, or a person who is in receipt of mature age allowance under the Social Security Act 1991. It also includes a person who is in receipt of a service pension or income supplement, or is eligible for fringe benefits or certain treatment, under the Veterans' Entitlements Act 1986.(6)
A 'disadvantaged person' under the Health Insurance Act 1973 is generally a person who has received a relevant pension, benefit or allowance for 12 months but whose payment has been cancelled, based on their employment income, within a specified period.(7) Essentially, the combination of 'disadvantaged person' and 'concessional beneficiary' allows certain card holders, below retirement age, to enjoy concessions for a specified period following the loss of their social security payment due to their employment income.
The Secretary may also declare people on low income to be 'disadvantaged persons'.(8)
The relevant pensions, benefits and allowances for the purposes of the National Health Act 1953 are newstart allowance, mobility allowance and youth allowance.(9) The relevant pensions benefits and allowances for the purposes of the Health Insurance Act 1973 include parenting payment (pension PP (single)), sickness allowance, special benefit, widow allowance and partner allowance.(10) For these payments, the specified period is 26 weeks. They also include newstart allowance, jobsearch allowance and youth allowance, or a 'formal training allowance' provided the recipient is not in full-time study.(11) For these payments the specified period is 12 weeks.
The eligibility criteria for PCC and HCC are covered in administrative guidelines. While there is a legislative basis for both cards in the National Health Act 1953 and the Health Insurance Act 1973, those Acts do not describe or distinguish the cards. Thus, while both cards largely rely on the existence of some pension, benefit or allowance, the particular criteria relating to qualification, duration, etc are covered in guidelines developed by the Department of Family and Community Services and administered by Centrelink. While these are not publicly available, broadly, a person qualifies for PCC if s/he is in receipt of an age or disability pension or is over 60 years and on a relevant benefit or allowance. A person qualifies for HCC if s/he is in receipt of one or more listed benefits and allowances.
The eligibility criteria for CSHC are covered at length in Part 2A.1 of the Social Security Act 1991. A person qualifies for CSHC if s/he is not in receipt of a pension but is of age pension age, and is receiving income below the pension cut-off limit. Moreover, the Social Security Act 1991 requires that a recipient must be an Australian resident, must be in Australia, must not be in receipt of a social security payment or service pension and must satisfy the 'seniors health card taxable income test'.(12) If the person is a newly arrived resident, s/he must generally also complete any 'newly arrived resident's waiting period'.(13) A person is not qualified if they fail to provide tax assessment information.(14)
There is one exception to the residence requirement. A recipient may be a non-resident receiving a benefit or pension under an agreement between Australia and New Zealand.
A more complete comparison of each card is contained in Appendix 1 of this Bills Digest.
Clearly, there is some disparity in the legislative treatment of concession cards. Eligibility for PCC and HCC cards relies on a combination of the National Health Act 1953, Health Insurance Act 1973 and Social Security Act 1991. Eligibility is based on a person's status as a 'concessional beneficiary' and is essentially based on receipt of a social security pension, benefit or allowance. By contrast, CSHC cards rely directly on express provisions in the Social Security Act 1991. Eligibility is based on retirement age and income.
To a large extent, this patchwork is the product of historical factors. The PCC, or its predecessor, was introduced in 1951 focusing on age, invalid and widow pensions. The HCC was introduced in 1982 focusing on low income earners. The CSHC was introduced in 1994 to give low income retirees similar concessions.(15) Thus, the CSHC was introduced following the wholesale rewrite of the Social Security Act 1947. Moreover, it focused on a group of beneficiaries not otherwise covered in the social security law. It is perhaps for these reasons that the CSHC is the only card comprehensively dealt with in legislation.
The history is reflected in amendments to the definition of 'concessional beneficiary' in the National Health Act 1953 and 'disadvantaged person' in the Health Insurance Act 1973.(16)
As indicated, three of the major concession cards are issued by Centrelink within the Family and Community Services Portfolio. However, the principal legislation for PCC and HCC cards resides in the Health and Aged Care portfolio.
In June 1996 the then Minister for Social Security referred the issue of concession cards to the House of Representatives Standing Committee on Family and Community Affairs. Among other things, the terms of reference required an examination of adequacy and efficiency in administration given the number of cards and agencies involved.(17) In November 1997 the Committee issued its report Concessions - Who benefits?.
Various issues were canvassed in submissions and evidence to the Committee, including:
mismatch between the changes in social security payments under the Social Security Act 1991 and static nature of eligibility criteria under the National Health Act 1953
the fact that concessions are payable predominantly within the Health portfolio whereas income is assessed predominantly in the Social Security portfolio, and
the resulting potential for agency administrative error and recipient fraud.
