FLOOD, Ms Nadine, National Secretary, Community and Public Sector Union

NEWMAN, Ms Lisa, Deputy National President, Community and Public Sector Union

[10:18]

CHAIR: Welcome. Can I double-check that you have been given information on parliamentary privilege and the protection of witnesses and evidence.

Ms Newman : We have.

CHAIR: I now invite you to make an opening statement and then we will ask you some questions.

Ms Flood : The Community and Public Sector Union represents the real humans working at the centre of the Centrelink Online Compliance Intervention, more commonly known as the robo-debt debacle. Our community legitimately expects that government provide a properly resourced, transparent and accessible social security system which supports people in our community as needed through critical times of their lives. Delivery of those services is the role of the aptly named Department of Human Services, with the work done by our members. It is work they value and believe in, supporting families, pensioners, low-income earners, students and people, as they face life's challenges from illness to unemployment.

Our members believe that system is a cornerstone of a fair society and it is work that they are proud of and deeply committed to. However, what the Online Compliance Intervention and other failings in this department show is that years of government funding cuts and poor policy decisions have severely reduced the department's capacity to be that cornerstone and to deliver for our community. Of course what we are seeing currently is a very high human price being paid both by clients, the people in our community who rely on Centrelink and Human Services, and by the people themselves who work for the department.

It is not an exaggeration to say that the Department of Human Services is an agency in crisis, and it is not something I say lightly. The automated compliance or robo-debt issue has hit well over 300,000 people in our community, and of course there are approximately 20,000 letters still going out each week. We have an approach from government, and indeed the senior management of the department, which seems more focused on denying there is a problem and spinning the problem then actually dealing with.

More than 36 million calls to the Department of Human Services went unanswered last year as the department is no longer able to provide a basic level of service to Australians. Centrelink and Human Services' workers are already struggling with massive workload and pressures and the real lived impact of 5,000 permanent job cuts through a series of successive government decisions that have left this department simply unable to cope. Indeed, elements of that were acknowledged by the secretary of the department in estimates last week. What that means is that this department is increasingly placed in the position by government of making very bad decisions.

I think it is important to understand the root causes of these issues which do go back some years. If we deal with the lived impacts on our community now, we can see that the department has been put in a position where it has made decisions with the recent introduction of the automatic debt recovery program to remove or reduce the role of DHS staff in that crucial hands-on element of the work: investigating suspected overpayments and advising on appropriate debt recovery action. The notion that our community expects people should get what they are entitled to and no more is not a new one or a new part of this department's work. But there is a very serious problem here. This new approach, which removes and reduces human oversight of suspected overpayments and reduces employees' roles in a range of elements of the system, has been an absolute disaster for many Centrelink uses and also for the workers charged with implementing a system they know to be deeply flawed and unfair. Hundreds of thousands of Australians, as you have heard, have received frightening and, in some cases, inaccurate debt notices and then faced enormous difficulties trying to get in touch with DHS staff. Of course, at the other end, employees are unable to provide services of the sort they are committed to provide and are also increasingly facing client aggression and frustration.

So how did it come to this? Most of the major problems facing DHS begin with a lack of funding and resources and without proper funding the agency loses the capacity to make good policy decisions, design effective programs and ensure the right benefit goes to the right person at the right time and for the right amount.

DHS has faced a triple whammy of funding cuts starting under successive governments. These do go back to Labor government decisions on efficiency dividends that have then rolled into the decisions of the Abbott/Turnbull government. Service delivery agencies are hit hardest by a number of elements of budget funding processes. I would note that no government ever stood up and said, 'We would like to cut 5,000 jobs from the Department of Human Services, and we think that is a good idea.' It is simply the result of a number of decisions put together.

So-called efficiency dividends hit service delivery agencies harder. Other whole-of-service savings measures, many emanating out of the Department of Finance, also generally hit service delivery agencies harder because they do not have the scope of policy agencies around program funding. In DHS's specific case, the machinery of government changes that resulted in the creation of this mega-agency and the service delivery reform initiatives included the classic Department of Finance mistake where you very clearly identify the savings that will supposedly come out of consolidation and these changes, take those up-front and then see what happens. In this case those impacts have resulted in DHS being an agency that is absolutely struggling. I note the secretary herself said cutting an agency by 10 per cent in 18 months has created no little challenge, which was at one point the impact of those combined three different elements of savings measures.

