Human Services fraud and compliance blitz draws fire from Audit Office




The Department of Human Services’ (DHS) efforts to prevent Centrelink fraud have been criticised in an Australian National Audit Office (ANAO) report, with only two out of seven fraud prevention and compliance measures judged effective and expected savings falling short of their targets in four cases.

The ANAO report deals with Human Services compliance programs announced in earlier Budgets and running between 2012 and 2016, just before the current robo-debt crisis, which automatically matched ATO and DHS data and generated thousands of debt letters to benefit recipients, some of them wrong.

During its investigations the ANAO examined the design and implementation of seven compliance measures, including Employment Income Matching – a forerunner of the data-matching system used in the robo-debt fiasco.

It looked at whether programs were monitored properly and explored whether savings’ targets had been achieved.

“Most of the compliance measures examined did not fully achieve their expected outcomes, including savings and addressing the risks to payment integrity,” said the ANAO report, which was published yesterday (Tuesday).

Shortcomings were identified in DHS monitoring and reporting for every compliance measure. The Department of Social Services also drew criticism for not keeping an eye on progress against targets.

 “The monitoring and oversight arrangements for the compliance measures, set out under the Bilateral Management Arrangement between DSS and Human Services, have not been effective as they were not followed,” said the report.

 “The Department of Social Services as the relevant policy entity did not take responsibility for monitoring outcomes, including impacts and actual savings, achieved from the measures.”

But Human Services is having none of it, instead arguing that it has exceeded its savings target across the seven compliance measures assessed by ANAO by more than $210 million or 26.7 per cent.

The Department argued the ANAO’s methodology was suspect and said it did not agree with the ANAO’s tables detailing what savings had been achieved against targets.

It hit back, saying: “The department does not accept the key conclusion in the report that most of the compliance measures examined were not effectively implemented and the expected outcomes were not fully achieved, including savings.”

The behemoth Department said it had exceeded its outcomes and implemented its compliance program effectively. It also denied that it failed to provide clear and accurate progress updates to the public or had briefed ministers ‘in an ad hoc manner’.

Human Services said it already consistently tracked and reported on key outcomes and collated information on targeted and achieved savings, making the ANAO’s third recommendation redundant.

It continued: “The Department notes that the ANAO has not made any recommendations which directly address its main conclusions and findings.”

Meanwhile politicians lined up to put the boot into DHS’ fraud recovery and compliance efforts.

Greens Senator Rachel Siewert said the report showed there was ‘a dysfunctional crackdown on the social safety net before the large scale automated debt recovery system even begun’.

 “The department haven’t been able to manage these measures, the government went full steam ahead on the automated debt recovery process regardless; causing dismay and stress to thousands of vulnerable Australians when quite obviously they couldn’t handle it,” Ms Siewert said.

 “Anyone taking a flick through the ANAO report can see that an erosion of the social safety net has been going on for some time and that the approach has long been in disarray”, Ms Siewert said.

She said it was ‘laughable’ that DHS had disputed the report’s findings.  

“Clearly this has been back of the envelope accounting from the government to undermine the findings of the audit.”

Shadow Human Services Minister Linda Burney said the ANAO report highlighted that the administration and monitoring of fraud and compliance programs was ‘deeply flawed’ and  that DHS was ‘a complete mess’.

“The Minister is desperate to cover up the mess he has created,” Ms Burney said. “These are the compliance measures which haven’t even faced the most public criticism – what will an audit of the robo-debt scheme find?”

She said that DHS and DSS were not following joint management agreements on welfare payments ‘meaning the right hand has no idea what the left is doing’.   

The Senate Community Affairs References Committee is currently carrying out an inquiry into the Centrelink robo-debt scheme with a reporting date of May 10. Submissions are due by March 22.


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