Centrelink plays dumb over cases of overpayment caused by its own error

The fact that overpayment of welfare cash transfers are caused by departmental administrative error does occur is recognised in Australian social security law and regulations.

Here is one example of this.

Dept. Of Social Security, Guides to Social Policy Law, Family Assistance Guide, Version 1.191 - Released 3 January 2017:

7.3.2.10 Waiving a Debt Arising from Administrative Error…..

Debts arising solely from administrative error

The part of a debt that can be waived under this provision is called the 'administrative error proportion' of the debt. The administrative error proportion can be up to 100% of the amount of the debt.

The administrative error proportion of the debt must have been caused or contributed to by an administrative error made by the Commonwealth, for example, a decision made by a delegate of the Secretary. If the debtor has contributed in any way to the cause of the debt, that part of the debt cannot be waived under this provision.

The administrative error proportion of the debt must be waived if:

·       the payment was received in good faith and recovery of the debt would cause the debtor severe financial hardship, or

·       the payment was received in good faith and the debt has been raised in either of the periods below (whichever ends last):

o   after the end of the next income year following the income year in which the eligibility period or event which gave rise to the payment of FA occurs, or

o   more than 13 weeks from the day the FA payment was made that gave rise to the debt.

The Dept. of Human Services (Centrelink Included) delivered $115.8 billion in payments to customers/clients in 2015–16 and obviously keeps an account of monies involved in over payments.

Prior to fully automating its data matching and payment discrepancy assessments the department indicated in its 2015-16 annual report that 1.6% of all payments were overpayments due to administrative error. [Dept. of Human Services, 2015-16 Annual Report, Part 3—Management And Accountability, Social Security And Welfare Programme Compliance, Payment accuracy, correctness and integrity, p.114]

Just last year on 20 October 2016 The Daily Telegraph reported:

The Department of Human Services overpaid 1.5 million people a total of $1.5 billion, an average of $1000 each, during 2015-16. It clawed back $920 million by deducting money owed from ongoing social security payments or tax refunds.

But it wrote off $76 million in debts that were solely due to administrative error, were less than $50 “and not cost effective to pursue’’, or in cases where the debtor was subject to “extreme and unusual circumstances that interfere with their capacity to pay’’.

The Administrative Decisions Tribunal holds transcripts of cases which come before it, including those involving overpayment by Centrelink due to administrative error.

In fact Centrelink data on administrative errors has been recorded for many years (probably since 1998-99), as this excerpt from an Australian National Audit Office report in May 2006 shows:

In 2004–05, Centrelink identified one or more errors in 4 552 of the 10 048 RSS reviews conducted, with the total number of 7 037 errors distributed across these 4 552 reviews. Centrelink RSS Reviewers determined that 78 per cent of these errors were due to customer error (that is customer action or inaction). The remaining 22 per cent were categorised as due to Centrelink administrative error (predominately incomplete processing), albeit that only 5.1 per cent of these errors (or 3.4 per cent of reviews) had an immediate impact on the customer's payment.

In 2011-12 the government waived nearly 800,000 other overpayments - totalling $37 million - that were due to administrative error or categorised as "special circumstances" according to news.com.au.

Although Centrelink is frequently expressing overpayments due to administrative errors in percentage terms it seems that there is a specific Dataset 4 which counts the number of “customers” involved. [Social Security Policy Branch, Social Security Assurance Tracking Process Error Using Sample Surveys, 2009 power point presentation]

Yet despite a range of audit information being available to the department it could not even give Senator Siewert a ball park estimation of the number of overpayments due administrative errors which occurred last financial year, according to The Guardian on 31 January 2017:

Centrelink is unable to track how many cases of overpayment are caused by government error, according to responses it provided to a senate committee.

The Department of Human Services provided a series of responses to questions posed by the Greens senator Rachel Siewert on welfare overpayments. 

Siewert asked how many of the 629,917 customers overpaid last financial year were caused through system or administrative error by Centrelink. DHS responded: “The department does not currently capture the portion of overpayments raised as a result of system or administrative error.”

Siewert described that lack of information as outrageous, saying the department appeared not to be keeping track of its own mistakes. “The government must immediately work to establish how many people accessing the social safety net received an overpayment because of an administrative error,” she said.