If we want to look at where robo-debt has come from, it is a fairly obvious consequence of a department that no longer has the resources to provide effective services. The decision to replace the human oversight of debt recovery with automated data matching was absolutely based on a desire and an imperative to save money. It has of course proven to be a classic false economy and has created costly reverse workflows where staff are taken offline to deal with complex and difficult disputes over incorrectly raised automated debts. Sadly, I would suggest that in the last few years, one of the things DHS has become an expert at is bandaid solutions as it lurched from one crisis to the next. This is simply the largest of those.

As a result, the department tries to plug the gap in those services with casual staff who do not have access to the appropriate training, who are deeply frustrated that they cannot do the work and who are largely used to answer the phone and redirect customer inquiries, which allows the department to keep its core statistics lower; someone has clicked on it, they cannot fix the problem, but it is going through to another line and that is good enough. That sort of gaming of the system is the situation this department has been put in.

Our members believe that our social security service system must be robust, sensitive and flexible enough to deal with underpayments, overpayments and other changes in people's lives in a way that ensures the integrity of Commonwealth funds and the dignity of customers. That includes dealing with the reality of an economy and a workforce where people come in and out of work, employers come and go, and there is an increasing level of insecure employment, casual contracts and so on. It is a complex situation that people are in, and systems like this have to deal with that.

At the same time it is important we note there has been a disturbing cultural shift imposed on Centrelink and on the Department of Human Services. It has increasingly gone from an agency focused on treating people like people to one that focuses on treating people as numbers in a dataset and doing the minimum possible. It is also an agency that, more than most, ignores or discards the input of staff in relation to crucial work design and staffing issues and has a vicious and draconian approach to staff speaking out internally and externally.

I would note that this is possibly the only Senate inquiry in the last three years where CPSU representatives have appeared without bringing delegates or rank and file workplace representatives. In this case we felt that it was simply too difficult to ask those people to attend because of the circumstances and the pressure that is in place in this department at this time. We will be putting their feedback further in a written submission, but this is an unusual step for the CPSU.

The same 'my way or the highway' attitude that created the robo-debt debacle has caused major problems elsewhere, including the agency's hopelessly stalled enterprise bargaining situation where DHS has again taken a more negative and unfortunate approach on government policy, significantly causing concerns for working women in that department and meaning that bargaining is impressively more mired in this agency than across the rest of the Commonwealth public sector, which is really quite a high bar after a three-year industrial dispute. Crucially, one of the issues still in dispute in this agency is the need for robust predecision consultation processes where people who do the work in areas such as compliance can actually have a better voice to inform senior management on what will and will not work at the front line. Those sorts of issues are very important to the people who work in this agency.

So, we are calling for a number of things to happen. The Turnbull government must immediately suspend the online compliance program and actually put the real fixes in place so that this no longer hurts thousands of Australians. There needs to be immediate action and a serious budget solution to reverse the damage done by the combination of multiple cuts to the Department of Human Services, including the reduction of 5,000 permanent jobs. Any new approach should have properly resourced human oversight so that the agency can be confident that the overpayments it identifies and debts it raises are legitimate and accurate. DHS must immediately be put in a position by government to convert casual workers—of which there are now thousands—to permanent roles with access to effective training and to be able to provide a genuine, full range of services and support to customers.

Finally, the culture in this agency needs to change, and the approach we have seen over recent months in this matter is a damning indictment, but it is also a responsibility of government. We need to deliver a system in which the people who work for DHS can deliver great services to the community, and the community can have faith in our social security system and this department's work.

CHAIR: Ms Newman, would you like to make a statement?

Ms Newman : The introduction of the automated debt processing system has been done without any consultation of effective staff or their union. We have not been consulted about the design of the system or its potential impact on staff. We have watched the introduction of the system roll out with increasing levels of alarm and distress. In January we started to have contact from members who were reporting that average incomes could lead to incorrect debt calculations and customers could end up paying money that they did not owe before a debt was proven to exist. A mismatch in employer information could also lead to double counting of income and therefore generate false debt statistics. Customers would be unable to get the documentation they required to prove that the debt did not exist, and customers would not be advised of their appeal rights.

We have also been told by our members, as Nadine said, that the customary oversight has been removed from the system before contact with customers has been initiated and that, instead, that oversight has been limited to queries and requests for reassessments once notices have been issued and received by customers. Members have been particularly disturbed by reports of managers instructing frontline staff not to correct errors that they find and instead to push customers onto self-service mechanisms and/or refer them to a different part of the department—namely, the OCI teams.

