BILLS DIGEST No. 48, 2021–22    4 March 2022

Social Security Amendment (Improved Child to Adult Transfer for Carer Payment and Carer Allowance) Bill 2022

Carol Ey
Social Policy Section

Date introduced: 10 February 2022

House: House of Representatives

Portfolio: Social Services

Commencement: The day after Royal Assent.

Links: The links to the Bill, its Explanatory Memorandum and second reading speech can be found on the Bill’s home page, or through the Australian Parliament website.

When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the Federal Register of Legislation website.

All hyperlinks in this Bills Digest are correct as at March 2022.

Purpose of the Bill

Structure of the Bill

Background

Committee consideration

Policy position of non-government parties/independents

Position of major interest groups

Financial implications

Statement of Compatibility with Human Rights

Key issues and provisions

1 Purpose of the Bill

The purpose of the Social Security Amendment (Improved Child to Adult Transfer for Carer Payment and Carer Allowance) Bill 2022 (the Bill) is to amend the Social Security Act 1991 (the Act) to simplify the Child to Adult transfer process for Carer Payment and Carer Allowance.

2 Structure of the Bill

The Bill consists of one Schedule with three Parts:

• Part 1 ensures that all recipients of Carer Payment (child) continue to receive payment until the care recipient reaches at least 16 years and 3 months of age. It also provides that if the appropriate documentation for assessment for Carer Payment (adult) has been received prior to the care receiver’s relevant birthday and a determination is not made at the time payment would currently be cancelled, payment is continued until a determination is made

• Part 2 proposes the same provisions for Carer Allowance

• Part 3 extends eligibility for Health Care Card to align with the provisions for Carer Allowance.

3 Background

This Bill proposes minor changes to the arrangements for those who are receiving Carer Payment (CP) (child) and Carer Allowance (CA) when the care recipient child reaches the age of 16 (or 18 if they have a terminal illness). Carer Payment is an income support payment, payable at the rate of the Age Pension, available to those providing constant care to someone with a severe disability or illness. Carer Allowance is an income supplement for those who provide additional daily care to someone with a disability or medical condition.

The intent of the new arrangements is to ensure that those carers who submit the necessary documents for assessment for transfer to CP (adult) or CA (adult) prior to their child reaching the relevant age are not disadvantaged if their assessment is rejected, compared to those who do not apply for transfer.

In addition, if the determination process in these cases continues beyond the normal cancellation date, the proposed amendments mean the carer will continue to receive payment until a determination is made. This ensures that there is no gap in payment receipt for those who are subsequently determined to be eligible for CP (adult) or CA (adult) due to assessment delays.

This measure was announced in the Mid-Year Economic and Fiscal Outlook 2021–22.¹

4 Committee consideration

Senate Community Affairs Legislation Committee

The Bill has been referred to the Senate Community Affairs Legislation Committee for inquiry and report by 24 March 2022. Details of the inquiry are at the inquiry homepage.

Senate Standing Committee for the Scrutiny of Bills

The Scrutiny of Bills Committee has not reported on the Bill at the time of writing.

5 Policy position of non-government parties/independents

Non-government parties and independents do not appear to have commented publicly on the Bill to date.

6 Position of major interest groups

In noting that the Bill had been introduced, Carers Australia reported that the Minister had met with carers and their representatives in September 2021 to discuss the issues in transferring to Carer Payment (adult) and Carer Allowance (over 16 years) when care recipients turned 16:

While the Bill has yet to pass through Parliament and the start date for the new rules is unfortunately not until 1 January 2023, it is gratifying that the Minister listened to carers and took some action.² 

7 Financial implications

This measure is estimated to cost $7.6 million over four years from 2021-22 (and $2.0 million per year ongoing).³

8 Statement of Compatibility with Human Rights

As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill’s compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act. The Government considers that the Bill is compatible.⁴

Parliamentary Joint Committee on Human Rights

The Parliamentary Joint Committee on Human Rights has not reported on this Bill at the time of writing.

9 Key issues and provisions

In order for a carer to transfer from CP (child) to CP (adult) the care receiver must be assessed, rated and scored under the Adult Disability Assessment Tool (ADAT), which is given legislative force by the Adult Disability Assessment Determination 2018. Under current arrangements, if the child is assessed, rated and scored before they turn 16, and is not given a qualifying score for CP (adult), the CP (child) payment is cancelled on the child’s 16th birthday.⁵ However, if the care receiver is not assessed, rated and scored at 16 years and 3 months, the CP (child) payment is cancelled at that point.⁶

Hence a carer who provides the necessary documentation and receives a negative assessment prior to the care receiver turning 16 is disadvantaged over a carer who does not submit any documentation.

