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Tuesday, 7 February 2017
Page: 5

Mr TUDGE (AstonMinister for Human Services) (12:19): We will not be supporting this suspension motion. I would like to speak on it and address the points that the member for Denison has raised. The way I will do that will be by stepping back and explaining to the member for Denison and to this House exactly how this process works. It is a process, by the way, which has been around for a very long time.

As has been the practice since 1990, when Labor introduced the Data-matching Program (Assistance and Tax) Act, we check the self-reported income to Centrelink with the income data held at the Australian Taxation Officer. Where there is a discrepancy between those two sets of data an inquiry is made of the recipient as to why there might be a discrepancy. That is not a debt notice, as the member for Denison suggested. The first letter which goes out is stating that a discrepancy has arisen and asks them to please explain why that discrepancy might exist. At all times a person can speak to a Centrelink official in relation to that letter or in relation to any issue which they may raise.

Sometimes people can explain why there is a discrepancy between the two sets of data. It could be, for example, that an employer has incorrectly written the dates of employment in his or her report to the ATO. That enables the recipient to be able to correct that record, and that can be the end of the matter. That occurs, to date, in about 20 per cent of occasions. In about 20 per cent of occasions a person receives the correspondence from Centrelink pointing out a discrepancy and is able to validly explain why there is that discrepancy, and that is the end of the matter. In the other 80 per cent of the cases, there has not been a response or there has not been a valid explanation as to why there might be a discrepancy. In that instance, a debt notice may be given.

I point out, as I said at the get-go, that this has been a practice going back to 1990, when Graham Richardson introduced the data-matching act. It was then actually refined in 2011 when some automation was introduced by none other than Bill Shorten, who is now the Leader of the Opposition, and the person who is now the Deputy Leader of the Opposition. Of course, in our 2015-16 budget we decided to further expand this amount of work to cover more people, and my department has been implementing that initiative since. But at all times the basic methodology of the data checking has been exactly the same.

Why do we have to do this data checking? That is the important question here: why do we have to do this?

Unfortunately, amongst the five million people who at any time might be on income support payments, the vast majority do exactly the right thing, but there are some who deliberately defraud the system and there are others who inadvertently do not update their income details correctly and consequently may have received an overpayment. I would like to give some examples of such people. One such person, in a very stark example, was a Queensland gentleman who was receiving Newstart for all of financial years 2011-12 and 2012-13 and, during the two full years that this man was on Centrelink payments, he had declared less than $5,000 of employment income to Centrelink. However, the Australian Taxation Office data showed that he had in fact earned $100,000 during that time, so consequently the person was given the opportunity to explain, but a debt has been raised against that individual. That was an individual, by the way, who was not picked up by the Labor Party when they were in government, but we have picked it up now, and I think it is quite right that we ask that individual to be able to explain why there is such a stark discrepancy and why they reported $5,000 for those two years but the Australian Taxation Office reported $100,000 for those two years. Another example is another Victorian male who was on Newstart for all of financial years 2010, 2011 and 2012. During that time they declared less than $11,000 of employment income. However, the Australian Taxation Office showed that they had earned more than $65,000 during that time. Again, that had not been picked up in the past, but it has been picked up in this particular example. There are countless examples like this.

I point out that even in the single example, I think, that the member for Denison raised publicly in the media, in a doorstop which he did with a particular individual, we looked at her file—as the member would know, the Social Security Act allows us to correct the record if there has been misinformation—and this person was on a Centrelink payment for the duration of full financial years and during that time declared only a very small amount of income, but the Australian Taxation Office records showed that, in fact, she earned quite a considerable amount of income and consequently a debt has been raised with that individual.

I should point out, by the way, that between Mr Wilkie and the Labor Party there have been some 52 cases put up to the media. Of the 52 cases that have been highlighted in the media, a third were not even related to the system that we are referring to, including, by the way, the example which the member for Denison referred to. This is Department of Human Services information that they have provided to me. The majority of the cases that were part of this system, which has been operational since last July, have also had examination. In fact, in the majority of cases the evidence to date shows that those people also owe money back to the Commonwealth. These are the ones that have been highlighted in the media, let alone the ones that have not been highlighted in the media.

No-one likes to receive a debt notice—no-one likes it; of course they do not—but we have to be fair and reasonable. We have to be reasonable to the recipients of welfare, but we also have to be fair and reasonable to the taxpayers who are working very hard to pay for the welfare system and they expect us to do this checking work to ensure there are not overpayments, which some people have clearly received. How can we be reasonable to recipients? We can do so by not giving them a debt notice straightaway but asking them to validate the information or clarify, and that is exactly what we do. The member for Denison knows we have already put in place some additional refinements to the system and will constantly put in place additional refinements to the system. That includes making the 1800 number more accessible and more easily identified by people so that they can find it. To the member for Melbourne's point, there is always that 1800 number which people can get through quite expediently to talk with an official and be able to address their particular issues.

I should point out also to the member for Denison who has moved this motion that, if people receive a request for information and indeed even if a debt notice is subsequently given to them, having updated some information, they still have multiple opportunities to go back and update their information should they choose to. I am sure the member for Denison would have informed his constituents of that. They can get a reassessment, they can have a review and they can appeal on top of that, so they have additional options available, which I am sure the member for Denison would have informed his constituents about if they felt aggrieved in relation to their particular debt notice.

I stress this point in the last minute which I have available to speak on this particular matter: the system has to be reasonable to the welfare recipient, but it also has to be fair and reasonable to the taxpayer. Today there are workers across the country who are busting their guts and paying their taxes and a significant part of their taxes goes towards supporting the welfare system. I think they are happy to support the people in need, but they want to be sure that the payments are right, that there is not a payment which is an overpayment and that there is not an underpayment. That is exactly what this system is designed to do. Data checking has always been a feature of successive governments going back to 1990. If there is a discrepancy, the individual is asked to explain why there is a discrepancy and if they cannot they are asked to pay back any debt which they may owe. I think that is fair for the taxpayer and I think what we are putting in place is reasonable to the recipient also.

The SPEAKER: The time allotted for this debate has concluded. The question is that the motion to suspend standing orders be agreed to. I think the noes have it. In accordance with standing order 133, the division is deferred until after the discussion of the matter of public importance. The debate on this item has adjourned. The division will be revisited at 3.30.