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Closing address to The ACROD Convention, Cairns

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Minister for Community Services

Hon. Warren E Truss, MR



Thank you Bryan for your kind introduction. And thank you to ACROD for inviting me to deliver the closing address at your Annual Convention today. I know that my predecessor, Warwick Smith, had been looking forward to attending this conference. It is a great pity that we lost such an effective Minister at the last election.

As the new Minister for Community Services, I'm pleased to be here to present the Government's perspectives on disability issues and to meet representatives from community organisations delivering services.

I know some of the people here today through my work as a Member of Parliament. In my electorate of Wide Bay, there are many successful agencies delivering services to people with disabilities and, from time to time, I have been drawn into this work. I have been impressed by what can be achieved by local providers, supported by the community, helping people with disabilities.

At the outset, I can assure ACROD members that I value their views and will work assiduously to develop a constructive relationship with stakeholders. Effective communication between the Government and the community is essential to developing and delivering good policy.

This communication is especially important in a diverse service portfolio such as Family and Community Services. The portfolio spends billions each year providing income support and other services to the community. Support for people with disabilities is a major part of this effort. For example, more than 550,000 people receive the Disability Support Pension, at an annual cost of more than $5 billion.

Over the next few months, I will be talking to as many grass roots organisations as I can to hear at first hand their views. One of my major challenges as the Minister for Community Services is to bring to the policy debate in Canberra an appreciation of the realities facing service providers and their customers.

I am in a very good position to do this as my Ministerial responsibilities include the operation of Centrelink, CRS Australia, the Social Security Appeals Tribunal, the Child Support Agency and child care as well as general service delivery by non-government providers.

Delivery issues are of fundamental importance to the portfolio. As we all know, the Department of Family and Community Services contracts out the delivery of many services. Tapping the expertise, as well as the energy, of local providers has the potential to greatly enhance policy outcomes.

We may not always agree about how services should be delivered or how much money can be spent on disability programs. Nevertheless, we share the same goal - to give people with a disability the opportunity to enjoy, and take part more fully, in Australia's 04/12/1998

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economic and social life.

THE GOVERNMENT'S VISION One of the distinctive features of the Government's social policy is its whole of government approach. In the past, policy and services was often fragmented across portfolios and agencies. The focus was often on programs rather than customers. Customers entered and left programs, and the programs went on.

The Government recognises that programs must be designed and implemented as part of an integrated approach with common vision. Ensuring people make the transition from welfare to work, for example, is now an important focus for a range of policies, cutting across previous boundaries.

The Government supports an integrated approach in service delivery as well. With the establishment of Centrelink, the Government consolidated delivery of its social security programs. Creating the Family and Community Services portfolio is another step towards a more cohesive and effective social policy, with a priority focus on families.

In his address to ACOSS earlier this month, the Prime Minister explained in detail the Government's social vision for its second term. The Prime Minister identified the key challenges for Australia if we are to continue to be a fair country offering opportunity and support for all Australians. At the heart of this vision is the conviction that a partnership between individuals, business, the community and government is essential to strengthening our society.

The Prime Minister also stressed that, where possible, effective policy prevents rather than cures problems.

Lifelong education, secure pathways from school to work (such as New Apprenticeships), incentives for people to stay in education and training and to seek employment are all part of this approach. Families need support, financial and otherwise, to fulfil their vital role in our society.

An important part of this vision for Australia is to ensure that people with disabilities have opportunities and rights equivalent to their fellow Australians

• that they be treated with dignity and respect • that they have the choice to participate fully in community life • that they have the choice to work in productive employment, and • that they can be constructive and valued members of their families and their


The Prime Minister made the fundamental point that social and economic goals must be complementary. A strong and sustainable safety net requires adequate resources. I understand the conference heard yesterday from Senator Chris Evans on Labor's "vision" for social policy. There is no vision in just running a scare campaign about a goods and services tax. I will return to that topic later but I will make one point, an

inescapable fact which Senator Evans and his colleagues refuse to see.

Without tax reform, the safety net is at risk in the long-term. This statement is not empty political rhetoric. Allow me to quote ACOSS's analysis of the ALP tax package:

"The major flaw in the package is that it fails to comprehensively strengthen the tax system in relation to income, consumption, and state revenues. As a result, the adequacy of future provision of essential income support payments and social services is put at risk"

NEW FAMILY AND COMMUNITY SERVICES PORTFOLIO As I have mentioned, the new Family and Community Services portfolio encompasses a 04/12/1998

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much broader range of services than the previous Department of Social Security. The new Department includes

• All of the former social security functions, as well as Centrelink and the Social Security Appeals Tribunal; • Family support services from across government, including the children's services program, the Child Support Agency, the Institute of Family Studies, family

relationships services and support for homeless people; and • Disability services programs and the Commonwealth Rehabilitation Service, from the old Department of Health and Family Services.

