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Social Security compliance report.

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Tuesday 7th April 1998   




I am pleased to present to the Senate Centrelink's second quarterly report on compliance activity for the first six month s of the 1997-98 financial year. The compliance results for the first half of 1997-98 clearly vindicate the Government's drive to ensure that social security payments are only received by those who are entitled to them. 


Centrelink conducted over one and a half million entitlement reviews for July to December 1997 which resulted in 171,422 payment cancellations or reductions, a 25.4 per cent increase over 1996-97. Furthermore, during this period there were 1,319 people convicted through the courts for welfare fraud amounting to almost $13 million in debts for recovery action. 


Centrelink also recovered $230 million in outstanding debts during this period, an increase of 31.3 per cent on the same time last financial year as well as saving almost $13 million every week as a result of the savings from payment cancellations and reductions. The growth in debt recovery is the result of a focussed effort by Centrelink staff in response to this Government's determination to improve compliance and debt recovery for the benefit of all Australians. 


Australians clearly want a social security system that is fair, equitable and targeted to those most in need. Centrelink received 27,447 fraud tip-offs from the public between July and December 1997, which resulted in 7,400 payment cancellations or reductions and debts of over $12 million being raised for recovery action. 


The majority of people on income support are genuinely in need of the assistance we provide. Unfortunately however, there is a relatively small number of people who continue to abuse the system to the detriment of others. Not only does welfare fraud steal from the Australian taxpayer, it stigmatises those who are genuine recipients of Social Security payments. We are putting the message out that this Government, unlike its predecessor, is serious about eliminating fraud of the social security system. 


Those who try to rip off the system should be aware of the risks because they will be found out and will face the possibility of criminal charges as well as having to pay the money back. 


This second report for 1997-98 clearly demonstrates that staff in Centrelink are active in pursuing fraud and incorrect payments. Whilst each of the quarterly reports demonstrates continued improvements in the identification and recovery of debts Centrelink is also placing a stronger emphasis on a range of preventative measures both at registration and throughout the customer's relationship with Centrelink. An example of this is the introduction of debt prevention and monitoring officers in customer service centres whose role is to minimise debts occurring by working with staff and facilitating the provision of information to customers. 


I will continue to report regularly on the results of compliance activity in Centrelink for Social Security payments.   



Minister for Social Security






Key highlights for the period 1 July 1997 to 31 December 1997 were: 


A total of 1,550,044 compliance reviews were conducted, an increase of 11.9 per cent on the number of reviews undertaken for the same period in 1996-97 (1,384,864).  Details by type of review and by program are in Tables 1 and 2. 


The number of reviews which resulted in the cancellation or reduction of a payment  increased by 25.4 per cent (171,422 compared to 136,726 for the same period in 1996-97). 


Savings in future outlays as a direct result of payment cancellations and reductions were over $13 million a week. 


Debts identified from reviews totalled $161.9 million, compared to $105.6 million in the same period in 1996-97, an increase of 53.4 per cent. 


Recoveries of debts for DSS (including debt from earlier years) amounted to $2 29.9 million, an increase of 31.3 per cent on the amount recovered in the same period in the last financial year ($175.1 million). 


A total of 1,319 convictions were recorded for welfare fraud with $12.9 million involved.  This compares with 1,101 convictions involving $10.7 million for the same period in 1996-97.  Details by program are in Table 4. 


Within these overall figures, the re were the following highlights: 


In total, 27,447 tip-off reviews were conducted resulting in 7,400 cancellations or reductions to payment, a 31.1 per cent increase when compared to the same period in 1996-97 and $12.3 million in debts were also identified for recovery action.  Details by program are inTable 3. 


The Data-matching Program identified debts worth $44.5 million, an increase of 72.8 per cent on 1996-97 ($25.8 million). 


Other data-matching activities identified a further $72.2million in debts, an increase of 48.3 per cent on the amount identified in the same period in 1996-97 ($48.7 million). 


Mobile Review Teams were responsible for cancelling or reducing 22,784 payments and identifying debts worth $20.7 million for recovery action.




Case No 1 

52 year old female incurred a debt of $109,710 by claiming Sole Parent Pension while living in a defacto relationship.  Discovered by a compliance project.  Convicted and sentenced to 10 months periodic detention. 


Case No. 2 

72 year old male incurred a debt of $87,378 by assuming the identity of his brother who lives overseas,  to make a dual claim for Disability Support Pension.  Discovered by data-matching with Immigration records.  Convicted and sentenced to 12 months jail with a minimum of 6 months to serve.  


Case No. 3 

75 year old male incurred a debt of $99,147 by claiming a Pension at the married rate and failing to notify that he had been separated and divorced from his wife over 20 years ago. Discovered by a compliance project.  Convicted and sentenced to 36 months jail to be released after 8 months upon entering into a good behaviour bond for 2 years. 


Case No. 4 

52 year old male incurred a debt of $40,805 by claiming Newstart Allowance and not declaring that he was employed part-time.  Discovered by data matching with income information from the Australian Taxation Office.  Convicted and sentenced to 30 months jail to be released after 12 months upon entering a good behaviour bond for 24 months. 


All debts incurred must be repaid.