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Community Affairs Legislation Committee - 26/02/2015 - Estimates - SOCIAL SERVICES PORTFOLIO - Department of Human Services

Department of Human Services


CHAIR: We will now begin questions concerning corporate matters of the Department of Human Services.

Senator CAMERON: Ms Campbell, why is your department giving the benefit of the doubt to those who might be a threat to our country?

Ms Campbell : On every occasion when we consider an application for a payment, we follow the legislation. We follow the extant legislation and we determine eligibility around those criteria.

Senator CAMERON: I had a look again when I heard the statement. Obviously I was concerned that the Prime Minister believes that Centrelink was providing the benefit of the doubt to people who were a threat to the country. You have a very extensive process of checks and balances within Centrelink, haven't you, in terms of people getting access to benefits and only those who are entitled to the benefits?

Ms Campbell : We do. Sometimes we find other information from other parties which we may not be aware of, such as people who may have left the country on different passports and that information is fed back to us. We are then able to make adjustments to eligibility around those that are set in the legislation's criteria, as well as the new legislation on foreign fighters.

Senator CAMERON: You signed off on a letter to the minister, which is part of your annual report. You signed off on 25 September that you were operating in accordance with guidelines 5.8 of the Commonwealth fraud control guidelines, 2011?

Ms Campbell : Yes.

Senator CAMERON: You have a whole range of fraud control and compliance measures in place. Because when I word searched 'compliance' and 'fraud', there was a huge amount in your annual report on how you deal with these issues, isn't there?

Ms Campbell : Yes.

Senator CAMERON: You do engage with the Department of Immigration and Border Protection—page 152 of the annual report. So if someone is setting off to be a foreign fighter and they are receiving either Centrelink payments or any payment under Centrelink, you would become aware of that, would you?

Ms Campbell : If an individual leaves the country under their own passport and we get the information back from Immigration, we are able to check against the eligibility criteria to determine whether they remain entitled to a welfare payment.

Senator CAMERON: So this argument that your department, the government and the community is funding people who are engaging in terrorist activities overseas while they are on Centrelink payments, that could only happen if there was a pretty big fraud taking place?

Ms Campbell : And leaving the country on a different passport.

Senator CAMERON: That is fraud, isn't it? That is an illegal activity. Have you been consulted about this issue of giving the benefit of the doubt to people who would cause harm to the country? When did you first hear this?

Ms Campbell : When the foreign fighters legislation was being developed we were consulted and worked with the Attorney-General's Department on how that would work in operation. Once the legislation was through, how the processes of notification would work and how we would provide advice back to government in that regard.

Senator CAMERON: When was that?

Ms Campbell : That was last year.

Mr Withnell : That was in November last year.

Senator CAMERON: Did the Attorney-General's Department raise the question that your department was providing support to people who would do harm to the country?

Ms Campbell : I think the Attorney-General's Department raised issues when they became aware of someone who may be in this circumstance how we would go about ensuring that the appropriate actions had been taken under the then current legislation for social security and then the legislation which is now in place for foreign fighters.

Senator CAMERON: So you are confident that if someone on a Centrelink payment leaves the country with their own passport, compliance measures are in place whereby if they were overseas committing acts of terrorism they would not be doing that on Centrelink payments?

Ms Campbell : Depending on what payments they are under, the Social Security Act determines how long payments continue when people leave the country. Under the foreign fighters legislation, that allows for people who are identified as being engaged in such activities to have their payments reconsidered.

Senator CAMERON: Take me through the compliance process. Let's have a look at this issue that has made the news. You know, we have people getting a benefit who would do harm to the country. What are the checks and balances in place to stop that?

Ms Campbell : I will start by saying it depends which sort of payment is under consideration. Maybe if we take Newstart as an example.

Senator CAMERON: How about Newstart and DSP?

Ms Campbell : I will ask Ms Golightly to work through the compliance requirements of that.

Ms Golightly : Of course, they need to be a resident of Australia. We do all sorts of liquid asset tests and all of that sort of thing before they get on the payment. If at any time we find that they do not meet those basic requirements, then we would look to review that payment. Once the person is on Newstart, for example, they also have, as you know, mutual obligation and reporting requirements. They are meant to regularly declare income, for example, that they may have earned. They are meant to attend appointments and do their compulsory activities. So there are a range of processes in place to make sure that people are meeting those obligations. Some of that is done by employment service providers. For example, in the income declaration side of things the jobseeker will have a regular point in time when they are supposed to report by. Also, we have, for example, data matching with the ATO. That gives some flavour of what happens with Newstart.

Senator CAMERON: On page 13 of your annual report, your key performance indicators, 'fraud prevention and compliance measures', you have achieved your target each year for the last three years. Is that correct?

Ms Golightly : Yes.

Senator CAMERON: As I said, these are very sophisticated fraud compliance and exposure measures that you have in place. On page 76 you say that you undertake research and analysis activities to further develop your core role in the community. Is that research and analysis to make sure that you comply with the department's fraud and non-compliance agendas? This is under 'vulnerable people'.

Ms Golightly : I think that refers to more general work we do in terms of what assistance or interventions we might be able to provide vulnerable people. It is much broader than just fraud and compliance.

Senator CAMERON: Chapter 9 in your annual report is where you go to the issue in detail. On page 142 you say that you take a strategic approach to risk, that your 'focus is on preventing incorrect payments' and that you do that through education and intervention. You say you also work with 'others such as the Australian Federal Police to promote a high level of programme integrity…' When you say 'others such as', does that include the Department of Immigration and Border Protection?

Ms Campbell : Yes.

Senator CAMERON: How does it work? I assume that if a 'person of interest' is on Centrelink payments and they use their own passport to leave the country, there would be a process between either the Crime Commission, the Federal Police or border security to advise Centrelink that there is an issue here. In colloquial terms, is that how it works?

Mr Withnell : It is similar to that. We have a real-time match with the department of immigration for people leaving the country. People are required to let us know when they leave the country as well, but not everyone does. If a person leaves the country and the payment they are on has no portability arrangements, then there is an automatic cancellation or suspension of the payment.

Senator CAMERON: So the passport get scanned, they are not supposed to be going overseas or the payment does not apply if they are overseas—

Mr Withnell : That is right.

Senator CAMERON: Has the payment automatically gone?

Ms Golightly : It depends on the payment.

Senator CAMERON: That is what I'm saying: if the payment is one of those payments that you have outlined.

Ms Golightly : Yes.

Senator CAMERON: What are those payments?

Mr Withnell : I do not know all of them, but Newstart is one of them.

Senator CAMERON: So as soon as someone gets their passport scanned to leave the country, even without a red flag of being a person of interest, then that payment stops immediately through your processes?

Mr Withnell : If they are on a payment that does not have portability arrangements—that is not allowed to be taken overseas.

Senator CAMERON: I am talking about Newstart.

Mr Withnell : With Newstart that is the case.

Senator CAMERON: The DSP provides some portability, doesn't it?

Mr Withnell : That is right.

Senator CAMERON: That has been tightened up recently, hasn't it?

Mr Withnell : That is correct.

Senator CAMERON: What is that length of time?

Ms Golightly : It is four weeks.

Senator CAMERON: It is possible, then, that someone could go on the DSP and be overseas while doing harm to the country and getting paid the DSP? Is that the benefit of the doubt where the issue is active? Is that the issue, Ms Campbell?

Ms Campbell : If this person is not known to the authorities, has not been identified and cannot be dealt with under the foreign fighters legislation, that is possible for four weeks.

Senator CAMERON: But if the department of immigration, the Crime Commission or the Federal Police has a red flag on the person, do you have the capacity to stop the payment immediately?

Ms Campbell : It would depend on under what legislation the payment was to be stopped. Under the foreign fighters legislation there is a set of parameters where the Attorney-General's Secretary seeks information, I write back and provide that information, the Attorney-General makes a determination and then writes to the Minister for Social Services.

Senator CAMERON: So people on DSP can go overseas for a month and have no stop to their payments. And that would happen to people who were overseas for a range of issues. That is a genuine position where people have the freedom to do that and still be paid.

Ms Campbell : For four weeks under the portability.

Senator CAMERON: What discussions have you had, Secretary, in relation to the 'benefit of the doubt'?

Ms Campbell : I have not had any discussions about that specific statement. We have had discussions with the Attorney-General's about the foreign fighters legislation, to put in place the ability when a person is identified to remove payment, as well as the social security extant criteria.

Senator CAMERON: When was the first that you heard of this term 'benefit of the doubt'?

Ms Campbell : I heard it when the Prime Minister—

Senator CAMERON: When the Prime Minister—

CHAIR: Senator Cameron, sorry to cut you off now. But in a few more minutes I will go to others who are waiting.

Senator CAMERON: I will have to come back to this, obviously. The first you heard about Centrelink providing the 'benefit of the doubt' to people who would cause harm to the country and Centrelink being part of that problem was when the Prime Minister made a public statement?

Ms Campbell : The actual terminology. Of course we had been working with the Prime Minister's department, the Attorney-General's Department to ensure that there were mechanisms in place to deal with known individuals.

Senator CAMERON: How did you understand 'benefit of the doubt'?

Ms Campbell : I understand that we implement the legislation to ensure that the legislation is in place. I think Minister Morrison went out and talked about the legislation and Centrelink applying the extant legislation that was in place.

Senator CAMERON: What is the definition of 'benefit of the doubt'?

Ms Campbell : Senator, I am not a lawyer.

Senator CAMERON: I am not asking for a legal definition. You are the person responsible for the oversight of these payments. The Prime Minister has made a very clear statement that Centrelink is giving the benefit of the doubt to people who would cause harm to the community. What is 'the benefit of the doubt'?

Ms Campbell : I took the comment in the context of the legislative base that was available for Centrelink to implement, and that the Prime Minister was interested in what other legislative mechanisms could be put in place to ensure these individuals were not on payments.

Senator CAMERON: Have you had discussions with Minister Payne on this issue?

Ms Campbell : Yes we have.

Senator CAMERON: On specifically what the 'benefit of the doubt' means?

Ms Campbell : I think we talked about it in the context of the legislative framework that was available.

Senator CAMERON: It is another three word slogan, really.

Senator Payne: That is a comment.

CHAIR: It is four. This will be the last question, Senator Cameron, and then I will go to Senator Smith.

Senator CAMERON: Can you just take me through your intelligence capabilities that you mention on page 143?

Mr Withnell : We have a number of levels of intelligence capabilities. We have links to the Australian Crime Commission, the Australian Federal Police and a range of other agencies. We have officers posted to those organisations. We have a number of AFP officers seconded to us who which sit with our intelligence and investigative teams. We have intelligence officers who operate both at a strategic and a tactical operational level, depending on the need. So there are some who will survey the broader landscape, if you like, in terms of payments and where we might best use our resources. There are others who provide support in relation to investigations or particular activities that are undertaken.

Senator CAMERON: You have a public relations and media capability, don't you?

Ms Campbell : Yes.

Senator CAMERON: How many people are employed in that?

Ms Campbell : It is approximately 70.

Senator CAMERON: Have any of these 70 people tried to explain to the media in recent times the strategic approach of how you prevent incorrect payments and how you have a forensic capability? Is that being done?

Ms Campbell : I do not have the exact details of those arrangements, but we can take that on notice.

CHAIR: Thank you. We will leave this question—

Senator CAMERON: I want to come back to that point. I am very concerned that you are not aware. While these other questions are taking place, do you have anyone here who could come to the table and tell me what is being done? I'll get the call shortly.

Senator CAMERON: You will certainly get further opportunities. I will now go to Senator Smith.

Senator SMITH: I want to go to the issue of the enterprise agreement, the progress of negotiations and perhaps to address some of the myths and untruths that might be circulating around in the community.

Ms Campbell : I am hoping that someone will join me at the table. But I can try to start for you.

Senator SMITH: The previous secretary did remind me once that Hansard does not record silence. So it is uncomfortable for us, but it does not look bad in the record. Turning to the issue of the enterprise agreement, I keep hearing reports from the CPSU that employees superannuation will be cut by 9½ per cent. Are you familiar with those reports?

Mr Hutson : Yes, we are familiar with a number of claims made in respect of superannuation in our proposed enterprise agreement.

Senator SMITH: Are they accurate?

Mr Hutson : Mostly, I would have to say, they are not accurate. The situation is that in our current enterprise agreement there is a provision that says that the department will contribute in respect of the public sector superannuation accumulation plan. That is a plan that covers somewhat less than half of our staff—15.4 per cent. That provision in our enterprise agreement mirrors the provision in the trust deed for the public sector superannuation accumulation plan, which is the real basis upon which we are actually making that payment. While under the current government's bargaining policy we are required not to rely upon the enterprise agreement where there is other legislation making those provisions. Therefore, we are seeking to take the 15.4 per cent reference out of the enterprise agreement and rely on the trust deed as we now do.

Senator SMITH: Just step us through and remind us what processes you have actually been undertaking around the enterprise agreement negotiations. When did they start and what key milestones have already been met? I will come to the cooperation or otherwise of the CPSU shortly. So you do not need to reflect on that just yet.

Mr Hutson : I will ask Ms Talbot to take you through that.

Ms Talbot : We actually issued our notice of employer representational rights on 3 June. That signalled that we were ready to bargain. On 10 June we finalised delegate facilities arrangements with the CPSU. On 11 June we actually started our formal bargaining. To date we have had 35 bargaining meetings. We obviously have gone through quite extensive negotiations. We have tabled two remuneration offers to date and numerous drafts of the enterprise agreement. We have also spent time with our staff on policy feedback workshops. It was very clear to us that our staff wanted to understand how our agreement looked. It was more streamlined than what it had been previously. A lot of detail is now sitting in policies, so we have developed a whole range of draft policies. To take our staff through those, we had workshops across Australia. We tabled our remuneration offer on 17 and 18 February and we are now in the process of going to talk to our staff about that remuneration offer.