“For the government to not collate that information is deeply concerning. It means there is no attempt to collect data and analyse how many vulnerable people are stuck with debts they were not responsible for creating.”

Centrelink has always required those who have been overpaid to pay the money back, including when the overpayment was not their fault. That is a separate issue to complaints about the new debt recovery system, which has been criticised for allegedly wrongly pursuing welfare debts from vulnerable Australians…..

The debt recovery system is being investigated by the commonwealth ombudsman, and will also come under the scrutiny of a Senate inquiry.

Siewert’s question on notice also asked whether there was a grace period to allow more time to hand back overpayments paid due to errors by the government. The department said there was no such grace period but customers were allowed to ask for extensions or payment plans because of financial hardship.

Siewert said a grace period, at least, should be introduced. “It’s unfair that people on low incomes have to pay back overpayments when the debt is not their fault,” she said.

“I know the government is hell-bent on making life as difficult as possible for people that access the social safety net, but I think we should show a bit of humanity to people that are stuck in a situation they didn’t create.”

In my honest opinion I don’t believe that Centrelink was acting in good faith when it gave the senator that answer. Hopefully as her question appeared to be on notice Centrelink will have a change of heart and supply the figure requested.

Thousands of jobs have gone from Dept Human Services & Centrelink in last five years and the headcount was down to 30,210 by May 2016

It is no accident that the post-September 2013 drive to slash public service numbers and funding was significantly impacting on the Dept. Of Human Services at the same time it sought to fully automate as much of Centrelink’s service delivery as possible.

Between its 2012-13 annual report and 2015-16 annual report the department had lost 5,628 staff due to budget cuts and make do measures were not meeting service delivery needs.

It was also foreseeable that Turnbull & Co would choose Centrelink clients as guinea pigs in an attempt at fully automating data matching with a view to further departmental cost-cutting – after all welfare clients are apparently considered the lowest of the low by a majority of Liberal and Nationals parliamentarians.

Given the fact that this federal government had also decided to be digitally ‘agile and innovative’ - which appears to be code for fast and sloppy - the debacle which followed was almost inevitable.

BACKGROUND

Government News, 2 May 2016:

Charities, welfare groups and unions have pleaded with Treasurer Scott Morrison to release the pressure on the Department of Human Services (DHS) by funding more staff and better IT systems in the federal Budget.

In a joint statement, 14 organisations: Carers Australia, St Vincent de Paul, the Welfare Rights Centre the Community and Public Sector Union, Australian Council of Social Services, Children and Young People with Disability Australia, ACT Council of Social Services, National Union of Students, Fair Go For Pensioners, Combined Pensioners and Superannuants Association, People With Disability, the Consumer Action Law Centre and Financial Counselling Australia demanded the government “properly fund” the DHS to “provide the Australian public with the Medicare, Centrelink and Child Support services they need and deserve.”

DHS has fielded a range of allegations over the past year, including:

·         Centrelink bunging Youth Allowance and Austudy payments

·         Call waiting times of more than an hour to get through to Centrelink

·         One-quarter of all 57 million phone calls to Centrelink, Medicare and Child Support agencies last year going unanswered (Auditor General’s report 2015)Complaints up almost 19 per cent on last year, and customer satisfaction is down by per cent (DHS Annual Report)

·         An avalanche of customer complaints about online services, particularly myGov

·         A litany of complaints about mobile apps for child support, Medicare and Centrelink

In its statement, the coalition of not-for-profit groups said the federal Budget should:

·         Restore adequate funding to DHS

·         Invest in high quality, in-house IT systems so clients can access a reliable online service

·         Increase DHS permanent staff numbers so that claims and queries are processed quickly and clients who need over-the-phone or in-person services can get them

·         Ensure rural and regional Australia has fair access to government services.

The statement said:

“Millions of people in Australia rely on the Department of Human Services every day, for essential services including social security payments, Medicare, child support and aged care.

“Australia needs these essential services to be both accessible and of high quality, and employees of DHS resourced to do the best they can for everyone needing assistance.

“However, after years of budget cuts, DHS systems and staff are under extreme pressure.

“People who rely on Centrelink expect and deserve high quality public services. Employees in DHS must have the resources to deliver high quality public services. People are trying to do the right thing and reports changes as required, but the system is letting them down…….

