Once upon a time, someone came up with an economic theory that robbery was good for the economy. The theory was along the lines that the robbers get some extra cash and most of it will reappear in the economy at some point soon after the robbery; the bank or shop is insured for the loss so it gets its money back; and as the number of robberies per annum doesn’t exceed the insurance premiums that banks and shops pay, the insurance companies are not out of pocket either. Of course, the theory is rubbish as stealing money (regardless of the rationale) is just wrong: staff and innocent bystanders who are the real victims of robberies are likely to need considerable physical and mental health support for a long time and so on.
Some apparently have a similar attitude to Centrelink benefits. In reality Centrelink pays out billions a year to those who qualify, according to some criteria or other, for financial assistance from the government. In any general population, there will be some who determine (for their own reasons) that their need is more important than others and, as this obviously not going to be met by compliance with ‘the system’, they will rort the system to get what they believe is their genuine entitlement. Centrelink’s billions are a good target as they have plenty more money to give away and a little extra won’t hurt.
In December 2016, Australia trundled off again to the silly season. It could be so named because of the number of public holidays, that people are nicer to each other than usual or there are a number of religious commemorations jammed into the month-long period. The ‘silly season’ is also a period when institutions (lets pick on governments and political parties here for examples) bring out unpopular announcements that they hope will be hidden by the decrease in attention generally shown by those who are searching for the latest toy at 2am in the morning, concerned about the results of the ‘summer of sport’ in their particular field of interest, or dreading the forced interaction with cousin Eric at the in-laws yet again. So what does the government try to hide in plain sight in December 2016? The obvious answer is that Centrelink unveiled their new ‘wizz-bang’ fraud detection system.
No one here is suggesting for a second that those who do commit fraud should get away with it. The concept is as silly as bank robbery being good for the economy. However, to be effective, a fraud detection system needs to have some rigour behind it to ensure that those who are doing the right thing are not unfairly targeted. Centrelink’s doesn’t.
When you apply for a benefit from Centrelink you are required to provide certain information regarding your financial affairs (as well as personal information so they can identify you). Some Centrelink benefits are targeted at those who ‘need a hand for a little while’ — such as those who have run out of sick and holiday leave while suffering a serious illness or the temporarily unemployed. It is highly probable that for a large proportion of the financial year in question, those that ‘need a hand’ would not qualify for a benefit as they earn too much (not that you have to earn much to disqualify yourself from most benefits). As you would expect, Centrelink looks at your income at the time a benefit is needed rather than the whole year’s income to determine if a short-term benefit is payable and the decision is made on that information.
All well and good you might suggest, and you’d be right, except that when Centrelink’s computer is given information from the Tax Office’s computer, which is only interested in your income for the year, there is a problem. The Tax Office may report that a person earned well in excess of the benefit cut off in a particular financial year (currently they are looking back six years). Centrelink’s automatic fraud prevention system then questions why you received a benefit for a part of the year. Rather than referring it to a person within Centrelink who can see that for three months of the year, the person was residing in the ICU at the local hospital, between jobs or in some other circumstance that determined that they ‘needed a hand’, the automated letter is sent out and a debt collector engaged.
And there’s the problem. Rather than quickly realise that a mistake has been made, correct the error and actively chase those who do defraud the system, Centrelink senior management and government ministers seem to be comfortable with something like 20,000 letters a week being dispatched with demands for payment being made prior to any discussion of the accuracy of the claim being considered and most of the letters being blatantly wrong. It could be considered to be a fraudulent business scheme; a swindle which is coincidentally the definition of a scam. Ironic really, when another section of the federal government runs the Scamwatch website.
In fact, Deputy PM Joyce and acting ‘responsible’ minister Christian Porter are singing the praises of the system.
There are many others who have written about this issue and the seeming double standard surrounding parliamentary members’ travel claims — that frequently are in the tens of thousands. The co-incidence of now ex-Health Minister Sussan Ley being on the Gold Coast ‘for work’ when a unit she was interested in purchasing was up for auction has been done to death, as have the claims of a number of other ministers. The Shovel has an interesting take on the events as well, which given the history of this government, has that slight ‘ring of truth’ to it.