This week I was contacted by a member with over 20 years experience in the department and extensive knowledge of debt management processes. She described the distress she felt at seeing the integrity of the debt management process that she has worked with for many years being sacrificed to the point where staff know that customers are going to incur needless debt. As she described it, the department has an obligation to pay the right person the right payment at the right rate at the right time. She told me that people are complex, with messy lives. The department has moved the burden of proof of a debt to customers, who in many cases struggle to find the required evidence to prove that they do not owe the alleged debt.

The system has had a significant impact on staff working with it. People have reported increased stress levels, increased absences from work, lack of sleep and increased customer aggression. And I would just note to the committee that in our previous surveying on client aggression directed towards DHS staff financial stress was one of the primary triggers to incidents of aggression. Staff are also very concerned and very angry about what they see being done to some of the most vulnerable members of the community, and many feel morally conflicted in their role in this process.

In January we contacted the department to raise the concerns our members had contacted us to relay and also asked for a meeting with the department. We were given the advice that has generally been given to other organisations, and that is that the system was working as it was designed to work and that there was no need to meet and talk about any issues about the system in detail.

DHS staff—our members—want to help customers, and that is why they find it so distressing to see their department putting customers at an increased risk of depression, decreased motivation, self-harm and even suicide. There have been anecdotal reports about increased levels of customer aggression directed at Centrelink workers that includes swearing, threats, physical aggression and spitting. We would make the case that the Turnbull government needs to suspend this system. It needs to fix the system so that before it contacts a person over an alleged debt it has skilled and experienced staff assessing that person's records holistically, because automated systems cannot read customer records and see the details that experienced officers can.

The department should also undertake an urgent risk assessment of the process to ensure that the risks to both the physical and mental health of both customers and staff are taken into consideration in the design of the system. And there needs to be immediate action to reverse the damage done by cutting 5,000 permanent jobs from DHS. Any new approach has to ensure that properly resourced human oversight in this agency occurs so that the government and the community can be confident that overpayments are identified and are correct. DHS must also immediately convert current casual workers to permanent roles through a merit selection process so that they can be properly trained and provide the full range of services to support the communities in which they live.

As Nadine mentioned, the culture in DHS is one of the most significant barriers to our members' voice and input into systems like this. There are many things that should have been taken into consideration in the design of this system that we believe constitute a current risk to our members' health and safety as well as the health and safety of the community that uses that system.

CHAIR: Thank you. I understood from estimates that there are some issues as to whether the department acknowledges that there is an increase in aggression. Can you just articulate a bit more broadly what your members have been subjected to?

Ms Newman : We do yearly surveys of our members on client aggression, and it is always a point of difference in that our members' view is that client aggression is increasing; the department's reporting statistics show that it is not. So that would tell me that there is a culture of normalisation of violence aimed at service officers, and underreporting. Anecdotally, we have many instances where early intervention strategies are deployed by the agency as an alternative to incident reporting and Comcare claims. This is an area that we need to address in the department and that the CPSU and our members would be more than willing to work with the department to address.

CHAIR: Thank you. Senator Watt.

Senator WATT: Thank you both for coming along. It is obviously a very dire situation in the department that you have described to us today, and I pass on my thanks to all of the staff for the incredible work that they are doing under enormous pressure. Hopefully this inquiry will be able to establish some changes that need to be made in that department to alleviate some of that pressure going forward.

I will pick up on one thing in your statement. I noticed that the department undertook a pilot of this OCI system in July/August last year before it was launched. Was there any consultation with the union through that pilot period?

Ms Newman : No. There has been no consultation about that trial or the initial design or subsequent changes to that design.

Senator WATT: And would you say that the union, on behalf of members and employees in Centrelink, attempted to bring forward concerns with this program—that you brought forward those concerns to either departmental officials or to the minister or his office before it was rolled out late last year?

Ms Newman : We could not raise concerns about a system that we did not understand, and we, like the rest of the community, have been reading in the press some of the details. And of course our members have been contacting us. When, essentially, the switch was flicked and all of those letters went out, that is when we started getting contact from our members. That contact has reiterated a number of concerns from staff that have been reported in the media. We were very careful to validate some of the reports in the media with our experienced members working in that area. Once we had done that, we sought to raise those issues directly with the secretary of the department, Kathryn Campbell, and to request a briefing on the design of the system, so that we could understand, operationally, how it worked and what its potential impacts on staff were going to be. And that request has been refused.