The Canberra Times, 10 May 2016:

Department of Human Services officials have confirmed that 918 workers will be shed in 2016-17….

The federal government service-delivery workhorse, which runs Centrelink, Medicare and the Child Support Agency, will see also see its funding reduced by $100 million year-on-year, thanks in part to a "special" efficiency cut of $20 million a year….

Mr Jenkin also confirmed the budget papers got the department's headcount wrong, reporting 30,102 when it should have been 30,210.

The department's finance boss said the staff cuts were a direct result of the budget cuts.

In the Dept. of Human Services Annual Report 2015-16 overall staffing levels were shown as:

NOTE: It is likely that as many as est. 3,796 of these staff were “non-ongoing” at the start of the 2015-16 financial year.

The results of payment discrepancies released for action in the 2015-16 financial year were:

* 109,355,545 data matches undertaken by the department [DHS Annual Report 2015-16, p.241];

* cost of the data matching program (including departmental salaries) was $8,327,500 [ibid, 243];

* 4,904 payment discrepancy notices sent out to clients and 1,657 (or 33.78%) of these notices were later found to be false debts [op.cit., p.241]; and

* an unspecified number of debt notices were waived for reasons not stated.

Since Centrelink began sending out fully automated payment discrepancy/debt notices in mid-2016 there have been 169,000 initial letters sent.

Based on Dept. of Human Services 2015-16 admissions, this suggests that at least an est. 57,088 of these letters contained inaccurate payment discrepancies/false debts which can be verified as such by paperwork held by Centrelink clients and/or their previous employer (if the business holds such records indefinitely).

Centrelink clients telling their own stories can be found at www.not.mydebt.com.au.

Centrelink's monumental clusterf*ck continues

As the Turnbull Government response grows more heavy-handed, community resistance grows......

Crikey, 19 January 2017:

Just as Australians were ringing in the new year and the public campaign against Centrelink's massively scaled-up debt recovery program was beginning to pick up steam, a legislative change removed a time limit that meant a certain number of welfare debts used to expire.

Previously, unlike other debts to the government, notably those owed to the Australian Taxation Office, welfare debts would lapse if no action was taken to recover them in six years.

Agencies like Centrelink could fairly easily restart the six-year limit, by taking a basic action like opening the client's record and doing a basic review, but nonetheless it resulted in some debts expiring because the agency did not have enough resources to pursue them all.

From January 1 it was removed entirely by the Budget Savings (Omnibus) Act, shortly after the government asked Centrelink to identify and recover hundreds of thousands more debts than it ever has before by significantly decreasing the amount of administrative effort spent on each one.

The various pieces of legislation amended by the act now say welfare debt recovery actions can take place "at any time" and according to the act's explanatory memorandum:

"This will align social welfare debt recovery with the arrangements applied by other government agencies involved in the recovery of Commonwealth debts, where there is no such limitation.

" … Removing this limitation will prevent debts from 'ageing' out of recovery, and will improve the ability to recover old debts. Debt recovery will be able to commence at any time."

The Mandarin has heard a significant number of relatively senior Department of Human Services staff are under the impression that the removal of the six-year limit has opened up a very large number of potential debts to recovery action that were previously off-limits.

There's apparently a view in the agency that now there is nothing stopping the automated compliance program from going back through tax and welfare records "indefinitely" to find new debts to raise.

But an independent expert in social security law said this was not quite right; the six-year limit only ever applied to debts after they were raised. The clock started when the agency became aware of the debt (or when it reasonably should have — for example, if it was notified of an overpayment but failed to actually raise a debt for six years or more).

The legal interpretation was that Centrelink could always chase a debt from any time in the past — provided it could argue there was no reasonable way to have found out more than six years prior — but in practice it always raised more debts than it could recover, so it prioritised the biggest ones and did not go looking for new ones especially hard.

The Mandarin also understands that debts that expired after no action was taken for more than six years before the change on January 1 cannot be resurrected.

The further back Centrelink goes looking for past discrepancies between taxable income and support payments, the less chance there is that the people advised of potential debts will be able to produce payslips or other records to prove they were not overpaid.

