Social Security Legislation Amendment (Streamlined Participation Requirements and Other Measures) Bill 2021 [further Response] [2021] AUSStaCSBSD 168 (4 August 2021)

• Social Security Legislation Amendment (Streamlined Participation Requirements and Other Measures) Bill 2021
• Instruments not subject to parliamentary disallowance28
• Broad discretionary powers
• Instruments not subject to parliamentary disallowance35
• Broad discretionary powers
• Parliamentary scrutiny – section 96 grants to the states39

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Social Security Legislation Amendment (Streamlined Participation Requirements and Other Measures) Bill 2021

Purpose	This bill seeks to modernise and streamline social security law to support the New Employment Services Model, which will operate from July 2022
Portfolio	Education, Skills and Employment
Introduced	House of Representatives on 27 May 2021
Bill status	Before the House of Representatives

Instruments not subject to parliamentary disallowance^[28]

2.61 The committee initially scrutinised this bill in Scrutiny Digest 8 of 2021 and requested the minister's advice.^[29] The committee considered the minister's response in Scrutiny Digest 10 of 2021 and requested the minister's further advice regarding:

• why it is considered necessary and appropriate that all determinations made under proposed section 40T are not legislative instruments; and

• whether the bill could be amended to provide that these determinations are legislative instruments to ensure that they are subject to appropriate parliamentary oversight.^[30]

Minister's response^[31]

2.62 The minister advised:

In relation to proposed section 40T of the Social Security (Administration) Act 1999, I note the Committee’s comments about commencement and disallowance issues and its view that urgency is not generally a sufficient reason for instruments to be non-legislative, with ‘minimal exceptions’. However, notwithstanding the Committee’s points about commencement and disallowance, this case falls within the category of cases where an exception is warranted.
An example of a situation where the power in proposed section 40T may be needed is if a bushfire is spreading on a Sunday night. If the instrument is legislative, it would need to be drafted, signed and registered, with an accompanying explanatory statement. This would not physically be possible in time to provide job seekers in the bushfire affected areas the certainty they need that they would not risk their payments being affected by not complying with their requirements the next morning. This is not an uncommon scenario. During the 2019–20 bushfires, for example, there were 22 instances where requirements needed to be urgently paused for some job seekers.
The Committee also noted the role of Parliament in scrutinising ‘possible encroachments on personal rights and liberties’. I can reassure the Committee that it would not be possible for an instrument under proposed section 40T to encroach on personal rights and liberties because the only purpose of such an instrument would be to exempt persons from needing to comply with mutual obligation requirements under the social security law in order to receive their social security payment.

Committee comment

2.63 The committee thanks the minister for this response. The committee notes the minister's advice that this case falls within the category of cases where an exception to the usual position that instruments should be subject to disallowance is warranted, noting that instruments may be required to be made during an emergency situation. The committee also notes the minister's advice that it would not be possible for an instrument under proposed section 40T to encroach on personal rights and liberties.

2.64 While acknowledging the minister's advice, the committee considers that it would be possible to put in place administrative processes to draft, sign and register determinations urgently if necessary. The committee therefore reiterates its view that instruments that may be legislative in nature should be legislative instruments to ensure that appropriate parliamentary scrutiny is available. This issue has been highlighted recently in the committee's review into the Biosecurity Act 2015,^[32] the inquiry of the Standing Committee for the Scrutiny of Delegated Legislation into the exemption of delegated legislation from parliamentary oversight,^[33] and a resolution of the Senate on 16 June 2021 emphasising that delegated legislation should be subject to disallowance and sunsetting to permit appropriate parliamentary scrutiny and oversight unless there are exceptional circumstances.^[34]

2.65 The committee requests that an addendum to the explanatory memorandum containing the key information provided by the minister in his responses to the committee be tabled in the Parliament as soon as practicable, noting the importance of these explanatory materials as a point of access to understanding the law and, if needed, as extrinsic material to assist with interpretation (see section 15AB of the Acts Interpretation Act 1901).

2.66 Noting that a determination under proposed section 40T can only be beneficial to affected persons by providing an exemption from mutual obligation requirements and that the secretary must be satisfied that exceptional circumstances exist before making a determination, the committee makes no further comment on this matter.

