A NEW TAX SYSTEM (FAMILY ASSISTANCE) BILL 1999
A NEW TAX SYSTEM (FAMILY ASSISTANCE) (CONSEQUENTIAL AND RELATED MEASURES) BILL (NO. 1) 1999
MAY 1999
© Parliament of the Commonwealth of Australia 1999
ISSN 1440-2572 |
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Committee Secretary
Senate Standing Committees on Community Affairs
PO Box 6100
Parliament House
Canberra ACT 2600
Australia
Membership of the Committee
Members
| Senator Sue Knowles, Chairman |
LP, Western Australia |
| Senator Andrew Bartlett, Deputy Chair |
AD, Queensland |
| Senator Kay Denman |
ALP, Tasmania |
| Senator Alan Eggleston |
LP, Western Australia |
| Senator Chris Evans |
ALP, Western Australia |
| Senator David MacGibbon |
LP, Queensland |
Substitute Member
| Senator the Hon Eric Abetz for Senator
Knowles for the period 24 to 28 May 1999. Senator Abetz was elected
as Committee Chair for this period. |
LP, Tasmania |
Participating Members
| Senator the Hon Eric Abetz |
LP, Tasmania |
| Senator Bob Brown |
Greens, Tasmania |
| Senator Mal Colston |
Ind, Queensland |
| Senator the Hon Rosemary Crowley |
ALP, South Australia |
| Senator the Hon John Faulkner |
ALP, New South Wales |
| Senator Michael Forshaw |
ALP, New South Wales |
| Senator Brenda Gibbs |
ALP, Queensland |
| Senator Brian Harradine |
Ind, Tasmania |
| Senator Meg Lees |
AD, South Australia |
| Senator Dee Margetts |
GWA, Western Australia |
| Senator the Hon Chris Schacht |
ALP, South Australia |
| Senator John Woodley |
AD, Queensland |
REPORT
A NEW TAX SYSTEM (FAMILY ASSISTANCE) BILL 1999
A NEW TAX SYSTEM (FAMILY ASSISTANCE) (CONSEQUENTIAL AND RELATED MEASURES)
BILL (NO. 1) 1999
THE INQUIRY
1.1 The A New Tax System (Family Assistance) Bill 1999 and related Bill
were introduced into the House of Representatives on 31 March 1999. On
29 April 1999, the Senate referred the provisions of the Bills to
the Committee for report by 25 May 1999. The Bills passed the House of
Representatives on 13 May with the A New Tax System (Family Assistance)
Bill 1999 being amended by the Government.
1.2 Due to the Committee’s workload with inquiries on other Bills
and a forthcoming round of supplementary estimates hearings, it was decided
to hold a public hearing on 5 May. However, as most organisations were
not opposed to the legislation and therefore reluctant to appear, this
hearing was cancelled.
1.3 The Committee undertook to receive written comments on the Bills,
and received four submissions which are listed in Appendix 1.
1.4 A public hearing was subsequently held on 13 May 1999 with representatives
of the Department of Family and Community Services. Details of the public
hearing are referred to in Appendix 2. The Department responded to questions
and provided information on a range of matters including: the youth allowance
changes contained in the amendments moved in the House; the payment of
family tax benefit subject to a tapered income test; the establishment
and operation of the new Family Assistance Office; and payment of and
eligibility for Child Care Benefit. The Department also advised that the
associated Bills foreshadowed in the Minister’s second reading speech
are being drafted and are expected to be introduced in time for the Senate
debate on the legislation.
2. THE BILLS
2.1 The A New Tax System (Family Assistance) Bill 1999 and A New Tax
System (Family Assistance) (Consequential and Related Measures) Bill (No.
1) 1999 simplify the structure and administration of family assistance,
as part of the Government’s plan for a new tax system. Twelve types
of assistance for families, currently available through the tax and social
security systems, will be reduced to three. The new payment types will
be Family Tax Benefit Part A – to provide assistance to families
with dependent children, Family Tax Benefit Part B – to provide assistance
to single income families, and Child Care Benefit – to provide assistance
for the cost of child care outside the home. The eligibility and rate
provisions relevant to these new payment types are set out in the legislation.
2.2 The new system of family assistance will be delivered by a new Family
Assistance Office, which will utilise existing service delivery networks
of Centrelink, the Australian Taxation Office and the Health Insurance
Commission.
2.3 The Bills also ensure, as part of the Government’s reforms of
the Fringe Benefits Tax provisions, that for the purposes of the income
tests for family assistance, the non-grossed up value of a person’s
fringe benefits will be used in determining the amount of family assistance
available.
3. RECOMMENDATION
3.1 The Committee reports to the Senate that it has considered the A
New Tax System (Family Assistance) Bill 1999 and A New Tax System (Family
Assistance) (Consequential and Related Measures) Bill (No. 1) 1999 and
recommends that the Bills proceed.
Senator the Hon Eric Abetz
Chairman
May 1999
MINORITY REPORT - AUSTRALIAN LABOR PARTY
A NEW TAX SYSTEM (FAMILY ASSISTANCE) BILL 1999
A NEW TAX SYSTEM (FAMILY ASSISTANCE) (CONSEQUENTIAL AND RELATED MEASURES)
BILL (NO. 1) 1999
The Government has made these Bills contingent on the enactment of the
entire Goods and Services Tax (A New Tax system) package of legislation.
It is the Opposition's view, however, that it is possible - and preferable
- to rationalise family payments without introducing a GST.
While remaining completely opposed to a GST, we support this Bill's attempt
to rationalise family payments.
The Opposition supports the child care measures on the understanding
that the Bill will retain the current system of payments in advance to
services, and payment for hours booked as opposed to hours used. We note,
however, that the main payment mechanism will be determined by the A
New Tax System (Family Assistance) (Administration) Bill 1999, which
at the time of this report has not been tabled before Parliament. The
Opposition is disappointed that the Government has not honoured its commitment
to table this legislation in the House of Representatives prior to the
scheduled Senate debate of the two other Family Assistance Bills, so that
the legislation can be considered as a total package.
RECOMMENDATION
That the legislation be passed without amendment.
Senator Chris Evans
(ALP, Western Austalia)
APPENDIX 1 - submissions received by the committee
| 1 |
Australian Council of Social Service (ACOSS) |
| 2 |
Welfare Rights Centre |
| 3 |
Brotherhood of St Laurence |
| 4 |
Uniting Community Services Australia |
APPENDIX 2
public hearing
A public hearing was held on the Bill on 13 May 1999 in Senate Committee
Room 2S1.
Committee Members in attendance
Senator Sue Knowles (Chairman)
Senator Andrew Bartlett (Deputy Chairman)
Senator Alan Eggleston
Senator Chris Evans
Witnesses
Department of Family and Community Services
Mr David Tune, Executive Director
Mr Alexander Dolan, Executive Director
Ms Judy Raymond, Assistant Secretary, Child Care Benefits Branch
Mr Jeff Popple, Unit Head, Tax Reform Unit