Senate debates

Monday, 15 March 2010

Families, Housing, Community Services and Indigenous Affairs and Other Legislation Amendment (2009 Measures) Bill 2009

Second Reading

Debate resumed from 24 February, on motion by Senator Wong:

That this bill be now read a second time.

5:50 pm

Photo of Mitch FifieldMitch Fifield (Victoria, Liberal Party, Shadow Parliamentary Secretary for Disabilities, Carers and the Voluntary Sector) Share this | | Hansard source

I rise today to speak on the Families, Housing, Community Services and Indigenous Affairs and Other Legislation Amendment (2009 Measures) Bill 2009. This is a bill that is essentially a compilation of a number of minor amendments across the portfolio. Schedule 1 will amend the Aboriginal Land Rights (Northern Territory) Act 1976 to schedule parcels of land so they can be granted to Aboriginal land trusts. Schedule 2 makes changes to income management provisions in social security law—and particularly in respect to Cape York—which will allow for aged pensioners and carer payment recipients to be income managed. This change, at the request of the Family Responsibilities Commission, will bring Cape York into uniformity with the other income managed areas in Australia.

Schedule 3 will amend legislation regarding the operation of the Social Security Appeals Tribunal. The amendments include changes to the titles of positions from executive director and director to principal member and senior member respectively. Subsequently, the principal member will be provided with the ability to directly request, inspect, copy and retain certain documents from an individual which are seen to be relevant. It will also become practice that the Social Security Appeals Tribunal can conduct pre-hearing conferences with the relevant parties and subsequently make decisions when agreements are made in social security and family assistance law appeals.

This amendment will bring pre-hearing arrangements in line with those currently under the Child Support (Registration and Collection) Act 1988. As the Social Security Appeals Tribunal, in their 2008-09 annual report states:

... appeals in the child support jurisdiction has contributed to the improved timeliness in these areas.

The ability to conduct pre-hearings with the parties involved and resolve the issues without the need for further hearings leads to a more speedy resolution of the issues and disputes before the Social Security Appeals Tribunal.

Schedule 4 amendments ensure that, where disposed-of assets are returned to the person, they will not be double counted when assets are assessed for means test purposes. Schedule 5 amendments clarify provisions relating to beneficiaries of discretionary trusts and assessed as a private trust and not on future beneficiaries of the trust when they are not currently receiving any benefits from it.

Schedule 6 makes amendments to the baby bonus, a payment introduced by the former coalition government in recognition of additional costs associated with having a new child. This amendment requires that when there is a change of carer Centrelink is notified as soon as practicably possible to ensure that the initial carer is not in receipt of overpayment of the baby bonus. The opposition will not be opposing this bill.

5:53 pm

Photo of Rachel SiewertRachel Siewert (WA, Australian Greens) Share this | | Hansard source

The Greens overall do not have problems with most of the amendments that are part of the Families, Housing, Community Services and Indigenous Affairs and Other Legislation Amendment (2009 Measures) Bill 2009. However, we have specific issues with an element of schedule 3, which introduces changes to the functioning of the Social Security Appeals Tribunal, the SSAT. I have some concerns about the amendments relating to pre-hearing conferences. I believe that they undermine the current functioning of the Social Security Appeals Tribunal and will make it more complex and time consuming while at the same time delivering poorer outcomes for those appealing Centrelink decisions.

This bill was part of a package of legislation that related to these changes and changes to the Racial Discrimination Act—along with the bill to do with welfare quarantining that we will be potentially considering later this week—that was considered during the most recent Senate Community Affairs Legislation Committee inquiry. What happened was that the bulk of the submissions, as you would expect, dealt with the changes to the Racial Discrimination Act and the income quarantining and did not specifically deal in great detail with these issues. Indeed, the committee report did not address these issues in great detail. However, the National Welfare Rights Network in fact did look at this issue in some great detail. I share many of the concerns that they raised in their very extensive submission.