In addition, if there is a delay in the assessment process and a determination is not made until after the child turn 16 years and 3 months, the payment is cancelled. If a favourable determination is made by the delegate after that time, normal date of effect rules apply.⁷ This may mean a gap between the cancellation of CP (child) and the commencement of CP (adult).⁸

Similar provisions apply for Carer Allowance (CA) when the care receiver turns 16.⁹

Slightly different arrangements apply where the care receiver is a child with a terminal illness. In this case, CP (child) is payable until the child turns 18. If the carer applies for CP (adult) and the child is assessed, rated and is given a qualifying score prior to turning 18, the carer transitions to CP (adult) on the child’s birthday.¹⁰ However, if the determination is not made prior to the child turning 18, there is again a possibility of a gap between the cancellation of CP (child) and the receipt of CP (adult).

Recipients of Carer Allowance, where the care recipient is aged under 16 years, may also be eligible for a Health Care Card, which provides cheaper access to medicines.

Provisions relating to Carer Payment

Part 1 of the Bill covers the amendments relating to recipients of CP (child).

Subsection 197(3) of the Act provides that where a CP (child) recipient is caring for a child with a terminal condition, they may continue to receive CP (child) until the child turns 18. Under Item 4 of the Bill, new subsection 197(3A) is inserted to continue payment to the later of:

• when the child turns 18 or

• up until a score under the ADAT is received if the carer ‘ensures that, on or before the day the care receiver turns 18, the Secretary is given all the information, statements and other materials that are needed in order for the care receiver to be assessed and rated and given a score’.

This removes the situation where there is a gap between the receipt of CP (child) and CP (adult) due to delays in processing.

Item 8 proposes a consequential amendment to subsection 197E(2), which specifies the qualification for CP for a child with a terminal condition.

Subsection 197(6) provides for continuation of CP (child) payment beyond the age of 16 years only if the care receiver has not been given a score under ADAT. Item 6 proposes to insert new subsection 197(5A) so that payment can continue to be received until the later of the child turning 16 years and 3 months or when an ADAT score is received if the necessary documentation has been supplied prior to the child turning 16. Item 11 proposes similar amendments to subsection 197K(2), which specifies the conditions under which CP (child) can be extended until the care receiver is 16 years and 3 months.

These provisions ensure that all CP (child) recipients who are determined not to be eligible for CP (adult) are treated equitably, and that the gap between receipt of CP (child) and CP (adult) is removed for eligible recipients due to a delay in processing.

If the Bill is enacted, these proposed amendments will apply where the care receiver turns 16 on or after 1 January 2023 (Item 12). This means that the changed arrangements for those caring for a terminally ill child will not take effect until 1 January 2025, as they do not come into effect until the care receiver turns 18.

Provisions relating to Carer Allowance and Health Care Card

Part 2 of the Bill proposes amendments to subsection 953A of the Act, which sets out the conditions under which CA can continue to be paid when a care recipient turns 16. The proposed amendments are consistent with those proposed in relation to CP (child); that is, qualification for CA continues until the child turns 16 years and 3 months or, where the necessary documentation has been provided prior to the child turning 16, up until a score under ADAT is received.

These amendments are also proposed to apply where the care receiver turns 16 on or after 1 January 2023 (Item 18).

Proposed amendments to align eligibility for a Health Care Card to qualification for CA are contained in Part 3 of the Bill. Item 21 amends the definition of a disabled child under subsection 1061ZK(8) from ‘under 16 years’ to ‘under 16 years and 3 months’. Again, these provisions are scheduled to apply where the care receiver turns 16 on or after 1 January 2023 (Item 22).

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Notes

[←1]

.    Josh Frydenberg (Treasurer) and Simon Birmingham (Minister for Finance), Mid-Year Economic and Fiscal Outlook 2021–22, 294.

[←2]

10 .    ‘Easing the Transition from Child to Adult Carer Payment and Carer Allowance’, Carers Australia, n.d.

[←3]

.    Explanatory Memorandum, Social Security Amendment (Improved Child to Adult Transfer for Carer Payment and Carer Allowance) Bill 2022, 3.

[←4]

.    The Statement of Compatibility with Human Rights can be found at pages 10–11 of the Explanatory Memorandum to the Bill.

[←5]

.    Department of Social Security (DSS), ‘3.6.4.34 Qualification for CP (Child) - Transition (Turning 16 years of Age) from CP (Child) to CP (Adult)’, Social Security Guide, 15 August 2016.

[←6]

.    DSS, 3.6.4.34 Qualification for CP (Child).

[←7]

.    DSS, 3.6.4.34 Qualification for CP (Child).

[←8]

.    Social Security (Administration) Act 1999 (Cth), Section 114.

[←9]

.    DSS, ‘3.6.7.42 Qualification for CA (Child) - Transition (Turning 16 years of Age) from CA (Child) to CA (Adult)’, Social Security Guide, 3 January 2017.

[←10]

.    DSS, 3.6.4.34 Qualification for CP (Child), 15 August 2016.