Senator WATT: Do you know roughly when it was that you requested that briefing?

Ms Newman : On 19 January.

Senator WATT: So after all that media attention about problems coming to light?

Ms Newman : That is right.

Senator WATT: And the secretary refused to meet with you—or just refused to provide a briefing?

Ms Newman : That is right.

Senator WATT: And there has been no contact from the secretary since that time?

Ms Newman : None.

Senator WATT: That seems to be a bit of a theme. We heard similar evidence from ACOSS this morning about attempting to meet with government officials to try and sort this out and being met with a brick wall. So that might be something we take up a bit this afternoon.

Ms Newman : Sure.

Senator WATT: Over the course of this saga, I have been particularly concerned about not just the impact on individuals and the distress they are being put through with their debt notices, but also a number of media reports about directions that have been given to staff, your members, over the course of this.

There is one particular report that I just reread this morning from the GuardianAustralia online on 19 January, an article by Christopher Knaus, that was also picked up by 7.30 on the same date. I will take you through some of the allegations. I think this report was based on a whistleblower, a Centrelink employee, who raised a number of very disturbing claims about directions that had been provided to staff in how to handle this. One was, and it has become quite well-known, that compliance teams were told by Centrelink management to not correct errors even when they uncovered errors with debts that were claimed to be owed. Have your members reported to you similar directions being made to them?

Ms Newman : Yes.

Ms Flood : Yes. I think it may well have been noted on that report that we are aware of this because we were involved in this particular case. In that particular case, it is a good example of what Lisa was saying. What we sought to do was to go to experienced, long-standing employees who were members of the union in relevant areas and check literally line by line, issue by issue and ask: is that your experience. There are a couple of things to say overall on this. One is that it verified almost everything in those detailed reports. There are a couple of things where we found different teams were doing things differently or different managers were doing things differently. That is not uncommon in DHS—I could be cynical and say that the further they are from Canberra, the more that seems to occur but it is a working theory. But I would preface our answers at this point by noting that there are a couple of those procedural elements where we were also told by members that there have been minor changes since, and we are currently updating that information for our submission to this inquiry to actually check what is our best understanding of what has and has not been fixed at this point because this is moving and it has moved quite a long way.

Senator WATT: It would be very helpful to get an understanding about where things currently sit.

Ms Flood : We will give you our best possible answers but we also attempting to do that in writing.

Senator WATT: Is it correct that a number of employees at Centrelink, your members, reported to you that they were being told by Centrelink management to not correct errors when they found them?

Ms Newman : That is right. Frontline service officers reported when they get customer details on the screen, when they are face-to-face with people, they would often find errors that they would be able to correct very quickly but they were told, quite quickly, not to do that and to push people back onto self-service portals to get them to use the online system to correct their own details. They also reported that people in the debt management teams were instructed only to deal with a very small portion of the debt management process despite their experience telling them that there were errors in other parts of the record.

Senator WATT: This report also says that teams were told that they should only correct errors if they were identified by customers. Is that consistent with what you have been told?

Ms Newman : Yes.

Senator WATT: And compliance officers have also been told that they cannot consider evidence the customer has previously provided, including documentation to prove that they were not working or pay slips previously provided to Centrelink. Is that something you have heard from your members?

Ms Newman : That specific concern, no.

Senator WATT: This report contains some complaints about the system counting income that was actually supposed to be exempt from Centrelink assessments. Income exempt from Centrelink assessment includes things like meals, laundry and uniform allowances, which were being counted by the automated system even when it had been previously excluded in earlier reviews by staff. Again, is that something your members have raised?

Ms Newman : That is consistent with the concerns that have been raised with us.

Senator WATT: And, at least in some circumstances, paid parental leave was also being wrongly counted as income by the automated system?

Ms Newman : Yes.

Ms Flood : With some complexity like the changes from 1 January PPL becoming assessable. So there are some complexities around some of those.

Senator WATT: We talked with ACOSS about the debt-collection systems and the debt-recovery fees that are being imposed on people. It sounded from their evidence like debt-collection fees have always been around as part of the system but their use has been significantly broadened now as part of the implementation of this system. That again came up in this newspaper report as well. Is that something that your members have reported to you?

Ms Newman : Our members have not reported fees associated with debt collection. What they have reported consistently is their concern that the system generates a debt agency contact with customers without a detailed assessment of whether or not a holistic view of records and therefore that contact could be discordant with the actual real level of debt in the first place.