The nature and intent of the SSAT is outlined in section 141 of the Social Security (Administration) Act 1999. The outline says that it will be ‘fair, just, economical, informal and quick’. By introducing pre-hearings, I am concerned that the SSAT will become a more formal and daunting process for Centrelink and Family Assistance Office clients who are representing themselves before the tribunal to appeal decisions. This is quite a stressful process for these people as it is. Having said that, we support it, because we believe that it is a good process. But it is quite stressful for people. We are concerned that these changes will make it more difficult for these people to exercise their right of appeal and reduce their access to procedural justice.

I am aware that there has been a significant increase in the number of appeals being heard by the SSAT over the last couple of years. Between 2007 and 2009 there was a 60 per cent increase in finalised cases. This means an extra 5,000 cases. While child support appeals were added to the SSAT in 2007, the vast majority of this increased case load relates to social security and family assistance. I suspect also that the Welfare to Work laws might have also been a significant factor.

However, I am not convinced that the government has presented to us a compelling case as to why this increase is happening, how these provisions will address emerging problems and whether this change will solve the underlying issues rather than simply brushing them aside. I am not convinced that the mechanism that they are introducing here to supposedly address these issues does in fact do so.

It must be noted that these changes are a precursor to the larger changes that we will be considering potentially later this week—these larger changes being the changes to Australia’s social security system that are being considered in a package of bills that also look at the RDA and income quarantining. We will be debating those later. I have flagged that we have concerns with those changes.

It must be understood that these changes to the operations to the Social Security Appeals Tribunal, the SSAT, come on the back of, firstly, the changes made that suspended access to the SSAT as part of the NT intervention measures introduced by the former government; secondly, the reinstatement of access to the SSAT for those subject to the NT intervention by the current government; and, thirdly, the changes proposed in the 2008 measures bill, which have yet to be dealt with in this chamber.

I should note the number of appeals that have been made following the changes to the appeals process under the NTER. While there have been a large number of internal reviews, fewer than five appeals had been made through the SSAT process as at February estimates. So there has not been a great take-up of those changes. I supported the reinstatement of access to the SSAT for those in prescribed communities. But at the time I noted that the majority of the decisions that Aboriginal Australians in prescribed communities objected to—particularly those to do with having their income quarantined—were decisions that had already been made, and so could not be challenged retrospectively. I also noted that this unfairness and racial discrimination was contained in the legislation, and so while the reinstatement of their repeal rights was welcome, Indigenous Australians in prescribed communities could not object to income quarantining. Those decisions, because they were made under the legislation, were not open to appeal under the SSAT, which means that I am not at all surprised that people have not been taking up their appeal rights under the SSAT. Their appeal rights have been curtailed under the legislation.

It is clear from answers at Senate estimates over a number of years that Aboriginal people are both much more likely to be breached by Centrelink and much less likely to appeal a negative decision. We need to appreciate the historical context to understand why, in general, Aboriginal Australians are both less likely to be aware of their appeal rights and, when they are aware of them, much less confident in their ability to appeal a decision and receive procedural fairness. We are concerned that, by changing the SSAT process even here with the pre-hearing hearings, Aboriginal Australians will be further disenfranchised from this appeals process.

With the introduction of the legislation to extend blanket income-quarantining into broader categories across the NT and across the rest of Australia, the likelihood of appeals and the amount of work likely to be faced by the SSAT will increase alarmingly, because people will be able to access the SSAT in a different manner to people in the prescribed communities that I was previously talking about. While I mentioned earlier that the primary objectionable decision to subject an individual to income quarantine cannot easily be appealed—because the objectionable bit is actually the legislation—there are a lot of individual administrative decisions involved in the day-to-day operations of income management that will be open to appeal. For example, somebody might apply to use their 100 per cent quarantined, matched savings to buy a computer so they can look for work or to get their car fixed so they can get to job interviews, and be refused on the grounds that these are non-essential items. All these items will be appealable if the legislation that is being introduced to the Senate—and that should be discussed later in the week—goes through.