The National Social Security Rights Network (previously the Welfare Rights Network) opposed the removal of the six-year expiry date. In a recent statement, it says a lot of people are contacting it in distress because they do not realise "the system does not necessarily require people to have documentation from many years ago" and think that "without it they cannot provide the information being sought" by Centrelink. The body recommends:

"If it continues, the system should be applied to the most recent financial years first. Many people would be able to readily check information against their recent records, reducing their distress and anxiety about the process. This would also give more time for Centrelink and other stakeholders to assess how the system is working and make a considered decision whether it is fair and reasonable to roll out for earlier years."

In any case, DHS spokesperson Hank Jongen told The Mandarin there are no plans to check the records any further back than six years ago:

"As part of the compliance measures announced in the 2015-16 budget, 2015-16 MYEFO and in the 2016-2017 MYEFO, compliance reviews will not be undertaken prior to 2010-11 financial year."

The Canberra Times, 19 January 2017:

Centrelink is deliberately ripping-off thousands of Australians caught up in its data matching "robo-debt" program, with managers telling public servants at the agency to enforce debts they know are bogus, according to explosive new claims…..

Pensioners and other struggling members of the community are being hounded for "recovery fees" unfairly added on top of their debts by Centrelink, according to the whistleblower's statement, published on Thursday by left leaning advocacy group Get-Up and Centrelink's main workplace union the CPSU.

The union says it has independently verified some, but not all, of the whistleblower's allegations.

The insider, who has defied public service bosses' threats on leaking against the program, also alleges that Centrelink managers are well aware that bogus debts are being pursued and are ignoring pleas from compliance staff to take a fair approach to the debt recovery process.

"We are struggling with our consciences and pushing back against our leaders daily," the whistleblower wrote.

"We are telling the...helpdesk that what we are doing is wrong.

"I see these reviews every day and I am horrified at what I am being directed to do."

Centrelink has been contacted for comment on Thursday morning.

The insiders alleges that the rip-offs operate in five main ways:

Doubling income​, where a person's entire income from the same employer is counted twice, creating an "overpayment".

Non-assessable Income, where​ money that should not be counted as assessable income by Centrelink is counted and overpayments raised against the victim.

Fictitious payments​; where system generates debts based on payments that Centrelink never made. The whistleblower alleges it is even possible to have a debt claim larger than a person's total Centrelink payment.

False recovery fees; recovery fees are being regularly applied when they shouldn't and can be much larger than the set fee of 10 per cent.  

Corrupted review​; compliance officers are directed not to fix these errors, even when there is evidence, and their work is rejected when they do.

But Centrelink media spokesman Hank Jongen denied the accusations in a statement posted online on Thursday, saying the claims about doubling income, non-assessable income, fictitious payments, false recovery fees and corrupted reviews were all incorrect.

The Sydney Morning Herald, 17 January 2017:

Public servants at Centrelink have been threatened with disciplinary action or even criminal prosecution as their bosses at the welfare agency try to stem the flow of internal leaks about the agency's "robo-debt" campaign.

Several workers have gone public about the debt recovery debacle since the controversy emerged last month and now Centrelink's parent department, Human Services, has issued a stark warning to its 36,000 staff about the consequences of leaking.

The department, which has gone to extraordinary lengths and expense in the past to track down and crush internal dissent, issued its latest warning on Tuesday after several media stories featuring insider accounts of the data matching program's failings.

Excerpt from whistleblower letter released by GetUp! on 19 January 2017:

The letter can be found at:
https://www.dropbox.com/s/7cszry1mjjjsndj/2029-img-113185553-0001.pdf?dl=0

GetUp! creates FraudStop:

:

                        Click on image to enlarge

Get started here.

#NotMyDebt: "Treating Australians like crap is going to get you crap poll results"

The “false debt” disaster rolls on, with the Turnbull Government attempting some window dressing in the hope of reversing bad polling.

News.com.au, 16 January 2016:

AN Australian of the Year finalist has also become embroiled in the Centrelink debt recovery debacle, after being sent an incorrect debt notice due to the automatic debt recovery system.

Queensland medical researcher Dr Janet Hammill, who works voluntarily and lives off the age pension, was sent a debt notice for $7600, The Guardian reports.

