Explanatory Memorandum
(Circulated by authority of the Minister for Family and Community Services, Senator the Hon Kay Patterson)Outline and financial impact statement
Outline
This Bill makes amendments to the A New Tax System (Family Assistance) Act 1999 and the A New Tax System (Family Assistance) (Administration) Act 1999 to give effect to the Government's Welfare to Work package as it relates to child care benefit.
The amendments made by Schedule 1 increase from 20 to 24 hours per week the threshold weekly limit of hours of care provided by an approved child care service to a child, for which child care benefit may be paid without the need for the claimant and the claimant's partner (if any) to satisfy the work/training/study test.
Amendments made by Schedule 2 modify the work/training/study test that a claimant and the claimant's partner have to meet to be paid child care benefit for up to 50 hours of care provided to the claimants' child by an approved child care service in a week.
As a result of the amendments in Schedule 2, an individual undertaking paid work, or a course of study or training for the purpose of improving the individual's work skills and/or employment prospects, or any other activity that the Minister determines, will satisfy the work/training/study test only if the sum of the hours that the individual spends during the week doing those activities is at least 15. In addition, an individual will be able to average the number of hours that the individual spends doing those activities over a two week period and will satisfy the work/training/study test for each week in that period, if the sum of the number of hours for that two week period is at least 30.
The amendments made by this Bill apply to child care benefit claimed as child care benefit by fee reduction, or as a lump sum, for care provided by an approved child care service.
Financial impact statement
Schedule 1 - Amendments relating to threshold for receiving child care benefit
Commencement: 1 July 2006
Financial impact: Total resourcing
| 2005-06 | nil |
| 2006-07 | $1.8 m |
| 2007-08 | $1.9 m |
| 2008-09 | $2.1 m |
Schedule 2 - Amendments relating to work/training/study test
Commencement: 1 July 2006
Financial impact: Total resourcing
| 2005-06 | nil |
| 2006-07 | $2.1 m |
| 2007-08 | $2.2 m |
| 2008-09 | $2.4 m |