Revised Explanatory Memorandum
(Circulated by authority of the Minister for Social Services, the Hon Christian Porter MP)Statement of compatibility with human rights
Prepared in accordance with Part 3 of the
Human Rights (Parliamentary Scrutiny) Act 2011
SOCIAL SERVICES LEGISLATION AMENDMENT (FAMILY PAYMENTS STRUCTURAL REFORM AND PARTICIPATION MEASURES) BILL 2015
This Bill is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the Schedule
This Bill makes amendments to the A New Tax System (Family Assistance) Act 1999.
From 1 July 2016, family tax benefit Part B will be removed for couple families (other than grandparents and great-grandparents) with a youngest child aged 13 or over. Single parents, grandparents and great-grandparents caring for a youngest child aged 13 to 18 will continue to have access to family tax benefit Part B (subject to satisfying other relevant requirements).
This reform will improve the sustainability of the family payments system over the long term, while continuing to provide assistance to families in need with more limited capacity to engage in the workforce or increase workforce participation.
Human rights implications
These amendments engage the following human rights:
Right to social security
Article 9 of the International Covenant on Economic, Social and Cultural Rights recognises the right of everyone to social security, while article 11 recognises the right to an adequate standard of living for an individual and their family, including adequate food, clothing and housing, and the continuous improvement of living conditions.
Rights of the child
Article 26 of the Convention on the Rights of the Child requires countries to recognise the right of the child to benefit from social security. Benefits should take into account the resources and the circumstances of the child and persons having responsibility for the maintenance of the child.
The objective of the family payment reform is to ensure that the family payments system remains sustainable in the long term. The United Nations Committee on Economic, Cultural and Social Rights recognises that a social security scheme should be sustainable, and that the conditions for benefits must be reasonable and proportionate.
To the extent that introducing a new rate structure for family tax benefit Part B limits the right to social security, this is reasonable and proportionate.
As a share of Gross Domestic Product (GDP), government spending on family assistance in Australia has tripled from 0.9 per cent in in 1980 to 2.7 per cent in 2012, the most recent year for which comparable data is available. Government spending on family assistance in Australia has consistently been above the OECD average as a share of GDP. This is despite Australia being widely regarded as having one of the most targeted social welfare systems in the OECD and having an overall smaller total spend on welfare benefits compared to the OECD average (taken as a proportion of GDP).
While the number of families who receive family tax benefit has declined over time, down from 1.72 million in 2010-11 to 1.62 million in 2012-13, expenditure continues to rise, increasing by almost one billion dollars over the last three financial years for which data is available, up from $18.9 billion in 2010-11 to $19.8 billion in 2012-13.
With pressure on government spending expected to be further increased as a result of the aging population and the costs of health care, age related pensions, and aged care, it is imperative that support focuses on those most in need and helps promote greater workforce participation.
The Government supports families with the direct costs of raising dependent children through family tax benefit Part A or youth income support payments, with a family's rate of assistance determined by family income. These payments have the primary objective of ensuring that all children have access to a basic acceptable standard of living.
Family assistance provides additional support to families with one main income through family tax benefit Part B to recognise and support the role of parents and other carers as carers and members of the workforce. The design of family tax benefit Part B has a workforce participation focus, and is not based on a family income test, but a primary earner and a secondary earner income test.
The level of financial support provided by family tax benefit Part B is higher for families with a youngest child aged four and under in recognition of the higher need for parental provision of direct care of children, and reduced when a youngest child turns five (moving into compulsory education) and primary carers have a greater capacity to move into the workforce or increase their workforce participation.
Where a youngest child has reached the age of 13, the Government considers it appropriate to expect primary carers to engage in the workforce, or increase their workforce participation. While this measure will reduce a family's rate of family assistance once their youngest child turns 13, this measure does not limit an individual's right to social security and they will retain access to income support or social security payments for themselves, and assistance for dependent children through family tax benefit Part A or youth income support payments.
Conclusion
These amendments are compatible with human rights because they advance the protection of human rights and, to the extent that these changes limit access to family payments, these limitations are reasonable and proportionate and families are otherwise provided for.