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Wednesday, 29 April 1987
Page: 2204


Mr BLUNT(5.01) —I am responding to the Social Security Amendment Bill 1987 on behalf of both Opposition parties. This Bill can truly be described as a machinery Bill. It proposes to amend a very large number of sections of the Social Security Act. The legislation was rushed into this place during the last sitting period of this Parliament when the Government was of the opinion that it might go to the polls. There was a need to do some housekeeping within the Department of Social Security and to make some changes to the mechanics of the administration of the Government's welfare policy. Unfortunately, the Government received the wrong news from its Party opinion polling and decided that it really could not afford to go to the Australian people because it would not be re-elected if it did so. For that reason the Bill was not proceeded with during that sitting period. It has now been brought into the House.

As I said, the Bill is extremely comprehensive in terms of the changes it proposes to make to the Social Security Act. On behalf of the Opposition parties I formally advise that we will not oppose this Bill. We believe that the Government has an entitlement and a right to change the mechanics and the legislative basis on which it operates its social welfare policy. We do, of course, have grave reservations about the effectiveness of that policy and its consequences both to the Australian taxpayer and the people the Government purports to be helping. As I said, this Bill is comprehensive. It proposes many changes to the Act. For example, it requires that a formal request be made to apply the hardship provisions of the assets test. Of course, we all remember this Government's record on the assets test-the beginning of what can only be described as a litany of offences against the aged and the retired members of the Australian community.

This legislation also provides for the index- ation of the threshold limits on the assets test, and we support that. I reiterate on behalf of both Opposition parties our commitment to repeal the Labor Party's assets test when it is replaced as the government of this country after the next election. The legislation proposes several other changes relating to what could be described as double dipping into the social welfare system by students on allowances who may seek to obtain the unemployment benefit. The legislation requires all decisions of the Department of Social Security either to be in writing or be recorded on computer. It also provides that all decisions should be able to be appealed against or reviewed. This is a very important provision which I am pleased to see has been codified in this amending legislation.

The legislation also seeks to make changes to the secrecy provisions of the Act and brings the requirements for officers of the Department into line with the current secrecy provisions of other Commonwealth legislation. It makes changes to the supporting parent's benefit extended to the spouse of a person in custody. It changes the waiting period for the availability of rent assistance. It distinguishes the young homeless allowance from the special benefits for under 16-year olds. It changes the provision for the recovery of payments from compensation claims. That is a very significant change. Under the present arrangements, it is difficult for the Government to know exactly who is receiving compensation. A person who is injured at work or in a motor vehicle accident and who is unable to earn an income is eligible for sickness benefit, the invalid pension or a special benefit. If, as a result of a claim for compensation, a lump sum payment is made, it is important that the Commonwealth be able to recover the value of the income support payments made to that person during the time that he or she was waiting for compensation payment to be made.

The legislation imposes penalties on financial institutions involved in the direct credits payments system for not complying with notices from the Department of Social Security. It increases those penalties significantly from $1,000 to $10,000. It also makes significant changes to the penalties, both monetary and in terms of imprisonment, for clients of the Department-that is, people receiving benefits from the Department of Social Security. I will have more to say about the bona fides or perhaps the attitude of the Government in this area. There is a significant increase in the level of penalty that is proposed. However, in other areas of the Government's activity we wonder whether it is genuine in requiring people receiving benefits from the Department actually to provide the information that the Act notionally requires them to provide. As I said, this Bill increases significantly the penalties for clients. Fines in respect of notification and review requirements are to be increased from $500 to $1,000, or six months imprisonment. The fine for a body corporate will go up to $5,000. In the context of that amendment, it is interesting to note the agreement that the Department-that is, the Government-has reached with the Administrative and Clerical Officers Association, the union that has jurisdiction within the Department of Social Security. The Government is undertaking a review of people who have been unemployed for a long time-that is, over two years. It is interesting to note that under this Government's administration the number of people unemployed for over two years has ballooned dramatically. In fact, the possibility of the long term unemployed gaining employment under the administration of the Hawke-Keating Government has declined significantly.

