Commonwealth Numbered Regulations - Explanatory Statements

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AUSTUDY REGULATIONS (AMENDMENT) 1991 NO. 480

EXPLANATORY STATEMENT

STATUTORY RULES 1991 No. 480

AUSTUDY Regulations (Amendment)

Issued by the authority of the Minister for Higher Education and Employment Services

The Student Assistance Act 1973 (the Act) provides the legislative authority for the AUSTUDY scheme, and for a debt management regime for the AUSTUDY, ABSTUDY and Assistance for Isolated Children schemes.

These schemes pay financial assistance directly to students or their parents.

Section 56 of the Act provides that the Governor-General may make regulations for the purposes of the Act.

At Attachment A is a list of the policy changes to AUSTUDY to be made by the proposed regulations. These will implement:

       changes announced in the 1991 Budget context;

       minor corrections to and clarifications of the existing AUSTUDY Regulations; and

       a provision setting a rate of interest for overdue student assistance debts. Details of the proposed regulations are at Attachment B.

The proposed regulations will make amendments to the AUSTUDY Regulations, to commence on 1 January 1992. This reflects the fact that AUSTUDY is administered on a calendar year basis, approximating to the academic year.

ATTACHMENT A

Policy changes included in the proposed regulations

Changes announced in the 1991 Budget

The proposed regulations will include the following changes to AUSTUDY announced in the 1991 Budget context:

       CPI increases will apply to the levels of maximum payments [regulation 21]

       CPI increases will apply to the asset tests applied to students, their spouses and family [regulation 3]

       CPI increases will apply to the spouse and parental income tests [regulations 29 and 32]

       the amount of income which a student may earn, before AUSTUDY abates will be increased from $4,000 to $5,000 [regulation 26]

       the parental asset test will be extended to include the assets of the student's immediate family [regulation 3]

       the rules defining the effect of previous study on a tertiary student's eligibility for AUSTUDY will be simplified [regulations 7, 10 - 15, 20]

       the conditions under which an abatement will be made to the parental income test to allow for dependent children will be simplified (regulations 28 and 30)

       the minimum annual payment will be increased from $50 to $250 a year (students with entitlements under this figure will not be paid an allowance) [regulation 23]

       the academic progress rules for secondary students will be simplified [regulation 6]

       secondary students who live away from their permanent home will no longer receive fares assistance for travel to their permanent home [regulation 33]

       diploma courses with year 10 as an entry requirement will not be equated to undergraduate diploma and degree courses [regulation 8]

       modified workload and previous study rules will apply to sole parent pensioners [regulation 17 - 19]

       study undertaken overseas will be disregarded (unless it equates to a Master's or Doctor's degree) [regulation 9]

       secondary students will only get the away-from-home rate if they are 19 or older and studying at TAFE or similar institutions [regulation 25]

       the assets test will not apply while a spouse or parent receives a payment from the Departments of Social Security or Veterans' Affairs [regulation 3]

Other changes

       the provision disregarding study needed to enter the student's current course only apply to the normal prerequisite course [regulation 16]

       AUSTUDY will not be paid where a student's spouse receives Social Security benefits at the married rate [regulation 4]

       the circumstances under which an allowance may be paid to homeless students will be clarified [regulation 24]

       an interest rate will apply to outstanding student assistance overpayments [regulation 35]

       a student will be obliged to tell the Department about relevant changes to the family's assets [regulation 34]

       absences from school for parts of a day will be taken into account [regulation 5]

       scholarships for tuition fees will not be included in the income test on a student's income [regulation 27]

ATTACHMENT B

1.       Commencement

Regulation 1 of the AUSTUDY Regulations provides for a commencement date of 1 January 1992

2.       Amendment

The proposed regulations will amend the AUSTUDY Regulations.

3.       Regulation 13 (Do assets affect AUSTUDY?)

Eligibility for AUSTUDY is subject to an assets test. Students cannot get AUSTUDY if the value of assets is beyond certain maximum levels.