The interesting thing about Sussan Ley’s ‘impulse’ purchase of the unit on the Gold Cost is that it wasn’t a recent purchase. It was made in 2015 and while the reputed $800,000 unit on the Gold Coast may sound excessive to you, me and clearly most Australians, really the unit isn’t that expensive for where it is.
The real question is who mentioned the purchase to the media in the middle of public outrage over the government’s debt collection practices — regardless of whether the practices are legally or morally correct?
Of course, since the unfortunate relegation of Sussan Ley, others were jockeying (to a greater or lesser level of success) for the position of health minister. The ‘prime minister in waiting’ Tony Abbott did his chances no favour when he chose to speak out on the renewable energy target for 2020 (that his government implemented). Pauline Hanson certainly wants Abbott back in the Ministry, which may also be more of a hindrance than a help in the short and long term.
Turnbull has replaced Ley with Greg Hunt (former environment minister for both Abbott and Turnbull) who seems, in current LNP terms, a safe pair of hands. Environmentalists may decry his actions while environment minister, but he did generally keep environmental issues off the front page which is something other portfolios in the Turnbull government can’t seem to achieve:
Having been environment minister in the Abbott government, Hunt is used to difficult portfolios. In that role he oversaw the abolition of the carbon tax and the creation of the government-funded Direct Action scheme that pays polluters to reduce their emissions.
Ley has taken a bullet for the team and the world rolls on. Other ministers, including Bishop and Cormann, are also being questioned on travel expenses incurred on official business at what seem to be exclusive social events. Clearly there is more at play here than the ill-advised purchase of a unit on the Gold Coast.
In 2016 he was named "best minister in the world" by the World Government Summit — an honour recognising his work to protect the Great Barrier Reef and his contribution to the Paris climate talks.
Not being an insider, how does that work? Is there somebody somewhere who trawls through the workings of government looking for potentially embarrassing material that can be released at the opportune time to make a political point; is it sheer incompetence; or, worse still, is it a belief in one’s own importance so great that somehow thousands of public moneys used ‘on official business’ when you happen to go along to a property auction in your private capacity ‘while you’re there’ is acceptable practice?
In all probability, it is one of the latter two possibilities. Just before the 2015 ‘silly season’, you might remember that Treasurer Morrison announced that he was to delay the release of a taxation discussion until 2016. He would not rule anything in or out of the discussion paper which led to every interest group in the country urging the priority of their special interest as being more important than others’ special interests. The inevitable debate went on so long and hurt the government’s standing rolling into 2016 to the extent that they nearly lost the double dissolution election.
The Abbott/Turnbull government has been plagued with stuffups. From the NBN fail where the second rate hybrid system promoted by Turnbull (while communications minister) as cheaper and quicker while delivering slower and no cheaper service to Australians; through to the inhumane treatment of humans at detention centres owned and managed by the Australian government — where even the government Audit Office has reported that political expediency has overruled good governance in the supervision of the contractors engaged to do the work:
Out of $2.3 billion paid over 40 months, $1.1 billion was approved by officers without the appropriate authorisation and another $1.1 billion was paid with "no departmental record" of who had authorised the payments.
And to prove that this government will commit the same errors again and again, it appears that the current Centrelink debt collection system will be expanded to include those on disability, age and family related payments.
The ANAO also concluded the contracts themselves lacked effective guidelines and management mechanisms, owing partly to the "great haste" with which the detention centres were established in 2012‒13. Many faults persisted in later contracts, the ANAO said.
The Abbott/Turnbull government is out of touch with the reality of Australian life. The continual scandals, the exorbitant waste of money on things like detention centres and travel expenses while sending out debt letters to those who have needed to use their entitlements under the welfare system, while embroiled in continual argument over which faction of the Liberal Party should be running the country is unedifying at best. No wonder the Hansons, Xenophons and so on are getting some political traction.
What do you think?
Let us know in comments below.
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