5.2.6.20 RA savings provisions - 1974 to 2000

Summary

Several changes have occurred throughout the years with regard to the rates and conditions under which RA is paid. At each change, suitable savings provisions (1.1.S.40) were included in the legislation to ensure that recipients were not disadvantaged because of the changes. This topic contains details of the following RA savings provisions:

• 1974 legislation
• 1976 legislation
• 1980 legislation
• 1981 legislation - before 13 June 1987
• 1981 legislation - after 13 June 1987
• 1987 legislation
• 1989 legislation
• 1993 legislation
• 1996 legislation, and
• 2000 legislation.

Prior to 5 September 1985 RA was known as 'supplementary assistance'.

1974 legislation

With effect from 1 November 1974 the Act was amended to provide that the rate of RA would not exceed the amount of rent (1.1.R.160) actually paid. However, in any case in which the amount of RA being received exceeded the amount that was being paid for 'rent', the amount of RA was not to be reduced solely on that account.

RA was subsequently increased only when the amount of rent increased to an amount greater than the rate of RA being paid.

A recipient who travelled overseas before 1 November 1974 and who, prior to departure overseas was in receipt of RA at a rate greater than that payable under the later provisions, was paid an amount of RA on return assessed on the conditions applying before 1 November 1974.

Where, upon the death of one of a married couple (1.1.M.120), who had been granted RA prior to 1 November 1974, the amount paid in rent by the surviving partner (1.1.P.85) was less than his/her existing entitlement, the amount of RA payable to the surviving partner was increased to the amount payable for the couple prior to the partner's death.

These savings provisions were repealed on 13 June 1989 and no longer apply to recipients.

1976 legislation

No rate of RA in force immediately prior to 25 November 1976 was reduced or cancelled solely as a result of the introduction of the income test.

This savings provision was repealed on 13 June 1989 and no longer applies to recipients.

1980 legislation

From 1 January 1981 the 'pensioner contribution' in respect of a benevolent home recipient was brought into line with the patient contribution in non-government nursing homes, as prescribed in the National Health Act 1953. This increased the pensioner contribution from 66.66% to 87.5% of the maximum pension, including RA. Where a recipient was admitted to a benevolent home prior to 1 January 1981, part of his or her pension (up to $42.80 a fortnight) plus part of any entitlement to RA (up to $2.00 a fortnight) could be retained by the recipient under a savings provision introduced by the Social Services Amendment Act 1979. The savings provision as it applied to RA was repealed from 13 June 1989. Later indexation (1.1.I.100) increases were applied to the pensioner contribution, (i.e. the component paid to the benevolent home). The last benevolent home in Australia (1.1.A.320) ceased to exist as of 1 January 1994.

1981 legislation - prior to 13 June 1987

RA payments in force as at 1 February 1982 continued to apply until the recipient ceased to qualify under the 'previous' conditions, (e.g. received an increase in income or ceased to pay rent etc.), or became entitled to a higher rate of RA under the rules applicable after 1 February 1982. Consequently, until a higher rate of RA became payable under the 'post 1 February 1982' conditions the rate of payment was assessed under the 'pre-1 February 1982' conditions.

Any recipient receiving RA who was protected by the savings provisions continued to be protected when they:

• commenced to pay Government rent
• commenced to pay a different rate of Government rent
• changed their accommodation and continued to pay Government rent
• returned from overseas having been granted RA prior to 1 February 1982
• transferred between sickness benefit and pension, or
• continued to pay rent at an amount of $10.00 a week or less.

If a recipient residing in a rented property purchased by an authority included in the definition of 'Government rent' of the Act, after 1 February 1982, he or she would normally not be entitled to RA. If, however, at the date of purchase, the person was receiving RA under the 'pre-1 February 1982' conditions by virtue of the savings provision, RA continued until eligibility under the 'pre-1 February 1982' conditions ceased.

From 1 January 1994, the last remaining benevolent home in Australia (as legislatively defined) ceased to exist. However, until this time all benevolent home pensioners (whether admitted prior to or after 1 January 1981) who were receiving RA prior to 1 February 1982 qualified for a higher rate of assistance under the revised provisions as a result of the more liberal income test. However, in some instances the amount actually retained by the recipient was reduced because of the increase in the 'pensioner contribution'. The savings provision arising from the 1980 legislation remained in force on 1 February 1982. A pensioner received so much of any increase in the rate of RA as brought his or her payment of RA to $2.00 a fortnight. Any excess entitlement over $2.00 a fortnight was paid to the benevolent home as a pensioner contribution.

1981 legislation - after 13 June 1987

From 13 June 1987 this savings provision was modified. RA ceased to be payable to a recipient who had been in receipt of RA, under the 1981 savings provisions, solely by virtue of paying 'Government rent'. This savings provision was repealed on 13 June 1989 and no longer applies to recipients.

1987 legislation

From 1 July 1987 RA, where payable, became part of the rate payable rather than, in addition to rates payable. Invalid pension recipients whose rates are restricted by the UK invalidity benefit may not receive an increase in the rate payable as a result of RA.

1989 legislation

From 13 June 1989, boarders and lodgers receiving RA prior to June 1989, would be entitled to payment under those rules until they became eligible for payment at a higher rate under the rules applying after that date. Boarders and lodgers who were covered by the boarders and lodgers savings provision received RA on the basis that 100% of the amount they pay is regarded as rent. This savings provision was repealed on 6 May 2016 and no longer applies to recipients.

Pensioners covered by the retirement village savings provision do not receive a saved rate of RA. Rather, the savings provision preserves their qualification to receive RA, despite being treated for all other purposes as homeowners. RA for these recipients is calculated in the same way as for other private renters, under current rules. These recipients would only lose saved status if they leave the retirement village.

1993 legislation

From 20 March 1993, a new structure of RA rent thresholds according to family and marital status, was introduced. Any existing recipient who would have received less RA as a result of the March 1993 changes, retained the rate they were receiving at the time.

1996 legislation

From 20 March 1996, a strategy to phase out the 1989 and 1993 savings provisions was introduced. The saved rate of RA will reduce by the amount of increases in other components of the payment due to:

• any cost of living increases, OR
• ad hoc increases announced by the Government.

This will continue until the saved rate of RA no longer provides any advantage to the recipient, who will then be paid under current rules and rates.

2000 legislation

From 1 July 2000, if the RA recipient, or recipient's partner, begins to receive FTB Part A at greater than the base FTB child rate, and this rate includes RA, the savings provisions no longer apply. The entitlement to RA is then assessed according to the FTB legislation.