Social Services and Other Legislation Amendment (Military Invalidity Payments Means Testing) Bill 2024 - Commentary on Ministerial Responses [2024] AUSStaCSBSD 77 (27 March 2024)

	Home \| Databases \| WorldLII \| Search \| Feedback Australian Senate Standing Committee for the Scrutiny of Bills - Scrutiny Digests

Purpose	The bill seeks to amend the Social Security Act 1991 and Veterans’ Entitlements Act 1986 to confirm the income support treatment of certain military invalidity pensions affected by the Full Federal Court decision in Commissioner of Taxation v Douglas [2020] FCAFC 220.
Portfolio	Social Services
Introduced	House of Representatives on 15 February 2024
Bill status	Before the Senate

Retrospective validation^[94]

2.127 Schedule 1 to the bill seeks to amend the Social Security Act 1991 and the Veterans’ Entitlements Act 1986 to clarify the classification of military invalidity pensions within the social security and veterans’ entitlements means test respectively, following the decision in Commissioner of Taxation v Douglas [2020] FCAFC 220 (Douglas). Items 37 and 39 of Schedule 1 to the bill seek to validate past assessments of the military invalidity payment to ensure the payments continue to be treated as exempt from the assets test in both the Social Security Act 1991 and the Veterans’ Entitlements Act 1986.

2.128 In Scrutiny Digest 3 of 2024, the committee requested the minister’s advice as to whether any persons are likely to be detrimentally affected by the retrospective application of the legislation and, if so, to what extent their interests are likely to be affected.^[95]

Minister for Social Services’ response^[96]

2.129 The Minister for Social Services (the minister) advised that the amendments provide a clear legal foundation for the classification of military invalidity pensions affected by the Douglas decision. The amendments will ensure the income provided by these payments continues to be assessed in line with the intent of policy and legislation before Douglas and also validates past mean test assessments which may be invalid in light of Douglas.

2.130 The minister advised that it is highly unlikely that any veteran and/or their partner would be detrimentally affected by the operation of the validation provisions because they deem the historical treatment of the affected payments in the means test to be valid and effective, and to have always been so. The provisions do not operate retrospectively to change anything that occurred in the past and they cannot result in any debts arising for past periods. The validation provisions do not remove people’s rights of review or appeal in cases where decisions may have been invalid for other reasons.

2.131 The minister offered that the explanatory memorandum to the bill could be updated to include this further explanation of the issue.

Committee comment

2.132 The committee thanks the minister for their response and their constructive offer to update the explanatory memorandum to the bill with the additional information provided.

2.133 The committee acknowledges the minister’s explanation that it is highly unlikely any veteran and/or their partner would be detrimentally affected by the operation of the validation provisions as they continue the assessment of the military invalidity pensions in line with the policy intent and legislation pre-Douglas. The committee welcomes the minister’s advice that retrospectivity in this case cannot result in any debts arising for past periods.

2.134 However, it remains unclear to the committee, irrespective of previous policy intent, whether it is possible that any veteran (or their partner) who received one of the relevant invalidity benefit payments and also an income support payment from the social security system would have been entitled to a greater payment in the past than that which they received, in accordance with the law as it stands following the Douglas decision. If so, it is also unclear what rights such persons would have to claim additional amounts of payment but for the respective validation provisions contained in the bill. This is central to the question of whether retrospective validation would trespass on personal rights and liberties, which the committee has a duty to consider.

2.135 The committee, however, notes the minister’s explanation that the legal basis for the historical treatment of affected payments is unclear and that the bill seeks to address this by the inclusion of the validation provisions. The need for clarity may appropriately justify retrospective validation in this case.

2.136 The committee requests that an addendum to the explanatory memorandum be tabled containing the key information provided by the minister, 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).

2.137 The committee otherwise draws to the attention of senators and leaves to the Senate as a whole the appropriateness of retrospectively validating past assessments of the military invalidity payment.

^[93] This entry can be cited as: Senate Standing Committee for the Scrutiny of Bills, Social Services and Other Legislation Amendment (Military Invalidity Payments Means Testing) Bill 2024, Scrutiny Digest 5 of 2024; [2024] AUSStaCSBSD 77.

^[94] Schedule 1, items 37 and 39. The committee draws senators’ attention to these provisions pursuant to Senate standing order 24(1)(a)(i).

^[96] The minister responded to the committee’s comments in a letter dated 19 March 2024. A copy of the letter is available on the committee’s webpage (see correspondence relating to Scrutiny Digest 5 of 2024).

Australian Senate Standing Committee for the Scrutiny of Bills - Scrutiny Digests