The new department is responsible for a wide range of programs and services covering family support, people with disabilities, child care and income security.

The Department will also work with other departments in related areas affecting the living standards of most Australians, such as health, housing, education, taxation, superannuation, savings and industry (particularly employment policy).

This arrangement means that the Department will undertake most of the work on improving family policies and services. At the same time, the Department will contribute to developing wider government reforms - for example, we have a senior representative on the Treasury team, charged with implementing the government's tax plan.

It gives us the opportunity too, as I said before, to better integrate and link income support and services. In the disabilities area, for example, we now have income support payments, specialised employment and the assistance we provide to States for accommodation, support and related services. Bringing all these together will help get the policy links right between income support and services for people with disabilities.

The new portfolio encompasses a number of service delivery bodies and mechanisms. The two public sector agencies ACROD members are probably most interested in are CRS Australia and Centrelink.

Commonwealth Rehabilitation Service Each year, through its network of 160 offices, the CRS helps about 26,000 people with an injury or disability return to the workplace.

Like all Government programs, this important service must be delivered efficiently. The Government believes people should have greater choice and should be able to select their provider. To maximise the benefits of the Commonwealth resources devoted to rehabilitation, we believe that the government provider should be exposed to competition from non-government service providers. The service will, of course, continue to be free to eligible persons. People in rural and remote areas will not be disadvantaged.

Centrelink Centrelink was established as a 'one-stop' shop to provide services to Australians needing income support, as well as access to employment assistance and many of the community services offered previously by several departments. In just one year, Centrelink has made impressive progress and the Government is very pleased by what has been achieved in such a short time.

Centrelink was created to improve government services delivery. Customers wanted to have a single accessible point of contact for their social security needs - Centrelink fulfils this need. Customers want prompt service and accurate advice - the new service model announced earlier this month by Centrelink will provide for more point of contact decision

making and faster response times.

I'm the first to admit that there have been some teething problems with the new agency. This is hardly surprising for such a major administrative reform. In the disabilities area, 04/12/1998

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Centrelink drew together services provided previously by three Departments. Inevitably it has been these transitional problems, rather than Centrelines far more important successes, which have received publicity. How many people know that complaints to the Ombudsman about services delivered by Centrelink are 11 % lower this year than in the last year of the old arrangements?

What is happening in Centrelink is a major cultural change towards a much more customer-focused organisation. Separating policy and service delivery has meant that customer service is the clear, overriding goal of Centrelink.

Centrelink has streamlined disability pension forms and claims, and introduced telephone lodgements of claims and provisional payments.

Centrelink now has over 260 specialist disability officers and most Customer Service Centres have a Disability and Carer Team.

The new service model present challenges for Centrelink staff. Staff will be expected to take on greater responsibilities for individual case management and to provide customers with point of contact decisions. Customers will have the name and phone number of the person handling their file. We have committed significant resources to training staff and to improving information technology systems.

The Government also intends to make Centrelink more accessible. Customers will be able to do business via the internet, by phone and fax and at electronic information kiosks around the country. Centrelink customers want better access. Over the last year,

8,000 customers have been consulted through workshops to identify their needs. These innovations are a direct response to customer preferences.

Recent public attention on Centrelink has tended, unfortunately, to focus on the staff redundancies which will occur over this year and possibly the next two years. From the time the Government announced the establishment of Centrelink, it was made clear that

consolidating services offered by different agencies would produce resource savings by eliminating duplication and other costs.

At the same time, the Government allocated significant start-up funds to ensure Centrelink had adequate resources to begin operation as a new, customer-focused agency.

The Centrelink Board believes that the organisation has became more efficiency and can meet this efficiency dividend. There will be changes in total staff numbers, but only through natural attrition and voluntary redundancies. The Centrelink Board has assured me that the organisation will meet the Government's and the public's expectations for improved service delivery. I will certainly be monitoring their performance.