Senator SMITH: In October I read a report that the union alleged that the department had walked away from negotiations. Was that true?

Mr Hutson : No, that is not true. We have never walked away from negotiations.

Senator SMITH: When these allegations and untruths are made in the public arena, how do you get your side of the story out there?

Mr Hutson : Within the department, we have a number of avenues. We have created as part of this enterprise agreement negotiation a very transparent process. We have a particular site on our intranet which is known as 'bargaining watch', which advises staff of all of the things that happen in negotiations on a day by day basis. In addition, when there are some particular issues of concern that make the press, we often issue an all-staff notice explaining that we believe that the department has been misrepresented.

Senator SMITH: Just remind me of the total number of employees of the department.

Mr Hutson : It is roughly 34,000 or 35,000.

Senator SMITH: How many are union members?

Ms Talbot : There are 14,500, according to the protected action ballot, who are eligible to vote.

Senator SMITH: Can you just explain that to me? My next question was the number of people who participated.

Ms Talbot : When the CPSU sought to undertake industrial action, they had to undertake a protected action ballot. There were 14,500 CPSU members in the department who were eligible to vote in that ballot.

Senator SMITH: In all of this, what is important to me and others senators here is what impact this has on the department's ability to service its customers. How have you managed issues around industrial disputation to ensure that they do not adversely affect Australians that are in receipt of benefits?

Ms Talbot : For particular actions which might have more of an impact on the department, the CPSU must provide us with five days notice. That was an undertaking we sought at the Fair Work Commission. For other actions it is three days. What we do when we receive a notice is look at it very carefully to understand the potential extent of the impact. Our approach in this is to minimise any impact on customers and ensure that we are able to maintain services on behalf of government. I have a meeting with all of my general manager colleagues when a notice is received and we look at what stops we might need to put into place to ensure that there is no impact. To date, there has been minimal impact. We have had no customer complaints in relation to industrial action and there has been a low level of participation of our staff in industrial action.

Senator SMITH: Well, congratulations on both fronts. How many strikes has the CPSU called?

Ms Talbot : We have had industrial action on a number of occasions. On 3 December, 5 December, 11 December and then on 19 February. At different times there have been different types of action. Some have been specific to certain sites. Some have been across the board, and any staff who are members of the CPSU could have participated in those actions.

Senator SMITH: So despite that strike activity, you have been able to maintain services to Australians who are in receipt of benefits?

Ms Talbot : That is right.

Senator SMITH: Where is the bargaining process up to as of today?

Ms Talbot : We have indicated that we will be going back into bargaining in March. We have not determined the date yet. We have advised the CPSU and other bargaining representatives that we would come back in with a further draft agreement based on the discussions and deliberations we have had over the last number of months. At the moment, the pay offer has been made. We spent two days taking representatives through those details, and we have indicated that we wish to take some time with our staff to actually explain what the pay proposal is.

Senator SMITH: Again, congratulations on the minimal impact to Australians who are in receipt of benefits. And congratulations, Secretary.

CHAIR: Senator Siewert.

Senator SIEWERT: I have some questions that I will ask here but if you tell me they should be in community services, that is fair enough. They are both about specific contacts I have had over the phone and interaction with Centrelink, which seem to be a bit systemic. That is why I am not necessarily bringing them up as individual issues.

Ms Campbell : Is this about the performance of Centrelink?

Senator SIEWERT: Yes, particularly the phone line for disability and carers.

Ms Campbell : I think we were going to do corporate first, but I think we have already gone somewhere else already, so we can answer the question now if that would suit.

Senator CAMERON: I am happy for it to be answered now, but I will be coming back to some of these issues probably in the appropriate area. I just want to make clear that I thought we were dealing with corporate issues and that we had been. You said that we had strayed out of corporate. I thought all of the issues we had dealt with were corporate.

Ms Campbell : It is how the definitions go.

Senator SIEWERT: I am happy to leave it there, but I have some significant issues that I need to go over.

CHAIR: Before you proceed, Senator Siewert, I will seek some guidance from the departmental secretary. With the DHS in particular there is often a lot of crossover. There will be crossover, so are you comfortable that questions that could be asked in outcome 1 are asked now?

Ms Campbell : If that would assist the committee.

CHAIR: I think it is probably simpler. Go ahead. I do not want to limited and if the secretary is happy, then I think we should proceed.

Senator CAMERON: I am okay with that.

Senator SIEWERT: We do generally stray. One is about the phone lines. I have had a number of concerns raised with me about people not being able to get through on the phone lines, specifically for people with issues around disability and carers. It is not irregular; it is constant. Even when we contacted Centrelink, the person we contacted admitted that they could not get through on the line. It was constantly engaged. The feedback was that to try and phone at the beginning or the end of the day. One of the people I had been talking to had been doing that. If it was just one I would say, okay, it is just a busy period. But I have had a number concerns raised.

Mr Tidswell : We take about 59 million calls per annum. It is a significant number. Naturally at certain times of certain days we get peak periods. December, January and July are peak periods. It is difficult to manage all of the demand. But on average we have set a key performance indicator of 16 minutes average speed of answer. So people are answered within 16 minutes. For the year to date, across all of the Centrelink phone lines we deal with in the social services area, we are just under that 16 minute target. It is absolutely true that, like anywhere, at certain times of the day—and we have a finite limit of resources—if people try to get on at the same time we will get delays in answering people within that 16 minutes.

Senator SIEWERT: When it is 16 minutes, do you know you are on a wait call?

Mr Tidswell : We want people to increasingly try to do as much work as they can themselves. We still get a vast number of calls, probably 200,000 a week, that are more general inquiry calls. When people come into what we call our IVR, which is the entry point into the phone lines, they will receive messages about things they can do themselves and that you do not need to ring if these circumstances occur. What we try to do is give people the information and direct them to our mobile apps and our self service applications. We try to direct them to other ways in which they can find the information through websites and other sources. That is the way all service industries are moving forward.

Senator SIEWERT: I understand what you are saying. Some people either can't find the answer online or have difficulty accessing online. In fact, people in the bush are still having trouble with speeds. And I am not starting a discussion about the NBN at this stage. For those who still want to be able to talk to somebody, or if their issue is too complex, when they get on the phone and they get a message. But do they get to know how long it is before they can speak to somebody?

Mr Tidswell : One of the things we have done in the last couple of years is in response to what our customers have said. They would like to know the wait time and they would like to then make a decision about whether they want to hang on hold or go and do something else. On top of that, we also have in place what we call a place in queue. So if somebody is registered and we know who that person is, if we have that information, we can make contact back with them on the wait time that they would have experienced if they had stayed in that queue.

Senator SIEWERT: I understand that.

Mr Tidswell : And that is working very well.

Senator SIEWERT: What these people are getting is an engaged tone.

Mr Tidswell : Every so often what happens is that we have to protect out infrastructure. We get surges of demand. So that the whole system does not crash, we have to make sure that there is a limited amount of people who can enter into those queues so that we can answer them in a reasonable time. But we also have to protect the infrastructure. We are doing less and less of that. But in peak times, absolutely, so many people have to ring us. That is why we are trying to develop alternatives to make it easier for Australians to contact us and do their business with us in a variety of ways.

Senator SIEWERT: So peak times are December, January and July.

Mr Tidswell : Definitely in December and January, and at tax time when there is other activity. There are other seasonal peaks depending on the payments.

Senator SIEWERT: What are the other seasonal peaks?

Mr Tidswell : Where it is family tax benefit time, et cetera. We have peaks in child support. Obviously in July there is a lot of activity with tax time. So we do have these quite extraordinary times. What we are trying to do is match our staff profile to the scheduled arrival of those calls and to those peaks. Increasingly, we are using a variety of means to do that—to have the staff ready for the volume that we predict. But it is difficult to manage over the entire activity that we do. And it is difficult to manage when people ring us at certain times and in certain patterns. It is the same with face-to-face services as it is in providing a telephone service.

Senator SIEWERT: You have different lines for different allowances. What were the waiting times for different lines? Is that easy to get or are you able to give us something there?

Mr Tidswell : One of my colleagues may well have that information. I do not have that information in my folder to break it down individually.

Senator SIEWERT: I would like to know the average wait time per line.

Mr Tidswell : For disability and carers, and that is the line that you were interested in—

Senator SIEWERT: That is the one that I have had a lot of complaints about recently, but I would like to know the average wait times for all of them.

Mr Tidswell : We have monthly figures. What is your preference?

Senator SIEWERT: Would it be possible to table the monthly figures in terms of the most recent average?

Mr Tidswell : We have figures here month by month for this financial year.

Senator SIEWERT: It will take too long to read all of those out, so if you could table the progressive month by month figures. But what was it for January?

Mr Tidswell : As I said, the total wait times for all of those lines was just under 16 minutes. In disability and carers it was 21 minutes and 46 seconds. For employment it was 23 minutes and 14 seconds.

Senator SIEWERT: What is employment?

Mr Tidswell : It is Newstart. For families it is 18 minutes and 39 seconds. For older Australians it is 19 minutes and 18 seconds. For youth and students it is 25 minutes and 19 seconds. For the participation solution scheme it is 17 minutes and 51 seconds. January is our busiest time.

Senator SIEWERT: That is what I was asking for.

Mr Tidswell : It is a really challenging time. We have short weeks. We have days when people are off. People naturally tend to do their holiday thing and their Christmas thing. We have people finishing jobs at the end of the calendar year—factory closures, et cetera. We then have school leavers and university leavers. It is the whole period of things. Once people have had some time off over Christmas, they usually come in hard and fast. So it is one of our most difficult times.

Senator SIEWERT: I understand that.

Mr Tidswell : With all of those averages, obviously we get times when it is much quieter.

Senator SIEWERT: I will check the time when some of my complaints came in. But I know for a fact that one of them that I have done a lot of work on was not in January.

Ms Campbell : Senator, were these complaints calling from Western Australia as well?

Senator SIEWERT: Not all were from Western Australia. Certainly not. They are from the eastern states as well. Why did you ask about Western Australia?

Ms Campbell : Just because there is the time delay.

Senator Payne: The time zone difference has an impact.

Ms Campbell : Of course, we do not have as many people answering the phone at night.

Senator SIEWERT: Yes I understand that. When we are all still up and working.

Ms Campbell : We are constantly putting in place strategies to ensure that we can deal with that issue. I was just interested to find out whether it was Western Australia.

Senator SIEWERT: Some of them are, but definitely some of them are not. If I could get that table, it would be appreciated. How often do you review that process? When do you look at when it is time to actually do something about putting in more infrastructure for the telephones?

Mr Tidswell : It is a constant thing. We have people monitoring, as we call it, queues every minute of our operational day and to respond quickly to certain events. To give you an example, we have had to quickly establish some telephone lines for cyclone events. So in that sense we are constantly monitoring the boards and looking at where we have the efforts. We constantly look at where our staff are and whether people are adhering to the schedule and being where they need to be so that we have adequate people to manage the demand. But it is difficult because the arrival patterns of how people make their phone calls and at what time of the day.

Senator SIEWERT: If you could take on notice each month for the last 12 months, but including the previous years so that I have last January through to this January. Again, I have had a complaint, but this is a generic question. You have gone to sending a lot of the administration online. I have an example here—and I actually have a copy of the letter so it is not just hearsay—of someone who would have had to report next in December from March. She then thought that things must have changed and she must have been doing everything right. Some time later she then got a letter in her inbox saying that she should report on 27 January. She got that e-mail on 3 February. Obviously it changed what she was told, but she was also told that she should have reported in January. But she was told in February.

Ms Campbell : We are happy to take personal circumstance—

Senator SIEWERT: I will give you this. My question is: how many of these examples do you have where this is happening?

Ms Campbell : Sometimes there can be individual circumstances where something else may happen which triggers those types of activities. We generally look at these on a case-by-case basis. If we saw something systemic, then we would look to see whether we had an IT problem.

Senator SIEWERT: You're right, there may have been something to trigger it, but to send a letter after the fact that you have to report in January. She could very well end up getting breached under the new regime because she had missed a reporting date when she did not even know she had one. And she had actually been told that she did not have to report until March.

Ms Campbell : We are happy to take that individual case and look at it to see whether it is a systemic issue. Clearly it is hard to report on 27 January when you are told on 3 February. But if we can look at that and see whether there are any other cases. I do not think we have seen a systemic issue.

Mr Tidswell : We deal with such big volumes and the reporting regime, our customer base, it really does understand the approach. We get upwards of 80 per cent of people reporting their earnings online or through mobile apps. We are always trying to communicate with people about what their arrangements are. We are increasingly doing that through electronic mail and getting it sorted. So to me, I do not have issues in that area that tell me that there are systemic failures. But there can be these complicated things going on with different payments, different start dates, different date of effects and how the reporting things kick in.

Senator SIEWERT: I understand that. The fact is that people will get breached. I have a whole lot of other questions about that. I had an example of someone in Western Australia who was literally getting kicked out of her house because the payments had stopped and she could not meet her rent. An administrative error means that somebody can be breached and literally miss the payments on their house and lose their accommodation. You can see why people are a bit upset. You say that you are dealing with lots of people. I understand that. But now the system means that there are severe consequences for that.

Mr Tidswell : I do not know this specific case, so we'll look into it. But generally we get these things fixed. That is why we have a network of offices and the ability for people to get these sorts of complex kind of enquiries and matters of sorted.

Senator SIEWERT: Have you had any reports of this happening?

Mr Tidswell : There will be cases, absolutely.

Senator SIEWERT: How many?

