Chris Evans (WA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I rise to speak on the Families, Community Services and Indigenous Affairs and Veterans’ Affairs Legislation Amendment (2006 Budget Measures) Bill 2006, which is a mouthful but is an omnibus bill which implements two of the government’s budget commitments and proposes a series of new measures to crack down on social security fraud and improve information exchange between social security agencies.

Labor supports the budget measures contained in the bill which will make changes to the assets test for people of pension age living in rural and regional areas and implement changes to crisis payment provisions. We also support the proposals to improve information exchange between social security agencies. I notice that the government has now circulated in the chamber an amendment to the bill which seeks to oppose its own schedule 2 in the bill. I am very pleased to see that it has done that. This gives effect to Minister Hockey’s public announcement. That schedule proposed giving Centrelink officers search and seizure powers to raid the homes of social security recipients, which of course includes nearly every family in Australia, given the family payments system. It was bad law and terrible policy and I am pleased to see the government has recognised this.

In terms of schedule 1, Labor believes in a retirement income system which is secure, stable, simple and fair. We remain strongly committed to a means-tested age pension system which guarantees a decent retirement income to older Australians on the basis of need. We recognise there are problems in the existing system, in particular under the existing assets test, which disadvantage pensioners or potential pension recipients who are living on the land. Under the existing assets test many older Australians living on farms or large rural residential blocks find themselves unable to support themselves in retirement. This is because the value of the property their home is on excludes them from the pension. Many of these older Australians have been forced to sell their land and their family homes in order to support themselves. That is clearly not desirable.

Labor believes that older Australians should not have to sell their family homes, where they have spent the best part of their lives, in order to fund their retirement. So we support these government changes to the assets test. We think they are an improvement and will exempt property on the same title as the primary residence from the assets test. They will do so in cases where there is a long-term attachment to that land and where it would be unreasonable to realise the value of the land by selling or leasing it. We also have problems in relation to a number of holiday home issues, which have been raised with me and are the subject of a debate another day, but I think we are struggling with a policy to deal with the increasing asset values, given the boom in housing and land prices. The government is promoting this as an equity measure to address concerns that people of pension age living on farms and rural residential properties are unfairly excluded from receiving the age pension. People living in urban areas whose properties have substantially increased in value may remain exempt by virtue of the property being the primary residence. So I think the proposition is reasonable.

There is an issue that I will be taking up by way of an amendment to this bill, which is to address a concern that has been raised by my constituents in Western Australia that is largely as a result of the skills crisis in this country. A number of pensioners who have approached me are disadvantaged under the current assets test as a result of the Howard government’s failure to properly address the skills shortage. Under the current arrangements, a person has 12 months to sell their existing home and construct a new home before the proceeds of the sale of the existing home become an assessable asset. Because of the huge skills shortage, and therefore the delay in building completion dates—particularly in states like Western Australia, which are enjoying enormous economic growth—a number of people have been unable to get their home completed within the 12-month time frame. Their stories of waiting for tradesmen to turn up are legendary. I know it is an issue in Canberra as well, although not with a pensioner; one member of my staff moans long and loud about those problems. We are concerned about the impact on pensioners if that delay forces them to be caught up by the assets test. I will be moving an amendment about that in the committee stage, to try to get government support for that proposition. I hope the government considers the issue seriously because it seems to me to be a growing problem.

While Labor support schedules 1, 3 and 4, we could not have supported the passage of schedule 2 of the bill, given the damning evidence presented at the Senate Standing Committee on Legal and Constitutional Affairs inquiry into this part of the bill. I am glad to see the government, too, will be opposing that part of their bill. The schedule would have given Centrelink officers the power to enter and search premises, including the homes of social security recipients, and seize material relevant to offences committed against social security law. Frankly, this measure should never have come before the parliament. It was bad policy and it would have been even worse law. The Senate legal and constitutional committee’s report, handed down last week, was damning of how poorly thought through this part of the legislation was. I would like to thank Senator Ludwig, who on behalf of the Labor opposition sought to forensically go through the arguments for this schedule and, I think, by virtue of his questioning and research prove that the case was not made.

The committee found that the proposed measures were unsupported by clear evidence and disproportionate to the likely degree of intrusion which would have been likely to result from the powers. The committee also found that many fundamental aspects of the supporting framework to the powers had not been fully considered before the legislation was introduced. The committee considered that issues had not been adequately thought through, and these included issues of training and recertification of officers exercising the powers and the absence of governance, accountability and oversight mechanisms and procedures for handling evidence and other operational guidelines.