Senator WATT: Because of the complications in this system, this report says that, in some cases, individuals have been handed a debt or have been advised they have a debt that was more than the social security benefits that they actually received. Is that something that your members have raised with you?

Ms Newman : Some of the stories have been truly staggering.

Senator WATT: Can you give us a couple of examples?

Ms Newman : There are elderly people that have had debts of thousands of dollars reduced to $50.

Senator WATT: Because the fact was they actually only owed $50?

Ms Newman : That is right. There are alleged debts that people have travelled hours to a Centrelink office to talk to somebody about, because they could not reach anybody through their call centre network, only to find after two visits that a debt had not occurred. The one example that a member told me about was somebody that had to get on a bus for an hour and 15 minutes to get to a Centrelink office not once, not twice but three times before the matter was resolved. That is an example of the administrative onus that has been reversed. Prior to this system occurring, debt-management processes would be incredibly thorough and, where debts occurred, there would be a small amount of errors. There is not enough transparency—and I know our friends in ACOSS have raised concerns about this with us—to know whether or not the level of payment of alleged debt is because people are simply assuming that the department is right and therefore paying.

The other issue that has been raised by our members is the point in the process at which people do start paying. In August 2016 the department launched an autopay online payment system for clearing of debts, and this is something that we have not been able to clear up. Have people been asked to repay debts before a formal debt has been raised? That is the conversation that they are having with people and the compliance team triggering debt repayment before a process has actually formally raised a debt.

CHAIR: Could you explain how that happens?

Ms Newman : How that can happen is a question that members have asked us.

Ms Flood : It might be a question more aptly put to a very long list of people.

CHAIR: Yes. Obviously, we will be, but any insight you have from your members would be useful.

Ms Newman : It is an allegation that has been reported in the press. It has been a concern that has been reflected by the feedback that we have got from our members, but, to be frank, the level of scrutiny that people employed in the compliance section are subject to, particularly after the media controversies started to gain stream in January this year, has been extraordinary. People that I have got a legal entitlement to talk to are fearful of any engagement with me lest they be subject to code of conduct action by the department. So our ability to investigate that kind of question is very limited. I am going to be watching the outcomes of this process with great interest to see whether or not that is actually happening and how it could happen.

CHAIR: Thank you.

Senator WATT: The last of the allegations that were made in this report was that employment termination payments were also wrongly being used to calculate debts for age pensioners. Is that something that your members have raised?

Ms Newman : It absolutely is.

Senator WATT: Can you explain what that means?

Ms Newman : The way it has been expressed to me is that employers report termination payments sometimes incorrectly. Experienced officers are in a position to look at payments and through their experience know when something looks slightly left of field. What has actually happened—and this goes to the salary-averaging issues as well—is that, if an employer reports income incorrectly on PAYE statements, that will automatically generate a discrepancy, which then goes into the automated contact process, so the way that that has been described is incorrect reporting of final payments being lumped in with normal salary and assessed when it should not be.

Senator WATT: Beyond the ones that are in that report, are there any other directions that have been given to staff that you think would be of concern to the committee?

Ms Newman : We will make a detailed submission to the committee in the coming weeks. We are just in the process of seeking feedback directly from our members to make sure that some of the detailed issues of the nature which your questions are designed to identify are flushed out as much as possible.

Senator WATT: This is unrelated, but do you know whether the Australian Federal Police has a presence on the online compliance investigation or debt recovery team?

Ms Newman : I have been told that there is a unit consisting of several federal police officers which has been embedded in the department to look at cases of criminal fraud.

Senator WATT: And do you think that makes employees scared to raise concerns publicly?

Ms Newman : It will not help.

Senator WATT: Thank you.

Senator DUNIAM: I look forward to seeing the submission when you are able to put it in. I am not sure we will have another chance to talk, but we may be able to interrogate it further once you have put it in. Ms Flood, I wanted to go to the points you made towards the end of your opening statement with regard to what in the union's view needs to be done. You said there that the OCI needed to be suspended so we could put the real fixes in place. What are the real fixes?

Ms Flood : That issue is probably larger than the DTA's job.

Senator DUNIAM: I suppose. I only ask that because one thing I have been contemplating as we proceeded to hearings in this committee was that I had the view that Senate committees often can turn into talkfests and do nothing. I thought, 'If we're going to do something for the people of Australia, I'd like to get input from all witnesses about what it is specifically they think we should be doing.' As the representative organisation of the DHS employees, I thought you might have some specifics with regard to the real fixes.

