Commonwealth of Australia Explanatory Memoranda Commonwealth of Australia Explanatory Memoranda[Index] [Search] [Download] [Bill] [Help]
2022
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
SOCIAL SERVICES AND OTHER LEGISLATION AMENDMENT (LIFTING THE
INCOME LIMIT FOR THE COMMONWEALTH SENIORS HEALTH CARD) BILL
2022
EXPLANATORY MEMORANDUM
(Circulated by the authority of the
Minister for Social Services, the Hon Amanda Rishworth MP)
SOCIAL SERVICES AND OTHER LEGISLATION AMENDMENT (LIFTING THE INCOME
LIMIT FOR THE COMMONWEALTH SENIORS HEALTH CARD) BILL 2022
OUTLINE
This Bill amends the Social Security Act 1991 and the Veterans' Entitlements Act 1986 to
increase the Commonwealth Seniors Health Card income test limits to $90,000 a year for a
single person and $144,000 a year for couples (combined).
Schedule 1--Amendments
This Schedule amends the Social Security Act 1991 and the Veterans' Entitlements Act 1986
to increase the Commonwealth Seniors Health Card income test limits for single persons and
members of a couple.
Financial impact statement
MEASURE FINANCIAL IMPACT OVER THE FORWARD
ESTIMATES
Schedule 1 - Amendments $69.4 million
• The measures in this Bill are part of a commitment by the Government to increase the
Commonwealth Seniors Health Card income test limits to $90,000 a year for a single
person and $144,000 a year for couples (combined).
• This financial impact includes impacts for the Department of Social Services, Services
Australia and the Department of Veterans' Affairs in relation to amendments included in
the Bill.
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
The statement of compatibility with human rights appears at the end of this explanatory
memorandum.
SOCIAL SERVICES AND OTHER LEGISLATION AMENDMENT (LIFTING THE INCOME
LIMIT FOR THE COMMONWEALTH SENIORS HEALTH CARD) BILL 2022
NOTES ON CLAUSES
Abbreviations used in this explanatory memorandum
• Social Security Act means the Social Security Act 1991;
• Veterans' Entitlements Act means the Veterans' Entitlements Act 1986.
Clause 1 sets out how the new Act is to be cited - that is, as the Social Services and Other
Legislation Amendment (Lifting the Income Limit for the Commonwealth Seniors Health Card)
Act 2022.
Clause 2 describes the commencement of the provisions in this Act. It provides a table setting
out the commencement date of the various sections in, and Schedules to, the new Act. The
whole of the Act will commence on the day the Act receives the Royal Assent.
Clause 3 provides that legislation that is specified in a Schedule to this Act is amended or
repealed as set out in the applicable items in that Schedule, and any other item in a Schedule
to the Act has effect according to its terms.
Schedule 1--Amendments
Summary
This Schedule amends the Social Security Act and the Veterans' Entitlements Act to increase
the Commonwealth Seniors Health Card income test limits for single people and couples.
This Schedule also includes application provisions to ensure the amendments to the Social
Security Act and the Veterans' Entitlements Act apply from 20 September 2022 as intended.
Background
The Commonwealth Seniors Health Card is a concession card that provides cardholders with
access to Australian Government health concessions including the lower threshold of the
Extended Medicare Safety Net and cheaper medicines listed under the Pharmaceutical
Benefits Scheme.
Australian residents or special category visa holders who are of age pension age or veteran
pension age who do not receive a social security payment, service pension, income support
supplement or veteran payment may claim a Commonwealth Seniors Health Card, subject to
meeting the relevant qualification criteria. One of the criteria is that the person must satisfy the
Commonwealth Seniors Health Card income test. To satisfy this test, the person's total
adjusted taxable income, as well as deemed income from any account based superannuation
pensions held, must not exceed the applicable income test limit for the relevant tax year.
Different income test limits apply depending on the person's family situation, namely if they are
a single person or a member of a couple. Couples separated due to illness, respite care or gaol
have a combined income test limit of two times the single limit. This is because the assumption
that members of a couple are able to share the financial costs and expenses arising from the
relationship does not apply in cases of illness, respite care or incarceration.
Increasing the Commonwealth Seniors Health Card income test limits will allow more
individuals access to relevant pharmaceutical and medical benefits. This Schedule increases
the income test limit for a single person, a member of illness separated couple, a member of
respite care couple, and a member of a partnered (partner in gaol) couple from $50,000 to
$90,000. It also increases the income test limit for each member of a couple from $40,000 to
$72,000, meaning a new income test limit of $144,000 combined.
On 20 September of each year, the Commonwealth Seniors Health Card income test limits are
indexed in line with increases in the Consumer Price Index. The increased income test limits,
as amended, will substitute the indexation of the income test limits on 20 September 2022.
Indexation of the new income test limits in this Bill will commence on 20 September 2023. This
ensures the new income test limits will not be increased more than the amounts specified below
on 20 September 2022.
Explanation of the changes
Social Security Act
Section 1071 sets out the Seniors Health Care Card Income Test Calculator.
Item 1 amends table item 1, column 3 of point 1071-12 to omit "$50,000" and substitute
"$90,000". This reflects the increase to the Commonwealth Seniors Health Card income test
limit for single persons to $90,000 per year.