The 76-year-old had reportedly received a $26,000 research over parts of 2011 and 2012, which she fully reported to Centrelink at the time.

But the system appears to have averaged the grant across 2012 and deemed her overpaid.

But Centrelink’s automated debt recovery system appears to have averaged the grant across all 26 fortnights of 2012, before deeming her to have been significantly overpaid.

Hammill said she had struggled to contact anyone at Centrelink.

“You feel so helpless, I mean for heaven’s sakes, you can look through my CV and see that I’m not helpless,” Hammill told The Guardian.

“But this puts you into another category of disempowerment. I can just imagine somebody who is not computer literate or is just managing to get by day to day, it’s just been so terribly frustrating,” she said.

“They made me feel as though I’m some sort of cheat, and I haven’t had an income since April 2012.”

Her story comes after whistleblowers revealed the “true horror” of the Centrelink debt recovery debacle, after a new poll showed the Turnbull Government took a hit over the ongoing saga.

A number of former Centrelink staff, who allegedly left over the debt recovery fallout, have written to independent MP Andrew Wilkie with reports that a high number of clients are suicidal over debt notices.

Other former workers have told of being given daily quotas of debt notices and being urged to work overtime and compete to haul in the most debts.

One single mother has told of having to start repaying an incorrect debt notice for $11,800 while she challenges the request.

Mr Wilkie has today written to the Commonwealth Ombudsman to report evidence from the whistleblowers, which he claims have described the “true horror” of what’s happening behind closed doors.

His letter, published on his website, outlines the insight of former staff members, including that employees are discouraged from questioning debts and from pausing debt repayments if customers are in financial hardship.

A “high” number of callers were contemplating taking their own lives, it said.

“The system’s a complete dud and must be fixed or binned,” Mr Wilkie said.

“Every day new cases of bogus debts are coming into my office which has received hundreds of complaints from people who have recounted deeply disturbing stories about Centrelink’s debt hunt.”

The Sydney Morning Herald, 16 January 2017:

Centrelink public servants who ask too many questions about their agency's controversial "robo-debt" recovery effort are being "managed" out of debt recovery units, according to independent MP Andrew Wilkie.

The Tasmanian independent also alleges public servants are being played against each other by managers, competing for the highest daily quota of debt notices.

But Centrelink is unhappy with Mr Wilkie's letter to Ombudsman Colin Neave, with the agency saying on Monday the the allegations are inaccurate or misleading. 

Centrelink says there are no quotas and that Mr Wilkie's accusations about the management of mental health issues among clients were overblown. 

Mr Wilkie said the former public servants had reported problems with suicidal clients and a breakdown in the systems that were supposed to support them.

"The number of customers who report feeling suicidal is high," Mr Wilkie wrote.

"It has been reported to me that that over a period of days there was an error in the system so that calls transferred to social workers were instead transferred back to casual workers on the general phone line that have no training in suicide prevention."

The Guardian, 16 January 2016:

Asked in the ReachTel poll how “errors with the Centrelink automated debt recovery system” affected their vote, 49.8% said it made them less likely to vote for the Coalition compared with 14.4% who said they were more likely to and 35.8% who said it would not impact their vote.

Asked which should be the Turnbull government’s priority, a large majority (82.2%) nominated cracking down on international tax avoidance, compared with recovering debts from Centrelink overpayments (17.8%).

Respondents were asked given the “significant errors” in the system whether individuals should have to “defend themselves which may include accessing pay slips and employment records from up to five years ago”.

Most said the burden of proof should be on Centrelink (78.6%) not the individual (21.4%).

The poll was taken on Thursday after a week of revelations of taxpayer funded travel claims by ministers and MPs to attend sports events and Sussan Ley’s trips to the Gold Coast including one on which she bought a $795,000 apartment and two to attend New Year’s Eve events with multimillionaire Coalition donor Sarina Russo.

The week culminated in Ley’s resignation as health minister on Friday.

GetUp’s campaigns director, Mark Connelly, said the poor poll result was “no surprise” given revelations government ministers had been spending taxpayer funds on chartered flights and to go to polo matches “while sending tens of thousands of false debt-threat letters to everyday Australians”.

“Treating Australians like crap is going to get you crap poll results.”