Further, the committee was of the view that powers of entry, search and seizure are most appropriately exercised by the AFP, yet the inquiry heard that FaCSIA and Centrelink had not bothered to consult the AFP about the proposals to provide these powers for Centrelink officers. In its submission and evidence to the inquiry, FaCSIA claimed that one of the reasons Centrelink officers needed these powers was that the AFP was too busy to help out with social security cases. This turned out to be complete nonsense, and the AFP disputed FaCSIA’s claim in its evidence to the inquiry.

To back up their claim for unusual additional powers, the agencies were relying on a letter written by the Commissioner of the AFP five years ago which noted that terrorism was the priority work area. I agree that terrorism is the priority work area for the AFP, but that does not justify this sort of legislative proposal. The agencies had not bothered to consult with the Federal Police in recent times, and the AFP told the inquiry that they could meet their obligations to enforce social security requirements. This was not important to the government, which brought on this legislation seeking substantial new powers despite a range of flaws, a lack of planning or demonstrated need, and without proper accountability and oversight provisions. The committee’s report also expressed concerns that adequate information about schedule 2 had only been made available by FaSCIA and Centrelink ‘after persistent questioning by the committee’. Moreover, when this information was provided, the committee was hampered in its work by ‘the brevity and, in many cases, contradictory nature of much of the information provided’.

The committee also expressed concern at the apparent inability of FaCSIA and Centrelink to provide accurate statistics and background information to support their arguments. I want to make it clear that this was not a partisan view; this was a view expressed by all members of the committee. There was concern about how the executive was acting in seeking to get legislative support for a case that was not made.

I think the affair reflects very badly on the government, on its incompetence and, I think, growing contempt for the legislative process. I am particularly concerned that this reflects a trend that we are starting to see in the Senate, where the government’s recognition that it has the Senate numbers is leading it to put up more and more poorly thought through, poorly drafted and poorly constructed legislation because it knows it can drive it through the chamber. We have had a number of instances recently where legislation which would not meet the most basic of tests has been brought before the parliament, most of it rammed through on the basis of the government’s numbers. Its legislation would never have passed the previous Senate, not because of the politics of the issues but because of the Senate’s view that the legislation would have needed to be justified and effective, and we would have made sure it was tested against proper requirements for legislation.

I think the government is growing lazy and complacent in dealing with legislation given its control of the Senate and that is now creeping into the bureaucracy’s view of what is achievable. Any seemingly half-baked idea now seems to get presented as legislation before the Senate. Much of it is unjustifiable and poorly drafted. So I think it is an issue that the Senate ought to take very seriously, not just on this occasion.

I pay tribute to the coalition members of the Senate Legal and Constitutional Committee who, on this occasion, were prepared to say, ‘Hang on, this is a nonsense. This is not justifiable and it ought not be supported.’ Unfortunately, on many occasions coalition senators have not been able to express those views, even when honestly held, because of their commitment to the government. I understand the pressures they are under but I think that they too are starting to realise that they are being asked to rubber-stamp legislation that should not be passed by the Senate, and I think that a number of them are feeling constrained in their roles as a result of what the executive is asking them to support.

Schedule 2 was so bad that government senators joined with opposition senators in making it clear that it should not be supported. I think it is important that the Senate continues to play that role and that all senators take that role seriously. I think that should act as a warning to the government, particularly following on from the Crimes Amendment (Bail and Sentencing) Bill 2006, which allegedly was to deal with Indigenous people using a cultural defence. Again, we saw that that was quickly and poorly drafted legislation where the government had a publicity idea, reflected it in a hastily drafted bill, were in the embarrassing position of being in the chamber arguing for the removal of customary defences by all persons using customary or cultural defence and then found that they had only removed it from two sections of the bill, not all three. That is how slapdash it was. So I think that we have to ensure that the Senate does exercise great caution over the bills that we are asked to pass, and I urge coalition senators to continue to take that role seriously.

Labor supports the rest of the measures in the bill, including those to deal with crisis payments. Those payments are currently available to victims of domestic or family violence if they are forced to leave their home and establish a new home as a result of the violence. Extending eligibility for crisis payments to those who remain in their own home after the perpetrator has left or has been removed, recognises that violence may trigger financial crisis even when the victim remains in the home.