Mr Tidswell : I have a watch list of all the things going on, all the things that we are worried and concerned about. This has not been brought to me as a systemic issue. But that does not mean that this particular case is not absolutely as you describe. We need to look into what has occurred, what has happened, why did this correspondence go at that time and what triggered that letter to advise her to report after the date. That is the sort of thing that we need to look at. It could well be a confluence of activities and events that for this particular individual customer.

Senator SIEWERT: As I said, I have copies of it here. I will double check that it is okay to hand her name over. She may just want the circumstances. I'll do that before the end of the day. Secondly, if I understand correctly what you have just said, you are not aware of this type of thing happening before.

Mr Tidswell : I am not saying that. I just do not know that it is systemic. It has not been presented to me. We hear about these things quite quickly. One of the things we do have is an extensive complaints mechanism. Complaints are down. We are happy about that. So we have a whole infrastructure around service recovery, getting on top of these things and sorting them out. Basically, it is a complicated system and it is difficult to administer. We do not always get it 100 per cent right. But our aim is to get it right and get it corrected so people are not impacted unfairly, as you have suggested.

CHAIR: Senator Siewert, we might leave that there. I'll go to Senator Reynolds and then to Senator Cameron.

Senator REYNOLDS: Thank you and good morning, Secretary and Minister. I would like to keep on the theme of technology and client services and move on to IT and your ISIS ICT system. The more I have read about it the more I think it sounds like Frankenstein's monster. Can you give me a bit more information about the nature of your ICT. Is it called ISIS?

Ms Campbell : Yes.

Senator REYNOLDS: I understand that it is 30 years old.

Ms Campbell : It is the 'integrated social infrastructure system', and it is some 30 years old. It does the job. It makes sure the payments are made, but it is very old. It is very difficult to make changes in that. It is not flexible at all and that is why we have been building a business case about its replacement.

Senator REYNOLDS: How many customers do you support? Is it around seven or eight million?

Mr Sterrenberg : It is around seven million customers.

Senator REYNOLDS: Did you say 34,000 staff use the system?

Ms Campbell : We have 34,000 staff. Not all of them use ISIS.

Senator REYNOLDS: So, many thousands of staff have daily access to the system. How many transaction would you do daily, monthly or yearly on it?

Mr Sterrenberg : We do 12 billion database reads and around 21 billion http calls between the system's infrastructure.

Senator REYNOLDS: Presumably you do a lot of batch reporting and processing every day.

Mr Sterrenberg : Yes. We do 16,500 batches every night. Just to clarify what that means, every time somebody presses a keystroke it creates a protocol, a http call, and then that call goes through our infrastructure. Every time it moves from one piece of infrastructure to another it will create a secondary call. That is what equals 21 billion.

Senator REYNOLDS: How many separate pieces of infrastructure have you got across the system? Do you know?

Mr Sterrenberg : Yes, we do know, but it is quite complex to describe. I will provide rough numbers. We have close to 45,000 desktops. We have three mainframes, 3000 virtualised servers and we store 13.4 terabytes of data. It is a very large infrastructure.

Senator REYNOLDS: Presumably in recent times, as we talked about last time, you have added all of the new IT systems and structures, all of the interfaces, onto this Behemoth. How is that working? Has that added strain on to the system or is it just an additional level of complexity, along with the tablets, myGov and all of the new technology.

Mr Sterrenberg : Over the last 10 years the constant layering of complexity has brought us to a stage now where we believe our systems need to be replaced.

Senator REYNOLDS: I would imagine you would have tens of millions of lines of code now.

Mr Sterrenberg : More than that.

Senator REYNOLDS: Is it 20, 30 or 40 million lines of code?

Mr Sterrenberg : Yes. The infrastructure is very large. To give you an example of our data centres, we have close to 2,500 kilometres of structured cabling, 2,600 connection points and over 600 kilometres of fibre patch leads. That is just to cable our data centres. That is not taking into account the connection points where we use the managed telecoms network.

Senator REYNOLDS: Do you have a costing for maintaining the hardware and the software and maintaining the system? Do you have global figures for that?

Mr Sterrenberg : Yes we do. It is $252 million for the business as usual. That covers the maintenance of the infrastructure and the application maintenance. Then we have the telecoms cost, which is connecting all of the staff and customers to our networks. That is $293 million. We have projects of $274 million and then we have capital replacement costs of $167 million. That gives a total of $986 million.

Senator REYNOLDS: So we are looking at nearly $1 billion a year just to maintain this system?

Mr Sterrenberg : To maintain the operating system is $252 million.

Senator REYNOLDS: But all of the associated expenditure adds up to somewhere between $950 million and $1 billion a year?

Ms Campbell : That includes the smart centres, the telecommunications and the entire ICT operations of the department. It is about $1 billion a year.

Mr Sterrenberg : That covers not just the Centrelink program but Medicare and child support. We also do the infrastructure for the Department of Veterans' Affairs.

Senator REYNOLDS: That is right. We talked about that last time.

Mr Sterrenberg : We also do a number of others.

Senator REYNOLDS: Under the myGov—

Mr Sterrenberg : Yes. We are one of the designated government internet gateways where we look after the Internet gateways for, I think, around 12 other agencies.

Senator REYNOLDS: Given the complexity and the age of the system—and I guess you have 30 years of technology there that you have plied in together—is it difficult to find the expertise still, especially dealing with a lot of the legacy systems and the software and hardware that you have? Is that an issue?

Mr Sterrenberg : Yes. And it will be an increasing issue over the next couple of years.

Senator REYNOLDS: A lot of the ICT specialists would not have even been born when the code was being written.

Senator Payne: Thank you for reminding us of that.

Senator REYNOLDS: In terms of the complexity, apart from the cost and the difficulties of running it and adding to it, obviously we had the release of the McClure report this week, and that created a very clear picture of the need to simplify the system, particularly for the payments and benefits. It seemed to me, when I read that, that you are going to need to have an ICT system because if you try to do that with your current system and not reform and have a new system that is much easier, simpler and modern you cannot really do one without the other.

Ms Campbell : I think it is fair to say that it would be very cumbersome and very expensive to try and do it in the existing system.

Senator REYNOLDS: To retrofit the old system?

Ms Campbell : You would have to look at the investment and whether it was worth investing in the old system, depending on what level of changes the government decided to make.

Senator CAMERON: That is not consistent with your previous evidence, but that is okay. I'll come back to that.

CHAIR: Sorry, there was an interjection there. Ms Campbell, do you want to respond? Ordinarily it is disorderly to respond to an interjection, but not so much in committees.

Senator REYNOLDS: I was about to ask the question if you would like to respond to this assertion.

Senator CAMERON: It was not an interjection. It is based on the Hansard, that is all.

CHAIR: However we interpret it and whether it is an interjection or not, I will allow Ms Campbell to respond.

Ms Campbell : I think when we have been asked on previous occasions whether or not we could make changes to the current systems, we have said that, yes, we can make changes, but depending on the complexity and how wide the changes were and whether it is a good investment or not. The issue I was talking about just then was whether it would be worth investing in the existing system, depending on the scope of any changes. As you see, we do make the changes in the system. When new policies are implemented in every budget, we are able to make those changes within the existing system. It is a cost benefit issue.

Senator REYNOLDS: As you have gone through and done that cost benefit analysis, and looking further into the future, you have pushed the system and you have made adaptations and adaptations. It has got so complex. Look at the technology that is out there now. Presumably, as you look forward, there will become a point where, apart from anything else, you simply cannot maintain the old system and it becomes so exponentially more complex that it will have to get to a point where it is no longer viable. Is what you are saying that there comes a point where it is more cost-effective just to deal with it earlier and go to a new system rather than just making it worse and more expensive?

Ms Campbell : We think that we are getting to the point where the level of complexity is adding quite additional costs and also not allowing us to be timely in our response, so that we can't make changes in a rapid manner. It also depends on just how many changes there are. The McClure report, which is a report to government, indicates a broad range of changes. Our advice would be, depending on how broad ranging the changes are, that there needs to be a new system to deal with very significant changes.

Senator REYNOLDS: So really it could be almost axiomatic that while the McClure reforms are designed to bring simplicity, without a new system it will actually make the system more complex?

Ms Campbell : Yes.

Senator REYNOLDS: Thank you.

CHAIR: Senator Cameron.

Senator CAMERON: Can I come back now to the benefit of the doubt, which The Prime Minister has indicated Centrelink is giving people who are a threat to the community. I think I got to the stage where I was asking how many people you had doing public relations and media work. It was over 70.

Ms Campbell : Yes.

Senator CAMERON: Who is in charge of that media unit?

Ms Campbell : Mr Jongen is in charge of the media unit. We will ask Mr Jongen to come to the table.

Senator CAMERON: Mr Jongen, how are you?

Mr Jongen : I am very well, Senator.

Senator CAMERON: You have a fairly big team working for you—70 people.

Mr Jongen : I think in the context of the amount of media that we are engaged in, it would be an acceptable number. It is a big team, yes.

Senator CAMERON: If I need to know about the complexity, I will ask. We have a situation where the first that the department knew that the Prime Minister had a concern about the department giving the benefit of the doubt to people who would do harm to the community was when the Prime Minister made the statement. What did you do after you heard that—apart from maybe faint?

Mr Jongen : I looked at it in the context of the broader issue, as the secretary has already indicated, which is in relation to potential terrorists overseas, if you like. Having been aware of the fact that we are very limited in terms of the powers under the Social Security Act, it was actually a fair call.

Senator CAMERON: It was a fair call. So you agree that Centrelink is giving the benefit of the doubt—

Mr Jongen : I did not say that.

Senator CAMERON: Just let me finish. You are saying it is a fair call. So you must agree then that Centrelink is giving the benefit of the doubt to people who would cause harm to the community. Is that right?

Mr Jongen : I did not say that. What I meant was that the Social Security Act has limitations. Those limitations in this space probably would result in the sort of statements that the Prime Minister made.

Senator CAMERON: Ms Campbell has just been at pains to go through all the checks and balances and all the internal systems and external systems to deal with this. So I am a bit confused that on the one hand we have evidence earlier that says if someone uses their passport to go overseas then that payments will be stopped. You accept that.

Mr Jongen : Yes.

Senator CAMERON: What do you believe this 'benefit of the doubt' is then?

Mr Jongen : Firstly, I am not a subject expert. You are asking me my personal opinion.

Senator CAMERON: No, you are not here in any personal capacity. You are here as a senior public servant. That is the capacity you are in. That is what I am asking you. I am not interested in your personal view.

Mr Jongen : All I can say is that there are no provisions under the Social Security Act, particularly at the time that the Prime Minister made these comments, that actually prevent people of, let us letter say poor character, from travelling overseas.

Senator CAMERON: So people who are engaged in harming the Australian community?

Mr Jongen : That is correct. Those provisions do not exist under the Social Security Act.

Ms Campbell : The department's interpretation of the comments was the legislative framework in which we operate.

Senator CAMERON: Which has checks and balances, as you have indicated.

Ms Campbell : But until recently, when the foreign fighters legislation was introduced and passed through the Parliament, there was not a power to suspend or cancel a payment if someone was suspected of terrorist activity.

Senator CAMERON: When did the foreign fighters legislation go through?

Ms Campbell : At the end of last year.

Ms Golightly : In November.

Senator CAMERON: When did the Prime Minister make this statement?

Ms Campbell : The prime minister made the statement recently.

Senator CAMERON: Well, I will not ask you what the Prime Minister was thinking, because nobody knows that these days. There could be some reputational damage to Centrelink. The statement that the Prime Minister made was that you are giving the benefit of the doubt to people that could harm the community.

Senator Payne interjecting

Senator CAMERON: Can you let me finish?

Senator Payne: Certainly. I thought you had finished.

Senator CAMERON: Good on you. You have 70 people, Mr Jongen. Do you engage with, say, the Alan Joneses, these shock jocks who are out there running these arguments that there is a system in chaos? How do you deal with that? What do you do to engage and get the story that we heard this morning—not your story because they are a bit different—but the story from Ms Campbell. I'm just worried that you have a different story from Ms Campbell. But, anyway, what do you do to engage with the commercial media?

Mr Jongen : I have a regular cycle of talkback sessions across most key talkback stations. The agreement that I have with those stations is that I do a 30 minutes segment during which I take questions from customers and deal with their issues. Basically, as part of that discussion, part of my role is debt prevention rather than fraud detection. That means that I talk about people's obligations, the requirements that they need to meet and the fact that they should be honest in their dealings with us, et cetera. That becomes one of the central themes. On occasions, if I am asked, I also deal with issues of fraud prevention, but always at a very general level. I talk about the fact that we undertake data-matching exercises with a range of government agencies and that we have internal data matching, all of which contributes to a very sophisticated system of fraud detection.

Senator CAMERON: So you do that 'on occasions'?

Mr Jongen : Yes.

Senator CAMERON: When was the last occasion you dealt with that issue?

Mr Jongen : The last occasion, in terms of specific media, was actually not in talkback radio but on A Current Affair. I have also done interviews with Today Tonight. We work with those programs.

Senator CAMERON: When?

Mr Jongen : Two occasions in December were the last times. Can I make another point? I do not emphasise fraud on every occasion, because one of the central elements of my message is that the overwhelming majority of Australians are honest in their dealings with us. So although we have to be conscious of fraud, it needs to be always contextualised.

Senator CAMERON: Sure, but you have a situation now where you are the head of public relations, basically. What is you title?

Mr Jongen : General manager, Communications.

Senator CAMERON: So you have a job to communicate with the public and with the media to get the real issues out there. The Prime Minister has made an allegation that the Department of Human Services is giving the benefit of the doubt to people who would do harm to the community. What communications strategy have you developed with your 70 media people and with the secretary to get the message out there that that is not a correct position?

Ms Campbell : Minister Morrison made a statement on the day after, I think—the Monday—indicating his confidence in Centrelink applying the legislation as it was in place, and that, if there were changes that needed to be made, they needed to be made in that legislative frame.