ABC News, 16 December 2016:

The automated program — which compares Centrelink and Australian Taxation Office records — has issued 170,000 notifications since July with thousands of Australians incorrectly told they have outstanding debts.

After weeks of public criticism, Human Services Minister Alan Tudge has told his department to ensure welfare recipients can launch an internal review of their payments before debt proceedings are launched.

Disability pensioner Justin Burns last week told the ABC he disputed his debt and requested a review, but was still being forced to pay $40 a fortnight from his pension to repay the debt while the review was underway.

"I have had to borrow money off my parents, I have had to borrow money off my friends," he said.

"I thought, 'Holy, you know what, I don't believe I owe this money at all'."

Mr Tudge will also ensure Centrelink clients are informed of discrepancies in their accounts before being contacted by debt collectors.

"One of the issues has been that on some occasions, the address that Centrelink has on file hasn't been updated, so the first a person might hear about this is when there is a debt collector on their doorstop," Mr Tudge told 2GB radio on Monday.

"We are fixing that problem by ensuring that we use multiple different addresses, including a person's electoral roll address, to ensure they do get that letter and do get that opportunity to update their records."

Letters will now be sent by registered mail so Centrelink can track whether they have been received.

In some cases, the letter will be followed up with a phone call.

One client told the ABC they were contacted by debt collector Dun and Bradsheet about a $3,836 discrepancy, despite never being contacted by Centrelink.

Mr Tudge has also called on his department to simplify its language and ensure a contact number is printed on all notification letters, rather than being listed online.

Labor's shadow human services minister Linda Burney said the changes were a "stunning admission" given Mr Tudge's earlier claim the system was working.

"The system must be suspended until changes to make it fair are applied to everyone — that means those currently paying disputed debts should have the review completed before they are forced to pay," she said.

Unfortunately for Mr. Turnbull on 17 January 2017 The Sydney Morning Herald also carried news of his government's intention to expand this flawed debt recovery scheme:

The Coalition government is going to target more than 3 million of elderly and disabled Australians with its controversial Centrelink "robo-debt" campaign, Parliamentary documents show.

The mid-year economic forecast tables published last week shows the government has booked savings of $1.1 billion from data-matching the aged pension and another $400 million from the disability support pension.

The move will bring more than 3 million more Australians into the sights of the data-matching program, which uses an automated system to match information held by Centrelink and the Australian Taxation Office and calculate overpayments.

But the policy has been beset by errors and has been hugely controversial with many of those targeted for debt recovery saying they are being hounded by commercial debt collectors for money that they do not owe…..

The data matching effort so far has been concentrated overwhelmingly on mostly young people who have received the dole or Youth Allowance, although evidence is emerging that students have also been hit heavily.

But the supporting tables to the government's mid-year financial and fiscal outlook, published on Thursday by the Parliamentary Budget office, reveal that Coalition policy is to massively extend the data matching effort to the more than 2.5 million age pensioners and about 800,000 disability support pensioners.

"Relative to the 2016-2017 budget, policy decisions are expected to decrease expenses on the age pension by $1.1 billion to 2019-2020 primarily due to measures to enhance the integrity of social welfare payments including expanding and extending data-matching activities with the Australian taxation office," the document reads.

The papers also reveal that the government believes it will slash spending on the disability support pension using the same methods.

Wondering why there are no horror stories flowing from the financial reassessment of Centrelink pension eligibility?

There are many legitimate complaints and concerns being voiced over the Turnbull Government decision to change Centrelink’s debt recovery system to one which is fully automated, with no human oversight of initial debts raised for those certain individuals receiving welfare pensions, benefits and allowances.

However, there is little being said about the reassessment of asset and income limits for aged pension eligibility which came into effect on 1 January 2017.

Centrelink states:

If you have reached age pension age, Age Pension may help to support you. To qualify, you must first satisfy age and residence requirements. How much you can get depends on your income, assets and other circumstances.

If you are a self-funded retiree or still working, you may be able to get a part pension.

Centrelink further states that the current maximum basic age pension rate is $1,203.00 for a couple and $797.90 for a single person per fortnight.

This basic rate places any recipient who relies solely on a Centrelink pension for their retirement income firmly below the poverty line.

