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Social Security and Other Legislation Amendment (Welfare Payment Reform) Bill 2007 and four related bills concerning the Northern Territory national emergency response

CHAIR —I welcome the witnesses from the Australian Council of Social Service.

Ms Woodruff —I am from Uniting Care Burnside but here with ACOSS.

Mr McCallum —I am also CEO of the Association of Childrens Welfare Agencies in New South Wales.

CHAIR —Would you like to make a short opening statement and then we will ask questions?

Mr Johnson —We thank the committee for the opportunity to speak. We refer the committee to the Combined Aboriginal Organisations of the Northern Territory’s request that there be a delay in the legislation’s passage so that it can be properly assessed by the Australian community via the parliament and that negotiations and consultations be urgently begun with the Aboriginal people of the Northern Territory.

The submission which we have provided to you deals with the emergency response in the Northern Territory’s Indigenous communities, the proposed system of income management in those communities and finally the proposed system of income management across Australia in respect of children at risk and children not enrolled in or regularly attending school. We submit that these bills should not be passed in their present form and that more time be given to review them to make best use of the increased resources, increased opportunities and increased attention for the protection of children.

The federal government can take action today to fund effective and proven programs to ensure that children and families are safe and to ensure that investigations are begun to bring perpetrators to justice. The parliament can then take the time to ensure that legislation which is eventually passed focuses on effective and proven ways to protect children and improve the living standards and conditions of Aboriginal Australians.

ACOSS, like other Australian organisations and Australians, is deeply concerned about the longstanding issues of child abuse of Aboriginal children in the Northern Territory and child abuse and exploitation of children across the country. We also refer you to the Combined Aboriginal Organisations’ report entitled A proposed emergency response and development plan to protect Aboriginal children in the Northern Territory: a preliminary response to the Australian government’s proposals, which outlines a series of proven and effective programs that can be implemented directly. We also refer the committee to the many reports and recommendations that have been made to government over the last 10 years which are detailed in full in the report.

In relation to changes to land tenure, other submissions have dealt with the issues relating to land tenure and we also see no evidence of any direct link between the compulsory acquisition of five-year leases over prescribed townships and the problems of child abuse in Aboriginal communities in the Northern Territory. In relation to the suspension of the Racial Discrimination Act, we do not see the underlying reason to act contrary to the Racial Discrimination Act and suspend its provision. To deny appeal rights to any Australians is staggering but to limit it to Aboriginal people in the Northern Territory is unacceptable.

In relation to the income management regime and new activity requirements, the bill implements an apparently simple solution to a complex set of problems, attaching new conditions to social security payments and taking over family budgets to combat child abuse, truancy, prolonged joblessness and social breakdown in remote communities. The causes of these problems are complex. An income management regime does not address the underlying factors which cause so much pain to children suffering from abuse.

We point the committee to the Halls Creek trial. Parents participated voluntarily in a scheme to improve school attendance, but it was thwarted by inadequate engagement with parents by the school, problems of bullying and teasing at school and resistance from children themselves. School attendance did not improve, despite considerable efforts from Centrelink and the local employment service providers. This has to be seen contrary to the great results that have been achieved through the Clontarf program. There is a risk that income management, or the threat of it, could exacerbate tensions between parents and children or between parents, instead of helping to resolve truancy problems.

In relation to school attendance, we ask the committee to consider specific concerns before the bill is enacted. Parents and foster carers can be penalised for events beyond their control—for example, where they have just taken custody of a child who has longstanding problems with school attendance, or where there are conflicts between parents who share the care of a child. Income management is imposed on both parents. As you would be aware, where parents are sharing custody, one parent could have custody of a child for over 70 per cent of the time and the other parent could have custody for around 14 per cent of the time. Under the legislation, the misdeeds of either one of those parents in relation to encouraging school attendance would mean that both of those parents’ income payments would be affected.

There are privacy implications related to the legislation. For example, schools may be aware of which families receive income support. Another issue is the inaccuracy and timeliness of school enrolments and attendance records, which could be compounded by any attempt by Centrelink to replicate them on a national scale. Centrelink lacks the resources and expertise to assess the reasons for nonattendance at school and to work with parents and schools to resolve problems such as bullying or the quality of schooling. Another issue is the lack of clarity in the bill regarding the circumstances in which attendance will be considered unsatisfactory.

There will be a likely shift of resources, including school and community agency resources, away from effective measures that support parents in getting their children to school towards the administration of referrals to income management systems. There is a lack of requirement for a written warning to be given immediately before the imposition of income management. Finally, in relation to school attendance, it will be particularly difficult to administer these provisions fairly and in a timely manner in cases where families move frequently or parents have limited literacy skills.