Ms Flood : My view on a problem as complex and tricky as this is that there are always two levels. There is what you do within the bounds of what is currently possible. The department has, as we know, ageing platforms and ICT challenges. It has a current staffing and budget profile and a range of challenges that I think have probably been reasonably investigated through estimates and other processes and this intersection between the work of DHS and other agencies such as the Digital Transformation Agency, DSS as the policy agency and so on. So, within those boundaries, what is possible? We suspect it is possible to go further than the department has currently around immediate fixes on the system and the relatively minor changes that have been made in recent weeks. You can do that. So you have the staff that you have, they have the training you have, you have the systems you have and what is possible within that around online compliance intervention, and we suspect that there is more that can be done.

Senator DUNIAM: So that is the part I am interested in—the more that can be done.

Ms Flood : Outside that boundary, there is a more serious issue, I think, for government around what are the substantive changes that need to be made that ensure that the Department of Human Services can actually deliver effective services. Even if we had not had the OCI or robo-debt issue, there was already a real problem there, as we have seen in another report: 36 million unanswered calls does suggest something is going wrong. So it depends which of those you want to operate in. I sat in this building five or six years ago and said, 'If government goes down these tracks, we are going to reach a point where Centrelink cannot deliver effective services.' Sadly, we are now past that point.

Senator DUNIAM: I take it from what you are saying to this committee that the real fixes, in the CPSU's view are greater resources. Is that the key point? So you saying that to operate within the existing envelope is a nonstarter in terms of actually resolving these issues. Is that the key point?

Ms Flood : No. I am saying that, in terms of how the Public Service operates, you always have to do both. You have to do what is possible within your current systems budget funding et cetera, and I think we would advocate that the department and the government need to look further and deeper on what they are doing on the OCI program right now.

Senator DUNIAM: Just on that, do you have any specifics about what actual elements of the OCI program should be looked into further? Obviously there is the manual checking and things like that, but did you have any specifics you wanted to raise now? Is that something that will be in your submission?

Ms Flood : We will put that forward in the submission. There are a range of issues around elements of the process, but I also note, as Ms Newman, has that we do not pretend or portray that we know all of the detail around how these processes are operating, and I would note with the culture of this department that has actually been significantly more difficult than it genuinely is in our representative role, so we will put forward what we believe to be credible and reliable in the same way as when we put these things forward. We have checked those. We do not just go: 'Oh, great, someone is calling themselves a whistleblower and putting that forward. Cool.' We have to protect the credibility and integrity of the organisation.

Senator DUNIAM: Look, that is fine.

Ms Flood : We will do as much as we can, but we are not going to pretend that we can do it all.

Senator DUNIAM: Understood. Thank you. I want to go to the second part of what you said there towards the end of your opening statement. I guess this goes to the outside-of-the-envelope component you have been talking about, and that is the budget solution or the budget-related element. You talked about staff reductions and the ageing platforms and things like that. You quoted the figure of 5,000, which I think is the reduction, if I heard you correctly.

Ms Newman : Five thousand permanent jobs.

Senator DUNIAM: Permanent jobs, okay. So is part of what you are saying today that those 5,000 permanent jobs need to be brought back? Is that part of the solution from the union's point of view?

Ms Flood : DHS needs a significant increase in funding and employment. Our view is that there needs to be an increase in staffing, not necessarily of all of that. This was a machinery-of-government change that brought together Centrelink, Medicare and child support. There were some legitimate savings out of that.

Senator DUNIAM: Do you have a specific figure? You are saying 'not necessarily all' but there should be an increase. Do you have an idea, as your members are the coalface?

Ms Flood : We have not put a specific number on that. It does also depend partly on what the systems and the work practices look like, which, of course, change over time and unfortunately in this case generally for the worse. So we are not putting a specific number on that. We are noting the reduction from 36,000 five years ago to 31½ thousand. There is no-one, including the Secretary, who could argue that there actually has not been a significant decrease in the capacity of the department through the scale of those reductions.

Senator DUNIAM: Is it possible—just going to the point on the ageing platform and the systems they have in place—that it may not be all about numbers of people, experienced officers who are available to do the work, but also about systems that work better. Is that part of what you are getting—

Ms Flood : Yes, and that certainly was part of the argument around service delivery reform in that program and a range of the initiatives since. But I think, as the Secretary acknowledged, the department has been put under very substantial pressure through those multiple savings measures. I guess the CPSU has put forward over time, and will put forward again in this submission, that the design of those measures tends to overestimate the extent to which people will move to online and self-service and the extent to which the platforms and systems will be able to do the work with fewer staff involved. The evidence on that is fairly compelling in the case of this department, given the data that has been put forward in reports—the Audit Office report, annual reports, estimates and so on—about what is actually occurring on the service levels. So there is a real problem there.