The bill also proposes a series of changes to social security legislation to enhance information sharing between agencies, and we would support that. However, we do believe that the changes to information exchange arrangements should be implemented in consultation with the federal Privacy Commissioner. We note that Centrelink is currently not required to inform people when their carers payment is about to be cut off and we believe that they should be required to do so. We also question the government’s projected savings of $131.8 million from this measure. The extent to which these savings will be realised is questionable, given the government’s savings projections of this nature are notoriously unreliable. It seems that alleged social security fraud savings come up every year—it seems to be a bottomless pit of savings—but I am certainly getting a bit cynical about it.

In conclusion, Labor supports the measures in the bill. We think they are worthy of support by the Senate. We are very pleased that the government has backed down over the search and seizure powers. I pay credit to the members of the Legal and Constitutional Committee for their work in bringing the government to the realisation of how poor their proposals were and, because of the government’s support for opposing scheduled 2, Labor will be supporting the bill.

Andrew Bartlett (Queensland, Australian Democrats) Share this | Link to this | Hansard source

On behalf of the Democrats, I indicate that we support the legislation once the amendment is put through to remove schedule 2 from it. I concur with much of what Senator Evans has just said. I would want to make two key points in regard to the process that has been followed to date. Firstly, I think there does need to be a particular recognition of and congratulations to the Senate Legal and Constitutional Committee. It was a brief Senate inquiry and a brief committee hearing but it was sufficient to clearly draw out ample evidence that the proposal contained in schedule 2 of the legislation was badly thought through, improperly justified and, frankly, quite dangerous.

It is a tribute to all members of the committee, including the government members of the committee and its chair, that the committee not only pointed those matters out in its report but, indeed, was also sufficiently diligent in its questioning to draw these facts out in the committee hearing process. My understanding—and I am almost certain of this as a member of the committee—is that the relevant minister, Minister Hockey, indicated his decision to withdraw this schedule from the bill before the Senate committee report even came down. Normally it takes the strength of a unanimous Senate committee report, with the government members included, to create sufficient awareness, pressure and recognition for the government to move necessary amendments. It does not mean it always follows that the government will move those amendments, of course, but usually that is the way it works. If there are going to be amendments as a result of Senate inquiries, they are proposed usually once the committee has done its report and attention has been drawn to the strength of the concerns. In this instance the evidence was so strong, so clear-cut, so problematic at the hearing itself that the minister indicated before the report had even come down that he would be withdrawing schedule 2.

That leads me to the second point I want to make. There does need to be congratulations given to the minister, Minister Hockey. The easy thing to do when you have the numbers in the Senate is to just insist on going ahead anyway. I can certainly think of some other ministers who, I suspect, in similar circumstances would have dismissed all the concerns and bulldozed straight ahead anyway, enforcing their will, if you like, on their colleagues most probably because of the nature of parliamentary discipline. They would have got that accepted and we would have ended up with an extremely bad and dangerous law. Probably anybody who expressed concern about it would have been dismissed as being soft on welfare fraud or something like that.

So it is worth while paying tribute to Minister Hockey. Obviously, any time a minister withdraws a section of a bill in the face of criticism they leave themselves open to being accused of backdowns, backflips and the like. A small amount of that happened, as is understandable. But to have the guts to stand up and say, ‘No, actually this is wrong. We’ll take this out and have another look at it. We won’t insist on proceeding. We won’t force this through. We won’t inflict bad law on the people of Australia,’ takes a bit of backbone. It might seem like common sense, but it is not automatic and I think it needs to be commended when it happens.

Having said that the decision of the minister needed to be acknowledged and congratulated, I nonetheless have to express great concern that the provision was put forward in the first place. I do not know whose idea it was. Centrelink and social security legislation span a few different portfolios. I do not know whether it came from a ministerial or departmental level, or where it came from, but it is a dangerous idea. To reinforce what the relevant schedule of the bill sought to do—or seeks to do, before it gets removed: it sought, or seeks, to introduce for social security, family assistance and related student assistance payments provisions for entering and searching of premises, and copying and seizing of material relevant to pursuing these investigations.

I note that the justification given initially was that these provisions would mirror provisions that are already available to other agencies such as the Health Insurance Commission, the Australian Taxation Office, the Child Support Agency and the Department of Immigration and Multicultural Affairs. It is important to note that that justification was used because it is literally an example of the slippery slope. That is why there is good reason to raise concerns on principle about expanding powers such as search and seizure—law enforcement types of powers that would normally be associated with police type agencies—to other general government agencies, public servants and officials. The reason is that, once it is done for one agency, it is very easy, common and understandable for ministers that might want that power for some other thing to say, ‘We already do this in this area. There’s no problem. We’ll do it for this other section as well.’