The changes to the SSAT have been justified by the Department of Families, Housing, Community Services and Indigenous Affairs as aligning social security and family assistance with its child support jurisdiction. However, it must be understood that appeals against administrative decisions where the individual is in conflict with Centrelink or the department are totally different to decisions about the conflict within the child support system, in which the dispute is usually between two individual parties. The existing exclusion of Centrelink or the department from participating in SSAT hearings is a deliberate recognition of the imbalance in power that is inherent when an unrepresented individual is up against a legal representative of a government department. This imbalance is even more stark when we consider that, for an individual, it is likely to be their first time, whereas the department, of course, is likely to be involved in a large number of similar disputes.

There is a real risk that these changes will undermine the successful features of the current system for no good reason. The SSAT appeals procedures have been in place and working effectively for a long time. By comparison, the child support jurisdiction is relatively new, deals with a much smaller number of appeals and has not been independently evaluated. I cannot see how the argument that this realignment would make SSAT more efficient makes sense, considering that the child support jurisdiction has a much greater problem with the timeliness of decisions and much longer delays due to the high number of adjournments.

It should be noted that the claim of increased efficiency does not seem to sit well with the changes contained in the 2008 measures, which, as I said, have not been introduced and which we believe would add substantial procedural complexity to the SSAT process and elevate the role of the respondent departments or allow them into the SSAT review process. The National Welfare Rights Network has this to say:

It is critical that the Social Security and Family Assistance external merits review system provides a mechanism for review that is accessible and responsive to the needs of people using the system. Each day Centrelink makes millions of decisions under the Social Security Act 1991 and Family Assistance Act 1999 and related legislation, which have a direct impact on the daily lives of individuals. Whilst the decisions appealed are small in proportion to the number of decisions made, the outcome of the appeals lodged has consistently revealed over many years a high rate of error at the primary decision making stage. In 2008/09, Centrelink internal review officers changed 30.8% of the decisions reviewed and the SSAT changed approximately 29.9% of finalised decisions.

Those statistics are from Centrelink’s annual report of 2008-09. The data mentioned by the Welfare Rights Network clearly indicates that, where there were appeals, more than half of the time Centrelink was in fact wrong. Note that 31 per cent of the original decisions were changed by Centrelink itself; therefore, 69 per cent go to the SSAT. Then 30 per cent of those 69 per cent were found to be wrong. That is 21 per cent, and if you add that to the percentage that Centrlink changed themselves it is 52 per cent. That is a large number of decisions that Centrelink gets wrong. It highlights the importance of having an effective appeal system. It also highlights that the SSAT is being used.

The SSAT functions on an intermediate level of review and is designed and intended to allow reviews that are accessible, informal and relatively quick. With this number of appeals, and with the number of decisions Centrelink gets wrong, you can understand why. It allows an applicant to put their case in a straightforward way in a non-adversarial format. This format works well, because above the SSAT sits the higher tier of the Administrative Appeals Tribunal, or AAT. The SSAT is made up of a multi-skilled panel with experience and expertise in welfare, law and administration and must deal with a complex area of law and disadvantaged clients, many of whom have a poor level of education and understanding of the processes involved. Often it involves discussions of sensitive personal information, concerning sometimes the health, sexual relationships and problems of many disadvantaged individuals. This is why we believe a non-adversarial and more informal approach is the most appropriate.

The SSAT provides detailed written decisions which the department can then review and refer to the AAT for a more complex review process where it feels it is necessary. I cannot see the logic behind making the SSAT more complex, more adversarial and a more ‘AAT-like’ process. There is little to be gained by creating an inferior version of the AAT, particularly when we see from the evidence that the SSAT is picking up a high number of poor decisions and is doing so in an efficient and cost-effective manner. I believe that the right of appeal to the AAT makes the participation of the department in the SSAT unnecessary. What is the department hoping to achieve by this? We are worried that it may in fact have an effect of being more intimidatory to the people that are involved. No system is perfect, but we are very concerned that this may affect a system that has in fact been helping deal with a number of areas where Centrelink have in fact made the wrong decision or a poor decision.

