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Monday, 7 September 2015
Page: 6116

Senator LINDGREN (Queensland) (17:13): I rise today to speak to the government's Social Services Legislation Amendment (No. 2) Bill 2015. This bill continues our good work in improving our social services system so that those who most need support can get support. Given how Labor has left the nation's finances, this government has had to take the responsible steps to get the budget back into order. This bill is just part of that process, but it is also an important step in ensuring that we take the right steps to protect the most vulnerable people through the income management regime.

This bill contains three schedules.    Schedule 1 proposes changes to the Social Security Act and the Social Security (Administration) Act to continue income management and the BasicsCard for two additional years to maintain support for existing income management participants and to streamline the income management program. Schedule 2 proposes changes to the Aged Care Act to cease payment from 1 July 2015 of the residential care subsidy to residential aged-care providers for holding a place for up to seven days prior to a care recipient entering care. The schedule also proposes consequential amendments to fee and leave provisions. Schedule 3 proposes to remove provisions from the Aged Care Act that allow for the establishment of aged-care planning advisory committees. Each of these measures is important to maintain the strength and sustainability of our social services system.

I note that the Community Affairs Legislation Committee also held an inquiry into this bill. While no public hearing took place, there were a number of submissions raising concerns about the income management regime. This reflects ongoing philosophical objections by certain groups to income management measures. However, we need to note up-front that income management programs have been in place since 2007 and have assisted around 25,000 Australians. Income management programs continued from 2007 throughout the Rudd-Gillard-Rudd governments. This is a program that is responding to some of the most serious instances of social and economic disadvantage. It is an acknowledgement that sometimes people need significant help to get on their feet and we have a responsibility to provide that help. It is a program that is necessary and it should continue. This bill enables it to continue and, in fact, improves the scheme so that it is more efficient and better able to help people in need.

Schedule 1, regarding income management, was the most contentious of the issues brought before the committee and no doubt will take up most of this debate. So it is worth spending some time on this issue and clarifying exactly what this bill will do. We know all too well how, in some of these most vulnerable families, the basics of food and shelter are not being provided to children, so it is vital this program remains in place to give vulnerable families a chance to get the basics right. To ensure vulnerable people benefitting from income management continue to receive support, Minister Morrison announced that the government has committed $146.7 million to extend a streamlined version of income management to all existing locations until 30 June 2017. This will align end dates across all 12 locations across Australia. The alignment extends to the income management element of Cape York welfare reform, which will also continue until 30 June 2017. This will enable income management to continue to provide additional support in disadvantaged locations for vulnerable people, children and families.

The government is uniquely positioned through the provision of welfare and family payments to use income management to support vulnerable families by assisting them to stabilise and take control of their financial circumstances. This new funding also includes a limited expansion to new locations which might need the additional support that income management provides. This is particularly in response to the tragic case of Chloe Valentine, who tragically died as a result of neglect by her parents and was let down by the system set up to care for at-risk children, and one of the ways she was let down was by the fact that her parents saw her as an easy way to get more welfare money that they could spend on drugs. That is how serious this issue can be, and it is these sorts of scenarios that income management is meant to address. In this context, Minister Morrison announced on 14 August this year that the child protection and voluntary measures of income management will be introduced in the Greater Adelaide region from October this year.

This bill will streamline the program while ensuring continued support to people who benefit from income management. Streamlining includes the removal of social worker assessed referrals through the vulnerable welfare recipient measure, as this was an underutilised tool by social workers and highly resource intensive. The removal of this will also allow social workers to better service their vulnerable clients. There was some contention about this particular part of schedule 1 in the committee process, with concerns raised about how this process would work. However, it was made clear that this measure does not change a person's ability to access a social worker or social workers being able to make assessments. This particular mode of assessment was not really used as it was intended, so it is appropriate that it is removed. There remain a number of measures of vulnerability that will be applied before a person is put on income management, and I am confident these will be sufficient. Further changes in schedule 1 will allow participants to continue to adjust how they use their funds to meet priority needs at any time; however, they will no longer be required to discuss these arrangements with Centrelink every eight weeks.