I think that the social security area has quite significant distinctions to the tax office, the Health Insurance Commission and the immigration department in particular. As the Welfare Rights Network pointed out in their evidence to the committee inquiry, issues relating to enforcement for those agencies usually relate to people avoiding the agencies, whereas, with Centrelink, if you want to keep getting paid, you need to retain contact. There are many ways that Centrelink can require contact with people to enable basic payments to continue, so it is quite different even from that point of view.

The other difference, as the committee pointed out, is that in most instances with those agencies when these sorts of search and seizure operations occur, it is at business premises, not private residences, where many of the sorts of raids would occur when you are talking about social security and Centrelink payments. It is a reminder of how this sort of justification, this sort of creeping effect, once the powers are given more widely, is used to spread it out to other officials for all sorts of other reasons. So it is good that the line in the sand has been drawn on this occasion, and I hope that continues to be the case.

The other part of this situation which is worrying and which I think needs to be emphasised is the flimsiness of the justifications that were given. Senator Evans has read out some of the conclusions of the unanimous committee report—I was a member—and they should set a few alarm bells ringing, frankly. We are, in this place, as are the general public, reliant on taking the word of agencies when they put forward arguments to justify why certain actions or changes are needed. The arguments put forward by Centrelink officers once they were explored by committee members fell apart quite quickly. That is a matter of concern. I am not suggesting there was deliberate deceit undertaken; I suspect it was a belief that took hold amongst some in Centrelink that a certain situation was occurring and they needed to do something about it. They just continued on their way and did not put a lot of time into talking to, in particular, the Federal Police to determine whether their belief was valid and whether there might be ways to solve it. They immediately went to the end of the process to their preferred solution and decided that they might like search and seizure powers themselves.

The suggestion and the justification made by Centrelink officers that there were delays in the process of obtaining and executing warrants and that their inability to act promptly jeopardised their capacity to get evidence were not able to be backed up. Also, they stated that there had been an increase in the number of times that the AFP had rejected referrals for them to become involved in Centrelink activities when the AFP was able to provide data that quite clearly proved the opposite: there has actually been a decline in the number of cases rejected by the AFP in recent years, including since 2000. Indeed, the decline has been quite dramatic in the number of cases rejected by the AFP.

It should always raise a concern when a rationale is put forward by a government agency as to why a quite significant power is required and then, when you do the tiniest bit of digging, you discover that that rationale is not actually backed up at all and is undermined by the basic facts. That does not engender confidence and it is a concern. I think it is a sign of what Senator Evans referred to as the government’s growing arrogance. There is a growing view that, with the government’s control of the Senate, they feel they do not need to worry about doing all this ‘homework’. They think, ‘We have got the power, we want to do this, we know it needs to be done and we should be allowed to do it.’ Again, it is a tribute to the Senate committee that they were able, even in that short hearing, to expose the problem.

I should also note the work of another Senate committee, which does not get terribly much notice but also does a good background job of exploring not the partisan policy issues but some of the basic principles—that is, the Senate Standing Committee for the Scrutiny of Bills. It also looks at the principles of whether legislation that gives extra powers to government or government officials is justified. We are, of course, always talking about balancing principles. No-one is arguing—I am certainly not—that under no circumstances should any non police officer, public servant or official ever be able to conduct search and seizure type operations; clearly, that would be unreasonable and inflexible.

But we do need to balance-up giving extra enforcement powers that will obviously help with compliance with the law, which is always in the public interest, with the potential for those powers, firstly, to infringe upon people’s dignity with arbitrary invasions of their property and privacy and, secondly—and potentially worse, of course—the potential for them to be misused. With an agency as large and dispersed as Centrelink, I do not think it is casting unfair aspersions on the public sector in general to say that unless you have an extremely good training regime—something else that had not been worked out when these proposals were put forward—the chances of the powers being misused will likely be quite significant.