The introduction of pre-hearing conferences we believe adds an unnecessary layer of complexity to the SSAT proceedings. Given the informal approach taken by the SSAT to the sensitive issues it deals with, the participation of the department in pre-hearing conferences is likely to make these much more formal affairs. This may have the bizarre result of making the pre-hearing conference much more formal than the actual hearings, but it is also likely to make the hearings themselves more formal and less effective. The usual reason for a pre-hearing conference within an adversarial system is to give parties an opportunity to come to a pre-hearing settlement. However, given the evidence that more than half of the appeals to the SSAT were based on circumstances where Centrelink had got the facts wrong, had insufficient information to make a reasonable decision or made an error in their interpretation of the legislation, it is unfair and unreasonable to be pushing respondents to pursue settlement, and we believe this is undermining the important role of the independent and in-depth review by the SSAT and the role that it plays in bringing to light and remedying poor decision-making processes within the bureaucracy. To this end I recommend that the provisions relating to pre-hearing conferences should be dropped from this legislation.

We also have some concerns about single-member panels, although, as you can tell, we are very deeply concerned about the pre-hearing amendments. As it currently stands, up to four members of the SSAT can hear a review. In practice this tends to result in a minimum panel of two for the majority of straightforward cases, with three-member panels being used predominantly for more complex matters, or when a new panel member is learning the process. Panel membership is usually decided based on the relevant expertise for particular appeals that they may be dealing with, particularly for the more complex legal, medical or family issues. I am not convinced that moves to encourage single-member panels are a good idea. I believe that this undermines the effectiveness of the collaborative decision-making process of multi-member panels and their ability to combine elements of different expertise to tackle the intricacies of particular cases. I am concerned that single-member panels are likely to be less balanced and to produce outcomes that are perhaps less fair. I am also concerned about the process being more open to external pressures. I suggest that single-member panels should only be considered in the most extenuating circumstances where it is necessary to hear a matter quickly and the applicant to the review gives free, prior, informed consent to a single-member hearing.

Other elements of the legislation we do not have so much concern about. Having considered these issues substantially, it is this particular SSAT area that we have some concerns about. The SSAT is very important to people using Centrelink and it is important that they have access to a fully functioning SSAT. While we are not opposed to changes per se, we are concerned that the changes the government proposes here will undermine the current effectiveness of the SSAT. The fact is that Centrelink do get some decisions wrong. They deal with a number of cases. I am not having a go at Centrelink, but the point is that we need to make sure that there is an open process and a good process for appeals where those decisions are wrong.

Photo of Judith TroethJudith Troeth (Victoria, Liberal Party) Share this | | Hansard source

Senator Siewert, will you be circulating amendments for the committee stage of the bill?

Photo of Rachel SiewertRachel Siewert (WA, Australian Greens) Share this | | Hansard source

This legislation came on slightly earlier than anticipated, so the amendments are just being organised now.

6:12 pm

Photo of Claire MooreClaire Moore (Queensland, Australian Labor Party) Share this | | Hansard source

This bill covers a range of different items under the family assistance area but I particularly wanted to make some comments on the SSAT. Senator Siewert and I have had these discussions on a number of occasions. In terms of the processes before us under this bill, we are seeking to make this whole process more transparent and more user-friendly for the people who are involved in it. We know, and Senator Siewert has pointed out, the statistics regarding SSAT appeals, and one of the major issues is that we do not believe generally that people have total understanding of the process in which they are operating. Certainly over many years there have been attempts for the department to ensure that people understand their rights to appeal, but consistently what we find when people are going through the social security system—through Centrelink—they are unsure of their rights and the processes, and one of things we have to do is ensure that clarity is maintained and that people are fully aware of the processes and the decision-making process within the department.