In relation to child abuse and neglect, the specific concerns are that the bill does not appear to require state authorities or Centrelink to provide affected parents with reasons for notification to Centrelink for income management. The bill does not appear to limit the duration of income management or to require state authorities to justify extension beyond a fixed period. The effectiveness of voluntary programs to assist parents to deal with problems such as addictions and financial case management could be undermined by referrals to compulsory income management. Relationships between parents and child protection workers could be weakened by a notification to Centrelink to impose income management. Finally, in this area, there will be a likely shift of resources, including state protection authority resources, away from effective measures to protect children from abuse towards the administration of referrals to the income management system.

In relation to the operation of the income management regime, the specific concerns about proposals for income management are as follows. A major concern about the operation of the proposed scheme is that the normal appeal rights to the Social Security Appeals Tribunal and the Administrative Appeals Tribunal are denied to Indigenous people in the Northern Territory. These free, accessible and timely appeal mechanisms are essential for people on low incomes, especially those whose cash incomes are being reduced by income management.

There is too much discretion in the hands of the minister to determine the proportion of the various payments that can be withheld. A range of supplementary payments for specific purposes by people in vulnerable situations is included, such as bereavement payment, mobility allowance and carer allowance. Amounts withheld from payments are not kept in trust for the recipient and can be withheld for up to 12 months after the cessation of the income management. Income management can be conducted by private contractors rather than by Centrelink. This raises issues of accountability to parliament for the exercise of considerable discretion over the use of income support payments that will apply. Finally, in this area there are inadequate protections in the bill to ensure that recipients are assisted to meet essential expenditures, that they are consulted about expenditures and that they are kept informed about expenditures and account balances.

I turn now to unresolved questions. It is of great concern that this legislation is to be considered by the parliament when the key details of how the quarantining provisions will be initiated, determined and made operational are not established in the legislation. We therefore ask the committee to seek clarification on the following matters before voting on the legislation. Firstly, how will the income management be administered? For example, is the government considering a card or voucher model such as the US food stamp system, a compulsory version of the Centrepay system operated through Centrelink or the tendering out of financial management services to private or community organisations? Secondly, on what basis will those administering the scheme decide how income should be spent and what proportions of the quarantined benefits should be accorded to housing, nutrition, clothing and education? What evidence base will be used to make these determinations? To what extent will the recipients be consulted?

Thirdly, what will be the process to ensure flexibility in quarantining arrangements to account for marked variations in the cost of living in different cities and regions, particularly with respect to housing? Fourthly, has the Australian government reached agreement in principle or in detail with any state government over the application of the income management in cases of child neglect or truancy? Is there agreement regarding the respective roles of Centrelink and school authorities in monitoring and enforcing attendance? Fifthly, what will be the reporting relationship between state government departments, principally child protection and education authorities, and the Australian government? What privacy provisions, if any, will apply? What changes to the state legislations will be required to facilitate information exchange across levels of government? Finally, we seek clarifications for the reasons that, unlike non-Indigenous persons, many Indigenous persons will have welfare payments quarantined and will not have the right of appeal to the Social Security Appeals Tribunal. What is the reason for denying appeal rights to Aboriginal Australians?

CHAIR —Mr Johnson, this was to be a short opening statement. We have your submission. Would you like to make a concluding comment and leave time for questions? I do appreciate your very extensive opening statement with its suggestions, but perhaps you could wrap up with a closing comment.

Mr Johnson —Sure. In turning to what works and what can be done immediately, the federal government could immediately deploy trained, experienced and culturally appropriate child protection and children and family support workers to address the immediate needs children experience and the impact of abuse and neglect, establish safe houses for children and women and for young people, and consult and negotiate with Aboriginal communities. During questioning we are happy to talk about the key elements of an effective response, what can be done in the next three to six months and what needs to be done to ensure that all this time, effort and resources ensure that we get the best outcome for children and ensure that children and families are protected.

CHAIR —Thank you very much.

Senator LUDWIG —I would like to spend a little time going through the range of questions that you seek clarification on. Perhaps we could reverse the role and I could ask the questions. Some of them go to how the matter would be administered. How do you think the matter should be administered, given the way the bill is framed? Do you have a view?

Mr Johnson —In relation to the income management regime?

Senator LUDWIG —I was going to go through each of those if time permitted. Alternatively you could take that on notice and provide a short reply if you wish. You have suggested the question, but I was curious as to what your organisation’s view would be. Given the framework of the bill and what is likely to occur, what would you say is the best mechanism if we look forward to how it should be done?

Ms Woodruff —If I could answer from the perspective of being directly involved in programs that use the voluntary system, I think we can identify the elements that work. One of the elements that work is that it is a voluntary system. The second element that works is that it works in relation to case management and active support for the families, the couple or indeed sometimes the young person.