I found the evidence of the Welfare Rights Network very convincing. They deal with the difficult cases—not the day-to-day cases. The day-to-day cases are the ones that nobody notices because they are the ones where everything goes right. That is the vast majority, and that is good. But the ones where there are appeals, the ones where there are disputes, the ones where there are complaints—the ones where things go wrong—are the ones that people at the Welfare Rights Network deal with every day of the week. They get to see the flaws. Dealing with nothing but flaws day after day can tend to cull your judgment a bit, perhaps; you can assume that these practices or problems are more widespread than they are. But the simple fact is that the Welfare Rights Network do have that practical experience of how badly things can go wrong and of how internal processes are not always sufficient to resolve problems.

I used to work in the predecessor of Centrelink, the Department of Social Security, back in 1989 or 1990—I think it was around that time. Things have obviously changed a great deal since then, but I was a social worker and also dealt to some extent with some of the more difficult cases, rather than the run-of-the-mill ones. I would sometimes be playing an intercession type role when there were disputes in the compliance and enforcement area. It is not casting aspersions to say that sometimes people can get overzealous in that area. They are human beings and that is sometimes human nature in those sorts of circumstances. It can happen not even within a whole organisation but with individual officers, or in units or teams. In any particular region a culture can develop that can be overzealous.

I certainly saw examples of that in my time. It was only occasionally; not very often. It is a very difficult job, of course—particularly in the compliance area, which is very delicate. I am not in any way suggesting it is a walk in the park. But I have no doubt that already in the compliance area there are practices that are less than ideal. Expanding powers to such a dramatic extent as being able to get warrants to enter premises to search and seize material and question people is a very big step. I certainly do not think it is one that should be taken without very strong justification and a lot of preplanning.

Having made all those complaints about that section of the bill, I am obviously very pleased it is not going to stay in there. But I think we need to note that it did make it all the way through until the Senate committee drew attention to those problems. I hope, and I am sure and would expect, that the minister and ministers would be looking into how it got through—how it happened that such a poorly thought through provision could have almost entered into law. I will repeat that I think credit must go to the minister for accepting the mistake and withdrawing it—if you like, for taking the short-term hit for the long-term benefit of the administration of this particular area of the law and, obviously, for those in the community that have experience with it. It is worth repeating that there are, of course, millions and millions of Australians that have some form of contact with Centrelink each year. In that sense, I suppose, it is a positive sign that there are perhaps so few complaints. The area of Centrelink complaints is, I think, the biggest area of complaints for the Ombudsman. That is perhaps not surprising given the enormous number of Australians that have contact with Centrelink.

The other provisions of the bill, which will stay, are ones that the Democrats support. Senator Evans spoke about an amendment; I will listen to the arguments on that. The case he put forward for his amendment seemed valid to me, but I am happy to hear any other arguments to the contrary before determining a position on it.

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

I rise to speak on the Families, Community Services and Indigenous Affairs and Veterans’ Affairs Legislation Amendment (2006 Budget Measures) Bill 2006. Perhaps hereafter we can call it ‘the bill’. The bill was introduced into the Senate on 11 October 2006. It was referred to the Senate Standing Committee on Legal and Constitutional Affairs. That is unusual because these types of bills usually go to the community affairs committee or another committee.

The bill went to the Senate Standing Committee on Legal and Constitutional Affairs principally because of schedule 2. In short, schedule 2 contains proposed entry, search and seizure powers. Schedule 2 would amend the A New Tax System (Family Assistance) (Administration) Act and a number of other acts to provide Centrelink investigative officers with a wide range of powers. In short form, those powers can be explained as powers to enter premises with the consent of the occupier; apply to a magistrate personally, by telephone or by electronic means for a warrant; execute the warrant to enter premises with assistance and using reasonable force as needed; search the premises for evidential material; take photographs or video recordings; use equipment to process items found in the search; operate electronic equipment at the premises to obtain and copy data; and obtain an order requiring a person to assist in accessing a computer and copying its data. Quite a wide range of powers, in fact, are being sought in schedule 2.

Principally, as I understand it, it was sent to the legal and constitutional committee, to have a look at those powers, because of the very nature of those powers and the use that investigators from Centrelink could in fact then put those powers to. The remaining parts of the bill are relatively uncontentious. But you do question why the government in this instance put an omnibus bill together which contains relatively uncontentious changes to this area but also includes schedule 2 within all of that, which provides quite wide-ranging powers for investigative officers of Centrelink.