I disagree strongly with Senator Siewert’s proposition that the process put forward in this piece of legislation which asks for a pre-conference in any way puts more pressure on the people involved or makes the process less clear. The idea of having a conference before the formal hearing is exactly that. It ensures that people are able to get together. Madam Acting Deputy President, anyone who has gone through a formal SSAT hearing understands that it can be stressful and, in terms of bringing forward people’s knowledge and expectations of the process, can actually cause more stress on those people who are involved in working their way through the sometimes quite difficult process within Centrelink. The basis for bringing forward this process to the SSAT is to ensure that people understand their rights throughout the whole process. From the time that they receive a decision from Centrelink they should be in full understanding about the ways that they can question that decision, the documentation that is required and, most importantly, the appropriate process for appeal.

On numerous occasions in my past life I have been involved with people from Centrelink, and previously Social Security, and also clients of the organisation who were, through this process, able to come to some greater awareness as they were able to clarify the situation, become sure of the background to decisions and actually get the appropriate documentation. Very often under the previous system, by the time you actually started the ball rolling you were through to a formal hearing process. However, on so many occasions, by having an appropriate discussion beforehand—and this discussion does not necessarily mean that there is pressure from one side or the other—full documentation can be exchanged, people can clarify the reasons for the decision and the process can therefore be streamlined. This has been used in the child support process.

There has been much discussion between the different agencies about best practice. In no way do the changes in this legislation make it more difficult to appeal, bully someone into not appealing or put further obstacles in the way of people who are seeking to pursue their rights under the system. What they do is add a level of communication. In many ways this is the whole intent: to enforce effective communication. The department have actually put themselves on trial as much as the people who are challenging the decision, because it is in their best interests to ensure that people know what is going on and have their situation clearly understood. I feel very strongly about this element of the legislation. It would sadden me if the kinds of fears that have been put forward, in some cases by various advocacy groups in the community, were used to say that this legislation would be damaging to those involved. Any interaction between a client and the department can be difficult. Of course it is our intention that that is minimised. But this aspect of an effective appeals process adds to the way that people can understand and achieve their rights rather than in any way putting another obstacle in place.

6:16 pm

Photo of Ursula StephensUrsula Stephens (NSW, Australian Labor Party, Parliamentary Secretary for Social Inclusion and the Voluntary Sector) Share this | | Hansard source

I thank Senator Moore for her contribution. I also thank Senator Siewert for her consideration of the Families, Housing, Community Services and Indigenous Affairs and Other Legislation Amendment (2009 Measures) Bill 2009. I know that your work in and understanding of this area actually helps us to clarify many of these decisions. We had an indication from Senator Fifield that the opposition is supporting this bill. But I want to put on the record what the various minor amendments to the act that are incorporated in this bill are and deal with the schedules in the bill.

These are minor amendments to the act. Some of the amendments are to schedule three further parcels of land in the Northern Territory so that they can be granted as Aboriginal land. These three parcels of land are Alice Valley Extension (East), Loves Creek and Patta, near Tennant Creek. The Loves Creek land is subject to a partially heard land claim, and there was agreement between the Central Land Council and the Northern Territory government to schedule this land under the Aboriginal Land Rights (Northern Territory) Act 1976. The scheduling will resolve the claim and allow the land to be granted to the appropriate Aboriginal land trust. Scheduling Patta, near Tennant Creek, was also agreed between the Central Land Council and the Northern Territory government as part of an agreement for settling broader native title claims. The Alice Valley Extension (East) parcel of land will be leased by the land trust to the Northern Territory as an extension of the West MacDonnell National Park.

Some minor amendments are made by this bill to the income management provisions in the social security law to improve their operation. Firstly, the bill will allow people in the Cape York welfare reform areas who are receiving aged pension or carer payment to have their payments income managed. As with other payments that are income managed for people in Cape York, the new provisions will be relying on the local Family Responsibilities Commission issuing a notice and relevant conditions being met. It is actually at the request of the commission that these amendments are being brought forward.

Further income management amendments relate to the use of the residual funds in an income management account when a person returns to income management. These amendments are to make sure that any residual amounts being disbursed are retained in the person’s income management account at the time they return to income management.

