Katy Gallagher (ACT, Australian Labor Party, Minister for the Public Service) Share this | Hansard source

On the issue of income apportionment, this practice was utilised over many years—I think going back to the 1990s—and it was understood to be a lawful way of interpreting the social security legislation. As it turns out—and, as senators know, that has now become clear—it is incorrect, and that process had been used in an inconsistent way with the legislation.

As I just said, in relation to explaining our opposition to the amendment being moved, I understand retrospective legislation is something that is used very rarely. Nobody, I think, enjoys coming in and doing retrospective legislation. On very rare occasions, there are times when it is the appropriate course of action. In relation to the issues that I've just outlined, in relation to the cost, in relation to the millions of customers that would have to go back and the amount of resources that would be displaced to go and deal with this, if we weren't retrospectively dealing with this matter, I think it would be just unreasonable.

In the vast majority of cases, income apportionment only affected debts around the margins, like I just said. These are the situations where the person was overpaid. The question is just by how much. Most of those debts are not due to fraud. Debts can occur because a person made a mistake when reporting, or due to an unintended oversight, but they are still debts, and I think that needs to be understood.

In the vast majority of those cases, it would be unreasonable to waive that debt in full. For example, there was a $3,900 Newstart allowance debt that arose because a person misrepresented their earnings from multiple employers for 10 months in 2016. When recalculated, that debt decreased by $300, but this is still a significant amount owed to the government. Based on all the information available to us and the resources that would have had to have been deployed if we were to have gone back and investigated all of those cases, and in some cases spending hours only to find out that income apportionment hadn't been used—so there were all of those examples as well—the government decided that this was the most appropriate course of action.