Centrelink say they can deliver this with increased productivity, new technologies, more (but smaller) offices and specialised customer service. No offices will be closed as a result of the new service model; indeed at least fifty new offices will be opened. I will be opening an extra office in northern Cairns later today. About 50 Centrelink offices have already achieved the productivity target necessary to achieve the reforms set for the end of next year 1999 ! With results like these, I'm very confident Centrelink will continue to provide a very high level of services over the coming years.

ADDRESSING ACROD'S CONCERNS I know that ACROD has some specific concerns about government reforms in some areas of service delivery, including employment services. I want to assure you that the Government has been listening to what you have to say and I look forward to continuing to consult with your organisation in the future.

I'm sure everyone will agree that there were some very real problems with previous arrangements for service delivery and employment assistance. As with all government programs, resources are limited. However, it was clear that these resources were not 04/12/1998

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delivering the best results for the people we wish to help.

Some people with moderate to severe disabilities were not receiving the assistance they needed to get into real jobs. It was difficult to target funding without information on the people using services and the effects of their disability on their work prospects.

Difficult decisions had to be made.

The new arrangements were introduced this year to give people with disabilities the best possible service, tailored to their needs. We also wanted to ensure that the resources available went to those people with the greatest need. I doubt that anyone would dispute these aims.

However, I know that some agencies have been critical of the processes and the way Centrelink assesses the severity of a job-seeker's employment handicaps.

Employment Assistance One concern which has been raised is that, under changes mooted for January 1999, people with moderate to severe disabilities may have to go to a Centrelink customer service centre as part of 'job streaming'. Concerns on this issue were raised with me by some providers in my own electorate last week.

I'm pleased to say Senator Newman and I have considered the issue and agree with ACROD that this may present difficulties for some people with disabilities.

We have decided that the current transitional system, whereby service providers help job seekers to complete the relevant employment assistance application forms and then pass them on to Centrelink, will continue beyond 31 December this year.

Job seekers may, of course, go to Centrelink if they prefer. It will be their choice.

I think this arrangement is in the best interests of people with disabilities. It still provides a streamlined and simple process and does not compromise the aim of ensuring better targeting of employment services.

However, one aspect of the transitional arrangements will not continue after 31 December, because it does mitigate against assistance going to the people in greatest need.

From 1 January, job seekers with low disability-related barriers to employment (scoring under 50 on the assessment tool) will not be eligible for FaCS funding and will need to visit Centrelink to undergo an assessment and referral for access to the Job Network.

When the Job Network was set up we promised that the number of people with disabilities accessing mainstream labour market assistance would not fall. We've kept that promise, and around 15% of Job Network clients are people who have a disability which impacts on their capacity to work.

I think, in the main, the Job Network has begun quite well, considering it represented such a major change in the way employment services are delivered. Both Tony Abbott and Peter Reith are looking at ways to improve its operations, and I am contributing to that process.

Assessment tool and threshold score I am aware that there are also concerns about the assessment tool and the threshold score for eligibility for specialist FaCS disability services. I understand that the needs of people with psychiatric or other episodic disabilities and those with sensory impairments have been mentioned as especially problematic. These conditions are inherently difficult for any assessment system.

Warwick Smith and the Department considered the assessment tool very carefully before 04/12/1998

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it was introduced. Simply put, it is the best way we have at the moment to look at how severe a person’s barrier is to entering the workforce. So, we can't just discard it. But we appreciate that it may not be perfect and may benefit from some changes.

An Industry Reference Group was established to advise the Government on this, and other issues. Because of the election, the Group report has been delayed till April next year. I hope that the Group can suggest worthwhile improvements to the assessment

tool. I'd be pleased to consider ACROD's views as part of this process, and I will ensure you have the opportunity to comment on the Group's recommendations as early as possible.

Job Matching I also know some ACROD members are concerned about people with disabilities having access to Job Matching services under the Job Network. Warwick Smith and David Kemp were working on this issue before the election, and I can assure you I'll be continuing to discuss this issue with the new Minister, Tony Abbott.

TAX REFORM I mentioned earlier the Government's commitment to tax reform in Australia. And that maintaining a satisfactory social safety net depends on a robust and sustainable revenue base.

Although generally supportive of tax reform, ACROD has expressed concern about how the GST will affect their charitable and commercial operations. You are also worried about the plan to restrict FBT exemptions for public benevolent agencies to a $17,000 grossed up limit for each staff member.

The Prime Minister made it clear on ABC radio earlier this week that:

We do notin any way intend to burden the charitable activities of Australians or in any way discourage giving to charities through the introduction of the GST... That's our intention, and we will see that it doesn't happen.