Regulation 3 will increase the asset test threshold levels, in line with indexation.

The assets test will apply to family assets (rather than to parental assets as in the past) for students who qualify for the away-from-home or standard rates of living allowance.

For this purpose, 'family' will be defined to include the student, the student's parents, all the parents' dependent children in full-time studies and students aged 16 and over who are dependent.

4.       Regulation 22 (Excluded: (b) students getting certain pensions and allowances)

Regulation 22 of the AUSTUDY Regulations provides that in general, students cannot get AUSTUDY if they qualify for other forms of income support from the Commonwealth.

The amendment will provide that AUSTUDY is not payable to a student where the student's spouse received relevant Social Security payments in the period before the student's course starts.

5. Regulation 29 (Workload: (a) secondary students attending school)

Regulation 29 of the AUSTUDY Regulations requires that school students undertake full-time study to qualify for AUSTUDY. Subregulations 29(3) to (5) deal with absences within the control of the student or the student's parent where the student has already had more than 5 days of such absences in the term: AUSTUDY is not payable for the 14 days after such an absence.

The amendment will identify relevant absences as not being approved by the school, rather than as being within the control of the student or the parents control. The provision will apply to absences during parts of days which total 5 school days or more.

6.       Regulation 32 (Progress: (b) adult students repeating secondary study)

Subregulation 32(1) of the AUSTUDY Regulations at present provides that adult secondary students cannot get AUSTUDY for a level of study (for example Year 11) if they have previously attempted that level of study in the last three years.

The amendment will modify this so that any secondary student (of whatever age) will not get AUSTUDY if the student's study is of overall Year 12 level and the student has undertaken Year 12 in two previous years.

7.       Regulation 37 (How is a student's academic progress calculated?)

Under regulation 37 of the AUSTUDY Regulations, a student's eligibility under the academic progress rules is measured on the basis of the student's situation at the start of the academic year.

This regulation will be omitted, as it will be superseded by the proposed regulation 41 of the AUSTUDY Regulations (see regulation 11 of the proposed Statutory Rules).

8.       Regulation 38 (Levels of tertiary courses)

Regulation 38 of the AUSTUDY Regulations divides tertiary courses into three broad groups: graduate courses (Group A); undergraduate courses (Group B); and TAFE courses (Group C). within each group, all courses are treated as of the same level.

Regulation 38 will be amended to provide that a diploma course is not to be treated as an undergraduate course if it requires successful completion of Year 10 of secondary schooling (instead of the usual requirement of Year 11 or 12) for entry. Such diploma courses are only available at TAFE colleges and will be treated as TAFE courses.

9.       Regulation 39 (Overseas study)

Regulation 39 of AU STUDY Regulations sets out how overseas studies are to be equated with courses approved for AUSTUDY.

Regulation 39 will be omitted, so that study in an overseas course will in general be disregarded. (However, if the overseas course is of the same standing as an Australian Master's or Doctor's course, it will be taken into account: see the proposed amendments to regulation 45.)

10.       Regulation 40 (Progress: (a) to a second or later pear)

Regulation 40 of the AUSTUDY Regulations deals with the effect of a student's immediate past year of study on his or her current eligibility for AUSTUDY (or in some cases, on the effect of the immediate past 2 years of study). Regulation 40 will be omitted.

11.       Regulation 41 (Progress: (b) minimum time)

Regulation 41 of the AUSTUDY Regulations provides that AUSTUDY is not payable to a tertiary student who has already undertaken a sufficient number of years of study to have enabled the student to have completed the course. The rule applies only to study at the same level as the student's current course.

Regulation 41 will be modified to give students, in addition to the minimum length of the course, an extra full year, or an extra half year if the student's subjects are all semester subjects (neither concession applies if the students' course is one year or less).

