Details of the Financial Framework (Supplementary Powers) Amendment

(Prime Minister and Cabinet Measures No. 2) Regulations 2021

 

Section 1 - Name

 

This section provides that the title of the Regulations is the Financial Framework (Supplementary Powers) Amendment (Prime Minister and Cabinet Measures No. 2) Regulations 2021.

 

Section 2 - Commencement

 

This section provides that the Regulations commence immediately after the instrument is registered on the Federal Register of Legislation.

 

Section 3 - Authority

 

This section provides that the Regulations are made under the Financial Framework (Supplementary Powers) Act 1997.

 

Section 4 - Schedules

 

This section provides that the Financial Framework (Supplementary Powers) Regulations 1997 are amended as set out in the Schedule to the Regulations.

 

Schedule 1 - Amendments

 

Financial Framework (Supplementary Powers) Regulations 1997

 

Item 1 - Part 4 of Schedule 1AB (at the end of the cell at table item 492, column headed "Objective(s)")

 

Item 1 amends the objective of table item 492 in Part 4 of Schedule 1AB, which establishes legislative authority for government spending on the COVID-19 Disaster Payment (the payment). The payment is one-off and time-limited financial assistance to eligible persons who are, or were, unable to earn their usual income as a result of a state or territory public health order restricting the movement of persons for a period of more than seven days in a location in Australia determined by the Commonwealth Chief Medical Officer to be a COVID-19 hotspot for the purposes of Commonwealth support (the hotspot area).

 

Item 1 adds another objective to table item 492, which extends financial assistance (the extended payment) to certain persons who are, or were, unable to earn their usual income as a result of being present in another location in Australia at a time that it was subject to a state or territory public health order (the second public health order) restricting the movement of persons for a period of more than seven days because they were previously present in the hotspot area.

 

The Department of Home Affairs had responsibility for the payment until 30 June 2021. From 1 July 2021, the responsibility for the payment, including the extended payment, transferred to the National Recovery and Resilience Agency (the NRRA) in the Prime Minister and Cabinet portfolio. Payments to the additional cohort of eligible individuals will be administered by Services Australia.

 

The extended payment is intended to assist certain persons who:

*         are Australian citizens, Australian permanent residents or holders of a temporary visa who have the right to work in Australia; and

*         are aged 17 years or over; and

*         were previously present in a location (the hotspot area) in Australia that was at that time, or is at a later time:

o   subject to a state or territory public health order restricting the movement of persons for a period of more than seven days; and

o   determined by the Commonwealth Chief Medical Officer to be a COVID-19 hotspot for the purposes of Commonwealth support; and

*         are, or were, present in another location in Australia at a time that it was subject to a state or territory public health order (the second public health order) restricting the movement of persons for a period of more than seven days where such persons were previously present in the hotspot area; and

*         are, or were, restricted in their movement by the second public health order because they were previously present in the hotspot area; and

*         are, or were, unable to earn their usual income because the restrictions imposed by the second public health order prevent, or prevented, them being able to work in their usual employment; and

*         other than annual leave, have, or had, no available leave entitlements to cover the period of the restrictions; and

*         declare that during the period of the restrictions they:

o   are or were in an area where restrictions have been imposed on persons who were previously present in the hotspot area; and

o   have, or had, liquid assets of less than $10,000; and

*         during the period of the restrictions are, or were, not otherwise receiving:

o   Commonwealth income support payments or payments of a similar nature; or

o   pandemic leave disaster payments.

 

Precise eligibility criteria, including the period during which applications for the extended payment can be made, will be published on the Services Australia website (www.servicesaustralia.gov.au). Eligibility criteria will also be updated in the COVID-19 Disaster Payment Guidelines, which will be made available on the GrantConnect website (www.grants.gov.au).

 

For clarity, the reference to liquid assets is a general term and does not have the same meaning as defined in the Social Security Act 1991. It means that eligible recipients do not have readily available funds in cash or savings.

 

The rate of the extended payment will be set at $500 per week for individuals who were engaged in paid employment of more than 20 hours per week, and $325 per week for individuals who were engaged in paid employment of less than 20 hours per week.

 

From 1 July 2021 until 30 June 2022, the payment, including the extended payment, will be funded through an unlimited special appropriation established in the COVID-19 Disaster Payment (Funding Arrangements) Act 2021. This period reflects the time-limited nature of Commonwealth income support for the COVID-19 pandemic.

 

The extended payment will be administered by Services Australia as a demand driven (eligibility based) grant and paid directly to eligible persons. Claimants will be required to complete and submit a claim via their myGov account. Claims will only be accepted by telephone in limited circumstances. A claim will be assessed by Services Australia against the eligibility criteria before making the payment and claimants will be notified by letter if their claim has been granted or rejected. If the assessment process identifies unintentional errors in an application, the claimant may be contacted to correct or explain the information. Where requested, a claimant may also need to provide evidence of meeting the eligibility criteria for the extended payment. There will be no written grant agreement for the extended payment, or associated eligible grant activities. Proof of expenditure of the grant will not be required.