For those receiving additional income there is a reduction in this fortnightly basic rate of 50c for every dollar of additional income above $292 per fortnight for a couple and $164 for a single person. Income is defined by Centrelink as: an amount you earn, derive or receive for your own use or benefit profits, the amount of earnings in excess of expenses, whether of a capital nature or not, and a periodic payment or benefit you receive as a gift or allowance.

Financial assets are subject to deeming rates. For a couple the first $81,600 in assets is deemed to return 1.75% and assets above that amount to return 3.25% and, for a single person the first $49,200 is deemed to return 1.75% and assets above that amount to return 3.25%.

Commencing on 1 January 2017 home-owning Aged/Veteran/Disability pension recipients who have assets of over $375,000 for a couple and over $250,000 for singles now have their part pensions reduced by $3 for every $1,000 dollars over this limit. Non-homeowners who have assets of over $575,000 for a couple and over $450,000 for singles will experience a similar reduction.

Every person who is on a part pension after 1 January will retain their Pensioner Concession Card which allows for Medicare bulk billing and subsidised prescription medicine. Those who have their part-pension cancelled will receive a Low Income Health Care Card and Commonwealth Seniors Health Card if of retirement age which allow for the same benefits.

These higher asset limits will possibly make an additional 50,000 retirees eligible for a part-pension for the first time and another est. 116,000-156,000 will receive an increase in their part-pension.

But what does that mean in practical terms?

Well it mean that a home-owning couple will lose their part aged pension if they have assets above $816,000 and home-owning singles will lose the part pension if assets are above $542,500. While the assets limit for non-homeowners is $1,016,000 for a couple and $742,500 for a single person.

What the new rules also mean for example*:

*a home-owning part pension couple with $380,000 in assets then your part pension will be est. $1,307.40 combined per fortnight;

 *a home-owning part pension couple with $500,000 in assets then your part-pension will be est. $947.40 combined per fortnight;

*with $600,000 in assets a home-owning couple would receive a part-pension of est. $647.40 per fortnight and with $700,000 in assets the couple would receive a part-pension of est. $347.40 every two weeks; and

*by the time a home-owning part pension couple reaches $800,000 in assets their combined part pension is an est. $74 per fortnight. At which point the couple's additional retirement income is deemed to have reached est. $980 per fortnight based on those assets.

* All examples are maximum amounts before any tapering for additional income over $292 per fortnight is deducted.

  

So how many people will be heavily impacted by these changes?

Estimates vary, but ABC News stated on 11 November 2016 that:

The increase in the rate that the pension is reduced, as well as the reduction in this top pension threshold, could result in some 88,000 missing out on the pension entirely, and some 225,000 seeing their pensions reduced.

So is the change to age pension eligibility fair?

Well it depends where you are placed on the wealth ladder and whether or not you deliberately structured your retirement funds to: a) act as a form of estate planning to benefit your heirs and/or b) minimised returns on retirement investments in order to qualify for a part-pension before 2017.

Estimates based on the Dept. Human Services calculations show that poorer retirees and part-pensioners will be better off.

However, those who thought they were being rather ‘clever’ in how they structured their post-retirement assets are not so lucky. Suddenly that sea-side holiday home, weekend rural hideaway, expensive boat, regular overseas holidays, top of the range Winnebago and/or speculative land purchase are no longer being comfortably subsidised by the part-pension.

The absence of individual real-life hardship case studies in media articles concerning new pension eligibility rules appears to indicate that most part-pensioners realise that the changes are relatively fair.

Unfortunately for the Turnbull Government this will not mitigate ire at the ballot box in 2018. 

Firstly, because this particular welfare cost-cutting measure is retroactive and removed a measure of certainty regarding retirement income for est. 80,000-100,000 older people. And secondly, because the cost-cutting marches hand-in-hand with the federal government's determination to continue to ignore what ordinary voters view as blatant rorting of the Australian taxation system by very wealthy individuals and corporations.

#NotMyDebt: the electorate's face remains turned against the Turnbull Government's debt recovery policy

oecomuse: Musings from home and hearth, 8 January 2016:

According to Appendix E – Data matching of the 2015-16 Annual Report, the Department of Human Services spent $19.5 million in 2013-14, $25.5 million in 2014-15 and $8.3 million last financial year on its data matching program. That is, our government has allocated over $50 million in the last three years to produce the outcomes reported in the first week of 2017: outcomes so appalling that a government agency is making blanket referrals to the suicide prevention service Lifeline for hardships caused by its own actions.