Regulation 41 will also be modified to apply to students who have previously completed a course of study; the present regulation 42 at present deals with such cases.

12.       Regulation 42 (Progress: (c) completed course of the same level)

Regulation 42 of the AUSTUDY Regulations applies the progress rule to students who have already completed a course at the same level.

It will be omitted, being replaced by the proposed new Regulation 41.

13.       Regulation 43 (Progress: (d) combined courses)

Regulation 43 of the AUSTUDY Regulations deals with the student who has completed one course and is now undertaking a second course where the two courses together constitute an approved combined course.

Regulation 43 will be omitted and a new provision inserted to reflect the proposed new regulation 41.

14. Regulation 44 (Progress: (e) completed work is a higher course)

Regulation 44 of the AUSTUDY Regulations provides that students are ineligible if they have already completed a course of a higher level than their current course. This regulation will be omitted.

15.       Regulation 45 (Progress: (g) postgraduate study)

Regulation 45 of the AUSTUDY Regulations provides that students are ineligible for AUSTUDY if they have undertaken at least six months' study in a Master's or Doctor's course.

Regulation 45 will be amended to enable comparisons to be made between overseas courses which are of the same standing as an Australian Master's or Doctor's course. The amendments will repeat the substance of the existing regulations 39(3) to (5).

16.       Regulation 47 (Progress: concession (a) previous course needed to enter present course)

Regulation 47 of the AUSTUDY Regulations provides that the rules about previous study do not take account of a student's previous course if it is "a normal requirement" for entry to the current course. Regulation 47 will be re-drafted as to apply where the previous course is "the" normal entry requirement.

17.       Chapter 2, Part 3, Division 6

18.       New Part 4 of Chapter 2

The AUSTUDY scheme provides for special rules about academic ability for students with severe disabilities. At present, these are based in Part 3 of Chapter 2, which deals with the special requirements for tertiary students.

Regulation 17 of the proposed statutory rules will omit the heading to Division 6 of Part 3, which will be replaced by the heading to the new Part 4 to be inserted by regulation 18, as these rules apply both to secondary and tertiary students.

The title to the new Part 4 will refer also to sole parents, reflecting the amendment to be made by subregulation 19.2.

19. Regulation 52 (There are special rules for students with disabilities and students who are sole parents)

Subregulation 19.1 will make a drafting change consequential on the amendment to be made by proposed subregulation 19.2.

Subregulation 19.2 will insert a reference to students receiving a sole parent pension under the Social Security Act. This will enable the modified eligibility rules for students with severe disabilities to apply also to students who are sole parent pensioners.

Subregulation 19.3 will make a drafting change to the existing subregulation 52(2) of the AUSTUDY Regulations. In effect, it omits the present paragraph 52(2)(a) which is unnecessary.

Subregulations 19.4 and 19.5 will make drafting changes consequential on the repeal of other regulations.

20.       Regulation 54 (Students with disabilities: previous year's study)

Regulation 54 of the AUSTUDY Regulations deals with the effect on a student's eligibility of the student's last year of study. This regulation will be omitted.

21.       Regulation 61 (What is the maximum living allowance?)

22.       Regulation 64 (Is there an allowance for a spouse?)

These amendments will increase the maximum allowances payable, in line with CPI.

23.       Regulation 66 (Is there a minimum rate of allowance?)

At present students are paid AUSTUDY only if their annual entitlement to a living allowance is $50 or greater.

The amendment will change the minimum payment to $250.

24.       Regulation 74 (Independent student: (g) homelessness)

Homeless students can qualify as independent which means that they are not subject to the parental income test.

The proposed amendment will modify the circumstances in which a student can qualify as independent on the grounds of homelessness.

The amendment will clarify that the existing criteria for homelessness only apply if the student's health is substantially at risk. It will replace "serious family breakdown" with "extreme family breakdown", referring to a process of deterioration which has resulted in current total breakdown of the family relationship.

