Joe Ludwig (Queensland, Australian Labor Party, Manager of Opposition Business in the Senate) Share this | Hansard source

One has to be careful about these things. I am sorry, Acting Deputy President. We have a case where, in the overall scheme, you have Centrelink seeking a way of meeting that enhanced focus on serious social security fraud and, in doing so, they have moved to an end point. Effectively, that end point was to find a way to enhance the investigative functions of Centrelink investigators by utilising a range of powers such as search and seizure powers, which are articulated in schedule 2.

What they did not do is look at a range of ways to achieve compliance and deal with minor fraud and then interact more effectively with the Australian Federal Police to ensure that the overall target, which was an improved or enhanced focus on serious social security fraud, was the end gain. In fact, what became the end gain was increasing the powers of Centrelink investigative officers—which, in truth, was the wrong direction. It may be necessary to look at the investigative powers of Centrelink officers to ensure that they have sufficient powers to effect the outcomes that they are seeking, but the first step in the process is to consult the area identified as the problem, at least during the Senate committee hearings—that is, the Australian Federal Police.

It seems that what Centrelink was arguing, in short, was that the Australian Federal Police were not assisting Centrelink to at least the degree necessary to help Centrelink investigate serious fraud—in fact, fraud which does not meet the case categorisation-prioritisation model. That means that there was a point at which Centrelink came to a conclusion that the Australian Federal Police were not investigating, or at least not picking up, the cases. The committee hearing found, and the evidence demonstrated, that Centrelink’s conclusion was misplaced. The Australian Federal Police were able to argue and demonstrate quite conclusively that they were taking up the cases which were referred to them from Centrelink as serious and complex and that their refusal rate was within at least a reasonable margin.

One of the interesting points the Australian Federal Police raised was that the Centrelink agency had also not bothered to consult the Australian Federal Police about these powers in the first place. They had understood that the consultative process was to be undertaken by the parent agency, or the Attorney-General’s Department. In questioning the Attorney-General’s Department, their response was: ‘It is the agency’s responsibility.’ So, in fact, they sheeted the consultative process straight back to where it should have been in the first place—that is, with Centrelink.

In looking at the range of submissions that came forward from the various parties, we found that there was great concern about how these powers would in fact be used and perhaps abused, although it is not necessary to go that far. A range of submitters were very concerned as to whether these powers would be utilised appropriately by Centrelink investigative officers. At a Senate committee hearing it was demonstrated that there was a concern. Centrelink lacked the ability to demonstrate to the committee that they had appropriate systems in place to deal with the increased powers and that they had insufficient training in place. Centrelink’s response was: ‘We have a lead time and we will put those in place.’ From Labor’s perspective, it was an unconvincing attempt to indicate that they would be able to deal with those powers in a reasonable way.

The Australian Federal Police in their submission also stated a great concern: these types of powers are usually held and used by law enforcement agencies, which Centrelink is not. Their submission and evidence indicated that, having not been consulted by Centrelink, they remained concerned about how these powers would in fact be utilised. What Centrelink finally offered, which they seem to have now picked up, was to undertake reasonable consultation to improve communication. Had they started that process some time ago, we may not have got to this position of having schedule 2 in an omnibus families bill before the Senate committee. We might have been able to avoid that through reasonable consultation. If you look at the size of Centrelink, it is disappointing that they did not undertake that action in the first place.

The arguments that were put forward, such as the proportionality between objects to be achieved by the use of these powers and the degree of intrusion, is significant because, as the Scrutiny of Bills Committee noted:

It is often said that empowering ... authorities to enter and search private premises involves striking a balance between two competing public interests. There is a public interest in the effective administration of justice and government. However, there is also a public interest in preserving people’s dignity and protecting them from arbitrary invasions of their property and privacy ...

It is important to ensure that any use of these powers is reasonable and appropriate.

Centrelink were unable to demonstrate clearly that these powers were, in truth, necessary. It was a matter on which Mr Joe Hockey took a reasonable and pragmatic approach. We found that there was a complete lack of persuasive argument by Centrelink for these powers, and Mr Hockey took a pragmatic approach and has now sought to withdraw the schedule from the bill. We congratulate him for his courage in recognising that there was no persuasive argument for the inclusion of these powers. It now appears that Centrelink will be encouraged to at least consult with the Australian Federal Police in greater detail to ensure that they have appropriate procedures as well as a memorandum in place.

It is also a salutary lesson for Centrelink. If you go back and unpack their answers to many of the questions that were asked, you will find that they were the arguments that were in their primary submission and that their follow-up answers bordered on the misleading. If you look at their arguments and the responses given by the Australian Federal Police, they do not coincide, not even a little. The arguments put forward by Centrelink, as I have indicated, were unpersuasive. As an example, they said the case categorisation and prioritisation model had changed and had made it harder for the Australian Federal Police to pick up their cases. The Australian Federal Police indicated that the model had not changed and in fact Centrelink were wrong. Clarity about that could have been achieved if Centrelink had consulted with the Australian Federal Police in the first place. One wonders what Centrelink were doing between the time the legislation was drafted and when it was brought forward. Instead of taking what could be called a hopeful approach in achieving these powers, they should have taken a pragmatic approach and spoken to the Australian Federal Police about achieving some of the aims that they wanted to achieve.

There is still significant work to be done by Centrelink to ensure that current fraud within Centrelink is tackled and tackled appropriately. The onus is now on Centrelink and associated agencies to use the fraud control guidelines, to work with the Australian Federal Police to identify and combat fraud which is not referred but which is their responsibility and to also work with the Commonwealth Director of Public Prosecutions to ensure a reasonably fair outcome and that they do not move to one extreme—that is, using extreme powers such as those which the AFP recognised were powers that only law enforcement agencies would usually have. The justification Centrelink put forward for these powers also bordered on the mischievous when they said they were analogous to other powers held by other similar agencies. That argument was unpacked and shown not to be based on the complete truth either. When you look at those other powers in those other agencies, you will see that they are specific powers for specific purposes. Centrelink were asking for wide powers across the field that they would deal with in their own way through training and programs. Without taking any more of the Senate’s time, as I have indicated, with more diligence from Centrelink and Mr Hockey, and of course the cabinet ministers who approved this bill in the first place, this could have been avoided and work on the real issue of how the government identifies fraud could have been undertaken.