When examined by the committee a little bit further, it did become a bit plainer, if that is a reasonable way of putting it. Most of the submissions—in fact, the key submissions—were all opposed to the inclusion of schedule 2 in this bill but particularly to the powers that would be conferred on Centrelink investigative officers. There is a need for Centrelink officers to investigate fraud and to ensure that payments to people are appropriate. Centrelink have a range of powers already. They have a system of administrative breaches. I will not go into great detail about that. But they do have significant powers as it is.

Investigative officers in Centrelink, I am sure, play a vital role in combating both administrative breaches and fraud. In fact, if you look at the statistics, something in the order of 20,000 cases are investigated by Centrelink officers in combating fraud. The overall framework that we work within in this area is the fraud control guidelines promulgated by the Commonwealth. In short, the guidelines provide that fraud which is serious and complex be referred to the Australian Federal Police for investigation, as you would expect. Usually, under the fraud control guidelines, minor fraud or fraud which does not meet that criterion is required to be dealt with in-house. What that means is that the relevant agency or department should include within its overall administration a method to ensure that fraud is dealt with in an appropriate way—in other words, it should have proper processes and administrative procedures in place. That is the general framework that you would expect.

What is sought in this bill is in fact the movement of significant powers to Centrelink investigative officers to assist them in matters that are not being referred to the Australian Federal Police or which would not meet the case categorisation and prioritisation model that the Australian Federal Police use to assess serious and complex fraud cases, which they will then pick up. Of the 20,000 cases that Centrelink investigates, about 4,000 end up being referred to the Commonwealth Director of Public Prosecutions to be dealt with. For most of those, guilty pleas are usually entered. Of those, there is a significant or at least a very high guilty verdict rate. In other words, a quarter of the cases that they investigate and move towards completion obtain a guilty verdict.

You would have to say that, on the statistics they have provided to the committee, many of those fall within the areas that you would expect. Those are areas such as the employment sphere, marriage like relationships, education and the like. Without going to the particular detail of that, Centrelink does have a program in place. What has happened, by the look of it, is that a range of budget measures have sought to increase the focus of Centrelink on this area. To that end, the Department of Human Services put forward a series of measures under the headings Better Compliance and Better Service. One of these measures was an enhanced focus on serious social security fraud. I am sorry; my mobile phone is ringing. You occasionally get that, unfortunately.

Barnaby Joyce (Queensland, National Party) Share this | Link to this | Hansard source

Now you have to take the call.

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

That occasionally happens when you get called to the chamber.

Amanda Vanstone (SA, Liberal Party, Minister for Immigration and Multicultural Affairs) Share this | Link to this | Hansard source

I honestly do not recall that happening!

Barnaby Joyce (Queensland, National Party) Share this | Link to this | Hansard source

Senator Joyce interjecting—

Michael Forshaw (NSW, Australian Labor Party) Share this | Link to this | Hansard source

It is disorderly to interject and to answer the phone. Could you continue your remarks please, Senator Ludwig.

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

Thank you. I thought that, if I tried to draw the least amount of attention to it as possible, we might skate through.

The Acting Deputy President:

I think we are all waiting to hear, actually, what the call was about.

Amanda Vanstone (SA, Liberal Party, Minister for Immigration and Multicultural Affairs) Share this | Link to this | Hansard source

I note that you checked who it was from!

Joe Ludwig (Queensland, Australian Labor Party, Manager of Opposition Business in the Senate) Share this | Link to 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.

Amanda Vanstone (SA, Liberal Party, Minister for Immigration and Multicultural Affairs) Share this | Link to this | Hansard source

I thank all honourable senators for their contribution. I do not want to say much more—just two things. All senators whom I have heard speak on the Families, Community Services and Indigenous Affairs and Veterans’ Affairs Legislation Amendment (2006 Budget Measures) Bill 2006 referred to the government agreeing to an amendment to schedule 2 of the bill to remove in its entirety the search and seizure provision. A new service level agreement is being developed between Centrelink and the Federal Police. Therefore, the provision is no longer necessary and the government amendment will remove schedule 2 from the bill. The amendment will need to be moved during the committee stage, and hopefully we will do that soon. In addition, Senator Evans’s amendment, which I expect he will move, will not be supported by the government—just to give some advance knowledge of that—as it is not, in our view, comprehensive enough and does not address all of the issues or consequential amendments necessary for that to happen. I will discuss that amendment more when we get to the committee stage. There is some sympathy for where Senator Evans is trying to go; there is just disagreement on what it will actually achieve in terms of the current amendment. I thank senators for their contribution.

Question agreed to.

Bill read a second time.