Senator CAMERON: Minister Morrison is a minister for DHS, is he?

Ms Campbell : Minister Morrison is the minister for the Social Services portfolio.

Senator CAMERON: Mr Jongen, what strategies, what planning, have you done to try to disavow the position that some of the shock jocks are running with now that DHS is funding people who would do harm to the Australian community? What strategies have you put in place?

CHAIR: Mr Jongen, just before you answer, we are due to break, so I will allow you to answer this question and then we will go to a break.

Mr Jongen : The issue here, of course, is that the difference is in accountability on the part of the Attorney-General and the Department of Human Services.

Senator CAMERON: Mr Jongen, please—

Mr Jongen : I just need to give you that—

CHAIR: Order! Senator Cameron, you have asked not to be spoken over. Mr Jongen is answering your question.

Senator CAMERON: No, I did not.

CHAIR: You did, actually, a couple of times when Mr Jongen tried to answer your question and inadvertently interrupted you. Could you please allow Mr Jongen to finish his answer?

Senator CAMERON: As long as it goes to my question.

CHAIR: He is entitled to answer his question as he sees fit. You can follow up questions later but Mr Jongen should be allowed to answer.

Mr Jongen : Senator, the answer I would provide would be that there are measures in place to ensure that, with respect to people who leave the country with the intention of doing harm to the Australian community, the Attorney-General can provide notification to us to ensure that payment is not made.

Senator CAMERON: Chair, that is not what I asked Mr Jongen. I have asked Mr Jongen what he has done, as the head of communications, to deal with this issue that has left the impression that the Department of Human Services is giving the benefit of the doubt to people who would do harm to the Australian community. That is the question.

CHAIR: Senator Cameron, you get to ask the questions. You do not get to advise the witness on how they should answer. He has had the opportunity to answer. It is past the time to break, so we are going to break for 15 minutes.

Senator CAMERON: All right, Mr Jongen; I want you back on this one.

Proceedings suspended from 10 : 33 to 10 : 52

CHAIR: I will come back to Senator Cameron with his line of questioning. Senator Xenophon is keen to ask some questions so after Senator Cameron I will go to Senator Xenophon.

Senator CAMERON: I should not be too long. Mr Jongen, could you come back to the question I asked, and that is, what you have done in terms of a strategy to deal with this issue that the impression is out there that DHS is giving the benefit of the doubt to people that would do harm to the community. What have you done with your staff of 70 to provide some media response to this issue?

Ms Campbell : As Mr Jongen's senior officer, I have not asked him to undertake any work of that nature. I considered that the statement made by Minister Morrison about the legislative framework in which the Department of Human Services operated had addressed any concerns.

Senator CAMERON: In my memory, this is probably the biggest issue that DHS have faced, certainly in light of the current government. Your media people—you have not asked for anything? Did the media people offer up any strategy to you?

Ms Campbell : I have not asked for any strategy. I do not see that there is a need for any strategy.

Senator CAMERON: Okay. If the media, as they have been doing, say that people on DSP and Newstart are over there doing harm to the community, do you not see any need to respond to that?

Ms Campbell : We respond within the legislative framework. We explain the Social Security Act and how payments can be suspended or cancelled. We talk about the foreign fighters legislation and the provisions within that legislation and we note the responsible parties within that legislation and their roles.

Senator CAMERON: Mr Jongen, do you want to add anything to that?

Mr Jongen : No, Senator.

Senator CAMERON: I didn't think you would. What is the budget of your department, Mr Jongen?

Mr Jongen : I am going to have to take that on notice. I am sorry. I do not have those figures available to me. Off the top of my head, to assist you, it is around $9 million.

Senator CAMERON: So we spend $9 million on communications and neither the secretary nor you think that reputational damage to DHS should be dealt with by any media strategy or media response?

Ms Campbell : The money that is spent on the communications division is very focused on ensuring Australians are aware of the conditions under which social security payments are made. Mr Jongen talked about the opportunities he takes to ensure that people are meeting their needs, understanding how payments work, in a very proactive manner to ensure that Australians are informed.

Senator CAMERON: Ms Campbell, in your responses to me when I was asking about you giving the benefit of the doubt—the Prime Minister's statement—to people who would want to harm the community, you seemed to suggest there were checks and balances in place. The foreign fighters legislation, the existing legislation, makes it very difficult for that to happen; is that correct?

Ms Campbell : The arrangements in place with the foreign fighters now provide an extra level, or balance, in that regard.

Senator CAMERON: I was somewhat comforted by that response. You are looking back at where we were and saying we have got this legislation in place, but Mr Jongen seems to be looking forward and saying there are still problems. What are those problems? Mr Jongen, can you tell me what those problems are?

Mr Jongen : Senator, I was not looking forward. You asked me what my reaction was in relation to the Prime Minister's comment—

Senator CAMERON: Not your personal reaction; I am not interested in your personal reaction.

Mr Jongen : As I attempted to explain to you at the time, at that point in time I recognised that there were shortcomings which the Prime Minister was reflecting on in the social security legislation. Looking forward, which you are now asking me to comment on, we now have the foreign fighters legislation which addresses the reaction that I initially had to the Prime Minister's comment.

Senator CAMERON: I will have a look at your Hansard carefully. That is not the impression you gave me.

Mr Jongen : I apologise if I have misled you.

Senator CAMERON: Mr Jongen, have you issued any communications internally about this issue so the staff understand where this is at? I am sure all the staff have not been in a position to see this engagement. What have you done to communicate these issues to the staff?

Ms Campbell : I have not issued any communication to the staff.

Senator CAMERON: Nothing?

Ms Campbell : We conducted a dialogue, which is a regular meeting we have with staff from different levels, last Friday. The matter was not raised.

Senator Payne: Senator Cameron, I know that you would like to cast this in a particular political light, but I think even you could recognise that the government finds itself in quite altered circumstances in terms of—

Senator CAMERON: There is no doubt about the government being in altered circumstances.

Senator Payne: some of the external and, frankly, internal threats we face as a nation from extremists. The impact of those circumstances feels its way through a great deal of government, including those of us who are charged with the responsibility of making payments in a responsible fashion in accordance with the existing legislation.

As both Ms Campbell and Mr Jongen have said, when the Prime Minister reflected on the circumstances we found ourselves in last year, for example, when the fighting perpetrated by IS escalated so significantly and a larger number of Australians began to be engaged, it is quite a confronting circumstance for a government to face. I do not think anywhere in the world would you find a set of existing social security legislation which equips a government to deal effectively with that in the immediate term.

There are a number of provisions within the existing social security legislation—we have discussed those and adverted to those—which are commonly used for removing people from payments if they are in breach of the legislative requirements. But the developing circumstance led to the contemplation of the foreign fighters legislation, which, as Ms Campbell has very clearly said, gives us, if you like, another tool to deal with some of this extremist behaviour.

I think a measured and mature reflection, such as has been made on those circumstances and the challenges with which government is faced—although you might like to characterise it otherwise—is a very important discussion that the country has.

Senator CAMERON: Thanks for that, Minister. Given the chaos and dysfunction in the government, I am concerned that these issues are not being dealt with effectively. I am concerned that DHS has not protected their reputation against another chaotic announcement by a Prime Minister under huge pressure.

Senator Payne: I am absolutely confident in the way in which the Department of Human Services has dealt with these pressures.

Senator CAMERON: I am finished on this.

Senator XENOPHON: These are matters running to child support. The minister and the secretary are familiar with the front page report in The Canberra Times yesterday. There is a wry smile there that indicates a familiarity—

Ms Campbell : Yes, I did read that article.

Senator XENOPHON: I am going to touch on a matter which I appreciate is before the courts. As such, I will be restricting my questions in relation to this to the management of the litigation and the cost. Noting section 121 of the Family Law Act—and notwithstanding parliamentary privilege—that it is unlawful to identify the parties in a court case, I want to make it absolutely clear that I will not be doing anything that will identify the parties. I trust that the answers will reflect that as well. Yesterday's report in The Canberra Times revealed that the department has spent $565,000 of taxpayers' money litigating against a father over, effectively, a $6,000 difference of opinion. I presume the journalist is correct with respect to the $565,000 figure?

Ms Campbell : The $565,000 is correct in the total amount involved in this case but it is incorrect in the other amount.

Senator XENOPHON: Incorrect in which matter?

Mr Hutson : The total amount of expenditure of $565,000 is not about a single matter in front of the courts. It is about a series of matters in front of both the Family Court and the Administrative Appeals Tribunal running over the period of August 2011—

Senator XENOPHON: But the genesis of it was still about the way the department handled this and the amount involved.

CHAIR: Senator Xenophon, if you could just allow Mr Hutson finish before you interject.

Ms Campbell : I reject the fact that the entire amount that has been spent is about a $6,000 debt.

Senator XENOPHON: Perhaps we can go into that further. I want to talk about processes now. Is this the external Australian Government Solicitor cost, or are there internal costs as well that need to be factored in—in terms of resources of the department that have been expended on this?

Mr Hutson : That does include internal costs of the department.

Senator XENOPHON: It does include internal costs?

Mr Hutson : It does.

Senator XENOPHON: But at this stage the matter has not concluded, so I assume that if this matter is not resolved the costs will continue to escalate and there may well be costs orders involved as well.

Ms Campbell : When we say 'the matter', I think it is a number of matters that are leading through this case. The litigation continues.

Senator XENOPHON: Ms Campbell, we will go into that in a minute. It is the same original matter about the way the agency dealt with this particular issue, but some of them have flowed on to issues of FOI and about findings of the Information Commissioner which ruled effectively against the agency and which are still being contested by the department. I understand that this fundamentally centres about a child support change of assessment that the agency originally got wrong. Is that a fair assessment?

Ms Campbell : The matter commenced with a child support assessment. I am not sure we would characterise it as the agency getting it wrong.

Senator XENOPHON: Let us put it this way: I understand that an objections officer and the Social Security Appeals Tribunal both agreed that the original assessment was out, or wrong, by about 50 per cent. Can I clarify it? Having read the documents, the original assessment was $12,000 but was later reduced to $7,000.

Mr Hutson : I am sorry; I do not have that level of detail in front of me.

Senator XENOPHON: I do. You may want to take it on notice if you think that is wrong.

Mr Hutson : Sure.

Senator XENOPHON: Having read the papers, it seems that the SSAT confirmed that it was out by about 50 per cent.

Ms Campbell : Sometimes the SSAT has information that is not available to the original decision-maker.

Senator XENOPHON: I have spoken to the father, and again this morning he advised me that, other than during adjustment periods between the objection and the SSAT decisions, or changes in salary, there has never been an arrears situation. On one occasion there was a significant overpayment. He wants to make it clear: it is not a case about collection, it is not about the father not paying; it is about the processes that the department uses. I understand that the father has provided me with court orders he is seeking, including a consent order which protects the mother from any arrears that might result from any decision in his favour, so that there is no question of the mother and the children being out-of-pocket as a result of these measures.

Ms Campbell : If we are going to protect the court proceedings in this case I am not sure whether that is relevant for us to comment on. We have watched this case very closely because there have been broader matters of law, other than just the people who are involved in this case. That is one of the reasons why the costs are so high—because we have paid the legal expenses of both proponents, as we have sought to seek clarity over the operation of the child support law.

Senator XENOPHON: It has cost well over half a million dollars, and it could well cost hundreds of thousands of dollars more before this is concluded; is that right?

Ms Campbell : They are important pieces of law to how we administer the entire child support system to determine whether some pieces of evidence are admissible in determining child support.

Senator XENOPHON: But you are aware that the father did contact the department direct to say, 'I am prepared to participate in alternative dispute resolution to try and resolve this without recourse to costly litigation'? Can you acknowledge that?

Ms Campbell : I am aware of that, but there is also an issue about precedent, how we go forward with not just this case but other cases. The reason so much money has been spent on this case has been the need to test at law certain objectives. That is why the Commonwealth, as the model litigant, has paid the expenses of the other two parties involved—so we could test that at law.

Senator XENOPHON: Let us talk about the issue of model litigant. I note that when the agency fronted the Family Court two weeks ago it had a barrister, two AGS lawyers and a departmental lawyer to oppose an untrained, self-representing father asking that his matter be re-opened to lay out documents that he says—and that I say—were erroneously withheld from him and he wanted the judge to consider. It concerns me that there is now an argument about not allowing documents. You are supposed to be a model litigant and you are saying you are fighting—you are spending tens of thousands of dollars with each court hearing—about not allowing documents to be reconsidered in respect of this matter, attempting to refuse that these documents be considered.

Ms Campbell : To do that I would need to call the legal practitioners so that we could go through that level of detail. As you can imagine, we do provide the actual operation of these legal cases to the lawyers to construct those. I do not have the information about that exact point with me.

Senator XENOPHON: Again, I ask that you take this on notice. A fortune is now being spent, with up to four lawyers turning up against an unrepresented father about documents that he says—and I say—were erroneously withheld from him. Can I go to the AAT? Let us move to the FOI documents that the Information Commissioner has decided are not FOI-exempt. So the Information Commissioner has been involved in this. You have engaged Clayton Utz to represent you in the AAT and I believe you have special counsel and a partner working on the matter, along with an instructing solicitor from Human Services; is that right?

Mr Hutson : That would probably be right.

Senator XENOPHON: So you are there fighting an Information Commissioner's ruling.

Mr Hutson : That is again a very, very important point of law. We believe that the Information Commissioner's decision was not correct. Those documents go to legal professional privilege. In terms of the way we administer the child support legislation, the Social Security Act and all the other legislation we administer, legal professional privilege is an important part of the way we obtain legal advice and consider it. There is some information there which the Information Commissioner believes should have been released. But in our view that should not have been released, and the matter goes to legal professional privilege. That is why we have taken the matter up in front of the AAT.