Senator DUNIAM: Okay. I would be very interested in your submission if you could put down some specifics with regard to the solutions. I am a fundamental believer that we are here today to actually look at practical, actual, specific solutions that people have. It is part of the committee processes to air grievances, but I suppose I am here to see if there are things that need to be done, and that is the reason for my questions.

Senator KAKOSCHKE-MOORE: Ms Flood, you mentioned that you sat here five or six years ago and raised concerns that if certain budget cuts and staffing reductions went ahead they could have some quite catastrophic consequences both for your members and for members of the public who access Centrelink. In relation to debt recovery specifically, over how many years do you think your members have been raising concerns about debt recovery management with the department?

Ms Flood : Specifically around debt recovery management, I would need to check. The concerns around the impact of the funding reductions and the workload pressures certainly go back to the first time there was an additional increased efficiency dividend, which was under Prime Minister Rudd. I remember it well—I remember the statements he made at the time—and I think that was 2008-09. So there were the first changes in MYEFO and since. In terms of that overall picture then—

Ms Newman : I think it would be fair to say that concerns that have been raised historically about debt management have been nothing compared to the communication from our members—what are we in now, March?—really since December.

Senator KAKOSCHKE-MOORE: Okay. We would be particularly concerned if the department had been made specifically aware of deficiencies in their debt management systems and yet had moved ahead with the rollout of this expanded scheme.

Ms Newman : I would just make the point that I do not think it is an accident that we and other key stakeholders in the community were not consulted about the design of this process, because, if we were, those concerns would have been raised much earlier. Just as there are questions around why this has happened, from a general member's perspective this is a system that is designed to minimise human engagement and, therefore, be the cheapest option possible for the department to manage debt recovery. Unfortunately, the cost of those savings has been borne by the community that have been adversely affected and staff.

Senator KAKOSCHKE-MOORE: You also mentioned—I think I heard you right—that some of your own members are reluctant or even refusing to speak with you for fear of action under the department's code of conduct for employees. Did I understand you correctly? Is the code of conduct a bit like a sword hanging over the heads of your members?

Ms Newman : Yes. In one case particularly that I am thinking of, I had a member tell me, 'They are watching my emails.'

Senator KAKOSCHKE-MOORE: 'They', as in the department?

Ms Newman : Yes. Facebook communication is also being watched.

Senator KAKOSCHKE-MOORE: When you say 'watched', that is quite incredible. Do you believe that the department—

Ms Flood : This may be more incredible to you than to us.

Senator KAKOSCHKE-MOORE: So the department has access to your emails?

Ms Flood : No, they track who sends emails from their work email address to cpsu.org.au.

Senator KAKOSCHKE-MOORE: So, if employees are sending you an email, that email is being tracked by the department and read?

Ms Newman : Absolutely, and we have an example in relation to a bargaining issue that we dealt with last year, where the department issued show-cause types of letters to staff who had forwarded an email that they had received from the national manager of workplace relations outside the department. It was the most extraordinary thing I have ever seen.

Senator WATT: Do other Commonwealth departments read people's emails?

Ms Newman : I have not seen it.

Ms Flood : I would say there is one department that does it more frequently than DHS and that would be the Department of Immigration and Border Protection, notably around Australian Border Force officers, where we have had to change the union's processes to deal with how people can raise legitimate industrial issues when they operate under the Australian Border Force Act.

Senator KAKOSCHKE-MOORE: So, if your members wanted to raise quite legitimate concerns with you about the way they perceive this debt management process being rolled out and concerns they have as employees of the department, they do not feel confident that they can communicate with you through their work email and would need to use private email.

Ms Newman : That is right. Generally, while they have a legal right to talk to us about any workplace matter, there has been increasing scrutiny, and certainly the perception of increased scrutiny, around issues that have an industrial element to them. There is absolutely a legitimate right for them to forward us information and ask for our advice on that, particularly, I have to say, in relation to the issue around instructions that might have been received not to fix debt or errors on records. Members would be very hesitant to forward that material to me using their work platforms.