The Government has introduced what it describes in its Budget update as a review of the long term jobless-interviews for long term jobless. The Minister for Social Security (Mr Howe) frequently makes statements about his initiatives in this area. Part of that review process relates to the package of paper I have before me which contains the Government's initial proposal in this area. The Government sought to undertake a review of the status of both the personal and financial positions of people receiving the unemployment benefit. This was announced with great fanfare as part of the Budget measures. Numerous Press releases were put out by the Minister saying: `This is the end for the dole cheats. We are going to take a hard line on fraud and overpayment'. When this was introduced by the Minister, the ACOA said: `No you don't; we are not going to do it. There is a work ban on it. It is not going to happen'. Nothing happened in terms of the review of the long term unemployed. Work bans were also placed on the review of the supporting parent's benefit. That was part and parcel of this Government's so-called crack down on social security fraud.

As a result of that industrial action by the ACOA, the Department sat down and did a deal. This deal amounts to a sell-out-a sell-out on the policy of cracking down on people who cheat the system and a sell-out on the Australian taxpayer. What it really comes down to-and this is summarised fairly clearly in the social security bulletin put out by the ACOA-is that the interviewer, an officer of the Department, will decide which questions will be asked. The only actual requirement is for the client to sign the declaration. It is very important to note that he has to sign the declaration only once. The original proposal of the Government was that each page of this declaration would be signed by the person receiving the benefit. This very comprehensive and detailed questionnaire was the linchpin of the anti-fraud measures. However, what it comes down to is this: The interview officer will decide what, if any questions, are to be asked. The person receiving the benefit is required to put one signature on the questionnaire instead of signing every page. That is the sum total of the Government's review of the long term unemployed. The Minister has put out a statement in which he tries to put on a brave face. I take the view that the Minister is quite happy to do this deal because he really did not want to have these review processes anyway. He was forced into doing something because of the pressure applied by the Treasurer (Mr Keating), and the Minister for Finance (Senator Walsh) and, of course, community opinion which regards his administration of the Department of Social Security as nothing short of disgraceful.

After four years of the Labor Government, overpayment and fraud within the Department is at record levels. For the past three years the Auditor-General, in report after report, has said that the management and administration controls of the Department are not being applied; that there are serious breaches; and that there is a significant problem. Some people-not me-have extrapolated the degree of overpayment and fraud. The degree of overpayment and fraud is $1 billion. Total expenditure of the Department is around $18 billion, give or take a few hundred million. But if we extrapolate the degree of overpayment and fraud in the Auditor-General's findings we discover that the amount is up to $1 billion, perhaps more. No-one knows for sure. The Minister and the Department do not know-and I will go on to prove why they do not know-whether the figure of $1 billion is high, low or spot on. But it really does not matter. There is overpayment and fraud. The Auditor-General is telling them that there is something wrong with their administration. Every member of the community knows that there is something wrong. When we go and talk to the welfare groups they say: `People do cheat on the system but we turn a blind eye to it because we think they need the money.' People come and see me as a person interested in this area. They go and see their local members and talk to them about the problems. We all know that cheating is going on. For the Minister to say that cheating is not going on and to suggest that the measures that he has supposedly introduced are doing something about it is not accurate and I believe that it is a quite misleading position for him to take.

The reality is that there is a high degree of fraud and overpayment within the social security system in Australia. Only the other night on the way home from the airport the local taxi driver told me that the majority of his colleagues driving taxis on the Gold Coast are also claiming the unemployment benefit. Let me tell the Minister, who is in the House, that the overwhelming majority of professional fishermen in some parts of Australia are also claiming the unemployment benefit. In case the Minister does not understand how the system works, people who work as professional fishermen go out fishing when they can, when the weather is appropriate. If, for example, they are catching mackerel they get $50 cash for each mackerel that they catch. But that does not prevent a fisherman from going into the local office of the Department of Social Security and saying: `No, I am not working. I am available for work'. These fishermen have to show up at that office once very 14 days but that does not stop them from catching these fish which bring in $50 a time. They get paid cash for these fish, they put that money in their back pockets and they collect payments from the Department every 14 days. That is the reality of the social security system that this Government is administering. It does not enforce the work test.

Only the other day the Prime Minister (Mr Hawke) said in Victoria: `There needs to be a tougher work test'. It was my belief-I believe that the Minister's statement should be taken at face value-that he had toughened up the work test. I have on file copies of his Press statements that go back a year which state: `The easy time for the dole cheats is over. The work test will be enforced. We will crack down on them'. But only a month ago in Victoria the Prime Minister was saying: `We need a tougher work test'. I come to one conclusion: Either the Prime Minister does not believe the Minister or the Minister has not told him that he has toughened up on the work test-one or the other.

