Transcript: 2GB Mornings Interview with Luke Grant

11 January 2017

The Hon Alan Tudge MP

Minister for Human Services
Topics: 
Debt and compliance letters, Parliamentarian expenses
E&OE

LUKE GRANT:

Alan Tudge who's the Human Services Minister joins me on the line. Minister, all the best for the New Year. I hope - did you have a break at all?

ALAN TUDGE:

G’day Luke. Yeah I did take a couple of weeks off from just before Christmas until Monday with my family which was lovely. But back at it now.

LUKE GRANT:

You have copped a bit of flack over this, the Government has, others saying that the system is flawed, the people that don't owe money have been hit inappropriately with a bill; what's your response to that general observation?

ALAN TUDGE:

My response is that overall the system is working as planned. What we do, Luke, is that we check the records that we have with the Tax Office against what individuals had declared to Centrelink when they were on welfare payments, and if there is a significant discrepancy we then go back to the individual and ask them to explain that discrepancy.

On some occasions people do explain that discrepancy; it may well have been, for example, that the employer in reporting to the Tax Office said that they worked 10 months of the year when in fact they'd only worked six months of the year.

And when that's corrected then there's no issue. For others though, they're unable to correct the record or don't and if they don't do that, then a debt will be raised against them.

So this is an important compliance mechanism to ensure that people are getting the right payments, but no more and no less. And I think that taxpayers - who are spending a lot of money to support the welfare system - expect us to ensure a robust mechanism like this.

LUKE GRANT:

Why has, Minister, the Commonwealth Ombudsman got involved here?

ALAN TUDGE:

Oh you'd have to ask the Commonwealth Ombudsman that question. We welcome the Ombudsman inquiry into it and if they have any recommendations for us we'll certainly take those recommendations very seriously.

LUKE GRANT:

But do they just voluntarily decide, oh we'll take a look at this or has someone agitated for to get them involved?

ALAN TUDGE:

Oh, I imagine it's been the latter, but they make up their own minds as to what to get involved in.

LUKE GRANT:

In relation to the system itself, how different is it to what the ALP did when they were in the power?

ALAN TUDGE:

So effectively the methodology is exactly the same, what we have done is we've automated more of it. Although the Labor Party did have some automation when they were in power as well.

So the methodology of cross-checking the information from the Tax Office against what was self-declared is exactly as it's always occurred. We've just gone about it in a more automated manner.

LUKE GRANT:

Just let me clear that up, so in relation to the outcome we're seeing now where there are reports of people who are being, in their mind - and due respect to them - unfairly targeted, that would have been the case were it the ALP. What you've done is you've applied the ALP's formula but fast-tracked it by automating it. Is that right?

ALAN TUDGE:

That is right. And also we've gone back more years. You see, Luke, we wouldn't even be having this discussion if the ALP, when they were in Government, had a much more robust compliance system.

They just weren't doing it as rigorously and as broad as what we are now. And so we're going back and looking at some of those years from four or five years ago and checking off the data against it so as to ensure that there was integrity in those years.

Individuals get three opportunities to correct the record if the initial data matching shows there's a discrepancy. First of all they'll get a letter saying: there's a discrepancy, can you provide an explanation? If they don't provide an explanation they might get a debt notice.

They then get a further opportunity to challenge that debt notice and provide further information. Even after that they can then further appeal to a tribunal. You've got three chances to correct the record, if indeed you think it is wrong when that data matching has been done.

LUKE GRANT:

What about the claim, I think by one person, that they had to call Centrelink 350 times, is there any truth to that suggestion?

ALAN TUDGE:

Well that surprises me, that claim. Now sometimes our telephone line is very busy and you have to wait a long time. The average wait time is about 12 minutes at the moment and we have a dedicated line for compliance issues.

A wait time of 12 minutes means that some people are getting on earlier, some people are getting on a bit later. You can also, of course, go into a Centrelink office and talk with somebody if you want to and typically you'll wait about 10 minutes if you do go in to a Centrelink office.