 

Grants will be administered in accordance with the Commonwealth Grants Rules and Guidelines 2017 and the Public Governance, Performance and Accountability Act 2013. Information about the extended payment will be published on the Services Australia website and the updated COVID-19 Disaster Payment Guidelines will be published on the GrantConnect website. Decisions about Commonwealth expenditure in connection with the extended payment will be made by a Services Australia delegate of the Coordinator-General of the NRRA. The aggregated information on the number of claims granted and the total expenditure will be published on GrantConnect. Individual claimants will not be identified.

 

The COVID-19 Disaster Payment (Funding Arrangements) Act 2021 also creates an obligation on the Coordinator-General of the NRRA to include in the NRRA's annual report for the reporting period commencing on 1 July 2021, information that relates to payments made in that period. This information may include:

*         the total amount of payments for the reporting period;

*         the number of payments granted, and the number of applications that were not granted;

*         if payments are required for multiple events in the reporting period - the amount paid and number of claims for each event; and

*         qualitative information to assist with the interpretation of the above mentioned quantitative information.

 

Independent merits review is not considered suitable for decisions made in connection with the extended payment as such decisions are automatic or mandatory in nature. The eligibility criteria are simple factual matters. Where the applicant is eligible, the decision involves no discretion. For example, to be eligible for the extended payment a person must have been present in a location in Australia at a time that it was subject to a state or territory public health order restricting the movement of persons for a period of more than seven days because they were previously present in the hotspot area.

 

Further, the extended payment will be administered in a beneficial way that promotes compliance with health objectives and ensures financial support is available. Declaration is the primary method of a person demonstrating they have met the eligibility criteria. For example, a person must make a declaration that during the period of the restrictions he or she has, or had, liquid assets of less than $10,000.

 

The Administrative Review Council has recognised that it is justifiable to exclude merits review in relation to decisions of this nature (see paragraphs 3.8 to 3.11 of the guide, What decisions should be subject to merit review?).

 

Decisions to reject a person's claim for the extended payment will be subject to review processes within Services Australia at a claimant's request. If a person does not understand the reason(s) for a decision made by Services Australia, they can ask for an explanation of the decision. This explanation will be provided by a Subject Matter Expert (SME). The SME will investigate the decision, correct any identified errors, undertake any re-assessment and contact the customer to explain the decision. All customer consultations will be managed by Services Australia, which may seek input from the NRRA at any point in this process prior to finalising the review. The internal review process in Services Australia provides a robust means of addressing errors that might occur in the decision making process. Given these are beneficial and not complex decisions, the internal review process conducted by Services Australia provides an effective means of efficiently arriving at the preferable decision.

 

The extended payment will be subject to the oversight by the Commonwealth Ombudsman.

 

The audit process undertaken by the Australian National Audit Office also provides a mechanism to review government spending decisions and report any concerns to the Parliament. Judicial review may also be available under section 39B of the Judiciary Act 1903 and section 75(v) of the Australian Constitution.

 

Administrative accountability for the extended payment will be achieved by ensuring that:

*         the process of allocating funds is fair;

*         the criteria for funding are made clear; and

*         decisions are made objectively.

 

The NRRA consulted extensively with Services Australia, which has administrative responsibility for the delivery of the payment and other government disaster related payments to the community.

 

There was a need to implement the extended payment quickly in order to enable financial support to be provided to vulnerable Australians in a timely manner. Furthermore, the extended payment, being a benefit paid to individuals, imposes no regulatory burden on businesses, therefore broader consultation was not required in this instance.

 

Noting that it is not a comprehensive statement of relevant constitutional considerations, the objective of the item references the following powers in the Constitution:

*         express incidental power and the executive power (sections 51(xxxix) and 61), including the nationhood aspect.

 

Executive power and express incidental power, including the nationhood aspect

 

The express incidental power in section 51(xxxix) of the Constitution empowers the Parliament to make laws with respect to matters incidental to the execution of any power vested in the Parliament, the executive or the courts by the Constitution. Section 61 of the Constitution supports activities that are peculiarly adapted to the government of a nation and cannot be carried out for the benefit of the nation otherwise than by the Commonwealth.

 

COVID-19 is causing a widespread health emergency of national significance, with widespread impacts on sectors of the economy due to the need for lockdowns to contain the spread of COVID-19. The COVID-19 Disaster Payment will be extended to certain eligible persons who are, or were, unable to earn their usual income as a result of being present in a location in Australia at a time that the location was subject to a state or territory public health order restricting the movement of persons for a period of more than seven days because those persons were identified as being previously present in a hotspot area.