It could be inferred that the Prime Minister knows what we all know; that is, many people are cheating on the social security system and the work test is not being enforced because the Department of Social Security does not get on very well with the Commonwealth Employment Service. The reason it does not get on very well with the Commonwealth Employment Service is that the information that it gets from the Commonwealth Employment Service is not accurate. Of course, that is addressed in the agreement that the Minister has made, through his Department, with the Administrative and Clerical Officers Association. The ACOA has said: `Most of the information we get from the Commonwealth Employment Service is inaccurate and we refuse to process it. We refuse to do anything about it. We want you to take the responsibility for even looking at this information away from the regional officers into some central location. Maybe you can decide whether it is worth doing something about it'.

Notwithstanding the fact that there is almost a breakdown in communication between the Department of Social Security and the Commonwealth Employment Service the Minister has made statements saying that it is very important for officers of the Department of Social Security to stress the close working relationship between the DSS and the CES. What utter rubbish! He negotiated an agreement, to which he has linked the imprimatur of his Department, which is entitled `Agreement between ACOA and DSS'. If the Minister has not read this agreement perhaps he should because this is the deal. Section 3 of the agreement talks about DSS-CES liaison and that is what it really comes down to.

Let us get back to the two-year review of unemployment beneficiaries, for which this Bill changes the penalty provisions. If a person provides misleading information under this review that person will pay a higher penalty. But he will not have to provide any information at all. As I have said, this is a multi-page document which asks a whole stack of questions but, under the deal done with the ACOA, there is absolutely no requirement to ask any questions. The other day the Minister put out a statement which said that, after a review of the form, it was found that it would be expedient and perhaps more efficient to drop certain questions. It would have been more accurate to say that it was expedient to agree to the union demand that no questions at all be required to be asked. The only requirement imposed on officers of the Department of Social Security is to obtain one signature on the questionnaire-not even a signature on every page, although every page contains a provision for a signature.

Of course, there is also some significance in this lack of signature. There is a provision in this Bill that imposes a higher penalty for providing misleading information. If the questions are not asked it will be very difficult for people to provide misleading information. But if the page is not signed I wonder whether it will be possible for the Department to take any action, even if the information is misleading, because there is no acknowledgment by the beneficiary of the Department that the information has been provided by him and that it is, prima facie, accurate. That is the sort of administration we have; a complete sell-out. If the Minister had any commitment to stopping fraud and overpayment he would not have done this deal with the unions. It totally undermines any hope he may have had of stopping the rip-offs and the rorts that go on within the Department now in terms of the unemployment benefit. It is an absolute disgrace.

What compounds the disgraceful behaviour of the Government in this area is the fact that it continues to purport that it is doing something about social security fraud and overpayment. It is doing nothing. It has prepared this expensive and complex form and, as soon as the union puts some pressure on the Government, it walks away from it. There has been no attempt by the Government to enforce its policy. The whole exercise was one of window dressing. It had some factional politics in it because, as I have said, the Minister was forced into it by his colleagues within Cabinet and there was a need to be seen to be doing something. He is desperately hoping now that people will forget that this proposal will not be implemented. No action will be taken.

I said that there was an increased penalty for providing false and misleading information. I also said that there was no longer a requirement for beneficiaries of the Department even to sign information. They have to give only one signature and they probably will not even be asked any questions because the ACOA news bulletin states, under a fairly bold heading, that the only requirement on an officer is to obtain one signature and what questions will be asked will be at the absolute discretion of the interviewing officer. If the Minister put out a Press release the other day stating that he had deleted 12 questions and he believed that that was the situation, he was very badly advised by the officers of his Department. They did not show him the bulletins coming from the ACOA.

For the benefit of members of this House let me take a moment to go through the ACOA Social Security Bulletin. It is headed `Urgent. Breakthrough in Negotiations on New Initiatives'. It states:

A major breakthrough has been achieved in negotiations around the introduction of new initiatives. An offer from DSS was made on Friday which includes the following concessions to ACOA's claim: office closures-from 1.30 pm each Wednesday.

I do not know what happens if a client of the Department of Social Security has a problem after 1.30 p.m. on Wednesday because the Department does not answer its telephones.

The overwhelming majority of people who receive a benefit from the Department are in genuine need. They have crises from time to time in their lives and perhaps they need to talk to the Department, but after 1.30 p.m. on Wednesday they cannot talk to anyone. Initially, when this concession was agreed to, the phones just rang. No one even picked them up. Now, someone will pick them up and say: `I am sorry, we cannot do anything for you. Ring us back tomorrow'. Many people who get benefits from the Department of Social Security do not have their own phones at home: They have to traipse some distance and perhaps catch a bus to use a public telephone, if they can find a public telephone that works.