Among the responses were proposals to amalgamate administrative responsibility, develop a single concession card for all beneficiaries, or cash out the concessions in terms of a cash supplement to social security recipients or self-funded retirees. On the issue of a single card, an officer from the Department of Social Security commented that:
I believe that would be quite useful because of the similarities of concessions, and I believe we could perhaps work to make those Commonwealth concessions more similar. The states would, I guess, be likely to insist on some identifier on the card to indicate the person's underlying income support payments so that they could target their concessions. ... But if we could do that then, yes, that is feasible.(18)
Given these perspectives, the Committee observed that existing arrangements 'are too complex, cause confusion in policy formulation and discussion at the bureaucratic level is delayed because of the number of agencies involved', concluding that '[m]ost legislative and administrative responsibility should be transferred to the Social Security portfolio'.(19) It recommended that officers from the relevant agencies form a working party to 'investigate current legislative complexities within the concession card system' on the basis that any legislative reform 'should include relocating the bulk of concession entitlement provisions from the Health and Family Services Portfolio to the Social Security Portfolio' and that the 'Department of Social Security must hold responsibility for all concession card policy'.(20)
It is worth noting that the Committee was keen to retain the separation between social security and veterans affairs. It recommended that the Department of Veterans Affairs retain responsibility for determining eligibility and allocating concession cards to veterans.(21) (Note that the Family Services has been taken out of the Health portfolio.)
Clearly, a large motivation behind this Bill is the consolidation of arrangements regarding PCC and HCC cards into the Social Security Act 1991, using the specific CSHC template. However, as the Second Reading Speech indicates, some specific initiatives are involved.
The concessional benefits under the National Health Act 1953 extend not only to 'concessional beneficiaries' but also to their 'dependants'. Definitions of 'dependant' are contained in the National Health Act 1953, in relation to most 'concessional beneficiaries' and the Health Insurance Act 1973, in relation to 'disadvantaged persons'. (The Social Security Act 1991 contains its own definitions of 'spouse' and 'dependent child'.)
Generally, the National Health Act 1953 defines 'dependant' as a spouse of the person or a child either under 16 years who is in the person's care, custody and control or between 16 and 25 years who is in full-time study and is wholly or substantially dependent on the person.(22) This definition is largely mirrored in the Health Insurance Act 1973 with some additions which borrow from existing and past provisions of the Social Security Act 1991.
The Social Security Act 1991 defines 'dependent child' in much broader terms. It includes a 'young person' under 16 years who is simply in the adult's care(23) and a 'young person' between 16 and 22 years who is wholly or substantially dependent on the adult.(24) A 'young person' cannot be a dependant child if s/he is under 16 years, in full time study and earning more than $128.55 per week or if s/he is under 22 years and will earn $7,045.00 per year.(25)
Definition of 'resident'
As indicated, to be a 'concessional beneficiary' a person must be an 'eligible person' for the purposes of the Health Insurance Act 1973. To be an 'eligible person' the person must be an Australian resident which is defined to include an Australian citizen, a New Zealand citizen lawfully present in Australia, the holder of a permanent residence visa, who has applied for a permanent visa and who is likely to obtain more permanent residence, etc.(26)
The Social Security Act 1991 definition of 'resident' is more concise and flexible, referring to the definition in the Migration Act 1958.(27)
On 26 February 2001, the Government signed a new agreement with New Zealand regarding cooperation on social security matters. The new agreement takes effect from June 2002. Under the Agreement, New Zealand residents moving to Australia after 26 February 2001 will have restricted access to Australian social security assistance. Broadly, residents will need to obtain a permanent visa before they can access most social security payments. Residents who moved to Australia before 26 February 2001 are not affected.
It is unclear how the new agreement will affect concession cards. Information produced by the Department of Family and Community Services suggests that New Zealand residents will be able to claim certain benefits and allowances(28) and concession cards(29) 'no matter when they arrive', subject to any waiting periods that may apply to them.(30)
The administrative guidelines governing PCC and HCC are not publicly available, otherwise than in the form of the Guide to Social Security Law on the Department of Family and Community Services website.(31) The following discussion is based on more general and descriptive information published by Centrelink and the Department of Family and Community Services. As such, any comparisons between the current situation and the measures in the Bill are tentative.
Schedule 1 amends the Social Security Act 1991 and the Social Security (Administration) Act 1999. Item 6 inserts a revised Part 2A.1-Concession Cards in place of the existing Part 2A.1-Commonwealth Seniors Health Card.