 

Statement of Compatibility with Human Rights

 

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

 

Financial Framework (Supplementary Powers) Amendment (Prime Minister and Cabinet Measures No. 2) Regulations 2021

 

This disallowable legislative instrument 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 legislative instrument

 

Section 32B of the Financial Framework (Supplementary Powers) Act 1997 (the FF(SP) Act) authorises the Commonwealth to make, vary and administer arrangements and grants specified in the Financial Framework (Supplementary Powers) Regulations 1997 (the FF(SP) Regulations) and to make, vary and administer arrangements and grants for the purposes of programs specified in the Regulations. Schedule 1AA and Schedule 1AB to the FF(SP) Regulations specify the arrangements, grants and programs. The powers in the FF(SP) Act to make, vary or administer arrangements or grants may be exercised on behalf of the Commonwealth by Ministers and the accountable authorities of non-corporate Commonwealth entities, as defined under section 12 of the Public Governance, Performance and Accountability Act 2013.

 

The Financial Framework (Supplementary Powers) Amendment (Prime Minister and Cabinet Measures No. 2) Regulations 2021 (the Regulations) amend table item 492 in Part 4 of Schedule 1AB to the FF(SP) Regulations, which establishes legislative authority for government spending on the COVID-19 Disaster Payment (the payment). The payment is one-off and time-limited financial assistance to eligible persons who are, or were, unable to earn their usual income as a result of a state or territory public health order restricting the movement of persons for a period of more than seven days in a location in Australia determined by the Commonwealth Chief Medical Officer to be a COVID-19 hotspot for the purposes of Commonwealth support (the hotspot area).

 

The amendments to table item 492 extend the eligibility for the payment (the extended payment) to certain persons who are, or were, unable to earn their usual income as a result of being present in another location in Australia at a time that it was subject to a state or territory public health order (the second public health order) restricting the movement of persons for a period of more than seven days because they were previously present in the hotspot area.

 

The extended payment is intended to assist Australian citizens, Australian permanent residents and temporary visa holders who have the right to work in Australia, who do not, or did not, have available leave entitlements, other than annual leave, to cover the period of the restrictions. Individuals who are, or were, already receiving Commonwealth income support payments, payments of a similar nature, or pandemic leave disaster payments during the period of the restrictions will not be eligible for the extended payment.

 

The rate of the extended payment will be set at $500 per week for individuals who were engaged in paid employment of more than 20 hours per week, and $325 per week for individuals who were engaged in paid employment of less than 20 hours per week. To be eligible, recipients must not have liquid assets of more than $10,000 during the period of the restrictions.

 

The Department of Home Affairs had responsibility for the payment until 30 June 2021. From 1 July 2021, the responsibility for the payment, including the extended payment, transferred to the National Recovery and Resilience Agency in the Prime Minister and Cabinet portfolio. Payments to the additional cohort of eligible individuals will be administered by Services Australia.

 

Human rights implications

 

This disallowable legislative instrument engages the following rights:

*         the right to health in Article 12 of the International Covenant on Economic, Social and Cultural Rights (ICESCR), read with Article 2; and

*         the right to an adequate standard of living in Article 11 of the ICESCR.

 

This disallowable legislative instrument amends table item 492 to extend the eligibility for the payment (the extended payment) to certain persons who are, or were, unable to earn their usual income as a result of being present in another location in Australia at a time that it was subject to a state or territory public health order (the second public health order) restricting the movement of persons for a period of more than seven days because they were previously present in a hotspot area. The extended payment means that more people will be eligible for the payment.

 

Right to health

 

Article 2 of the ICESCR requires the States Parties to take steps to progressively achieve the full realisation of the rights recognised in the ICESCR by all appropriate means.

 

Article 12 of the ICESCR states, in part:

 

1. The States Parties to the present Covenant recognize the right of everyone to the enjoyment of the highest attainable standard of physical and mental health.

2. The steps to be taken by the States Parties to the present Covenant to achieve the full realization of this right shall include those necessary for: [ ... ]

(c) The prevention, treatment and control of epidemic, endemic, occupational and other diseases; [ ... ].

 

The extended payment broadens the group of individuals who are able to apply for the payment. The primary aim of the amendments to table item 492 is to ensure individuals who are in a different area to where the impact arose, but are still subject to health orders restricting their movement for longer than seven days - and who do not have available paid leave entitlements, other than annual leave, or another means of income support for the period of the orders in effect for greater than seven days - are able to claim the payment. The extended payment also promotes public health by ensuring that economic pressure is not a reason for persons to break state or territory public health orders and risk spreading COVID-19 to others. This disallowable legislative instrument therefore promotes the right to health.

 

 

Right to an adequate standard of living

 

Article 11(1) of the ICESCR states:

 

The States Parties to the present Covenant recognize the right of everyone to an adequate standard of living for himself and his family, including adequate food, clothing and housing, and to the continuous improvement of living conditions. [ ... ]

 

Similarly, the extended payment assists in promoting the right to an adequate standard of living for those persons who are, or were, unable to work and earn their usual income as a result of being present in another location in Australia at a time that it was subject to the second public health order restricting the movement of persons for a period of more than seven days because they were previously present in a hotspot area.

 

Conclusion

 

This disallowable legislative instrument is compatible with human rights because it supports and promotes the rights to health and to an adequate standard of living.

 

 

 

 

 

Senator the Hon Simon Birmingham

Minister for Finance