Commonwealth Numbered Acts

SOCIAL SECURITY AND VETERANS' AFFAIRS LEGISLATION AMENDMENT ACT 1995 No. 1, 1996 - SCHEDULE 3

                       SCHEDULE 3                 Section 3

AMENDMENTS OF THE SOCIAL SECURITY ACT 1991 RELATING TO
EARNINGS CREDITS 1. Paragraph 1115A(1)(a): After "special benefit" insert ",
or partner allowance received by a partner of a person who is receiving
special benefit". 2. Paragraph 1115A(1)(d): Omit. 3. Paragraphs 1115A(1)(f)
and (g): Omit, substitute:

"(f) if the person's earnings credit account balance is equal to or more than
the amount earned-the part of the amount earned that is not more than $100; or

   (g)  if the person's earnings credit account balance is less than the
        amount earned-the part of the amount earned that is not more than the
        lesser of:

        (i)    the earnings credit account balance; or

        (ii)   $100.". 4. Subsection 1115A(3): Omit "subsection (1)" (first
               occurring), substitute "subsection (2)". 5. Subsection
               1115B(1): After "special benefit" insert ", or partner
               allowance received by a partner of a person who is receiving
               special benefit". 6. Section 1115C (Earnings Credit Account
               Balance Calculator B- Module C): Omit, substitute:

"MODULE C-EARNINGS CREDIT When earnings credit arises

"1115C-C1.(1) A person has an earnings credit for an earnings credit
accounting period if the person's fortnightly rate of ordinary income for that
period is less than the person's ordinary income free area. Amount of credit

"(2) The amount of the earnings credit is the amount by which that fortnightly
rate of ordinary income is less than that ordinary income free area. Meaning
of fortnightly rate of ordinary income

"(3) If subsection 1115A(1) applies in relation to the application of an
ordinary income test to a person for an earnings credit accounting period, a
reference in subsection (1) or (2) to the person's fortnightly rate of
ordinary income for the period is taken to be a reference to:

   (a)  if the person is a member of a couple and the person's partner is
        receiving a social security pension-the rate worked out using the
        formula:
       person's reduced income rate   +   partner's income rate ; or

2

   (b)  in any other case-the person's reduced income rate; where: person's
        reduced income rate means the person's fortnightly rate of ordinary
        income for the period after taking into account any application of
        subsection 1115A(1) in relation to amounts of money that the person
        has earned for remunerative work. partner's income rate means the
        partner's fortnightly rate of ordinary income for the period. Note:
        For ordinary income free area see points 1067-H12 (Benefit Rate
        Calculator A), 1067E-G15 (Sickness Allowance Rate Calculator),
        1068-G12 (Benefit Rate Calculator B) and 1068A-D16 (Parenting
        Allowance Rate Calculator).". 7. Section 1115C (Module D of Earnings
        Credit Account Balance Calculator B): Omit, substitute:

"MODULE D-DRAWING ACCOUNT Drawing on account (recipient account)

"1115C-D1. Subject to point 1115C-D2, if, under point 1115A, an amount is
disregarded in applying an ordinary income test to a person or a person's
partner, the person is taken to draw the disregarded amount on an account
established under section 1115B. If social security benefit rate is
nil-account not taken to be drawn

"1115C-D2. If:

   (a)  because a person earned an amount of money from remunerative work done
        by the person during an earnings credit accounting period, the person
        would, apart from this point, be taken under point 1115C-D1 to have
        drawn an amount on the person's earnings credit account established
        under section 1115B; and

   (b)  the rate of social security benefit payable to the person for the
        period is nil; the person is taken not to have drawn that amount on
        the account.". 8. Schedule 1A: Add at the end (after proposed clause
        84 added by item 89 of Schedule 2): Application of legislative changes
        relating to earnings credits

"85. The amendments made by Schedule 4 to the Social Security and  Veterans'
Affairs Legislation Amendment Act 1995 apply:

   (a)  in respect of social security benefits (other than parenting
        allowance)-for any fortnight starting on or after 20 March 1996; or

   (b)  in respect of parenting allowance-for any fortnight starting on or
        after the first parenting allowance payday on or after 20 March
        1996.".