Madonna Jarrett (Brisbane, Australian Labor Party) Share this | Hansard source

I rise in support of this bill, Social Security and Other Legislation Amendment (Technical Changes No. 2) Bill 2025. Like many in the Brisbane community, I had grandparents and, now, another family member who relied on the economic support of the government to survive. They were hardworking. They paid their taxes. They contributed to society and to our economy. They looked after their neighbours. One had a terrible illness in the prime of their life that left them as a paraplegic, amongst other complications. They were a fit, outdoor blue-collar worker. The illness happened through no fault of their own. As for many, sometimes life just happens. They now rely on government payment support because they have to; their ability to work and earn a living is gone.

I tell this story because this is the primary purpose of social security: to provide economic and social wellbeing by creating a safety net for individuals and families who cannot fully support themselves due to age, disability, unemployment or other circumstances. Our social security system is something to be really proud of. It's a system that goes to our values as a government: no-one held back and no-one left behind. It is part of our identity and how we view ourselves as a nation—one that helps those when they need help the most. This is at the heart of why I am in this House. They are the values I live by. These are Labor values.

In Australia, the concept of social security was first introduced in 1908, when the Commonwealth parliament passed the Invalid and Old Age Pension Act. It provided financial support to the elderly and the ill. It followed the economic depression of the early 1890s, when poverty was widespread and the idea of who should support those unable to look after themselves was a big topic of debate. In the 1940s, Labor Prime Minister Curtin announced the development of a national welfare scheme, including sickness and unemployment benefits. Then, building on his legacy, the post-war Chifley government held the social services referendum—again, a Labor government. This allowed a change to the Constitution which granted the Commonwealth power to legislate for a wide range of social services, and these changes laid the foundations for the modern social security system we have in this country today.

This Labor government continues the fundamental principles underpinning social security, providing a safety net when people need it the most. We are also committed to a fairer and more efficient social security system. This bill does just that. This legislation is the government's response to the full Federal Court Chaplin case, which established beyond doubt that income apportionment was unlawful. We've heard a bit about that today. Income apportionment was the method used by Services Australia to calculate social security debts between the early 1990s and 2020. It involved using evidence from the individual, such as payslips, to determine their entitlement to a social security payment. That was also used as part of calculating debt. Where it wasn't clear what a person's exact daily earnings were, the employment income could be apportioned over two or more Centrelink fortnights. This practice is now understood to have been inconsistent with legislative provisions at the time. Just to be clear, this government has never used this practice, but, under the scheme, debt had accrued to some Australians.

If debt is reopened in this fashion, it will cause a number of issues. First, it would cause distress, delay and uncertainty for people with debt. Second, in some cases, debts are decades old and some have been repaid where maybe they might not have been correctly calculated. Third, it would also divert critical government resources from frontline services that help people who need support now. So this legislation avoids the need to recalculate potentially millions of debts, at a significant cost to the Australian social security system. That is why we are legislating also to put the historical practice of income apportionment on clearer legal footing. This bill will wipe out almost half of Australia's undetermined social security debt backlog. It's anticipated that, as a result, around 1.2 million undetermined debts are expected to be waived or not raised in 2025-26. We will establish a scheme also to roll out resolution payments for those impacted by income apportionment.

This bill will also increase the threshold for waiving small debts for the first time in over 30 years. It'll change from $50 to $250. Since 1990, that's a long time for something not to change. That small debt waiver amount has not kept pace with the value of government payments, which have tripled since 1993, and it no longer reflects what a small debt means to many people today. As has been mentioned in this House earlier, often the administrative cost of recouping small debts is higher than the value of the debt itself, making the process of debt recovery uneconomical. The changes in this bill will mean Services Australia does not waste time or resources chasing small debts, and they will spare Australians significant stress, particularly those who have accidental debts. Setting the threshold at $250 recognises people generally engage with the social security system in good faith while continuing to ensure responsible fiscal management.