Division 1 - PCC
Division 1 of Part 2A.1 deals with pensioner concession cards (PCC). Under proposed section 1061ZA a person qualifies for a PCC if a pension is payable or a relevant benefit or allowance is received. The list of relevant benefits and allowances largely reflects the current administrative guidelines. However, the list would seem to be more inclusive, referring generally to 'social security pension' rather than 'pension' and 'disability support pension'; and more specific, including 'partner allowance' and 'special benefit'.
As with the current CSHC, a person must be living in Australia as an Australian resident, unless they are covered by an agreement between Australia and New Zealand.
Division 1 also provides extensions after loss of payment from employment for:
recipients of mature age allowance (proposed section 1061ZB) [26 weeks]
long term recipients of social security benefits (proposed section 1061ZC) [26 weeks]
recipients of disability support pension (proposed section 1061ZD) [52 weeks], and
recipients of wife pension (proposed section 1061ZE) [52 weeks]
subject to the caveat that if the person receives an instalment of a social security pension or mature age allowance, they are not qualified for PCC for the period of the instalment.
A comparison of the extensions is contained in Appendix 2.
Qualification for PCC can effectively be measured daily. A person is qualified for CSHC if s/he generally meets the relevant criteria. A person is qualified for PCC only if s/he meets the criteria 'on a day' (proposed subsections 1061ZA(1) and (2)). Also, a person is qualified for an extension after loss of payment only if s/he does not receive a social security pension or mature age allowance 'on a day' in the extension period (proposed subsections 1061ZB(3), 1061ZC(3), 1061ZD(5) and 1061ZE(5)).
Division 2 - CSHC
Division 2 of Part 2A.1 largely duplicates the existing provisions dealing with the seniors health card (CSHC). Proposed section 1061ZG essentially mirrors the existing provisions relating to eligibility criteria in existing section 1061ZA. Proposed sections 1061ZH and 1061ZI clarify the operation of the 'newly arrived resident's waiting period' in relation to CSHC for residents who have entered Australia after 1 February 2000 or who have served a part of a waiting period before 1 February 2000.
Proposed section 1061ZJ inserts a provision which was perhaps inadvertently removed from the Social Security Act 1991 by an amendment in 1999. It relates to a requirement that a cardholder must provide a copy of a tax assessment if requested by the Secretary. It complements the requirement in proposed paragraph 1061ZG(2)(b) that a cardholder must provide a copy of a tax assessment where it is based on an estimate of income. A corresponding provision (section 1061ZLA) was repealed by the Social Security (Administration and International Agreements) (Consequential Amendments) Act 1999, leaving a hanging reference in paragraph 1061ZA(5)(a).
Division 3 - HCC
Division 3 of Part 2A.1 deals with the health care card (HCC). Largely, the eligibility criteria match those discussed above. However an adjustment is made for changes to child disability allowance and the rules for extensions for loss of payment may have changed.
Subdivision A - Automatic Issue Cards
Subdivision A deals with automatic issue health cards.
Proposed subsection 1061ZK(2) provides that a child is qualified for a HCC if their carer is qualified for carer's allowance. Proposed subsection 1061ZK(3) provides that a disabled child is entitled to a HCC if they are a dependent child of another person and, because of their disability, require substantial care and attention which is given by the carer or their partner at their home. Essentially these children would have qualified for 'child disability allowance' under the Social Security Act 1991 before 1 July 1999. However, the provisions for child disability allowance were repealed and replaced with provisions for carer allowance by the Assistance for Carers Legislation Amendment Act 1999. Under the amended provisions, to qualify for carer's allowance, a disabled child either has to suffer from a recognised disability or receive a positive disability assessment.
Proposed section 1061ZM deals with extensions for loss of payment from employment. To be eligible, the recipient of the relevant benefit or allowance must have been a 'qualified recipient' continuously for a year. To be a qualified recipient, the person must be receiving a social security pension, benefit or allowance, other than a special needs pension or youth allowance (where the recipient is studying full-time).
Proposed section 1061ZN contains residence requirements. Generally a person must be an Australian resident living in Australia. However, the residence requirement may be effectively waived by ministerial declarations either in relation to:
persons who hold a particular class of visa, or
individuals or classes of persons generally.
The residence requirement is also automatically waived in relation to persons covered by an agreement between Australia and New Zealand.
Subdivision B - Claim Based Cards
Subdivision B deals with claim based health cards.
Proposed section 1061ZO provides generally that claims may be made in relation to adults and children (subject to the health care card income test - see below).