Senator XENOPHON: I have just got a message from the father, who is looking at this, saying that costs were paid in the first matter only, that you are seeking costs against him in the appeal of the SSAT decision.

Ms Campbell : The first case, which was about what evidence was required and whether or not it could be used, was the matter of law that we were very focused on. I think that is where most of this started and that is where the costs are. These subsequent areas have come from the applicant. So we are, as is our normal practice, working through the legislative—

Senator XENOPHON: But you are seeking costs against him, so you will probably wipe him out. It is supposed to be a test case but you might wipe him out.

Ms Campbell : It was a test case for the first part—

Senator XENOPHON: Well you should have said that earlier.

Ms Campbell : I thought we were still talking about that, Senator. Then you went into the FOI, which I was treating separately; I am sorry.

Senator XENOPHON: Okay, but it is all inter-related, though. One flows from the other, doesn't it?

Ms Campbell : The first case was we were trying to determine whether or not under the Child Support Act we could use a piece of evidence—

Senator XENOPHON: Hearing your answer earlier, Ms Campbell, it would seem you said, 'It is a test case. We are paying his costs'. There are things flowing from that where he could end up losing his house as a result of massive cost orders against him because of the costs that are being knocked up by your department.

Ms Campbell : But they are subsequent actions he is taking against the Commonwealth.

Senator XENOPHON: Arising out of the same set of facts.

Ms Campbell : But they are subsequent actions that he is taking.

Senator XENOPHON: I am glad we clarified that. I have had a look at a few published AAT judgments which involved the department as respondent. It seems to me that mostly in-house lawyers are used to appear at the tribunal; sometimes the AGS. Why are you engaging Clayton Utz in this instance, given the additional cost involved?

Mr Hutson : We have a legal panel and we use it. AGS is simply a member of our legal panel. I am not sure why particularly we used Clayton Utz—

Senator XENOPHON: Let's move on, because I am running out of time. I note that the legal services directions require you to get a written advice before commencing proceedings. Did that occur in this instance?

Mr Hutson : That certainly occurs.

Senator XENOPHON: You also need to get an estimate under the various professional rules as to what the likely cost of this action would be?

Mr Hutson : Yes.

Senator XENOPHON: Can you tell us what the estimate was?

Mr Hutson : No, I would have to take that one on notice.

Senator XENOPHON: Yes, but you will tell me that, won't you? Or the likely costs—

Mr Hutson : If I am able to tell you that. I will take the question on notice and I will—

Senator XENOPHON: No, no. What I do not understand is that you have refused previously to let me know what the costs of this are, notwithstanding that Senator David Johnston, when he was in opposition, was asking similar questions and you provided information to him as to what the costs were a couple of years ago. Back then it was $25,000. It has now gone up to $565,000. I want to know why you have refused, in answers on notice, to provide me with details of cost. It does not relate to the identity of the parties. I just want to know what the costs are.

Mr Hutson : I will take that question on notice then.

Senator XENOPHON: It is my intention to put a standing question on notice, as this matter continues, about the costs. Your standard contract terms about refusing to answer questions of costs suggest it is not a problem to reveal monetary aspects of contracts to the Senate. I refer you to clause 15, in particular, and clauses 14.3 under 'confidentiality' and 14.3(d) that 'without limiting the application of this clause, 14.3, is disclosed in order to respond to a question or a direction of a House or a request by a committee of the Parliament of the Commonwealth of Australia or such equivalent bodies of the parliament of the relevant state'. Do you agree that in this process, if you are asked questions about how much a particular matters costs, you ought to disclose that?

Mr Hutson : As I said, I will take that question on notice.

Ms Campbell : We will abide by those directions of the Senate.

Senator XENOPHON: You have not previously.

Ms Campbell : I will go back and review that as to where that has occurred.

Senator XENOPHON: These were previous answers on notice provided.

Ms Campbell : I will review those questions.

Senator XENOPHON: Just to recap and to finalise: in summary, this man, even if there were a finding in his favour, does not want to pay any less to his wife and children. He is willing to give undertakings to the court in respect of that. He was concerned about the processes that were involved. He has been doing this as a self-represented litigant—a very good job, I think, in terms of the way he has been arguing his case. He has approached the department to say: 'Can you sit down and try and resolve this through an alternative dispute resolution?', and you are not prepared to do that.

Ms Campbell : Can I take you through what we understand to be the steps of these matters?

Senator XENOPHON: Can you answer that direct question? On two occasions he has contacted the department saying, 'Can we please sit down and resolve this without this massive litigation war involving hundreds of thousands of dollars of taxpayers' money over a matter based on the SSAT ruling which involves about 5,000'.

Ms Campbell : I reject that it is a matter that involves $5,000.

Senator XENOPHON: I am just relying on the Child Support Agency calculator: the annual amount of child support was $12,634; the SSAT recalculated it. After that it was $7,332.

CHAIR: Senator Xenophon, it might be helpful if we allowed Ms Campbell to outline some of those steps.

Senator XENOPHON: Sure.

CHAIR: Because there are obviously differing points of view here. If Ms Campbell can put the department's point of view about the steps that have been taken, then you can ask any further questions.

Senator XENOPHON: Of course.

Ms Campbell : The first matter was a Family Court matter that was brought in 2011 and was brought by the department in order to clarify an important legal principle which had far broader implications for all child support assessments. The department paid the legal costs for the person involved and the other parent because it was so important to set the principle. It would have been unfair of them to bear that cost. So that was finalised. The second matter was an appeal of that decision in 2012, brought by the individual that you are speaking with, about the documents. That was discontinued by the person you are talking of after three months.

The third matter, which is currently before the courts, relates to the child support assessment. These proceedings have been heard but remain reserved. The fourth matter is currently in the AAT and relates to the department appealing the decision by the Office of the Australian Information Commissioner about access to what we considered to be legal advice. So this is not just about a $5,000 or a $6,000 assessment. It is about a much broader range of issues.

Senator XENOPHON: Can you please at least concede that they still arise out of the same set of facts? They still arise out of an erroneous decision that could have been solved probably with a phone call earlier on and it has now taken a life of its own.

Ms Campbell : I do not think that is the case. The first matter supported the Commonwealth's position.

Senator Payne: The Family Court upheld—

Ms Campbell : The Family Court upheld the decision. Then there was an appeal, which was the second matter. Then there is a third matter, which relates to the actual assessment. That first matter was upheld.

Senator XENOPHON: I am very grateful to the chair for the time. I want to wrap this up. One of the orders sought by the father in this is a declaration that the Child Support Registrar is prevented, by way of enactment under the act, from advancing a child support assessment objection when it has prima facie indications that an application or submission arrived at in the part 6A assessment or objection contains false and/or misleading and/or reckless information. That is what he is fighting this about. He says to him it is an important matter of principle—

Senator Payne: And it is to us as well.

Senator XENOPHON: Why will there not be a concession, Minister, on the part of the agency that if an assessment contains false and/or misleading and/or reckless information, whether from any of the parties involved, that that ought to be a factor, that the Child Support Registrar cannot advance a matter until we sort out whether it is false or misleading or reckless? That is what he wants. We are spending hundreds of thousands of dollars fighting something that we ought to be in furious agreement on.

Ms Campbell : I think it was the context in which he thought it was false, whether or not we thought it was false or not. The first case was whether or not the evidence that was used could be used. The Family Court held that it could.

Senator XENOPHON: Let us see if we have any rulings by the time of the next estimates. I want to go to the issue of indemnity costs.

CHAIR: You will have to do it quickly.

Senator XENOPHON: I will. The costs were sought against the father in the appeal. Your department threatened indemnity costs in the second case. I put this to the minister perhaps—

Senator Payne: Which is the case, it was withdrawn by the father. We do not threaten. We are not in the business of threatening.

Senator XENOPHON: I have seen the chaffs. I am aware of the chain of the communications. As someone who still has a practising certificate after 30 years it looked like a threat.

Senator Payne: It is communicable. You and Mr Ruddock I think have your practising certificates after decades in the parliament.

Senator XENOPHON: I still do pro bono work. I still do my pro bono, my guilty pleas for people with gambling problems and the like. I still do that. This is a very important issue. If it is accepted that there are important legal issues at stake here, and that is uncontroverted, given that some of these other matters seem to flow from the original matter, which is the important legal principle—I think if you look at it they all flow from each other—can the department, can you as minister, at least consider or give an undertaking that you will not be seeking costs against the father, potentially bankrupting him, for what he considers are important matters of principle? I think you agree that the seminal issues are important matters of principle. I think you are waiting for a note from the secretary.

Senator Payne: No, I am not, actually.

Senator XENOPHON: Sorry.

Senator Payne: Although I may be in receipt of one, I was not waiting. I am not going to answer that question here. I obviously take advice from the officers in the department. Happily for all of them I am not litigating this, notwithstanding perhaps dreams and ambitions of a former life. Let me take some advice and undertake to discuss this with you further.

Senator XENOPHON: Thank you.

Senator SIEWERT: I want to go back to the issue of breaches, but in a different area—people being breached or suspended. On Four Corners on Monday night there were some examples of inappropriate behaviour, documents and reports being falsified. I realise Employment is not this area, so I am not asking you about that. But as a result of that it was suggested that people were breached as a result of forms that were filled out inappropriately, or wrongly or falsely. My question is: in light of that, have you taken any action? Have you spoken to the Department of Employment to address this potential issue?

Ms Golightly : I think the forms that you are referring to were actually in relation to claims for payment for Job Services providers, which is a matter for the Department of Employment. But the program did also talk about people who had other complaints about their providers. My recollection is that is where the breaching issue came up. In relation to that, our normal process—always has been, still is—is that if we receive a participation report from a Job Services Australia provider, reporting some behaviour or a missed appointment or whatever the issue might be, before we breach anyone we always have to look at whether there was a reasonable excuse for what might have happened and we talk to the job seeker as well as the provider, if we need to, but always the job seeker, to try and sort out what the issue was. If there was a reasonable excuse or a reason for why that all happened, then the job seeker is not breached.

Senator SIEWERT: There was one example of a third party saying someone had been breached and one speaking in person of where that had occurred. My question still stands. There is a suggestion or implication that this is widespread and that it could have happened to others. There were two examples where people said that it had happened. My question still stands, with due respect. Are you looking into this in a more systemic manner in terms of the reports of potentially it being more widespread?

Ms Golightly : We always look into reports of if someone is unhappy, if we have got enough of the details.

Senator SIEWERT: I am not asking about individuals who are not happy. I am asking as a systemic issue.

Ms Golightly : I understand. I am sorry, but what I was trying to say in my answer was that that is our normal practice, that we do always look into it. However we receive the information, we always do look into it. If there is a systemic issue we fix it. Quite often there are other things at play.

Senator SIEWERT: In this case have you started that process following on from the allegations that were made on Monday?

Ms Golightly : Where we have enough information to be able to identify that we are looking at the correct case, yes, we have.

Senator SIEWERT: In this instance it is not just the correct case; it is implications were made on Monday that this is widespread, that it has occurred on a number of occasions. It is not just a specific case. There is a suggestion that it is much broader and that it has occurred before.

Ms Golightly : I think I understand what you are trying to say. The program went to a number of issues. The main allegations were around provider payments.

Senator SIEWERT: Yes, I understand. I am going to follow that up next door later this afternoon.

Ms Golightly : But in terms of the issues about job seeker breaching, I am happy to go back and have another look at the program. But my understanding of it was that that was in relation to a couple of people on the program or a third party, in one case, mentioning that someone had been breached and, in their view, unfairly. We do have people all the time asking us about things which they may not understand or feel are unfair. It is part of our normal business—always has been and still is—to always look into that complaint, if you like, or query or concern. And we are.

Senator SIEWERT: You have spoken to the Department of Employment about how you could further look into this?

Ms Golightly : Yes. To identify what might have been happening we do need to have the specifics of cases to look into what the issue was in order to determine whether it is systemic or not or has a systemic aspect or not. In some cases we have the information. In others there was not enough to identify the person

Senator SIEWERT: Thank you. Have you contacted the people that were featured in the show to try to get some further information about the allegations that were made?

Ms Golightly : I would have to take that on notice. No.

Senator SIEWERT: What exactly has been the response since Monday?

Ms Golightly : Basically where we have information to be able to identify who the job seeker may have been we have been able to look and to see what—I am trying to be careful just because of the privacy stuff—

Senator SIEWERT: I understand.

Ms Golightly : what action had or had not been taken with that individual or individuals.

Senator SIEWERT: The individual cases, you are following up?

Ms Golightly : Where we have enough information. You may recall, some of it was about third party and some of it was not identifiable. Where we can, we are and we will.

Senator SIEWERT: In terms of the third party, have you contacted the person reporting on the third party?

Ms Golightly : No.

ACTING CHAIR ( Senator Siewert ): I have to keep going. I am Acting Chair. I am presuming I have not done my five minutes yet, so I will ask one more question and then I will go to you. I might as well go for it while I have got it. I will pretend she had follow-up information to questions on notice once I have asked questions next door on that one. Thank you. You answered a question for me, question 158 on overpayment figures. The average overpayment was 0.13 per cent—the Chair is back now—then you gave the figures of the average overpayment. In terms of the overpayments, could you take on notice for me, please, what the causes of those overpayments were? If you could tell me in general and then take on notice what the causes of those overpayments were. Were they misreporting, not reporting on time or were they the department's errors? Is that possible?

Ms Campbell : We will do the best we can. I am not sure what level of specificity we have got on that. We will seek to get as much information as we can.

Senator SIEWERT: You have given me some quite detailed information on breaking it down. I thank you for that because it is really useful. You look at some that are really high. For example, for parenting payment single it is nearly 30 per cent. I am wondering if you could also take on notice that question. But where they are really high in particular, it is very significant for a single parent to have to pay money back, specifically in those high areas. I will ask you that question first.