Mr Tim Fischer —And they miss out on the telephone concession too.


Mr BLUNT —And they missed out on the telephone concessions too, perhaps as a result of this Government's policy. But after 1.30 p.m. on Wednesday, no one can help them; they must ring back tomorrow. This is very interesting:

No action on the backlog of inaccurate CES advices.

There is to be central, not regional, processing `to eliminate incorrect and excess information'. Notwithstanding this, the Minister says that there must be a close working relationship between the DSS and the CES. Let me tell the Minister that in some places they do not even speak to each other. There is absolute animosity between the staffs of the two offices and the ACOA has refused to do anything to clear the backlog, as this orange paper says. I hope that the Minister is aware of this.

Point three relates to the discretion of the interviewer in the two-year unemployment reviews to determine the format and length of interview. There is no mandatory use of BC20, which is the form, and there is the removal of the counselling function regarding employment. Yesterday the Minister, in response to a question from me, said that the purpose of the review of the long term employed was not only to stop fraud-and I have demonstrated that it will not do anything about stopping fraud-but also to provide counselling services. It says in the document that the ACOA has achieved a concession from the Minister that there is no longer any counselling function. What exactly is the Minister on about? There is no fraud, the Minister has given away the obligation to ask questions, and he got up in the House yesterday and said that there is to be a counselling function. Yet he has done a deal with the ACOA which says that there is no longer any obligation to provide a counselling function-so there is nothing left in the review, no anti-fraud, no counselling function, just a whole stack of paper and a stack of press releases trying to convince the Australian people that the Minister is doing something. He has sold out completely. Maybe he did not sell out. Perhaps it is what the Minister proposed to do originally, but he has sold out on what the Treasurer and the Minister for Finance expected him to do because they also happen to know that there is a problem within the administration of the Department, just as every member of the community knows that there is a major problem.

Let us go to the national agreement of the ACOA's claim on POI-proof of identity. What it comes down to is that under this agreement with the Department there is no longer a requirement in the review of the long term unemployed to ask any questions about proof of identity. The Department is not even intending to ask persons to prove who they are. We are about to have forced on us again, when the Government has the nerve to pursue it at some later stage, an ID card. Identity is so important to the Department of Social Security that it does not even require people to prove their identity when it reviews the long term unemployed. That proves the point that I have been arguing for some considerable time-that the degree of fraud within the Department of Social Security related to false identity is not very high at all. The Minister has de facto acknowledged that by conceding the point about proof of identity in the deal he has done with the union. It would be honourable of him to stand up and say that the ID card will do nothing for the Department of Social Security in proving identity because identity is not a problem. If it is a problem, why has the Minister conceded to the union that it does not have to ask these questions on proof of identity? They are simple, basic questions about proof of identity. The Minister has said that the Department does not have to ask those questions, and yet he is going along with the right wing Labor Party line about ID cards. It is about time we had a consistent, forthright, honest and principled answer on the question of identity within social security and what bearing it has on fraud.

This agreement also extends to the sole parent review. The short 12-week review form is to be used for the interview. There is no mandatory use of the longer, more comprehensive form, the form that gave some potential for uncovering those people who are rorting the system. The interviewer is to determine the length and depth of interview, and there will be an extended period before cancellation. One talks about the bona fides of this Government in doing something about social security fraud and overpayment. Without even reading the details of this bulletin which goes out from the ACOA to its members, attached to which is a detailed copy of the agreement, I have proved conclusively that this Minister and this Government have no commitment whatever to doing anything to stop fraud and overpayment. All we see are a number of Press releases from the Minister saying that he intends to do something about fraud. But when it comes down to the nitty-gritty, when the Minister gets the opportunity to say to officers in his Department `This is what we shall do to stop the rip-off merchants, bring some integrity back into the social security system, and start to reel back the billion dollars worth of fraud in overpayments', what does the Minister do? He sells out. He says that there is no requirement to ask questions. Nothing is to be done about processing CES information. The Department does not have to get people to prove their identity-that is not important-but the Government intends to have an ID card which costs taxpayers a billion or more dollars. The Minister has the nerve to come into this place and to go around the community saying that he is doing something about fraud and overpayment. Press release after Press release has been issued saying, `We are going to stop these things and we have caught all these people'.