Senator KAKOSCHKE-MOORE: If that member was to forward those instructions that were delivered through the official departmental email system to their own personal email address in order to forward them to you without being detected, would they be in trouble for forwarding that material to their own personal email address?

Ms Newman : It would depend on the classification of the information that they are forwarding, but they could well find themselves in breach of the code of conduct for forwarding information from the department outside the department.

Senator KAKOSCHKE-MOORE: Just so I am clear, we have employees who are wishing to raise very legitimate and serious concerns about instructions being given to them by their employer in relation to collection of debts and they are too afraid to seek union advice.

Ms Newman : Directly through the departmental email, yes. And so a lot of my communication is done at night via personal mobile phone, talking about issues, particularly with the people that are involved in the OCI teams. I would not have any communication with them on their work email system. I just would not do it, because I could not guarantee that it would not have adverse outcomes.

Ms Flood : Just to understand, this is an agency that has a more difficult culture. But we are also talking about a relatively small number of staff who are under enormous scrutiny with an issue that is now highly politicised and controversial. It is very difficult, and, as a union, we have had to work out ways to deal with this, and I do draw parallels. We represent people who work in some of the most high-focus political areas of government—for example, the staff in the Border Force marine unit. They are great mariners who work on boats. Boats is a very potent issue, and so we have had to, as a union, think through carefully what is the difference between how you deal with members who are in an area that has that sort of scrutiny, on a permanent or a temporary basis, and the regular public servant who just has an industrial query, and we are careful about that because this is people's jobs and their careers.

Senator KAKOSCHKE-MOORE: To your knowledge, do Australia's current whistleblower protection laws apply to communication between an employee and their union when the employee is using their official work email address?

Ms Flood : There are some complexities about the interaction of the Public Service Act, the Fair Work Act and whistleblower protections, and there are some challenges in those systems.

Senator KAKOSCHKE-MOORE: So it is unclear.

CHAIR: Perhaps, due to time, you could take that on notice and include it in your submission. That would be really helpful.

Ms Flood : You are giving us a long list!

CHAIR: Yes, sorry about that.

Senator PRATT: Given that the system is designed to generate debts against those who have no debt, in that their information was provided correctly at the time, then it would be unsurprising that appeals would be at record numbers. Your press release in January says:

"Appeals in our office are at record numbers—and no one is doing them—no time!"

It is unsurprising that appeals would be heightened at this time. What evidence have you got that there have been any extra resources given to managing what would be an inevitable increase in appeals?

Ms Newman : Given the lack of transparency over this process and our lack of ability to have frank discussions with the department, there is very little evidence that I have that additional resources have been given. What I have been told is that the previous experienced staff have been redeployed into other areas of the department and have been replaced by either new staff or casuals that look at a small part of a reassessment only, because that is all they are trained to do, and that that process is inevitably going to have an outcome where the reassessments will be wrong. So, to answer your question, I do not have any evidence that there are increased resources. What I have been told is that the experienced officers, in some cases, have been removed from that work and inexperienced new staff, both permanent and casual, have replaced them and that there is great concern over the quality of the reassessments that will be done.

Senator PRATT: That is the reassessment pre a formal appeal? So, even after someone has been reassessed, if they are struggling—for example, to find pay slips from six years ago because Centrelink had previously told them they only needed to keep them for six years—and they are asking for that information to be reviewed and reassessed, how can they make it through to making an appeal, given how many roadblocks there are in the way to that?

Ms Flood : This is the sort of issue that we are exploring to put forth in a submission, because there have been some changes. In a number of cases, clients seem to have been put in an impossible position of being asked to provide documentation that they do not have, cannot get—

Senator PRATT: And that they provided at the time.

Ms Flood : and that they, in some cases, provided at the time. There are some changes. We are aware of one of them where, in some cases, they are saying that you can now provide the net pay from a bank statement, as opposed to the gross pay from a pay slip, of what you received at the time.

Senator PRATT: But getting hold of a bank statement from four or five years ago can cost money.

Ms Flood : Trying to work out what actually has shifted and what has not—we are seeking to do that, and obviously your committee is seeking to do that.

CHAIR: Thank you very much for your time today and your evidence. We have given you a ton of homework. It will be really helpful to us. If you can address that in your submission, that would be great. Or, if the time line for that is going to be too tight, maybe you could give us your submission and then something supplementary when you have an opportunity. We know it is a big ask.

Ms Newman : We will do our best.

CHAIR: Thank you very much for your time today. We are running over time, so I am intending to give you an eight-minute break, and we will start again at 11.30.