Ms Campbell : We are constantly looking at why people get overpayments, whether it is not doing the appropriate reporting or not understanding the parameters around which the payments are made. One of the roles of Mr Jongen is to make sure that people understand their reporting requirements and their obligations under them. When we find an area where we are seeing a spike in people getting it wrong, we do that strategy about ensuring that people are aware of their commitments.

Senator SIEWERT: Have you done that in these cases, because it is really high for Austudy, parenting payment partnered, parenting payment single, Newstart, family tax benefit—in fact, there are a whole lot of areas that are really high. Have you done that, and have you seen a decrease in it in the six months since the end of June 2014?

Ms Golightly : We will take the detail of that on notice. In general terms—and what I am about to say is not specific to a payment; I will have to check it—certainly with income reporting and change of circumstances, particularly in a student's place, there are things that we have noticed, as the secretary said, that people often get wrong. We do have quite an extensive information campaign around how important it is to tell us immediately if your circumstances change and to report your income.

I know, as a general statement, those two are fairly high up there in terms of the sorts of things we see that are causing problems. We do have information sessions and products out there to help with that.

Senator SIEWERT: Could you provide those figures to December, to see if we have seen a decrease in response to any actions you have taken? That would be very much appreciated.

Ms Golightly : Certainly, Senator.

Senator CAMERON: Ms Campbell, on IT, is Mr Sterrenberg here?

Ms Campbell : Mr Sterrenberg is making his way to the table.

Senator CAMERON: I see him gallantly pushing his way through. Firstly, can I say thanks very much for the documents that you sent and your answers to the questions on notice. I found both you and Mr Sterrenberg very helpful on this issue of IT. I want to go back to some of your answers this morning, having regard to some of the answers you gave back in October. It may be that I picked it up wrong, but back in October, when we were talking about the ISIS system, you indicated—this is on page 22; I do not know if you have it with you?

Ms Campbell : Page 23.

Senator CAMERON: Page 22?

Ms Campbell : I have only got page 23, Senator.

Senator CAMERON: I have one that you did not pick up. On page 22 you said that to do McClure—and I am paraphrasing here—you would have to work around a much simpler system, a much simpler policy framework, and that would be very difficult to implement under the current framework. That is basically what you indicated.

Ms Campbell : Yes, Senator.

Senator CAMERON: You then went on to say that you could not advise the government that it would be a sensible decision to do a completely new framework in that system, meaning the ISIS system.

Ms Campbell : Yes, Senator.

Senator CAMERON: You said it would be better to build a new system where the integrity of the data was assured.

Ms Campbell : Yes, Senator.

Senator CAMERON: You said on page 23, the one that you have got, 'My opinion is that we need to do something about the system now because it is not able to meet the flexibility requirements and it is not a modern system; I worry about some of the risks if we do not take some action.'

Ms Campbell : Yes, Senator.

Senator CAMERON: I am a bit confused that you may have opened the possibility this morning that further bolt-ons or changes to the current system might be an option.

Ms Campbell : Can I clarify what I said this morning?

Senator CAMERON: Yes, please.

Ms Campbell : Big change—it would be much better to invest in a new system to ensure that integrity and flexibility. If there were changes that needed to be made within a six-month time frame or a 12-month time frame, we have some flexibility, as we have had for many years now, to do those, what I would consider, minor adjustments rather than structural adjustments.

Senator CAMERON: You would do some more IT acrobatics, really, getting the system to talk to the other bits—

Ms Campbell : Indeed.

Senator CAMERON: To be able to get from one spot to the other, bend and twist and get there, but you will get there, if it is small changes.

Ms Campbell : It depends on what the changes are. That always forms part of our advice to government about how complex the changes are.

Senator CAMERON: Mr Sterrenberg, do those views remain your views, based on your technical expertise?

Mr Sterrenberg : Yes, Senator.

Senator CAMERON: We have seen the McClure report. I accept that that is a report to government, not a report of government, and the government will need to have a look at that report. Are you still of the view, Mr Sterrenberg, that there would be a three-year time frame between moving from the existing system to the new system?

Mr Sterrenberg : That time was put forward for the build component of the system. Clearly, there is a time frame to do the normal procurement processes that have to go before that. Obviously, there would be discussions with government to choose what parts of new processes they want to put in place.

Senator CAMERON: It is not like going down to Dick Smith and ordering a new computer, is it?

Mr Sterrenberg : No.

Senator CAMERON: The ISIS architecture document that you have given me—thanks for that—shows an extremely complex system. But the system is still working. It is still the workhorse, isn't it, that you indicated before?

Mr Sterrenberg : Yes, Senator. The system is stable.

Senator CAMERON: But it is a workhorse that needs to go out to pasture, doesn't it?

Mr Sterrenberg : Yes, Senator.

Senator CAMERON: To deal with this we really need a new system.

Mr Sterrenberg : Yes, Senator.

Senator CAMERON: Where is the scoping study up to? We have the McClure report. We have a budget coming up. I think you and I spoke about—and maybe Ms Campbell as well—time frames to get this moving and that it was in the context of the budget. Has the report been finalised?

Ms Campbell : The business case has been finalised.

Senator CAMERON: When was that finalised?

Ms Campbell : This month, I think.

Mr Shepherd : In February.

Senator CAMERON: It went to government this month?

Mr Shepherd : The business case was provided to government this month. I can confirm that.

Senator CAMERON: There is no real capacity to implement the McClure report under the current system?

Ms Campbell : Again, with McClure's report to government—depending on what government decides to do—for the entirety, hypothetically, it would not be a good investment and it would be better to do it under a new system. As we deal with government all the time about working on stand-alone measures, they may be able to implement it within the current system, but to do the entirety, we would recommend a new system.

Senator CAMERON: That would still be your recommendation to government, to get a new system?

Ms Campbell : Yes, Senator.

Senator CAMERON: Minister, there is a report in the Daily Telegraph on 24 February, quoting you as saying that the program has been described as 'a turbo charged Commodore 64, which will leave the government with at least a billion-dollar bill to replace it' and you said 'the system needed to be urgently updated'.

Senator Payne: I think I said 'turbo charged Commodore 64 with air dams and a spoiler', but yes.

Senator CAMERON: I am just looking at the quotes in the Telegraph.

Senator Payne: I know. They did not use the funniest ones.

Senator CAMERON: They did not use the funniest quotes?

Senator Payne: I thought they were funny.

Senator CAMERON: That is the Telly for you! Reading that, I am still a little bit confused as to your position on this now. 'Updating' means that you bolt on another spoiler. Do you mean—

Senator Payne: No, I do not mean that.

Senator CAMERON: You do not mean that? So you are as one with the secretary on this?

Senator Payne: Absolutely.

Senator CAMERON: That is good because I was not sure, having read that report. And I would not hold anyone to any supposed quotes in the Daily Telegraph, Minister. I am not sure that you have seen it but I think it was with respect to the McClure report, entitled 'The complexity'. Is this a DHS document?

Mr Sterrenberg : Yes, Senator.

Senator CAMERON: When did you prepare this document?

Mr Shepherd : As part of the development of the business case a range of depictions of the current system were produced. There are technical depictions of the system; there are depictions that represent the complexity of payments. The diagram you have in front of you represents the complexity of payments.

Senator CAMERON: Who decided to put documentation from the business case in the public arena?

Ms Campbell : We provided that information to the Department of Social Services. It is probably a question best directed to them.

Senator CAMERON: This is the one that Senator Payne described as the 'candy crush'?

Senator Payne: That has been attributed to me, Senator.

Senator CAMERON: That has been attributed, yes. It does look like it, I must say. Is the rest of the business case publicly available, Minister?

Senator Payne: No. It is advice to government.

Senator CAMERON: It is advice to government. But some parts may come out?

Senator Payne: It is a matter for the government, Senator. It is advice to government.

Senator CAMERON: Minister, what is your understanding of the situation now about a replacement? Where do you see that being up to?

Senator Payne: As indicated by Mr Shepherd, Mr Sterrenberg and the secretary, the business case has been provided to government this month and that matter is now under consideration by the government. As we have indicated prior to these hearings, it is also a matter under consideration in the budget process.

Senator CAMERON: What would be the scope of training required for staff to move to a new system? You must have looked at this.

Mr Shepherd : I cannot talk about the specifics of the content of the business case, but as you would be aware, DHS has had significant experience over the past three or four years in training staff and helping staff to both use our systems and help customers to go digital.

Senator CAMERON: That is helpful. So they are trained up on the Commodore 64. What I am asking is what is—

Senator Payne: They are actually on their own smart phones.

Senator CAMERON: Actually, would it be fair to say, Mr Sterrenberg, that it might take more skill to handle the Commodore 64 than the new system? Seriously, would that be—

Mr Sterrenberg : Yes.

Senator CAMERON: As Ms Campbell said, you change one part of the system as it is now and it affects other parts because someone who has long gone has programmed some piece of script into the system and it affects another part. So it is extremely complex.

Mr Sterrenberg : Yes.

Senator CAMERON: Is the system an impediment to ensuring that people that want to do damage to this community are kept under proper watch?

Ms Campbell : No.

Senator CAMERON: That is good. That is helpful. You did indicate to me, in October, that you would be raising the issue of local content with the department of industry. What discussions have taken place on that?

Mr Shepherd : Can I just clarify your question? Was that in relation to the question you asked about consultation with the department of industry?

Senator CAMERON: Yes.

Mr Shepherd : There has been consultation with the department of industry. We have met with them twice.

Senator CAMERON: So you have met them twice.

Mr Shepherd : Yes.

Senator CAMERON: Was this after I raised it in the Senate estimates?

Mr Shepherd : They actually participated in a workshop too about the design of the business case and we have had subsequently two additional meetings with them.

Senator CAMERON: When was this participation?

Mr Shepherd : I can get this on notice to you, but the initial discussions with that department in its portfolio were almost two years ago when the business case started. They participated in a cross-agency workshop in December and there have been two officer-to-officer specific discussions with the department of industry.

Senator CAMERON: What is an across-agency workshop?

Mr Shepherd : Sorry?

Senator CAMERON: What is an across-agency workshop?

Mr Shepherd : Agencies come together to help contribute to the design of the business case for this program.

Senator CAMERON: They actually participated in designing the business case?

Mr Shepherd : As you would know, we make payments across multiple agencies, some 20-plus agencies. They each have a stake in the design of any new system.

Senator CAMERON: When was that across-agency?

Mr Shepherd : I think it was 16 December, but I am going to defer to Ms Bennett for that.

Senator CAMERON: Which year?

Mr Shepherd : Last year.

Senator CAMERON: 2013?

Mr Shepherd : Yes. In addition to the one-on-one agency discussions we had almost two years ago, I joined Mr Sandison my colleague on those one-on-one discussions.

Senator CAMERON: What was discussed in the two meetings with the industry department?

Mr Shepherd : Given the issue is with government, I can outline the process. The process included thinking about aspects of the business case, what would be required, any replacement of the ICT systems, and what agency needs were. Those were gathered, collected, analysed and placed into the business case, which has now formed advice to government.

Senator CAMERON: What about the specific issue of local content?

Mr Shepherd : Sorry?

Senator CAMERON: You have a document there. Do you want to read that out?

Mr Shepherd : In terms of the content with the Department of Industry and Science specifically, we talked about the program's impact on the Australian ICT industry. I think that was the key question that you asked. We talked about the status of vendors in Australia. We talked about the government's policy in relation to ICT small-medium enterprise participation and procurement policy.

Senator CAMERON: What is this document you are reading from?

Mr Shepherd : These are my points around that—

Senator CAMERON: They are your points, are they?

Senator Payne: Yes, they are.

Mr Shepherd : meeting.

Senator CAMERON: How come the minister passed them down to you?

Senator Payne: We are very sharing, Senator.

Ms Campbell : I think he has got some in his pack.

Senator CAMERON: He has got his own too, has he?

Senator Payne: I think your little paranoia is slightly off target this time.

Ms Campbell : The minister was quicker to get to them than we were.

Senator CAMERON: The minister was quicker to get to them, was she?

CHAIR: Just a couple more questions.

Senator CAMERON: Where are you up to now with the department of industry?

Mr Shepherd : In terms of process, we wait for a decision of government.

Senator CAMERON: So nothing now until the decision comes out. So you are not sure when a decision could be made. It may not be made.

Mr Shepherd : It is actually for government.

Senator CAMERON: You are saying a decision may not be made; is that correct? It may not be made?

Ms Campbell : Senator, it is an issue before the government.

Senator CAMERON: All right. All I am trying to engage with is to make sure that, if and when a decision is made, Australian industry has got an opportunity to participate. That is fundamentally where I am coming from.

Senator Payne: We are very clear on your views on that.

Senator CAMERON: Does that coincide with your views, Minister?

Senator Payne: Indeed, and the government's procurement policy in relation to small and medium enterprises in the ICT space is also a useful template.

Senator CAMERON: That is excellent. So we should see some local content in this new system?

Senator Payne: I am not in the business of making predictions about matters that are decisions for government.

Senator CAMERON: Thank you, Chair.

Senator REYNOLDS: Just one question of clarification further to Senator Cameron's inquiries: given his obvious enthusiasm and interest in this project, I am presuming that he and his colleagues, when they came into government seven years ago, leapt straight onto this project and implemented some solutions. I am just wondering if you could give me a quick overview—perhaps the minister or the secretary—of the history of this project.

Senator CAMERON: You are leading with your chin.

CHAIR: I will allow her to ask the question.

Senator REYNOLDS: When did it actually start, in substance?

Ms Campbell : The business case was funded in the 2013-14 budget to look at the review.