This bill will also protect Australians who are subject to financial abuse and coercive control, which, as we all know, are predominantly women. As part of our election commitment, we committed to embed safety in Commonwealth systems. The government is legislating changes to better protect victims-survivors and prevent the social security system being weaponised against them. Financial abuse—as we heard from the member for Bonner—and coercive control are serious forms of family and domestic violence. The changes delivered through this bill will give Services Australia extended powers to waive social security debts that have been incurred as a result of coercion or financial abuse. What this means is that, when considering a debt waiver, a Services Australia official will be able to take into account all the circumstances that led to somebody knowingly making false statements to Services Australia or not complying with the law, and this includes coercion or financial abuse. This change directly responds to a recommendation of the 2024 Parliamentary Joint Committee on Corporations and Financial Services inquiry into financial abuse. It also demonstrates the government's resolve in delivering on its commitment to support victims-survivors under the National Plan to End Violence against Women and Children 2022-2032.

But, as I said before, we know this is a first step. The government is doing more to address financial abuse, including consulting on changes to tax and social security laws so perpetrators, not victims-survivors, are accountable for debts they accrue through financial abuse. We know that financial abuse is one of the most powerful tools perpetrators use to trap women and children. That's very sad. These changes are about putting control back in the hands of victims-survivors, removing unnecessary harm and making sure our system supports safety and dignity.

To compensate people with potentially affected debts, the bill establishes the Income Apportionment Resolution Scheme. Through this scheme, people with historical debts potentially affected by income apportionment from 1 September 2003 to 6 December 2020 will be eligible to apply for a resolution payment. This is in recognition of the fact that we know this method of calculating entitlement was invalid. To assist those affected to navigate the resolution scheme, Economic Justice Australia and the Australian Council of Social Service will each be given $400,000 in funding. The amount of compensation available will be based on a person's determined debt, with resolution payment amounts up to $600. The Minister for Social Services recently also announced a new $300 million package to support this reform. Further details on how and where to apply for compensation will be available following the passage of the legislation.

This bill really is an important step towards social security debt reform. It's important to note that, when issues are identified within a system, action is taken by this government to ensure that there is public confidence in that system. That's really important given what we've gone through over the last decade. This approach is quite opposite to the recent robodebt scandal, which was overseen by those opposite. Work was recently undertaken by the Attorney-General where an historic agreement to settle the Knox v Commonwealth class action was reached. This was an appeal from the original robodebt class action settlement in 2020. In the Attorney-General's own words:

When the unfairness, the illegality and the cruelty of robodebt became apparent, the approach of those opposite was to double down, to go on the attack against those who complained and to maintain the falsehood that in fact the system had not changed at all. But, when this government—

the Labor government—

came to office, we—

took swift action and—

established a royal commission which heard tragic stories of people being hounded by their own government to repay debts they did not even owe. None of us should forget—

I will never forget—

former minister Alan Tudge saying to vulnerable Australians, 'We'll find you, we'll track you down, you will have to repay those debts, and you may end up in prison.'

Is this how we treat some of the most vulnerable people living in our society? This goes to the true character of those opposite. It is a Labor government that cares about people. The Attorney-General said:

The royal commission's findings were damning. Commissioner Holmes found that robodebt was 'a crude and cruel mechanism, neither fair nor legal' and 'a costly failure of public administration, in both human and economic terms'

On this side of the House, we believe in strong social security which helps our fellow Australians, including those in my community in Brisbane, when they need it the most, whether that's a local pensioner who receives the age pension—someone who has worked hard their entire life and has now reached retirement age but cannot fully support themselves financially—or a local student under the age of 25 who might be studying or training at TAFE or university and is receiving youth allowance. Maybe it's a dedicated carer receiving a carers payment and providing critical support to those who cannot support themselves. Maybe it's a single parent who is receiving the single parenting payment and who is the main carer for a young child. Maybe it's simply income support for a jobseeker, for someone who is looking for work, who may be sick or cannot work.

In Australia, our values are based on respect, fairness and equal opportunity, and these values go to the heart of why we have a social security in this country that is designed the way it is. It recognises the inherent human right to a decent standard of living and helps individuals live with dignity, free from excessive hardship. It provides a sense of security and stability, ensuring that people's living standards are not drastically eroded by unpredictable social or economic events.

By providing a safety net, social security aims to prevent social exclusion and promote social inclusion. It enables people to participate in society. Social security not only addresses the needs as they arise but also works to prevent risks and help individuals and families adjust to unavoidable disadvantages. The people in my Brisbane community benefit from social security, as do millions of Australians, and this bill supports and makes our social security system more robust, stronger and fairer. I commend the bill to the House.

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