In relation to children, claims for a health care card may be made by or in relation to an 'FTB child' in certain circumstances. An 'FTB child' is defined in the A New Tax System (Family Assistance) Act 1999. Basically, an individual is an FTB child of an adult if:(32)
the individual is aged 18 and under
the adult is legally responsible for the care, welfare and development of the individual
the individual is in the adult's care, and
the individual is an Australian resident or living with the adult
S/he will also be an FTB child if s/he is over 21 but less than 25 and is in full-time study.(33)
Claims may also be made in relation to children in foster care if, family tax benefit is being paid in relation to the child and, immediately before foster care commenced, s/he was or may have been named on another PCC (Proposed subsection 1061ZO(5)).
The health care card income test may be waived by ministerial declaration in relation to a class of persons or specified circumstances (proposed subsection 1061ZO(7)).
Claimants for HCC are subject to a newly arrived resident's waiting period. However, the waiting period may be effectively waived by the Minister in relation to holders of certain visas and by the Secretary in relation to persons whom she considers have suffered 'a substantial change in circumstances beyond [their] control' (proposed section 1061ZQ).
Part 3.9A - Income Test Calculator
Item 8 inserts a new health care card income test calculator for claim based HCC. Broadly the calculator works by a comparison of 'ascertained income' and 'allowable income' over an 8 week period prior to the claim for HCC. 'Ascertained income' is essentially any ordinary income for the purposes of the Social Security Act 1991. It also includes non-social security law pensions, maintenance and compensation. 'Allowable income' is based on the income free area of newstart allowance, aggregated over the 8 week period, plus a nominal $20. For claimants with dependents, it includes an additional $34 per dependant. For claimants without dependants the amount is reduced by 60 per cent. These variables may be altered by regulations, to increase or decrease the allowable income.
Item 12 amends section 37 to establish a framework for determining the duration of concession cards. Essentially in granting a CSHC or claims based HCC the Secretary must specify the period during which the card will have effect. The Minister may determine the periods that are to be specified by the Secretary (proposed subsections 37(9)-(12)).
Item 15 provides for automatic cancellation where a cardholder 'ceases' to be qualified for the card. Thus, assuming that 'ceases' means stops, whether temporarily or permanently, in relation to PCC, if a pension is not payable, or if a person is not receiving a relevant benefit or allowance 'on a day' then the PCC is cancelled. In relation to HCC, if a person is not qualified for carer's allowance, is not receiving a relevant benefit or allowance, or fails to meet the income test 'on a day' then the HCC is also cancelled.
Item 16 provides for automatic cancellation in relation to PCC and automatic issue HCC. Essentially, if eligibility for a card is based on qualification for a listed pension, benefit or allowance, if that pension, benefit or allowance is cancelled, the card is also cancelled. The list of pensions, benefits and allowances largely mirrors the list in HCC.(34) The Secretary has the power to waive the automatic cancellation if s/he is satisfied that the person is 'likely to be granted a social security pension or benefit before it is reasonably practicable to take steps to give effect to the cancellation of the card'.
On their face, items 15 and 16 achieve the same result. Indeed, assuming that item 15 operates generally where a cardholder stops being qualified, item 16 may be redundant.
Health Insurance Act 1973 and National Health Act 1953
Schedule 2 makes consequential amendments to the Health Insurance Act 1973 and National Health Act 1953 following the amendments to the Social Security Act 1991.
Thus, item 13 updates the definition of 'concessional beneficiary' in the National Health Act 1953. Rather than refer to the fact that a person receives a social security payment, etc, it refers to the fact that they hold a concession card under the Social Security Act 1991.
Existing Concession Cards: Qualification and Validity/Renewal(35)
Validity/Renewal/Extension
pension, carer payment, parenting payment (single), mature age allowance or bereavement allowance
newstart, widow or sickness allowance or 'benefit' parenting payment (recipient over 60 and have received payment continuously for 9 months)
12 months with 26 week extension after loss of benefit from employment
12 months with 12 months extension after loss of benefit from employment
All Other payments (recipient over 60 and have received payment continuously for six months)
Non pensioner of age pension age with income below the pension cut-off limit
newstart, youth (not studying), partner and widow allowances
12 weekly with 6 months extension after loss of benefit from employment
'benefit' parenting payment
Expiry of medical certificate
drought relief payment
family allowance (maximum rate)
child disability allowance (for the child only)
mobility allowance, if not receiving disability support pension
Proposed Concession Cards: Qualification and Extension
Validity/Renewal/(36)Extension
26 week extension after loss of payment from employment
newstart, partner, widow or sickness allowance; 'benefit' parenting payment; special benefit (recipient over 60 and have received payment continuously for 39 weeks/9 months)
(52 week extension for disability support pensioners and former wife pensioners)
Cardholder has been a qualified recipient for 12 months means 6 months extension after loss of allowance from employment
Cardholder has been a qualified recipient for 12 months means 6 months extension after loss of benefit from employment
child generally meets criteria for child disability allowance (for the child only)
carer allowance (for the child only)
certain disabled young persons
Concessions and Health Care Cards' on the Centrelink Website.
