Perin Davey (NSW, National Party) Share this | Link to this | Hansard source

My question is to the Minister for Families and Social Services, Senator Ruston. Can the minister please update the Senate on how the Liberals and Nationals in government are seeking to change the way welfare recipients report their employment income to make the process simpler?

Anne Ruston (SA, Liberal Party, Minister for Families and Social Services) Share this | Link to this | Hansard source

Thank you very much, Senator Davey, for your question and your ongoing interest in managing our social security system. We are absolutely committed to making sure that our social security system is accurate, fair and simple for the people who need it. As part of this commitment, the government is introducing legislation that will be making it simpler for welfare recipients who report their income to do so and will improve the accuracy of the payment system.

At the moment, 1.2 million Australians will report that they earned income other than the money that they receive through their income support payments. Those 1.2 million people are required to report that to the Department of Social Services every fortnight. Currently, they have to undertake quite a complex calculation to report their partner's or their own income over that fortnight.

Deborah O'Neill (NSW, Australian Labor Party) Share this | Link to this | Hansard source

They were doing that.

Scott Ryan (President) Share this | Link to this | Hansard source

Senator O'Neill!

Anne Ruston (SA, Liberal Party, Minister for Families and Social Services) Share this | Link to this | Hansard source

This can be particularly difficult for people who might work shift work or do casual work. This can often lead to misreporting, both underestimating and overestimating, what people earn. What this legislation proposes is that instead of people having to go through that complex calculation, we're seeking to have them report what they earned, what they actually received, what they were paid, and not to have them make a calculation to estimate what they have earned. What we are doing here is ensuring that reporting of income is actually as it currently occurs and welfare recipients will report income as it is paid, as opposed to when it is earned. Changing the way employment income is reported simplifies this process for recipients. What we are doing is taking the guesswork out of the process.

Scott Ryan (President) Share this | Link to this | Hansard source

Senator Davey, a supplementary question?

Perin Davey (NSW, National Party) Share this | Link to this | Hansard source

Minister, how will payment recipients benefit from this new technology that's being embedded into the reporting process?

Anne Ruston (SA, Liberal Party, Minister for Families and Social Services) Share this | Link to this | Hansard source

Recipients will benefit from this in a number of ways. Most particularly, in addition to the change in the assessment model, for which the legislation is due to come before this place this week, it will also assist with the application and integration with the Single Touch Payroll data system, which means that welfare recipients can now have their employment and income details pre-filed, similar to what occurs on your tax returns. Through the advances that we have seen through the ATO, this will allow the information that employers report, as part of the system every fortnight, to populate Centrelink forms, which can be used as a prompt for recipients when they are filing their fortnightly returns. The recipient will still be required to validate their form. So, they are still able to make changes, if they believe the information contained in the pre-populated form may be inaccurate. It will assist in ensuring that we are not seeing underestimating or overestimating. (Time expired)

Scott Ryan (President) Share this | Link to this | Hansard source

Senator Davey, a final supplementary question?

Perin Davey (NSW, National Party) Share this | Link to this | Hansard source

Can the minister please advise us why it is so important to make income reporting simpler and easier for welfare recipients?

Anne Ruston (SA, Liberal Party, Minister for Families and Social Services) Share this | Link to this | Hansard source

People who currently receive payments such as Newstart, youth allowance and other social security payments need to report any income that they have earned over a fortnight. They can do it online, on a mobile app, over the phone, or by visiting a Centrelink centre. But the way they report their income, as it is paid, as opposed to as it is earned, will be simpler and easier. In any given fortnight 550,000 Australians will report that they have some form of income. By simplifying the system, it will make a huge difference to these hundreds of thousands of people. It means that payment recipients also have greater certainty about what they are going to get each and every fortnight. If we can help people to ensure that they get paid the correct amount each fortnight, we reduce the likelihood of their receiving an overpayment. This is particularly important for ensuring the sustainability of our welfare system into the future and for giving confidence to the recipients.