EXPLANATORY STATEMENT
Child Care Benefit (Rates and Hardship) Determination 2000
Summary
This determination is made under subsection 82(3) of the A New Tax System (Family Assistance) Act 1999 (the Family Assistance Act).  Section 82 was inserted by item 55 of Schedule 1 to the A New Tax System (Family Assistance and Related Measures) Act 2000.
The purpose of this determination is to specify kinds of hardship for the purposes of child care benefit (CCB), and to provide rules concerning the making of decisions on questions of hardship and certain other matters.
Background
The Family Assistance Act introduced CCB, which is a payment towards a family’s child care costs.  In some circumstances the rate of CCB can be increased if the child’s parent is in “hardship”. The rate of CCB can also be increased if the child is at risk of serious abuse or neglect.  Rates can be increased by a certificate issued by an approved child care service, or by a determination of the Secretary.  Paragraph 82(3)(a) of the Family Assistance Act provides that the Minister may specify kinds of hardship, and paragraph 82(3)(b) provides that the Minister may make rules relating to the giving of certificates by child care services and the making of determinations by the Secretary.
Explanation of the provisions
Part 1
Section 1 of the determination states the name of the determination and section 2 states that the determination commences on 1 July 2000, which is the date that the CCB provisions of the Family Assistance Act will begin to operate.  Section 3 contains interpretation provisions.
Part 2
Section 4 specifies kinds of hardship for the purposes of the Family Assistance Act.  Subsection 4(1) specifies hardship that occurs where a person experiences an event that significantly reduces his or her ability to pay child care fees, and subsection 4(2) gives some examples of the kind of event that may be relevant.
Subsection 4(3) specifies that hardship occurs when a person ceases to receive one of a number of specified social security payments, and either has significant expenses due to starting work, or experiences a significant drop in income.  Subsection 4(4) provides that this rule does not apply if a person has ceased to receive the social security payment because he or she has too many assets.
Subsection 4(5) provides that specified hardship does not arise due to routine matters or non-essential expenditure, or to an increase in child care fees.
Part 3
Section 5 contains definitions of terms used in this Part.
Section 6 provides that an event that causes a person hardship may not give rise to an increased CCB rate for more than 52 weeks altogether.
Section 7 provides that when person experiences hardship of the type specified in section 4(3) (ceasing to receive income support payments), a determination can initially be made for 3 weeks, and subsequently for 1 week, up to a maximum of 6 weeks.  The purpose of this provision is to allow sufficient time for a person’s new income details to be obtained, and for a new assessment of his or her circumstances to be made, for the purposes of calculating the person’s rate of CCB.
Section 8 provides that the Secretary should consider, when making a decision on hardship, how long the person needs to adapt to new circumstances after the event which caused the hardship, and sets out factors to be taken into account in making this decision.  An increased rate of CCB must not be given for more than the period that the Secretary considers necessary under this section, (and in any event is subject to the maximum 52 week limit under section 6).
Part 4
Section 9 provides further rules relating to the giving of certificates by an approved child care service under section 76 of the Family Assistance Act.  Under section 76, a child care service may certify an increased rate of CCB if a person is in hardship, or if the child is at risk of serious abuse or neglect.  Section 9 provides that the service’s certificate must contain a description of the circumstances applicable to the person or the child, including the reasons for giving the certificate.