House of Representatives Standing Committee on Family and Community Services Concessions - Who benefits?, November 1997, Chapter 2 and Concessions and Health Care Cards' on the Centrelink Website: http://www.centrelink.gov.au.
Department of Health and Aged Care, Pharmaceutical Benefits Safety Net Arrangements: What Safety Net Arrangements Apply?, February 2001. Generally, the Pharmaceutical benefits Safety Net Arrangements ensure that general patients pay no more than $21.90 for each prescription item covered by PBS. Specifically, they ensure that concession card holders pay only $3.50 per item. This 'copayment' is reduced to nil once the cardholder's expenditure exceeds $182.00 in a given year. Of the $3.2m annual expenditure on PBS, $2.5m or 80% is directed towards card holders: Department of Health and Aged Care, Pharmaceutical Benefits Branch, Expenditure and prescriptions twelve months to 30 June 2000.
Health Insurance Act 1973, definition of 'eligible person' in subsection 3(1).
National Health Act 1953, definition of 'concessional beneficiary' in subsection 4(1).
National Health Act 1953, definition of 'pensioner' in subsection 4(1).
Health Insurance Act 1976, section 4D.
Health Insurance Act 1976, section 5D.
Youth allowance is included but only in respect of allowees who are not undertaking full-time study.
Subsection 1061ZA(1).
Section 1061ZA(2). There is no waiting period for new arrivals from New Zealand who were Australian residents when the waiting period provisions commenced: subsection 1061ZA(7).
Subsection 1061ZA(5).
House of Representatives Standing Committee on Family and Community Services Concessions - Who benefits?, November 1997, Chapter 2 and Concessions and Health Care Cards' on the Centrelink Website.
So for example, the inclusion of general recipients of social security payments in the definition of 'concessional beneficiary' was effected by the Health Legislation Amendment Act (No. 2) 1982, section 24; the inclusion of mobility allowance was effected by the Social Security Legislation Amendment Act 1994, section 33; the inclusion of CSHC issued under the Social Security Act 1991 was effected by the Social Security Legislation Amendment Act (No. 2) 1993, section 17; and the inclusion of CSHC issued under the Veterans' Entitlements Act 1986 was effected by the Veterans' Affairs Legislation Amendment Act 1994, Schedule 2, clause 8.
House of Representatives Standing Committee on Family and Community Services, Terms of Reference.
Ms Peta Winzar, Assistant Secretary, Special Payments Branch, Department of Social Security, Standing Committee on Family and Community Services, Committee Hansard, 3 September 1996, p. FCA 8.
House of Representatives Standing Committee on Family and Community Services Concessions - Who benefits?, November 1997, p. 94.
House of Representatives Standing Committee on Family and Community Services Concessions - Who benefits?, November 1997, para 8.17, p. 94.
House of Representatives Standing Committee on Family and Community Services Concessions - Who benefits?, November 1997, para 8.17, p. 95.
Subsection 84(4).
Subsection 5(2).
Subsection 5(4).
Both figures are effective as at 30 March 2000: see the Guide to the Social Security Law, 1.1.D.70 Dependent Child, on the Department of Family and Community Services Website.
Subsection 3(1).
Subsection 7(2).
Family Tax Benefit A and B (family allowance) and rent assistance, Double Orphan Pension Maternity Allowance, Child Care Benefit, Maternity Immunisation Allowance.
Health Care Card and Seniors Health Card
'Australia-New Zealand Social Security Arrangements: Restricted access to Social Security payments for some New Zealand citizens' at http://152.91.11.189/internet/nz-oz/nz-oz.nsf/content/changes-restrictedaccess.htm [28/02/01].
Website at http://www.facs.gov.au.
See generally, Lesley Lang, Dale Daniels and Peter Yeend, A New Tax System (Family Assistance) Bill 1999, Bills Digest No. 175 1998-99.
A New Tax System (Family Assistance) Act 1999, subsection 22(6).
That is, minus references to children with a disability.
Welfare Rights Centre, Michael Raper (Ed), The Independent Social Security Handbook, 3rd Ed., Pluto Press, 1999, p. 382.
The duration of cards is to be determined by the Secretary against guidelines determined by the Minister (see item 12, proposed subsections 37(9)-(12)).