Let that sink in: Centrelink is using social media platform Twitter to refer income support recipients to Lifeline, because some ‘customers’ are suicidal after receiving letters sent by the agency demanding repayment of debts that people have not, in fact, incurred. This is the return on a $50 million investment of public moneys.

Many were letters stamped with the Australian Federal Police logo demanding information under the code name Operation Integrity.

It will surprise no one who has observed the Turnbull government that the operation has no integrity. The link above does not provide a breakdown of Operation Integrity costs. But it offers this:

“From 1 July 2016, $45.1 million will be invested in the myGov digital service over 4 years, to ensure people can continue to interact with the Australian Government online, ensuring access by all tiers of government. … the next phase of improvements to myGov. $5.4 million will be invested over 2 years to modernise this service and ensure it continues to deliver on the government’s commitment to make services simpler, clearer and faster.”

From what I can tell, and I may not be reading it correctly (the reporting methods are oblique at best), this amounts to an additional $50 million for a total of $100 million for the years 2013-20. Again, to use the government-preferred econospeak, this ‘investment’ has a return. In the first week of 2017, the dividend included driving some low-income Australians to suicidal despair. And causing incalculable hardship to other welfare recipients across the country.

The New Daily, 8 January 2017:

With a flagged $4 billion to be recovered over four years, Centrelink’s demand letters over alleged debts could be just the start.

The Turnbull government’s mass invoices – constructed from data matching to claim discrepancies exist with Centrelink’s casual, disabled and vulnerable income earners – are expected to be used across the entire pensioner and social security sector. New discrepancies can be created over a recipient’s claimed asset values to substantiate invoices for ‘over-payments’.

Data matching and garnishee was originally implemented by Labor in government, but it was the Turnbull government that devised the more aggressive, presumptive and system-wide invoicing strategy.

While a responsible government has every right on behalf of taxpayers to eliminate fraud and ensure financial control in a country under deficit distress, the anecdotal hypocrisy of MPs who are extended travel allowance indulgences under lax rules adds fuel to what is becoming an explosive backlash across Australian postcodes.

A crowdfunded court challenge to the legality of the alleged debt invoices is now expected…….

In the current clawback, Centrelink has repeated its customer risk protocol by referring any distressed recipients to Lifeline for psychological support. More petrol on the fire.

Centrelink’s response to one of the widespread complaints from distressed welfare recipients. 
Photo: Twitter

One Centrelink senior staffer, who asked not to be named, told The New Daily the anger and rage generated by the data matching strategy had placed counter staff under confronting pressure.

“They just want to spit on us,” he said.

He asked why DHS had not quarantined vulnerable recipients, many of whom were intellectually disabled, from the more able casual income earners.

If DHS had a genuine “customer focus” the entire casual income reporting process would be “bulletproof” for recipients so they could neither calculatedly defraud nor inadvertently fall into error. A department wanting to engender trust with Australians striving to earn sustaining incomes in a now highly casualised economy would act protectively towards them.

“One intellectually disabled bloke screamed, ‘I’ve had a go mate … I did some work’.”

Our informant said the Centrelink data matching strategy would soon be exposed as counter-productive, with recipients now likely to desist in seeking any paid work for fear of losing any of their welfare payments.

With a Newstart allowance at $34 a day and city rents now at extortionate levels, many vulnerable people had little money left with which to clothe and feed themselves.

“We are dealing with the most impoverished and vulnerable sectors of the community. This is cruelty.”

No Place For Sheep, 6 January 2017:

Centrelink has now begun using its Twitter account to refer people to Life Line if they are experiencing distress. Life Line is a voluntary organisation given little or no support by the federal government. The government has also ripped millions from frontline services for domestic violence victims, community legal aid centres, and over a billion from aged services. You can bet that these outrageously underfunded services will be stretched to their limits by Turnbull’s latest attack on vulnerable citizens.

I cannot remember anytime in this country when a government department has referred citizens to an emergency service because they are experiencing suicidal levels of distress as a consequence of that government’s policies.

Does anyone?