25.       Regulation 77 (Who gets the away-from-home living allowance?)

Tertiary students and older secondary students, who for reasons of the distance from their parental home and their place of study have had to move away from their parental home, may receive a higher rate of assistance (the away-from-home living allowance).

The amendment will tighten the conditions under which the awayfrom-home allowance may be paid. Older secondary students will not be able to receive the away-from-home rate unless they have had to move in order to have access to Year 11 or 12 offered through TAFE or another institution intended for older students, and their parental home is geographically isolated from these institutions.

26.       Regulation 82 (How does a student's income affect living allowance?)

At present a student may receive up to $4000 before any deductions will commence on the allowance paid through AUSTUDY. It is proposed to increase the limit on other sources on income to $5000.

27.       Regulation 83 (What is student income?)

A scholarship will be disregarded as part of a student's income to the extent that it applies to tuition fees.

28.       Regulation 87 (What are the deductions for children?)

Regulation 87 of the AUSTUDY Regulations provides that, in applying the parental income test, deductions are allowed on account of children who are dependent on their parents.

Subregulation 28.1 will have the effect that the deductions will apply on the basis of the number of dependent children during the year of study. At present regulation 87 applies to the parents' situation on 30 June in the preceding year (or in some cases, on 30 June in the current year).

Subregulation 28.2 will make a drafting change consequential on the repeal of regulation 89.

Subregulation 28.3 will provide for increased deductions for dependent children. Present deductions are $1,200 for one dependent child and $2,500 for subsequent dependent children; the new deductions will be $3,700 for children 16 or over, $1,200 for the first child under 16 and $2,500 for subsequent children under 16.

29. Regulation 88 (How does parental income affect living allowance?)

The point at which a student's allowance begins to reduce because of his or her parental income in the previous financial year will increase from the present figure of $19,300 to $20,700.

30.       Regulation 89 (Concession to the parental income test: (a) for brother or sister)

Regulation 87 provides that the rate of abatement under the parental income test is reduced where there is more than one child in the family who could apply for AUSTUDY (being 16 or older) and studying full time in an approved course but is not independent or receiving other assistance in lieu of AUSTUDY. This concession also applies to children under 16 qualifying for certain kinds of benefit under the Assistance for Isolated Children Scheme.

Regulation 89 will be omitted.

31.       Regulation 94 (What is the spouse's income?)

The proposed amendment will allow deductions against the income of the student's spouse where the student and the spouse have dependent children.

32. Regulation 95 (How does spouse's income affect living allowance?)

The level at which a student's allowance is affected by the spouse's income will be increased from $12,150 to $13,000.

33.       Regulation 99 (Who can get fares allowance?)

Regulation 99 of the AUSTUDY Regulations enables a fares allowance to be paid to adult secondary students and to tertiary students if they have to live away from home in order to study. Regulation 99 will be amended so that adult secondary students will no longer qualify for fares allowance.

34.       Regulation 109 (What changes in circumstances must the Department be told about?)

Section 48 of the Act requires a person receiving student assistance to tell the Department within 7 days if a "prescribed event" happens. It is an offence to fail to do so: paragraph 49(1)(e) of the Act. Regulation 109 of the AUSTUDY Regulations sets out the prescribed events of the AUSTUDY scheme.

An asset test applies under AUSTUDY during the period that an allowance is paid to a student. The proposed amendment will require a student to tell the Department of changes in assets values.

35.       New regulation 111A

Subsection 40(2) of the Act enables a Departmental officer to advise that, if a debt is not paid within 3 months, interest will commence from the date of the notice. No interest is payable, however if the debtor arranges repayments by instalments: section 40(5) of the Act. The rate of interest is to be prescribed by regulations.

The proposed subregulation 111A will set 20% per year as the applicable rate of interest. This will reflect the rate applicable under corresponding provisions of Income Tax Assessment Act (19361.


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