Lastly, changes are being made to how residual amounts left in an income management account are handled when a customer dies. Currently, and depending on how much is left in the account, these residual amounts may be paid to the deceased customer’s legal personal representative or to a person carrying out certain activities on the estate or affairs of the deceased person. However, if the customer has no legal personal representative, or if there is more than one person carrying out the relevant activities, it can be quite hard to work out who should be paid those residual amounts. These amendments will give further options to disburse the residual amounts in these cases.

Senator Siewert focused most of her comments on the amendments in the bill to improve the operation of the Social Security Appeals Tribunal in the handling of social security, family assistance and child support matters. As an example, changes are being made to the titles of tribunal members, such as renaming the ‘executive director’ to the ‘principal member’, consistent with titles in other Commonwealth tribunals. The bill removes the requirement for the principal member to chair the panels on which he or she sits, by enabling the principal member to determine who will be the presiding member. The SSAT will also become able to convene a pre-hearing conference for social security and family assistance law appeals. If parties reach agreement at the pre-hearing conference the SSAT is empowered to make a decision in accordance with the agreement. Senator Siewert raised several concerns on that matter, and I want to address those concerns.

First of all, as Senator Moore so rightly said, the SSAT process can be quite daunting. The pre-hearing conference is certainly not intended to intimidate participants any further in this process—in fact, it is there to do the opposite. It gives the SSAT the opportunity to explore possible areas for common ground for agreement between the parties. But the pre-conference hearing is also aimed at facilitating a settlement on some of the issues to be considered in the review, or even all of the issues. It enables early resolution of many cases that otherwise could be part of a much more formal and daunting process.

The pre-hearing conference, as with pre-hearing conferences in so many other processes, is often a very sensible way of ensuring that everybody understands exactly what is happening; of ensuring that cases can be settled; of limiting the issues in dispute, which is often a really important part of the process; and of explaining the whole process of the Social Security Appeals Tribunal in a very simple way that increases the possibility of settlement before the case goes to a full SSAT hearing. This goes to the issue that Senator Siewert raised. Her concern is that the SSAT will be involved in more hearings in the future. This bill may well mean that proceedings are brought to a close before they would have to go through to a stressful full hearing of the SSAT. It may also actually improve some of the time management issues that are on the SSAT. As Senator Moore said, this is a process that is used very, very successfully in child support cases and it is one that I know the Department of Human Services is now using to manage all areas of family services and family support in Centrelink and the Child Support Agency. It is trying to get some consistency, trying to ensure that there is best practice in these areas and trying to ensure that for those who are least experienced in these kinds of what can be fairly intimidating processes do not have to be put through the mill in this kind of way. We can actually get to informal processes through a pre-hearing conference that will enable outcomes to be much more clearly defined and reached much more easily.

Senator Siewert was also very concerned about the extent to which panels would be reduced to one member. It is quite clear in the legislation that a one-person panel will be used only in very straightforward cases. It is the intention to continue the practice of having at least two-person panels in most cases unless there is a straightforward issue to be resolved.

There are two other amendments on the means test for income support. The first amendment will clarify that a gift that has been returned does not have to be assessed as a deprived asset under the social security disposal of asset provisions. This is to avoid any possibility under the current provisions that a person who disposes of an asset in certain circumstances may have it double-counted as both a disposed asset and the returned asset. In the second means test amendment, it has been clarified that where a customer is the beneficiary of a discretionary trust and the trustee has a duty to maintain the customer then the trust should be assessed as being a controlled private trust in respect of that beneficiary. It is also made clear that when controllers of a trust are being determined it should not be relevant that there are other future beneficiaries of the trust when those parties are not currently receiving any benefits from the trust. These amendments secure longstanding policy in light of a recent full Federal Court case.

The other minor amendments in the bill provide a requirement for the claimant to notify if a child who attracted baby bonus leaves the claimant’s care within 26 weeks of birth or coming into their care and make further minor and technical amendments. On that basis, I commend the bill to the Senate.

Question agreed to.

Bill read a second time.