Broad discretionary powers
Instruments not subject to parliamentary disallowance^[35]

2.4 The committee initially scrutinised this bill in Scrutiny Digest 8 of 2021 and requested the minister’s advice.^[36] The committee considered the ministers’ response in Scrutiny Digest 10 of 2021 and requested the minister’s further advice as to:

• why it is considered appropriate that instruments made under proposed subsection 8(8AC) and proposed subsection 40(3) are not legislative instruments; and

• whether the bill could be amended to provide that these instruments are legislative instruments to ensure that they are subject to appropriate parliamentary oversight.^[37]

Minister's response^[38]

2.67 The minister advised:

Similarly, the power in proposed subsection 8(8AC) can only be used to specify that payments and benefits from employment programs are not to be considered income for social security law purposes, benefitting job seekers by allowing them to keep their full income support payments in addition to assistance from programs.
I note the Committee’s concerns about the power to make notifiable instruments in proposed subsection 40(3). In this instance, a notifiable instrument is preferred to a legislative instrument due to its technical nature, and because the Secretary already has the power to achieve the same effect, but with less benefit to job seekers, by requiring employment programs to be entered into a Job Plan under existing provisions, for example section 631C. The power to make a notifiable instrument means that job seekers can benefit more fully from the Points Based Activation System under the new employment services model. Under the new model, job seekers may have only a points requirement in their Job Plan, rather than specific activities.

Committee comment

2.68 The committee thanks the minister for this response. The committee notes the minister's advice that the power in proposed subsection 8(8AC) can only be used to specify that payments and benefits from employment programs are not to be considered income for social security law purposes, benefitting job seekers by allowing them to keep their full income support payments in addition to assistance from programs.

2.69 The committee also notes the minister's advice that, in relation to instruments made under proposed subsection 40(3), a notifiable instrument is preferred to a legislative instrument due to its technical nature, and because the Secretary already has the power to achieve the same effect, but with less benefit to job seekers, by requiring employment programs to be entered into a Job Plan under existing provisions, for example, section 631C.

2.70 While noting the minister's advice, the committee does not consider the fact that an instrument may have a beneficial effect or that similar powers are available in existing legislation to be a sufficient justification for not providing that instruments will be subject to disallowance. The committee also does not consider the fact that an instrument may be technical in nature will be a sufficient justification of itself for providing that an instrument will be notifiable rather than legislative.

2.71 The committee again reiterates that Schedule 5 to the bill seeks to amend subsection 28(1) of the Social Security Act 1991 to provide that declarations by the Secretary that particular programs of work are approved programs of work for income support payment will be legislative instruments. Noting the similarity in the types of determinations being made, it remains unclear to the committee why determinations made under proposed subsection 8(8AC) and proposed subsection 40(3) cannot be legislative instruments. The committee notes that neither the explanatory memorandum nor either of the minister's responses have addressed this issue.

2.72 The committee therefore does not consider that the minister has provided information that adequately justifies why instruments made under proposed subsection 8(8AC) and proposed subsection 40(3) are not legislative instruments and therefore subject to disallowance.

2.73 From a scrutiny perspective, the committee considers that the bill should be amended to provide that instruments made under proposed subsection 8(8AC) and proposed subsection 40(3) are legislative instruments to ensure that they are subject to appropriate parliamentary oversight. The committee otherwise draws this matter to the attention of senators and leaves to the Senate as a whole the appropriateness of providing that these instruments are not legislative instruments.

Broad discretionary powers
Parliamentary scrutiny – section 96 grants to the states^[39]

2.74 The committee initially scrutinised this bill in Scrutiny Digest 8 of 2021 and requested the minister’s advice.^[40] The committee considered the ministers’ response in Scrutiny Digest 10 of 2021 and left to the Senate as a whole the appropriateness of:

• conferring on the Employment Secretary a broad power to make arrangements and grants relating to assisting persons to obtain and maintain paid work in circumstances where there is limited guidance on the face of the bill as to how that power is to be exercised; and

• not including a requirement that written agreements with the states and territories about arrangements or grants made under proposed section 1062A be tabled in the Parliament.^[41]

Minister's response^[42]

2.75 The minister advised:

In relation to the Committee’s comment on guidance related to grants, I confirm my advice of 26 June 2021 that grants are made in accordance with the Public Governance, Performance and Accountability Act 2013, and with value for money and other requirements in the Commonwealth procurement and grants frameworks. The department also ensures that arrangements or grants are subject to robust conditions proportionate to the amounts and issues involved.
The Committee has questioned whether there should be a requirement for grants made under proposed section 1062A to be tabled in Parliament. This is met in effect by proposed section 1062D that requires that the number and amount of grants or arrangements made under proposed section 1062A be published in the department’s annual report. As the Committee would be aware, annual reports are tabled in Parliament.