The Treasurer went further to promise that charities would be better off with tax reform, as charities will not pay GST but will be able to claim the GST back on their inputs.

However,, commercial activities undertaken by not-for-profit organisations in competition with private commercial businesses will be subject to the GST. This is only fair given that the livelihoods of many people are involved. The definition of "commercial activities" is something the Government asked David Voss and his Tax Consultative Committee to

investigate. The Voss Report has now been considered by the Government and its recommendations will be reflected in the legislation likely to be introduced to the House of Representatives on Wednesday.

On Fringe Benefits Tax, I know that ACROD has been quite responsibly urging its members to limit salary side benefits. But some charitable bodies have been making very extensive use of their FBT exempt status, giving rise to legitimate community concern.

The Government believes that the proposed allowance of $17,000 grossed up value before an FBT applies is a responsible one - one that other taxpayers would regard as fair. It still provides a considerable concession that recognises the salary matching problems of the charitable sector.

OTHER TAX ISSUES I don't wish to use this conference as a platform for a debate with the Opposition on tax reform - we have other places for that.

However, I cannot allow Senator Evan's remarks yesterday to go without a response.

Senator Evans made some completely wrong comments about the supposed 04/12/1998

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inadequacy of the tax reform compensation being offered by the Government to people receiving social security benefits. The reform package includes a commitment to increase pensions by 4% on 1 July 2000, that is at the same time as the GST is introduced. In addition, we have guaranteed that benefits will remain at 1.5% above any increase in the CPI caused by the tax changes. There are other compensation mechanisms to protect savings and investment incomes for pensioners and self-funded


Contrary to what Senator Evans claims, it is extremely unlikely that the GST rate will ever increase - the mechanisms to be put into place will require that all governments in Australia, and both houses of federal parliament, will need to agree for an increase to occur.

Transferring the GST revenue stream to the States and Territories is intended to improve their capacity to deliver services by giving them, at last, a secure revenue base. Senator Evan's idea that this arrangement is intended to replace Special Purpose Payments and to transfer functions such as Medicare to the States has no basis in fact.

These are silly claims, reflecting either political ignorance or a desperate attempt to divert attention from the Opposition's own lack of policies. At the last election, only the Coalition presented a coherent set of policies to voters. The ALP did not. If Senator Evan's efforts

are any indication, the next election will be the same. Unlike the ALP, we do have a plan for Australia's future. We will faithfully implement what we have been elected to do.

GOVERNMENT'S ACHIEVEMENTS FOR PEOPLE WITH DISABILITIES Before I finish, I want to remind you of the good news for people with disabilities - the Government's record of support for them and for their carers.

• In the middle of this year we signed the Second Commonwealth/State Disability Agreement with all the States and Territories. This included a landmark, nationally consistent-framework for disability services. • Under the agreement, there was a $37 million increase in funds for State and

Territory governments 13% more than Labor provided in its last year of office, under the First Agreement. This new money includes targeted assistance for ageing carers from our Staying at Home package - with guaranteed growth each year. • The Commonwealth is spending an extra $54 million on disability employment

assistance services from non-government providers a 26% increase on Labor's expenditure • There's also the $20 million election commitment for carer respite, for carers of young people with disabilities. I guarantee these funds will be tied to the care of this

group and we'll be talking to you about how we can best make this happen. • Over 20,000 new job seekers with disabilities have received disability employment services since July 1996. • We've put in place a comprehensive package of employer incentives for wage

subsidies, workplace modifications, wage assessment and direct placement officers • In the last Budget, we expanded eligibility for the Domiciliary Nursing Care Benefit for carers of adult people with disabilities. This means, from July 1999, 14,000

more carers will benefit.

CONCLUSION In summing up I want to make two important points.

I believe that, with the creation of the Family and Community Services portfolio, we have new opportunities to produce more effective policies and services for people with disabilities.

The new arrangements gives renewed emphasis to collaboration and partnerships between the Government and the non-government sector, where we can work together 04/12/1998

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to find new and better ways of doing things:

I recognise ACROD as a major stakeholder in this process and I am looking forward to working with you in my new role.

I understand you have some questions for me. I suspect most of you in the audience have a level of expertise that no Minister could ever hope to match. And you might want to discuss some very technical issues. So, while I'm happy to deal with some of the broader issues you may wish to raise, Barry Wight, from the department is here in case you need more detailed answers.


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Minister for Family and Community Services Dept of Family and Community Services Centrelink 04/12/1998