Item 2 amends table item 2, column 3 of point 1071-12 to omit "$40,000" and substitute
"$72,000". This reflects the increase to the Commonwealth Seniors Health Card income test
limit for persons who are members of a couple to $72,000 per person (or $144,000 combined)
per year.
Item 3 amends table items 3, 4 and 5, column 3 of point 1071-12 to omit "$50,000" and
substitute "$90,000". This reflects the increase to the Commonwealth Seniors Health Card
income test limits for persons who are a member of illness separated couple or member of
respite care couple, or who are partnered (partner in gaol) to $50,000 per year.
Item 4 repeals and substitutes the note to point 1071-12 to state that indexation of the amounts
in column 3 are modified for the years 2022 and 2023. This is explained in item 5.
Item 5 inserts new subsections 1192(5BA) and (5BB) after subsection 1192(5B).
Section 1192 provides for the indexation of amounts.
New subsection 1192(5BA) provides that the Commonwealth Seniors Health Card income test
limits provided in items 1 to 3 above are not to be indexed on 20 September 2022. This ensures
that sections 1190 to 1194 do not apply concurrently with these amendments to effectively
increase the income test limits more than the amounts specified by items 1 to 3 above until
20 September 2023.
New subsection 1192(5BB) explains how to work out the indexed amount for the relevant
Commonwealth Seniors Health Card income test limit on 20 September 2023. For single
persons, persons who are a member of illness separated couple or member of respite care
couple, and persons who are partnered (partner in gaol), the current amount to be indexed
immediately before that day is taken to be $90,000. For persons who are a member of a couple,
the current amount to be indexed immediately before that day is taken to be $72,000. This
ensures consistency with, and continuity of, the indexation of the substituted income test limits.
Veterans' Entitlements Act
Section 118ZZA sets out the Seniors Health Care Card Income Test Calculator.
Item 6 amends table item 1, column 3 of point 118ZZA-11 to omit "$50,000" and substitute
"$90,000". This reflects the increase to the Commonwealth Seniors Health Card income test
limit for single persons to $90,000 per year.
Item 7 amends table item 2, column 3 of point 118ZZA-11 to omit "$40,000" and substitute
"$72,000". This reflects the increase to the Commonwealth Seniors Health Card income test
limit for persons who are members of a couple to $72,000 per person (or $144,000 combined)
per year.
Item 8 amends table items 3 and 4, column 3 of point 118ZZA-11 to omit "$50,000" and
substitute "$90,000". This reflects the increase to the Commonwealth Seniors Health Card
income test limits for persons who are a member of illness separated couple or a member of
respite care couple to $90,000 per year.
Item 9 repeals and substitutes note 4 to point 118ZZA-11 to state that indexation of the
amounts in column 3 are modified for the years 2022 and 2023. This is explained in item 10.
Item 10 repeals and substitutes subsection 198FAA(6). Subsection 198FAA(6) defines the
term 'indexation day' for the purposes of section 198FAA.
Section 198FAA provides for the annual indexation of the income limits that apply for the
purposes of column 3 of the table in point 118ZZA-11.
The revised definition provides that the indexation day will be "20 September 2023 and each
later 20 September".
The revised definition provides that for the purposes of the limits set out in column 3 of
point 118ZZA-11 that the revised Commonwealth Seniors Health Card income test limits
provided in items 6 to 8 above are not to be indexed on 20 September 2022. This ensures that
section 198FAA does not apply concurrently with these amendments to effectively increase
the income test limits more than the amounts specified by items 6 to 8 above until
20 September 2023.
Item 11 provides that these amendments to the Social Security Act and the Veterans'
Entitlements Act apply when working out whether a person qualifies for a Commonwealth
Seniors Health Card on a day on or after 20 September 2022. As an individual's
Commonwealth Seniors Health Card entitlement is effectively assessed each tax year, the
amendments will apply from commencement prospectively to individuals who claim
a Commonwealth Seniors Health Card before, on or after 20 September 2022, regardless of
their date of claim.
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
SOCIAL SERVICES AND OTHER LEGISLATION AMENDMENT (LIFTING THE INCOME
LIMIT FOR THE COMMONWEALTH SENIORS HEALTH CARD) BILL 2022
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 Bill
This Bill increases the Commonwealth Seniors Health Card income test limits for single
persons and couples to allow more individuals access to the relevant pharmaceutical and
medical benefits.
Human rights implications
The Bill's amendments support the right of everyone to social security in Article 9 of the
International Covenant on Economic, Social and Cultural Rights (ICESCR) by increasing the
coverage of an existing social security benefit.
By increasing the availability of health concessions to more Australians, the Bill also engages
with Article 12 of the ICESCR by working to create conditions which assure medical services
and attention are available to all in the event of sickness.
The Bill also supports the United Nations Principles for Older Persons especially with regard
to the independence and care of older persons by reducing the cost of required health care
and pharmaceuticals for an additional group of older people.
Conclusion
The amendments in the Schedule are compatible with human rights because they work to
improve a person's access to social security and health services.
[Circulated by the authority of the Minister for Social Services, the Hon Amanda
Rishworth MP]