Committee comment

2.76 The committee thanks the minister for this response. The committee notes the minister's advice that grants are made in accordance with the Public Governance, Performance and Accountability Act 2013, and with value for money and other requirements in the Commonwealth procurement and grants frameworks.

2.77 The committee also notes the minister's advice that, in relation to the tabling of grants, proposed section 1062D requires that the number and amount of grants or arrangements made under proposed section 1062A be published in the department's annual report.

2.78 While noting this advice, the committee reiterates that it has generally not accepted consistency with existing legislation or the existence of non-legislative policy guidelines to be sufficient as a justification for the conferral of broad powers in circumstances where there is limited guidance on the face of the bill as to how those powers are to be exercised.

2.79 It remains unclear to the committee why at least high-level guidance cannot be included on the face of the bill as to the exercise of powers under proposed sections 1062A and 1062B.

2.80 The committee also notes that including information regarding the number or amount of grants in the department's annual report is not equivalent to tabling the written agreements with the states or territories themselves. The committee considers that tabling the written agreements would allow Parliament, and particularly the Senate, to exercise appropriate scrutiny over the grant of money to the states and territories.

2.81 The committee again draws its scrutiny concerns to the attention of senators and leaves to the Senate as a whole the appropriateness of:

• conferring on the Employment Secretary a broad power to make arrangements and grants relating to assisting persons to obtain and maintain paid work in circumstances where there is limited guidance on the face of the bill as to how that power is to be exercised; and

• not including a requirement that written agreements with the states and territories about arrangements or grants made under proposed section 1062A be tabled in the Parliament.

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[28] Schedule 1, item 123, proposed sections 40T and 40U. The committee draws senators’ attention to these provisions pursuant to Senate Standing Order 24(1)(a)(v).

[29] Senate Scrutiny of Bills Committee, Scrutiny Digest 8 of 2021, pp. 40-41

[30] Senate Scrutiny of Bills Committee, Scrutiny Digest 10 of 2021, pp. 53-55.

[31] The minister responded to the committee's comments in a letter dated 28 July 2021. A copy of the letter is available on the committee's website: see correspondence relating to Scrutiny Digest 11 of 2021 available at: www.aph.gov.au/senate_scrutiny_digest.

[32] Scrutiny Digest 7 of 2021, chapter 4, pp. 33-44.

[33] Senate Standing Committee for the Scrutiny of Delegated Legislation, Inquiry into the exemption of delegated legislation from parliamentary oversight: Interim report, December 2020; and Inquiry into the exemption of delegated legislation from parliamentary oversight: Final report, March 2021.

[34] Journals of the Senate, 16 June 2021, pp. 3581–3582.

[35] Schedule 4, item 2, proposed subsection 8(8AC) and Schedule 6, item 1, proposed subsection 40(3). The committee draws senators’ attention to these provisions pursuant to Senate Standing Order 24(1)(a)(v).

[36] Senate Scrutiny of Bills Committee, Scrutiny Digest 8 of 2021, pp. 43-44.

[37] Senate Scrutiny of Bills Committee, Scrutiny Digest 10 of 2021, pp. 59-60.

[38] The minister responded to the committee's comments in a letter dated 28 July 2021. A copy of the letter is available on the committee's website: see correspondence relating to Scrutiny Digest 11 of 2021 available at: www.aph.gov.au/senate_scrutiny_digest.

[39] Schedule 2, item 2, proposed sections 1062A and 1062B. The committee draws senators’ attention to these provisions pursuant to Senate Standing Order 24(1)(a)(ii) and (v).

[40] Senate Scrutiny of Bills Committee, Scrutiny Digest 8 of 2021, pp. 41-43.

[41] Senate Scrutiny of Bills Committee, Scrutiny Digest 10 of 2021, pp. 56-58.

[42] The minister responded to the committee's comments in a letter dated 28 July 2021. A copy of the letter is available on the committee's website: see correspondence relating to Scrutiny Digest 11 of 2021 available at: www.aph.gov.au/senate_scrutiny_digest.