Let us look at the history of this matter. The Treasurer said in Parliament last year that there are 10,000 people getting unemployment benefits who should not be getting them and that the Government intended to do something about it. I agree that at least 10,000 people who are getting unemployment benefits should not be getting them and that something should be done about it. The Government announced that it was to have flying squads, hit teams, that would go around the country catching the cheats. I think that the Government set up about six teams. They came to my electorate on the north coast of New South Wales, they came to the Gold Coast, and to the northern beaches of Sydney and they say that they have caught 1,800 people who were getting unemployment benefits they should not have been receiving. What does the Government intend to do with those 1,800 people? Will it prosecute them? It has caught 1,800 of the Treasurer's figure of 10,000 people, which is a pretty conservative figure anyway. I figure that if people are cheating on the system, particularly after the Government has run an amnesty suggesting that those who are cheating and who tell the Government will be let off, and after that amnesty is over the Government has caught 1,800 people, the Government should prosecute them. I do not think that it will prosecute, because last year for every cheat caught within the Department of Social Security, not just in unemployment benefits but in every benefit category, the Government bothered to prosecute only 1,800 people. The Government has now caught 1,800 unemployment benefit cheats, and I wonder whether it will prosecute them.

The Government has caught 1,800, the Treasurer says there are 10,000 and it is now nearly the end of April. On the Treasurer's estimate, he was to catch them all by the end of this financial year. I wish the Minister luck in catching another 8,000 cheats in May and June. It cannot be done. The Minister says that there will be another 15 flying squads or hit teams around the country, but they will not catch 8,000 people in two months. They will be lucky if they can talk to 8,000 people in two months. The reality is that the only way to stop fraud and overpayment within the social security system is to look at the basis of the system and start changing it.

Unemployment benefit should be a benefit of last resort. It is essential that we go back to a needs basis, that we enforce the work test on a daily basis, that we require service or work in return for benefit; that we stop paying unemployment benefit to under 18-year-olds and get them back to school, enabling them to get an education; that we rationalise the level of income support paid to students and the unemployed. It is time that we stopped paying 16-year-olds to leave school and sit in milk bars and on beaches, and that we crack down on people who are cheating the system. When we catch cheats we should penalise them. If somebody steals one's motor vehicle, he or she should be penalised. If people steal from the taxpayer's purse, they should also be prosecuted and penalised.

Under this Government there is no commitment to return integrity to the social security system. The Government's attitude is that it will continue to pay out money because it is a lot easier to do so. What the Government does not recognise is that the taxpayers have just about had enough. There is a hardening of community attitudes to cheating within the social security system. Unfortunately, all people who are on benefit are tarred with the one brush, unfairly, but until the Government acts to stop the cheating and penalises the cheats, everyone on benefit will wear and continue to wear the community's opprobrium. The Government should act for the benefit of fair dinkum people who need help, to clean up the system and do something about it. The Government should not sell out every time a union puts on a bit of pressure because the union does not want to ask the questions. There should be a genuine commitment to providing more manpower resources to enforce the eligibility requirements for all benefits. The basis of the union's objection is that the Government will not provide a reallocation of manpower resources within the Department to ask the questions. Under this Government the Department has reduced the number of field officers and has transferred those field officers who remain from investigative work to payment work. Until there is a reordering of priorities, until we have a genuine commitment to making sure that the social security system is dedicated to helping those who are in need and stopping the rip-off merchants, we shall have a continuing decline in community attitudes.

It not only has been an impact on people in genuine need; it also has an impact on the attitudes of our community. There is an attitude that social security is a fair cop; that if a person holds out his hand someone will drop some money into it and that is good. If a person can get a bit more on the side by working, he should go to it because if he does not he will only be a mug because everybody else is doing it. The damage that is doing to incentive and attitudes within our community is absolutely horrific. Until Australia recognises that we have to work to earn our income, that no one owes us a living and that we cannot hold out our hand and get money for doing nothing, we have no hope of competing in this rapidly changing world.

Unfortunately, the philosophy of administration that is being fostered under this Government's administration of social security is perpetuating the attitude that people can get something for nothing. Let me tell honourable members that people cannot get anything for nothing; they should have to work for it. People should get welfare only when they are in need and we should have a needs based welfare system in this country, not a system that pays benefit to anyone who asks for it. As I have said, the unemployment benefit should be a benefit of last resort. We should not encourage our young people to leave school and get a benefit; we should be encouraging them to stay at school. I repeat that the Opposition parties do not oppose this Bill.


Mr DEPUTY SPEAKER (Mr Rocher) —Order! The honourable member's time has expired.