Whatever system we have, it has to empower people to take responsibility for their own finances, for their own lives, for their own children and for their own communities. I think it is extremely unlikely that you will get those outcomes if you impose from above, particularly if people are not consulted about how best that should be done. If we are to have a compulsory system then the absolutely crucial thing is that the casework, the support workers and the services that are required—and also the specialist services that people will need—assist people to learn how to do these things for themselves, rather than being dependent on a government making decisions for them. For example, if people are not spending their money on food because of drug and alcohol abuse—and I think this is an extremely questionable proposition, but let us say for the moment that that is the case—they will not stop, they will not learn how to do things differently, unless there are intensive and ongoing drug and alcohol rehabilitation services for them. And there is no mention of services such as those in the proposals that have been put forward.

Senator LUDWIG —That is helpful. In respect of the second one, which is a bit more difficult to answer from your perspective, can you provide at least a comment, given the nature of the bill and the way it will operate, on whether you share a view about how those schemes may be administered and how they may apportion quarantined benefits to housing, nutrition, clothing and education? You do not have to answer if you find that objectionable.

Ms Woodruff —I think there is a fundamental principle here, and that is about the engagement and the involvement of the people whose money you are planning to administer. That goes back to what is successful in the voluntary scheme—a negotiation with support people and Centrelink staff through Centrepay to determine what money is allocated for what purposes. You will find, if you look into the operations of the voluntary scheme, that people make different decisions depending on where they live, what their life circumstances are, what it is that they have particular difficulty paying et cetera. That is the only way you will get the engagement of people in this process, and if the people are not engaged then we will be running a top-down service controlling their lives forever because there will be no opportunity for them to learn the skills to do this themselves. That is how it gets allocated, in consultation with the person involved.

Mr Johnson —There is another point to make. It is important for creating dependency, but when you look at people on very low incomes they ration what they spend. People make choices from one week to another week to ensure that they can pay a bill at the end of the month. When this is being done on a very finite one- to two-week period, how are people going to make normal savings just to get their essentials or to pay normal bills?

Senator LUDWIG —Thank you; that is helpful.

Senator BARTLETT —I know that the general notion of doing this sort of quarantining of payments to encourage better behaviour has been floated for a little while. I am interested to find out from you how much detail of how it is going to work is in the legislation and how much of it is still a big question mark. You have raised a lot of questions in your comments and submission already. It seems to me, on initial reading, that it is really just a shell which gives an enormous amount of power for quite extraordinary intervention in the very fine detail of people’s individual lives. Within that shell, how many safeguards or what sort of framework do you see that at least gives us reasonable confidence that there will be some protections about how those processes will operate? Perhaps you can distinguish three levels: first, the Northern Territory; second, Cape York; and, third, the rest of the community. They are three distinct groups, and the Cape York one at least seems to have an assumption of a fair bit of engagement with the local community, but I do not know if that is in the legislation or just an assumption based on everything else we have heard.

Mr McCallum —There is an assumption within the assumption there that there is some evidence based efficacy factor involved in quarantining people’s income in this way, and I do not think you can point to anything that suggests that there is. When there are volunteer schemes in that regard, there is an engagement process that has some longitudinal or long-term indicators that say that people may then engage willingly and look at different ways of disbursing what is a very meagre income in the first place. But we tend to be jumping, in this particular situation, to a sense that this has some particular evidence suggesting that it will work to achieve the outcome.

Child abuse and neglect, which is seen to be the primary driver of all this, does not exist in isolation. Child abuse and neglect is not a point in time or an isolated incident; it has a whole range of contributing factors which go to the heart of housing, to education, to early childhood, to parenting education, to alcohol and drug treatment programs and to a whole range of other things. If we pick a point in time, all we are doing is maybe making people compliant with a regime, but they are not learning coping mechanisms or the ability to look into the future with some self-determination.

In my talks about this with child protection experts, I asked people like Professor Dorothy Scott, who is regarded as an expert in this field, ‘What would be the one thing you would tell the Senate committee?’ and she said, ‘Look at the sacred children report and implement the 97 recommendations.’ The first one is about consultation with local communities. That is where it starts and that is where we have to start with this, but we are jumping to end points here for which we do not have any evidence base to say that they will be successful. They may even marginalise and debilitate people even further.

Senator BARTLETT —I think some of you would have experience dealing with people who have regular engagement with our fairly large Centrelink system. Can you give us an idea of the level of bureaucracy that would be likely to be involved in properly implementing these—the numbers of extra hoops and the numbers of different ways people are going to have to engage with the whole welfare system, which is already not always as user friendly as it could be?