Senator REYNOLDS: The 2013-14 budget—not 2007, 2008, 2009, 2010 or 2011? It started in 2013. So this project started—

Ms Campbell : Yes, the replacement project.

Senator REYNOLDS: Thank you.

CHAIR: It does not sound like you have—

Senator REYNOLDS: Not a lot of action.

Senator CAMERON: I have a follow-up question on that. Is it true that the Howard government, Mr Sterrenberg, locked us into this system for 10 years in 2014? Is that correct? That is the evidence you gave previously.

Ms Campbell : In 2004 there was a contract signed for the software.

Senator CAMERON: For 10 years.

Ms Campbell : For 10 years.

Senator CAMERON: What was the value of that?

Ms Campbell : I do not have that with me. I will check whether Mr Sterrenberg has got it.

Mr Sterrenberg : I do not. We can take it on notice.

Ms Campbell : We will take it on notice.

Senator REYNOLDS: Locking in a contract is very different from starting scoping work and for the next generation to be ready at the end of a contract. So I would have thought it was a very different time frame.

CHAIR: Thank you. As much as I am enjoying the back and forth, Senator Smith has been waiting. I will go to Senator Smith.

Senator SMITH: I understand that the government has recently opened a joint—if that is the correct word—Medicare-NDIS office?

Ms Campbell : Yes.

Senator SMITH: In New South Wales.

Ms Campbell : Yes.

Mr Tidswell : We have opened a facility in Charlestown in Newcastle with the NDIS, so their quite large and bright new shiny facility in Charlestown. We managed to put in place a servicing point for Medicare servicing. Previously that was located in quite a dingy back area in a small shopping centre adjacent to the new site. We put it in the front of that NDIS facility so at one point you can do your Medicare servicing and, if you are going there as a client of the NDIS, you can receive services in one stop. It is working very well. People are liking it, not only the individuals themselves but also the carers. It makes it convenient. It is certainly something that we are going to do more of. It looks to be a good approach to joint servicing.

Senator SMITH: Why did we choose the New South Wales location over perhaps other options? Were there other options?

Mr Tidswell : We are in the mix now—

Senator Payne: It is the beginning of the process.

Mr Tidswell : It is the beginning of the process, as the minister said, of looking right across all of our property holdings with NDIS. I suspect we will be coming back to this committee with more information about our proposals as we work hard with our colleagues in the agency and the NDIS to get joint property arrangements. Those conversations are happening as we speak. It is the first of many.

Senator SMITH: When did the doors open, so to speak?

Mr Tidswell : I do not have that. Minister Fifield opened it.

Senator Payne: I think the middle of last year was when the doors opened, in general terms. A more formal opening was held some short time after that to give everyone time to settle in.

Senator SMITH: Do we have an indication of the sorts of numbers of people that are accessing the joint office?

Mr Tidswell : I am not sure if I have that with me.

Senator Payne: We do not have those NDIA figures with us. In terms of the Medicare system, Mr Tidswell may have those; I am not sure.

Mr Tidswell : No, I do not have them, unless somebody behind me has got that. I certainly do not have that in my folder. We can take that on notice, Senator. We can get that back to you pretty quickly, actually. I just do not recall. I keep a bunch of figures in my head but not the individual—

Senator SMITH: Of course, the benefit for the customer is they can access both the NDIS service at the same time as accessing Medicare.

Mr Tidswell : Absolutely. It is working very well. Our staff love it. The NDIS staff love it. As I said, the clients themselves think it is a great thing. We met a few of those. Their carers in particular and parents are particularly happy with the approach.

Senator SMITH: It is the first.

Mr Tidswell : That is right.

Senator SMITH: Are you able to share anything about other locations that might have been approved or are under consideration?

Mr Tidswell : There is a major piece of work underway with the agency to look at all their strategic property needs right across the country. We look at our assets, where we need to be and opportunities for co-locations and sharing sites. It is a great thing for government to be able to do this.

Senator SMITH: Thanks.

CHAIR: Senator Siewert.

Senator SIEWERT: Thank you. You might need to take this on notice. Do you have figures on how much it costs to administer each allowance—so how much it costs to administer Newstart and Youth Allowance?

Ms Campbell : We have a funding model with the Department of Finance where we are allocated a certain amount per customer on a certain allowance. I do not have that information with me. We could take that on notice.

Senator SIEWERT: If you could take on notice then how much it costs to administer for a person on Newstart, Youth Allowance, carers payments and DSP.

Ms Campbell : We will tell you what we are given to do it. Is like an average, a unit cost. That is what we can provide.

Senator SIEWERT: I notice the difference of what you have just said. Do you do analysis then on how much it actually costs?

Ms Campbell : We did that a couple of years ago when we updated our model. We will do it again in the future. It is not something we do all the time because it would slow us down in carrying out the work. We work on the costing and then we update it every couple of years when we go back to renegotiate the model with the Department of Finance.

Senator SIEWERT: So then the question is: the amount that you calculated last time—do you have that, or do you have to take that on notice as well?

Ms Campbell : I do not have that with me. We will give you that on notice.

Senator SIEWERT: Is there a difference between what you have calculated and what you get from the department?

Ms Campbell : We negotiated with them. We were happy with the outcome—we would always like more money from the Department of Finance, but that is not usually forthcoming—and it was something that we worked out unit prices on. It is like the average customer; we work it out on how many times they come in on average. Clearly, we are going to have customers who have much greater needs and come and see us more often. They would cost more versus those who do not come near us very often. The average is what we get.

Senator SIEWERT: All you actually have that you can give me is the cost that you calculated—

Ms Campbell : A couple of years ago.

Senator SIEWERT: a couple of years ago and what you are getting now.

Ms Campbell : Yes.

Senator SIEWERT: Do you get indexation? First of all, though, how do you calculate it?

Ms Campbell : I cannot recall whether it is indexed or there is a base amount that is indexed. We will take that on notice as well.

Senator SIEWERT: If you could.

Ms Campbell : And then we come back to do a review. I think the review is in 2017-18.

Senator SIEWERT: Thank you. It would be appreciated if you could take it on notice. So 2017-18. When did you last do it?

Ms Campbell : Was it last year or the year before? 2013-14, 2014-15, 2015-16, 2016-17, and then we get a new one in 2017-18.

Senator SIEWERT: So that is what, four?

Ms Campbell : It is about a four-year cycle, a forward estimates cycle.

Senator SIEWERT: If you could take that on notice it would be appreciated. Do you keep figures on people that apply—I am thinking of Newstart in particular—whose assets are above the threshold?

Ms Campbell : I believe we do; those people that we reject. Yes.

Ms Golightly : I think we do record that as a reason. But we will check.

Senator SIEWERT: Could you take that on notice—if you do, obviously, and, if you do, how many?

Ms Campbell : Yes.

Senator SIEWERT: Can you take this on notice: how long does it take people to use up their assets and come back on? I know that is a bit difficult, because people have different levels of assets.

Ms Campbell : There is a liquid waiting asset period which identifies if someone is likely to be going onto payment and that they have these liquid assets. There is a set of criteria around those. We work that out upfront, depending on how much money it is, how long before they will be able to go onto payment. We could provide some information on that.

Senator SIEWERT: That would be much appreciated. I have one last area of questions. Do you keep any records on the number of people on Newstart or DSP, the various allowances, who are disconnected from essential services like energy? Do you keep any records, or is there any way of knowing the number of people who are disconnected? Anecdotally I am getting a lot of reports of people having their energy disconnected.

Ms Campbell : We do not capture that information.

Senator SIEWERT: I know there are supplements. If people come to you and say, 'I have had my electricity disconnected', what additionally can you do to help?

Ms Campbell : What we can work through with them is advance payments, if they are eligible, and also offer Centrepay, which is a way of deducting some of those regular expenses before the payments are made. We can often work with the customer about ensuring that, once they can get back onto energy and the like, they have a way of making those payments regularly. That is more of an insurance policy about getting cut off again.

Senator SIEWERT: Are you able to provide any data on the number of people who have come to you seek those advance payments related to energy?

Ms Campbell : No, I do not think we would have that specificity.

Senator Payne: It would just be an advance payment as opposed to—

Senator SIEWERT: So you do not keep—

Senator Payne: In relation to purpose, no.

Senator SIEWERT: Thank you.

Senator Payne: Although there are a number of levels which need to be met. 'Hardship' has some specific legislative requirements.

Senator SIEWERT: Yes, to be able to receive it—I understand that. Energy, I presume, is one of those—access to essential services like electricity?

Ms Golightly : It is general hardship—

Ms Campbell : It is general hardship; if people are in hardship and need some money to meet whatever the hardship element is, then they are assessed against that criteria. There are only so many advances per payment, and they need to meet those requirements as well.

Senator SIEWERT: Thank you.

Senator REYNOLDS: I would like to move on to natural disasters. Given we have had two cyclones recently, it has been my observation that emergency services and the defence forces, quite often the first responders, get the most attention in terms of the work they do—the fabulous work they do. I know your department has a significant role to play, not only up front but there would obviously be a lead time in these various disasters. Could you explain to the committee what your role is, and your staff's role, in natural disasters.

Ms Campbell : I will ask Mr Tidswell to take us through this one.

Mr Tidswell : Shortly after the Deputy Prime Minister made some announcements for payments for individuals, we stood up some capability in Yeppoon and Rockhampton on Sunday afternoon, about 2 pm, and deployed staff into recovery centres in both Yeppoon and Rockhampton. On top of that we stood up our phone lines, so we have staff who work 24/7 in Geelong. Those staff were activated to take phone calls immediately upon activation. Then we put up our online claim and established the parameters to make the disaster recovery payment for the Australian government to those individuals and families affected.

We probably have about 300 people now working solely on this—taking calls, processing claims, being in the recovery centres. Also we have activated people in the Northern Territory who are in some of the communities most profoundly affected. We are working with the NT government to assist them with the work they are doing in that area. We have made a number of claims already. As of last night we have processed about 1,430 disaster recovery payments, to the sum of $1.86 million. That money should start flowing into people's bank accounts as we speak. Quite often, if we know the customer and they can provide evidence of being impacted by the very serious events, we can make payments very quickly. These are the payments arrangements for Cyclone Marcia, the Queensland event.

Senator REYNOLDS: In light of that, going into a region you would sometimes have business continuity issues which would complicate your response?

Mr Tidswell : Absolutely. We had to source generators. As you can imagine, these are not the normal generators you put next to your caravan; they are serious generators. It is challenging for us because you have to figure out how to configure the right electricity supply for air-conditioning, computing and the size of premises. We have been running on generators pretty much since then. I do not quite have an up-to-date whether we are all back on mains power everywhere. But absolutely, our staff—they are members of these communities—were impacted. So there are people cleaning up yards and doing stuff. They then put their work gear on and come to work on Sunday afternoon to staff these facilities. We have also sent our mobile service unit—it was in Longreach—down south. That started servicing in communities as of Tuesday this week. That will work its way around to those more isolated communities where it might be more difficult for people who are concentrating on clean-up and other things to assist and provide services.

Senator REYNOLDS: I would imagine from your perspective—sadly you have had a lot of practice in this area—that it is still a complicated activity to coordinate effectively, centrally and then also on the ground, particularly if you have two going at once. What are some of the complexities? Do you have a disaster relief manual with procedures that you go through fairly quickly, mobilising people?

Mr Tidswell : Absolutely. It is unfortunate that those in northern Queensland are very good with this because they have experienced so many of these disasters. We have a well-oiled machine. Our people are able to be deployed 24/7. We have good contact with the key partner agencies in Attorney-General's. They give us the information and provide us the detail about the activation and determinants. We are then able to, very quickly, galvanise teams of people back in Canberra who build the online claims, build the work-flows, get the material put on the website and make sure the whole thing runs as smoothly as possible. So we are pretty proud of this.

Senator REYNOLDS: It sounds a bit like a military operation.

Mr Tidswell : We have learned a lot from the military, actually. Quite often we work closely—

Senator REYNOLDS: Closely with all the agencies.

Mr Tidswell : with the military when we need extra help, particularly if there is a profound outage of telecommunications and electricity supplies. They have helped us enormously in some events.

Senator REYNOLDS: In Queensland you now have the teams deployed. They are making payments and providing the services and support. How long you would expect this operation to continue out in Queensland?

Mr Tidswell : Our goal always is to get into this as quickly as we can. What we try to do is bring people in. We have an emergency reserve staff that we can call on. These are people who are on short notice and short lead times to be able to leave their family home from around Australia. We tend to do this more on a Queensland basis for that event. Our modus operandi is to try and deploy as many people as we can afford to get on top of the job, provide the assistance, provide the help and then retreat back into our normal service presence. So we have service centres in Yeppoon and Rockhampton.

Senator REYNOLDS: What is the lead time? In terms of starting to draw down people, are we talking a week, a month, two months? What sort of time frame?

Mr Tidswell : It does depend on the size of this event. We are pretty good at getting a sense of what the claimant numbers will be—1,430 already granted in terms of the Queensland event. We would think we are about halfway through that event in that sense. So in the next week or so we will start to look at our service presence: do we still need to be in recovery centres, negotiating that with the Queensland government? Do we need our telephone to be operating from 8am to 8pm seven days week or can we moderate and move back in that area?

Senator REYNOLDS: But it is safe to say it is quite a long day for a big event; it is quite a long time.

Mr Tidswell : Yes.

Senator REYNOLDS: So not only is there the challenge of dealing with people who have been impacted—and quite often it will be your own staff as well—needing disaster relief payments, but you have all of the other payments and all of the other clients who still need to be looked after during that time.

Mr Tidswell : Absolutely. These things hit hard and do have—to coin a phrase—downstream impacts in that sense. Often the general, normal 'business as usual' activity for us gets busier in that time as well. We do look at providing those staff teams with extra assistance and support from other parts of the country. But our aim is to get in as quickly as we can, provide the assistance, go where the Queensland government, in this instance, have gone—to their recovery centres—work closely with them, and look to where there are other pockets of issues and problems. There always is with these things. Certain communities get hit harder than others and respond.