I also note this schedule includes the phased removal of the matched savings payment, which offers people on the compulsory measures up to $500 in matched savings if they complete an approved money management course and have demonstrated an appropriate savings pattern over a 13-week period. This will cease from 31 December 2015 as these payments were largely undersubscribed and costly to administer. Similarly, there will be a phased removal of voluntary incentive payments, which offer individuals a payment of $250 for every continuous period of 26 weeks. These payments will cease on 28 December 2015, which is the day 26 weeks after 30 June 2015, as evaluations have shown that incentive payments are not the main driver for people commencing income management and that they can create a dependency on the program.

Finally, the BasicsCard Merchant Approval Framework will undergo administrative and policy changes that will simplify the model, improve customer experience and remove unnecessary customer contact. This new, streamlined improvement to the income management regime will achieve a saving of $36 million over two years.

It is worth also taking the time to briefly touch on the other two schedules of this bill. Firstly, there are amendments in relation to ceasing the residential care subsidy for pre-entry leave. These amendments formalise the ceasing of payment of residential care subsidy to residential aged-care providers for holding a place open for a care recipient. These changes better target aged-care expenditure by only paying care subsidies on behalf of people who have actually entered permanent residential care.

The savings associated with this measure as stated in the explanatory memorandum have largely been realised through amendments to the Aged Care (Subsidy, Fees and Payments) Determination 2014 and the Aged Care (Transitional Provisions) (Subsidy and Other Measures) Determination 2014. The amendments in the bill formalise these changes in the principal act.

Previously, subsidies for the pre-entry period were paid to providers for up to seven days at the rate of 30 per cent of the full residential care subsidy that will be payable once the care recipient enters care. Care recipients will still be able to take pre-entry leave prior to entering an aged-care service. The provider will not be able to recoup any lost residential care subsidy from the care recipient. However, the aged-care provider will still be able to charge the care recipient the standard resident contribution for the pre-entry period.

Previously, any days taken as pre-entry leave were counted as part of the care recipient's entitlement to 52 days of social leave from the aged-care service. Under these amendments, the 52-day cap on social leave will not include any leave that was taken as pre-entry leave. This ensures any pre-entry leave taken by a care recipient does not negatively impact on their ability to take other forms of leave from the residential care service.

The impact of lost pre-entry leave payment revenue should be considered in the context of other recent aged-care changes, such as the redirection of the former government's workforce supplement into the general pool of aged-care funding and the introduction of a higher level of accommodation supplement. The government is expected to provide $11 billion for residential care subsidies in 2015-16.

Finally, schedule 3 relates to the aged-care planning advisory committees. On 15 December 2014, as part of the 2014-15 Mid-Year Economic and Fiscal Outlook, the government announced that the Aged Care Planning Advisory Committees would be abolished, with ongoing functions to be performed by the Department of Social Services. This forms part of the Smaller Government reforms to reduce the size and complexity of government, streamline services and reduce the cost of government administration. The Aged Care Planning Advisory Committees' role was to provide advice in relation to the distribution of aged-care places. However, the last of these committees expired in September 2014. These amendments repeal the now-redundant relevant provisions in the Aged Care Act 1997.

The government remains committed to engaging with stakeholders and obtaining local intelligence as part of a needs-based planning framework. Consequently, the department has consulted with a broad range of aged-care stakeholders to help inform the distribution of aged-care places in relation to the 2015 Aged Care Approvals Round which was announced on 15 August 2015.

The income management regime has been an integral part of our social services system now for eight years, and it has been supported by governments of both major parties. It is important that we continue to modify the regime and adjust as circumstances change so that it can continue to support vulnerable families.

These changes need to be looked at in the context of the need for cutting red tape and for budget repair. We need to make sure our social services system targets those most in need and provides adequate support for those who need it.

This bill is an important step in ensuring the sustainability of our social services system while also ensuring it continues to be most effective where it is most needed. I understand that there is, both here in the debate in this place and in the work of the community affairs committee, some contention about these income management measures. It is clear to me, though, that the proposed changes, together with the government's additional investment in financial wellbeing, will deliver more streamlined and cost-effective management programs. Furthermore, this bill provides ample flexibility for the minister so that vulnerable persons criteria remain responsive to the needs of the day.

It is important that we get this issue right. Vulnerable Australians need the income management program to help them get back on their feet. We need to make this program as simple and efficient as possible. This bill does that, and I commend it to the Senate.