Mr Davidson —The legislation is very complex with regard to which benefits and which circumstances might trigger financial income management. In the area of school attendance, for example, it is not clear from the legislation that the state authorities or schools would notify Centrelink or trigger that event. It seems the bill leaves open the possibility that Centrelink would step in, obtain the records and administer the thing pretty much on its own. That option is there in the legislation, and that is one of the reasons we ask: are the state governments on board in relation to this? Centrelink, of course, has no expertise in the area of school truancy and no capacity, really, to influence what happens in schools. That in itself is problematic. Centrelink would presumably, in the event that the states do not cooperate, need to establish its own enrolment list for students and regularly check it and then interview parents to establish whether children are absent without good reason.

So the potential usage of resources is very large there, and then when financial management or income management does apply, because people are on low incomes—for example, a sole parent with two children on $450 a week, typically—and pretty much all of their income is being spent on essentials, the juggling act of doling out payments for bills, food vouchers or whatever I would have thought would be a fortnightly or weekly exercise. Again, it is very labour intensive, and inevitably essentials will be missed in that process because the income is low and people’s circumstances change so rapidly. So I would say it could, depending on the role that the states choose to play in this, be very resource intensive indeed, including in remote areas, where the availability of professional resources on the ground is very thin anyway.

Senator BARTLETT —You might need some extra resources for all the welfare rights centres to deal with that.

Senator SIEWERT —The department told us this morning that it would cost $88 million in the first year. I assume that is for the NT, because the rest of it will not be rolled out until later. Does it sound like they have got that right?

Mr Johnson —I guess one of our points about getting it right is that it is about ensuring that the support and services are on the ground. What is really going to make a big difference to ensuring children are protected is safe homes. We have to have the supports and services—child protection workers and family centres—that families can go to as an initial port of call. They can then go to more referrals to specific services that are needed. Another issue, which seemed to be lacking this morning, is about ensuring that adequate safe and affordable housing is available. That is partly about protecting children and partly about realising the rights of children under the Convention on the Rights of the Child. That is an area that desperately needs to be addressed, and that kind of money is not there. We need to look at the emergency measures we can take right now to ensure that children are safe. We need to look at the things we need to be doing right now to ensure that, in the long term, children in Indigenous communities in the Northern Territory survive, develop and thrive. We are not seeing that comprehensive approach to deal with the lack of education and health in the longer term. That is where we are going to make a real difference in ensuring that children are protected.

Senator SIEWERT —I understand that you have some personal expertise in this area and that you have done some work internationally on these issues. From your experience, has emergency intervention of this type and level worked anywhere else? What approach do you suggest we should take?

Mr Johnson —I would also like my colleagues to refer to what is happening in Australia. In an emergency setting, the first thing a UN agency would do, under the direction of OCHA, is to ensure proper consultation on the ground. That is done within the first 24 to 48 hours and it is quite extensive. They then sit down with the communities to find out what supports and services they need. They set up safe houses and ensure that there are safe places for children to play. The international community ensures that there is safe and proper housing, water and access to medical services. The international community is able to do things quite quickly in a refugee camp, and that is based on consultation and asking the population themselves what they need. The biggest lesson learnt from all interventions internationally is that they always fail when they do not involve and empower the local communities to take part in the interventions that are taking place. If you look across the world at the operations that have been successful in resource-poor communities, the fundamental thing that crosses through all those interventions has been the giving of ownership, empowerment and control to the people themselves to ensure children are protected and families and communities are safe.

Senator SIEWERT —I want to change tack a bit. I put a question on notice in the Senate yesterday about the updated numbers of people—in particular, Aboriginal people—who have been breached under Welfare to Work. In the quarter that we have figures for last year, the number had gone up in, for example, Western Australia by 133 per cent. Do you or any of the people your colleagues have been working with have any anecdotal evidence that more Aboriginal people are being breached?

Mr Johnson —We know that is the case, and it is of great concern. We will take that on notice. We refer the committee to the Welfare Rights Centre submission as well as the Catholic social services submission in relation to today’s hearing. Given the rapid change for people coming from the CDEP into an activity requirement system, what numbers are we going to see? Is there an explanation of what is going to happen in relation to shifting people so quickly from the CDEP to a Newstart approach, in which people have to understand complex rules very quickly in remote areas and often in a second language?

Senator SIEWERT —That would be appreciated.

Mr Davidson —I want to make a quick point. People are likely to be required to provide medical certificates, in the event of illness, for failure to attend, for example, a Job Network interview, but they are going to have difficulty finding a doctor quickly in many of these committees. So there are those kinds of practical difficulties.

CHAIR —We thank ACOSS for your evidence and for the submission that you prepared. It is appreciated.

[2.15 pm]