Senator REYNOLDS: In very difficult and challenging circumstances, particularly initially on the ground.

Mr Tidswell : That is right.

Senator REYNOLDS: If you could pass on my congratulations—and, I am sure, the congratulations of all of us—on the great work your staff do. They are not always as well recognised as other emergency services personnel, but they are obviously doing a fantastic job; so thank you.

Mr Tidswell : Thank you.

Senator CAMERON: Support a decent wage rise for them!

CHAIR: If you had not blown the budget, Senator Cameron, there might be more money for wage rises. Senator Cameron and Senator Siewert still have some questions. We are due to finish at 12.30. I will go to Senator Cameron, then Senator Siewert and I will finish with a couple of questions.

Senator CAMERON: Thanks. Minister, can we get a debrief on how tropical cyclone Marcia was all handled and what issues arose, if any?

Senator Payne: Here and now?

Senator CAMERON: No—I am asking for a briefing.

Senator Payne: Yes, of course.

Senator CAMERON: Do you know how many additional staff were placed in the Fitzroy region for this incident? You can take it on notice.

Senator Payne: We will take it on notice and get back to you.

Senator CAMERON: I note that the disaster payment determination only covers major damage to the residence and serious injury. That is different from previous disasters, is it not, up until the Blue Mountains fires?

Ms Campbell : I will get someone to check, but I think there were other disasters with that same criteria—some flooding, or something.

Mr Tidswell : Certainly, as we talked about in this committee previously, the Blue Mountains bushfires marked the establishment of the 'severely affected' criteria. I think we have given evidence before that a whole different range of criteria was used in previous events. I think we provided evidence about some case-by-case determinants. It was not a blanket kind of thing in that situation.

Senator CAMERON: For the Victorian bushfire and the Tasmanian bushfire, if you could not get access to your principal place of residence for at least 24 hours or were stranded for 24 hours, or had no electricity or gas or sewerage services for 48 hours there was a payment?

Mr Tidswell : I think we have been here before. I need to have determinations for each event in front of me. I do not have them going back to the Victorian bushfires of 2009.

Senator CAMERON: Are you trying to tell me seriously that in your position you cannot answer that question? If that is the case, that is fine.

Mr Tidswell : I want to make sure I give you the exact answer.

Senator CAMERON: That's fine. Minister, in regard to the issue of the 48 hours and the 24 hours—the previous outcome—you indicated for many, many weeks, even months, that in the Blue Mountains the reinstitution of that was under active consideration. Nothing came of that. Is there any active consideration of providing some benefit to those in the Fitzroy region who have lost power, who have lost gas, who have had expenses outside their own control? Is there an active consideration, or should we just tell them they are not getting it?

Senator Payne: The declaration made by the Minister for Justice, if I recall correctly, which you obviously have seen, sets out the criteria upon which the government is intending to provide support. I do not understand there to be any changes to that declaration.

Senator CAMERON: You did personally indicate in a public way, on a number of occasions, in the Blue Mountains that consideration would be given to extending the payment in the Blue Mountains, regardless of the ministerial position. That is correct, isn't it?

Senator Payne: You asked me about the cyclones in Queensland.

Senator CAMERON: No, I am asking you about the Blue Mountains now.

Senator Payne: I see. So you have changed.

Senator CAMERON: Yes. In the Blue Mountains you said there would be active consideration—

Senator Payne: We had this discussion before. Yes.

Senator CAMERON: You failed to deliver. That is fine. Can I now move to the Four Corners report of last week.

Senator Payne: Of this week.

Senator CAMERON: Monday, yes. It seems like a long time ago.

CHAIR: You will have a fairly short period here, Senator Cameron, because I know Senator Peris also has just a minute or so, as well as Senator Siewert.

Senator CAMERON: Let me put my questions. All I can do is put them on notice then.

CHAIR: If you would like to, that would be fine.

Senator CAMERON: In terms of the Four Corners report, I will ask this on the record: what steps has DHS taken arising from the allegations of impropriety with people that you engage with, that is, Job Services Australia? Have you done anything on this?

Ms Campbell : Can we just clarify, the Department of Employment has the main engagement with Job Services Australia.

Senator CAMERON: But you have engagement with them, don't you?

Ms Golightly : The contract, though, for the services they provide is with the Department of Employment.

Senator CAMERON: I am not asking about the contract. You have an engagement with them, don't you?

Ms Golightly : We refer people to Job Services Australia. We act on participation reports, for example.

Senator CAMERON: Are you still referring people to the job service groups that were indicated to have rorted the system? Are you still sending them there?

Ms Golightly : Yes, because it is allegations at this point.

Ms Campbell : We will await guidance from the Department of Employment on that matter because it will be up to them, as the contract owners, on those issues.

Senator CAMERON: Thanks. Can I move to enterprise bargaining.

CHAIR: About two minutes, Senator Cameron.

Senator CAMERON: I noticed that you issued your revised staff pay offer. You have abandoned any pretence that productivity is going to be an issue in the bargaining. At least that is a bit honest. This revised pay offer might be a Mr Jongen special again. It said that if the department does not meet its workforce profile ratio target each year this will affect the annual pay increases, mostly in the late years of the agreement; correct?

Ms Campbell : Yes. That is what is on the table at the moment.

Senator CAMERON: How do your employees have any capacity to influence that ratio?

Ms Campbell : We have received significant feedback as part of the bargaining process and other communication we have been having with staff. We hear that message that is coming back. This is something that was within the framework as provided by the Public Service Commission. We will be engaging with the Public Service Commission on that.

Senator CAMERON: This is a John Lloyd special?

Ms Campbell : This has been part of the original framework. This is how we structured our offer. We are hearing back from staff their concerns on this and we are looking at the matter.

Senator CAMERON: Do you agree—I am asking you the question—that your staff have got absolutely no way they can influence this ratio?

Ms Campbell : It is very difficult for individual staff to do that, to influence the ratio, and we are taking that message on board and going back and looking at the agreement. That is what the bargaining process is about. We talk to people. They provide us feedback. We go back. And we are bargaining in good faith.

Senator CAMERON: You are bargaining in good faith, are you?

Ms Campbell : Within the framework.

Senator CAMERON: But you are not allowed to offer those workers in Queensland any increase over and above the pattern that has been established. So you cannot bargain in good faith.

Ms Campbell : This is the second agreement that we have bargained since the department has been brought together. We had a framework in the first agreement. We had a framework for the second agreement. We live within the framework. That is our role.

Senator CAMERON: Can you provide me, on notice, details of your productivity measures that you are looking at? How those productivity measures can be affected by the staff is on notice. I want you to delineate cost cutting from real productivity. Can you give me your definition of productivity?

Ms Campbell : We will give you the definition according to the Australian government framework. We will provide you the information as per that framework.

CHAIR: This will have to be the last one.

Senator CAMERON: Do you agree that you suspended negotiations?

Ms Campbell : No I do not. Suspended?

Senator CAMERON: Suspended.

Ms Campbell : I do not think we suspended.

Senator CAMERON: What did you do?

Ms Campbell : I think we were working with our bargaining representatives. We put some material on the table. My understanding is that we then went to Fair Work. Ms Talbot can take you through the details of what we did.

Ms Talbot : Obviously we went to the Fair Work Commission. After that we then continued to have conversations about the agreement. We provided a further revised working draft agreement.

Senator CAMERON: The question is: did you suspend or not suspend?

Ms Talbot : No, we did not suspend negotiations. We made it quite clear—

Senator CAMERON: Last question. You are getting feedback from your staff. You must be getting feedback that they are not prepared to accept cuts to their standard of living through the CPI position and they are not prepared to accept cuts in relation to their conditions. How are you going to deal with that inevitability and that reality?

Ms Campbell : We continue to negotiate with staff within the framework as provided.

CHAIR: We will leave that there. Senator Peris.

Senator PERIS: I was going to ask the minister if I was able to get an emergency briefing on the current situation in the Northern Territory with Cyclone Lam.

Senator Payne: Yes.

Senator PERIS: When would I be able to—

Senator Payne: Do you want to negotiate diaries across the estimates table?

Senator PERIS: No.

Senator Payne: We will be in touch with your office.

Senator PERIS: Thank you.

CHAIR: Thank you, Senator Peris. Senator Siewert, for just a few minutes.

Senator Payne: If we may, we have one point of clarification for the record.

CHAIR: Certainly. Mr Hutson.

Mr Hutson : I just wanted to correct the $565,000 that we were speaking about with Senator Xenophon.

Ms Campbell : In the child support case that Senator Xenophon had raised.

Mr Hutson : Those expenses were just external to the department.

CHAIR: Thank you. Senator Siewert.

Senator SIEWERT: I want to go to the issue of the independent assessment that you are now using for people with disabilities.

Ms Campbell : The medical doctors.

Senator SIEWERT: The medical doctors, sorry. That has been implemented from 1 January; is that correct?

Ms Campbell : Yes.

Senator SIEWERT: How many people have been now assessed through that process?

Ms Campbell : There is someone coming to give you that now.

Ms Golightly : I am sorry, I did not actually hear the last part of the question.

Senator SIEWERT: How many new people have now been assessed through that process—it is a double bang one, this one—and also is it being used for the review process that is going on?

Ms Golightly : In terms of the first part of your question, there is only a certain cohort of people who are in scope at this stage.

Senator SIEWERT: Can we go back to the in scope in a minute?

Ms Golightly : We are introducing it in a phased way. As of 25 February we had received 673 new claims for those people who would be in scope. Those claims are in various parts of the process.

Senator SIEWERT: How many of those have actually been assessed by the independent medical process?

Ms Golightly : The process is that they are first tested for base eligibility, residency, all that sort of thing. Then they have to go to a job capacity assessor. After that they go to, if they need to be reviewed on medical grounds, the government-contracted doctor. We need the records, of course, from their medical provider. At this point in time there has only been a small number of that total that have made it through to that end of the process.

Senator SIEWERT: They actually go through the job capacity process first?

Ms Golightly : First, yes, basic eligibility test first, like residency and that sort of thing but then job capacities.

Senator SIEWERT: So not everyone is going through the independent assessment?

Ms Golightly : No. Only if they have made it, I suppose, past the other barriers.

Ms Rule : The disability support pension has a rejection rate of about 60 per cent. We are trying to get people through the job capacity assessment process first, so we are only referring through to the government-contracted doctor once they have already been through some of the other assessments so that we are using the resources in the most efficient and effective way.

Senator SIEWERT: In other words, they are found not to have what?

Ms Rule : The job capacity assessment assesses the person's level of impairment against the impairment tables. There is a high rejection rate once we assess people against those impairment tables that we find they are actually not qualified for DSP. So it is only if they qualify against the impairment tables that we then refer them on to check that they are medically qualified.

Senator SIEWERT: We send them through another—

Ms Rule : What that means is that we are looking to see whether their medical condition is fully treated, diagnosed and stabilised.

Senator SIEWERT: How many people of the 673 that have applied have been through the job capacity assessment and then gone for independent medical assessment?

Ms Golightly : I think we have got around 20-odd people who have got through to that stage and have either just had their medical assessment or have booked in to have their medical assessment.

Senator SIEWERT: What does 'in scope' mean, when you say you are staging this through?

Ms Golightly : For the first part of the first phasing we are starting with people who are under 35 and in capital cities. We will gradually ramp that up. By the end of June it will apply to all.

Senator SIEWERT: New applicants?

Ms Golightly : New applicants, yes.

Senator SIEWERT: What about the 35-year-olds that are in that new process?

CHAIR: This is the last question, so please answer that. I have one question. Senator Cameron has one very brief question. We will allow the answer.

Ms Rule : The measure came into effect on 1 January. So any new claimant after 1 January who is in scope--that is, under 35 or in capital cities, is subject to the new process.

Senator SIEWERT: Thank you.

CHAIR: Very directly.

Senator CAMERON: On this issue of the DSP review, has DHS followed up on any of the recipients who have been moved from support pension to Newstart in terms of what that implication is for their capacity to keep a roof over their head, meet their bills, meet their payments? Has any of that been done? The feedback I am getting is that there are people with intermittent mental issues who are now on the street because of this review. Is that true?

Ms Golightly : The support that we provide anybody on any payment is the same. If someone is having difficulty they are able to come to us. We talked about advanced payments, for example, before. We do not have a register of people that—

Senator CAMERON: So you assess. You cut them off DSP, they go to Centrelink and then you wash your hands of it. That is ridiculous.

CHAIR: We have run out of time. He was making a rhetorical point and perhaps it is better not to respond to rhetorical points. Very briefly, we had the opening of the one-stop shop in Woden recently, which was excellent. The staff were excellent. Thank you for that. I did have a bit of feedback around people not necessarily knowing where it is. It is a bit past the interchange, and some elderly Canberrans fed-back on the radio that day. In terms of the signage—maybe it is not so much signage, maybe it is advertising generally for people to know. If I can feed that back and that can be taken into account to make sure that people do know where the one-stop shop is.

Senator Payne: Thank you.

CHAIR: Otherwise I was very, very impressed with the staff. They were excellent.

Senator Payne: Thank you.

Senator SIEWERT: Can I ask one clarifying question about a number? That is all I need.

CHAIR: If it is a number, go, very quickly.

Senator SIEWERT: Of the 673 people in scope how many were under 35?

Senator Payne: All.

Ms Campbell : They are all under 35.

Senator SIEWERT: Thank you.

CHAIR: Thank you, minister, thank you, Ms Campbell and all of your staff. We will now break for one hour. We will be back at 1.30 with DSS.

Proceedings suspended from 12 : 30 to 13 : 29