LUKE GRANT:

What about the claim that someone owes money, once investigated it's in fact proven that that claim is false? How many are I guess I'm asking you, are you getting right and how much of them are wrong?

ALAN TUDGE:

The initial claim, the initial letter which goes to a person is not a debt letter as such.

LUKE GRANT:

Sure.

ALAN TUDGE:

We do the data matching and then we inquire to the person to say: listen, the information here at the Tax Office is different to what you provided to Centrelink, can you explain? In 20 per cent of times the person can explain.

What the ALP is saying at the moment, by the way, is because it's 20 per cent, they're saying oh that's the error rate, that's completely wrong; this is part of the system, you get the opportunity to explain and that occurs about 20 per cent of the time.

The other 80 per cent of the time, people can't explain the discrepancy or don't explain and if they don't do that then a debt will likely be issued to that person.

LUKE GRANT:

See what I don't get if you allow me just to make this observation, Alan, with great respect is that what you're trying to do I think is sensible, fair and what should be done. What the other mob are saying is reckless.

Now you inherited a hell of an economic disaster from the former three PMs - Rudd, Gillard, Rudd - and what this is, to me in my mind as someone that wants to see you fix the budget, is the other side almost sabotaging your efforts to try and get some money back but they never get bloody well called out on it. It's just so frustrating.

ALAN TUDGE:

Well it is frustrating, and in some respects, this is classic Labor because Labor actually supported this measure, they booked the savings, the $4 billion in savings which we're going to get from it but now they're campaigning against it and saying that we should cease the operation of it. It's actually classic Labor and they're doing this time and time again.

This is a system which is robust, we're constantly making improvements to it and we'll continue to make improvements to it but we've already generated $300 million in the last 6 months alone from this and that goes back to the taxpayer, and we've got a target of $4 billion over the 4 year period.

This is an important measure, it's important for taxpayers who are paying for this welfare system and eight in 10 of their dollars pay for the welfare system, important for them to know that there is integrity in the system and that's what this is all about.

LUKE GRANT:

Yeah that's fair enough. Now I haven't invited you on to take calls, but I want to let you hear the comments of one caller and you might want then to follow that up off air. Bob, just go ahead and say what you want to say, mate.

CALLER BOB:

Yeah good morning, Luke. Look I've been on a disability pension since I retired about eight year ago and last year I got a notice from the debt recovery saying I owed Centrelink money. I got no previous letters to please explain or you know, it was just straight out a debt collection notice.

LUKE GRANT:

Okay just stay there, Bob, we'll get your details. Go ahead Minister.

ALAN TUDGE:

Can I just respond to that?

LUKE GRANT:

Please do.

ALAN TUDGE:

That just sounds very unusual that that would occur, certainly in the present system, a debt notice would be the third letter which you get.

LUKE GRANT:

Right.

ALAN TUDGE:

You first of all get a letter asking you to explain a variation.

LUKE GRANT:

Yeah.

ALAN TUDGE:

You second get a reminder letter if you haven't responded and then only thirdly if you haven't responded to those two do you get a debt letter.

LUKE GRANT:

Okay.

ALAN TUDGE:

Now if you're still on the DSP we would have an accurate address of course.

LUKE GRANT:

Yeah, yeah.

ALAN TUDGE:

Because he's, you know, getting that payment. So I’m happy if he wants to contact my office we can follow up on that and just understand it better.

LUKE GRANT:

Okay Bob you wait there, and Minister, I appreciate your time. Thank you very being available this morning. Obviously if we need to speak again, we'll try and get you on, but I wish you all the best for 2017 and keep going. You're doing good work.

ALAN TUDGE:

Thanks very much Luke, all the best.

LUKE GRANT:

All the best. That's the Minister for Human Services, Alan Tudge.

[ENDS]