Media Release by Senator the Hon Amanda Vanstone

‘Independent’ breaching report old news

I am pleased that many of the recommendations made by Professor Pearce on breaching are consistent with much of the good work that Centrelink is already doing to help disadvantaged job seekers and to ensure that all customers know their obligations.

Twenty six of the Pearce Report’s recommendations fall within my portfolio and the majority of those have, in substance, either already been put in place or are in the process of being implemented. While I welcome any participation in the breaching policy debate, much of Professor Pearce’s Report is therefore old news (see attachment).

However, some parts of the Report do not reflect what the wider community expects. What Professor Pearce and ACOSS need to understand is that taxpayers regard ‘the dole’ as a taxpayer funded payment for undertaking the job of looking for work.

Taxpayers think that looking for work is just as serious a job as actually working. Looking for work on ‘the dole’ is not an optional activity but an absolute requirement. After all, if you don’t turn up to work you’re not breached, you’re fired.

Last week, I announced breaching policy changes that would protect vulnerable job seekers, reduce penalties for missing an appointment and make it harder for that small group of people who want to cheat the system.

These changes received support from key organisations in the welfare sector.

The announcement builds on the good work that Centrelink has done to identify vulnerable customers, particularly the 3rd Breach Alert introduced in June 2001. In fact, largely as a result of this work breach numbers have actually decreased by about 20% over the period July to December 2001 compared to the same period in 2000.

One key initiative of last week’s announcement was the introduction of temporary suspensions for job seekers who miss appointments. This will address a number of Professor Pearce’s concerns.

There are four issues raised in the Report that I particularly want to comment on.

First, the Report states a number of times that Centrelink staff are exposed to excessive pressure or incentives to impose penalties. This is just not so.

Centrelink officers explained to the authors that their assertion was wrong before the Report was printed. It is simply unacceptable they have continued to peddle this myth.

There are no explicit or implicit targets on the number of breach decisions that have to be made. There are no performance requirements on Centrelink through its partnership arrangements that require this. There are no staff performance requirements either and no rewards.

Second, the Report criticises Centrelink for not following statutory requirements and due process when deciding whether a breach has occurred, for example, by not asking the job seeker if they have a reasonable excuse for missing an appointment before a breach decision is made.

In fact, Centrelink does everything it can to contact job seekers to see if a job seeker has a reasonable excuse for missing an appointment.

The reality is that Centrelink cannot help job seekers if the job seekers cannot be contacted.

The new temporary suspension initiative will encourage job seekers to come into Centrelink so that their issues can be worked through and so that Centrelink can examine whether they had a reasonable excuse for missing an appointment. If customers provide a reasonable excuse for failing to attend an interview then payments will be fully restored from the date of suspension.

Third, the Report recommends that penalties for breaches be cut by over 80 per cent in some cases.

Such a softening of the penalty regime does not reflect the wider community’s expectations. The current breach regime, which was extensively debated and passed in Parliament, is a proper reflection of the community’s expectations. The penalty regime was endorsed by Parliament and passed by Parliament. The penalty levels are designed to balance the need to provide a disincentive to non-compliance with the need to avoid putting people into undue hardship.

It is therefore a bit rich for Wayne Swan to be continually criticising the breaching system when Labor actually passed the legislation that implemented the breaching system.

That said, my announcement last week reduced the penalty for not attending an interview from an activity test breach to an administrative breach, thereby attracting the lesser penalty of a 16 per cent reduction of payments for 13 weeks instead of an 18 per cent reduction for 26 weeks.

While we are doing everything possible to ensure that vulnerable job seekers are treated fairly, we want the system to be tough on job seekers who simply cannot be bothered turning up.

Finally, the recommendation that customers be allowed to report income when it is received, not when it is earned, simply invites disreputable employers and workers to manipulate the system. Employers and workers could collude to take their wages as a lump sum and therefore only affect their payments in one fortnight. Income must be reported when you are earning it. People know when they are working; it’s naïve to suggest otherwise.

Attachment follows

Summary response to Pearce Report recommendations

Of the 36 recommendations, 26 are mainly or wholly in my portfolio.

Agree. Centrelink advise that the following recommendations have, in substance, either already been implemented or are in the process of being implemented largely as a consequence of Centrelink’s Review of Breaching Practices and Guidelines

  • R1 (1 & 2) Initial Centrelink interviews
  • R2 Especially Vulnerable Jobseekers
  • R3 Centrelink Information Seminars
  • R4 Special Follow-up Interviews
  • R6 (1, 3, 4) Contacting Jobseekers
  • R7 New Options for Making Contact
  • R8 Effective Communication
  • R9 Arrangements for Especially Vulnerable Jobseekers
  • R15 Activity Test Exemptions
  • R16 Activity Agreements
  • R20 Centrelink Investigations
  • R21 Referral to Specialist Officers
  • R22 (1) Imposition of Breaches
  • R23 Guidelines, Training and Monitoring
  • R26 (2 &3) Notification of Penalties
  • R28 (1) Post-breach Referrals
  • R31 Administrative Review
  • R35 Community Monitoring and Consultation

Disagree – The following recommendations we believe are either simply not necessary or are flawed

  • R1 (3) Initial Centrelink interviews
  • R6 (2) Contacting Jobseekers
  • R17 Reporting Income
  • R22 (2 & 3) Imposition of Breaches
  • R24 Structure of the Penalty System
  • R25 Recovery, Rate and Duration of Penalties
  • R26 (1) Notification of Penalties
  • R27 Relief from Penalties
  • R28 (2) Post-breach Referrals
  • R29 Moves to Low-employment Areas
  • R32 Independent Advice
  • R33 Contracts and Internal Monitoring
  • R34 Special Support Teams