Details of the Financial Framework (Supplementary Powers) Amendment

(Home Affairs Measures No. 2) Regulations 2021

 

Section 1 - Name

 

This section provides that the title of the Regulations is the Financial Framework (Supplementary Powers) Amendment (Home Affairs 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 - In the appropriate position in Part 4 of Schedule 1AB (table)

 

This item adds a new table item to Part 4 of Schedule 1AB to establish legislative authority for government spending on an activity that will be administered by the Department of Home Affairs (the department).

 

New table item 492 establishes legislative authority for government spending on the COVID-19 Disaster Payment, which will provide one-off and time-limited financial assistance to eligible workers who are unable to earn their usual income as a result of health restrictions (public health order) imposed by state and territory governments, where the Commonwealth Chief Medical Officer has determined the location to be a COVID-19 hotspot for the purposes of Commonwealth support.

 

On 3 June 2021, the Prime Minister, the Hon Scott Morrison MP, the Treasurer, the Hon Josh Frydenberg MP, and the Minister for Agriculture, Drought and Emergency Management, the Hon David Littleproud MP, jointly announced the COVID-19 Disaster Payment. The media statement is available at www.pm.gov.au/media/temporary-australian-government-assistance-workers.

 

The 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;

*         are aged 17 years or over;

*         reside or are employed in a location in Australia that:

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

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

*         are unable to earn their usual income because the restrictions imposed by the public health order prevent them from being able to work in their usual employment;

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

*         declare that during the period of the restrictions they:

o   reside or are employed in the hotspot area; and

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

*         during the period of the restrictions are not otherwise receiving:

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

o   pandemic leave disaster payments.

 

Further eligibility criteria may apply. For example, the payment will be made to eligible persons affected by the restrictions which remain in place for longer than one week, that is, it will be payable only for the second and subsequent weeks of the restrictions. Precise eligibility criteria will be set out 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 COVID-19 Disaster Payment is a national payment, with Victoria to be the first jurisdiction to receive Commonwealth support in the form of the payment, where the Greater Melbourne area has currently been determined by the Commonwealth Chief Medical Officer to be a COVID-19 hotspot for the purposes of Commonwealth support.

 

The rate of payment will be set at $500 per week for people who were engaged in paid employment of more than 20 hours per week, and $325 per week for people who were engaged in paid employment of less than 20 hours per week. Subject to further discussion between the Commonwealth and states and territories, total cost of the payment may be shared between the Commonwealth and the relevant state or territory, with the latter reimbursing the Commonwealth for making payments to eligible persons.

 

The payment is modelled on the existing pandemic leave disaster payment, which is made to eligible individuals who are, or were, unable to earn income because they are, or have been, required to remain in isolation as a quarantine measure, or are caring, or cared, for a person required to remain in isolation as a quarantine measure, as a result of COVID-19. 

 

The payment will be administered by Services Australia as a demand driven (eligibility based) grant and paid directly to eligible persons. The program will commence on 8 June 2021. The Government does not propose to nominate an end date for the payment at this stage, given the ongoing uncertainty with COVID-19, in particular given outbreaks can occur at any stage.

 

Claimants will be required to complete and submit a claim via a 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 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 payment. There is no written grant agreement for the payment. There are no associated eligible grant activities. Proof of expenditure of the grant is not 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 grants program, including the guidelines, will be published on GrantConnect. Decisions about Commonwealth expenditure in connection with the payment will be made by a Services Australia delegate of the Secretary of the department. The aggregated information on the number of claims granted and the total expenditure will be published on GrantConnect. Individual claimants will not be identified.

 

Independent merits review is not considered suitable for decisions made in connection with the payment as such decisions are automatic or mandatory in nature. The discretion available to an official of Services Australia when making a decision will be very limited and the decision making process is procedural. For example, to be eligible for the payment a person must reside or be employed in a location in Australia that is subject to a state or territory public health order restricting the movement of persons for a period of more than one week, and has been determined by the Commonwealth Chief Medical Officer to be a COVID-19 hotspot for the purposes of Commonwealth support.

 

Further, the payment is being 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 they reside or are employed in the hotspot area, and they have 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 payment are 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. Services Australia may seek input from the department 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 payment will be subject to the department's complaints process and 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 this program 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.

 

Consultation was undertaken between the Prime Minister and the Acting Premier of Victoria, as well as other state and territory premiers on 4 June 2021, in relation to the delivery of the payment in partnership with states and territories. The department also consulted extensively with Services Australia, which has administrative responsibility for the delivery of the COVID-19 Disaster Payment and other government disaster related payments to the community.

 

There was a need to implement the payment quickly in order to ensure that Victorian workers get the financial support they need to stay at home during the current outbreak and lockdown period. Furthermore, the payment, being a benefit paid to individuals, imposes no regulatory burden on businesses, therefore broader consultation was not required in this instance.

 

There is no effective cap on the expenditure as the payment is demand driven. However, any further funding is subject to the Government decision (and parliamentary scrutiny through the Budget process).

 

Noting that it is not a comprehensive statement of relevant constitutional considerations, the objective of the item references the following power 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 available to certain eligible persons who are unable to earn their usual income as a result of state or territory public health orders restricting the movement of such persons, which are in effect for greater than seven days in response to outbreaks of COVID-19 in the community, and the Commonwealth Chief Medical Officer has determined the location to be a hotspot for the purposes of this payment.

 

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 (Home Affairs 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.

 

On 3 June 2021, the Prime Minister, the Hon Scott Morrison MP, the Treasurer, the Hon Josh Frydenberg MP, and the Minister for Agriculture, Drought and Emergency Management, the Hon David Littleproud MP, jointly announced the establishment of a temporary COVID-19 Disaster Payment in recognition that extended lockdown periods can have serious financial implications for workers. The payment aims to help lawful workers unable to work and earn their usual income, because they are subject to state or territory public health orders restricting the movement of persons, and the Commonwealth Chief Medical Officer has determined the area to be a COVID-19 hotspot for the purposes of Commonwealth support. 

 

The Financial Framework (Supplementary Powers) Amendment (Home Affairs Measures No. 2) Regulations 2021 amend Schedule 1AB to the FF(SP) Regulations to establish legislative authority for the Government to make the COVID-19 Disaster Payment to eligible individuals who are, or were, unable to earn their usual income because they are, or have been, unable to work as a result of state or territory public health orders in effect for greater than seven days in an area determined by the Commonwealth Chief Medical Officer to be a COVID-19 hotspot for the purposes of Commonwealth support.

 

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.

 

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 payments introduced by this measure are targeted at those who are, or were, unable to work because of state or territory public health orders 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. The primary aim of this measure is to promote 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 measure 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, this measure assists in promoting the right to an adequate standard of living for those persons who are, or were, unable to work because of state or territory public health orders 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.

 

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