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2003-04 Budget

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Family and Community Services

Assurance of Support Scheme - improved operation

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 2.1 -4.0 -4.5 -4.9
Department of Immigration and Multicultural and Indigenous Affairs -0.1 -0.1 -0.1 -0.1

The Government will improve the operation of the Assurance of Support Scheme and simplify arrangements for people who provide an Assurance of Support.

Under the new arrangements, the Department of Immigration and Multicultural and Indigenous Affairs will continue to determine which new migrants are subject to an Assurance of Support. However, once the determination is made, the Assurance of Support will be issued under the social security legislation and Centrelink will administer the scheme.

This will enable Centrelink to provide people who have given an Assurance of Support with more comprehensive information regarding their financial obligations through a single point of contact.

The new arrangements will be implemented on 1 July 2004, with a net reduction in expenses of $11.6 million over four years.

The Department of Immigration and Multicultural and Indigenous Affairs will also generate administrative savings from no longer administering some components of the scheme.

See also the related capital measure titled Assurance of Support Scheme - improved operation in the Family and Community Services portfolio.

Australians Working Together Measures - changed arrangements

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 14.2 12.7 11.8 12.0

The Government will make a number of changes to the Australians Working Together measures announced in the 2001-02 Budget, in the areas of administration of activity and participation agreements and breach processing. These changes will include:

  • a formal cooling off period for activity and participation agreements;
  • more detailed consideration of personal circumstances in activity and participation agreements, activity exemptions and breaching;
  • earlier and improved notice of impending breach penalties;
  • reduced penalty periods for first breaches; and
  • reduced job search requirements for some mature-aged job seekers.
Bali Terrorist Attacks - ex-gratia payments for the Victims and Family members of Victims

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 0.5 - - -

The Government will provide $1 million over 2002-03 and 2003-04 to assist with travel and accommodation costs for certain people affected by the Bali bombings who decide to attend the trials in Indonesia of those accused of the bombings. The Government will also provide this assistance where a support person is required.

This measure extends the assistance provided under the expense measure titled Ex-gratia payments for victims and family members of victims of the Bali terrorist attacks announced in the Mid-Year Economic Fiscal Outlook 2002-03.

Centrelink Rural Call Centres - continuation of funding

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services - - - -

The Government will continue to fund the two rural call centres, in Port Augusta in South Australia and Maryborough in Queensland, at a cost of $31.8 million over four years. These rural-specific call centres provide information and advice on Centrelink services to many rural and regional customers.

This measure will involve funding of $7.8 million in 2003-04, $7.9 million in 2004-05, $8 million in 2005-06 and $8.1 million in 2006-07. Provision for this funding has already been included in the forward estimates.

Centrelink Service Delivery - enhanced information technology capability

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 27.0 7.9 -26.3 -57.3

The Government will provide funding to Centrelink of $312 million over five years (including $120.7 million in capital) to enhance the capabilities of its information technology systems and ensure continuing reliability. This funding will allow Centrelink to expand online services to customers (self-service) and enter working partnerships with community organisations. This funding will also allow Centrelink to increase payment accuracy through automated data matching and information exchange with businesses, Government departments, banks and others.

The measure will provide benefits to the community both through increased efficiency of Centrelink operations (saving $77.2 million over four years) and real time validation of customer circumstances with external parties (resulting in administered savings, in the Family and Community Services portfolio, of $126.6 million over four years). The measure will mean a net reduction in expenses of $48.7 million over four years.

See also the related capital measure titled Centrelink Service Delivery - enhanced information technology capability in the Family and Community Services portfolio.

Child support debt collection - additional compliance activity

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services -2.3 -2.4 -2.4 -2.5

The Government will increase compliance activity to target payers of child support who are not meeting their child support obligations. The measure is expected to benefit parents and children by increasing child support collections by $130.3 million over four years. The measure will increase the level of child support payments, ensure more reliable income support for recipients of child support payments and reduce dependence on social welfare payments.

This measure is expected to lead to savings in social welfare payments of $40.6 million and will cost $31 million to administer leading to a net savings of $9.6 million over four years.

Child Support improvements - support for unemployed parents

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services .. -0.1 -0.1 -0.1

The Government will provide funding of $11.9 million over four years for programmes to assist 31,500 unemployed parents who are newly separated and not residing with their children, to improve their parenting and relationship skills. The costs of these programmes are expected to be offset by savings of $12.2 million over four years as a result of reduced dependence on Family Tax Benefit and Newstart Allowance.

The measure responds to evidence that better parenting skills improve the relationships non-resident parents have with their children and ex-partners, which leads to increased levels of voluntary child support compliance.

Compliance reviews - expand data matching and asset reviews to identify incorrect payments

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services -27.5 -61.7 -66.7 -68.2
Department of Health and Ageing -2.1 -4.6 -5.0 -5.3

The Government will provide additional strategies for minimising incorrect payments by expanding data matching activity to take account of newly available data sources. Data matching will be applied to all payment types. These strategies will build on pilot projects announced in the 2001-02 and 2002-03 Budgets by:

  • increasing the number of data matching reviews by 125,000 each year;
  • expanding the number of data sources used in data matching reviews; and
  • increasing the number of Age Pensioner asset valuation reviews by 20,000 each year.

This measure is expected to lead to savings in social welfare payments of $307.7 million and will cost $66.5 million to administer, giving net savings of $241.2 million over four years.

Compliance reviews - extend 2002-03 data matching pilot

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services -19.6 -20.6 -21.2 -21.6
Department of Health and Ageing -1.4 -1.5 -1.7 -1.8

The Government will extend the data matching pilot programme announced in the 2002-03 Budget and integrate it into existing ongoing compliance activity. The pilot study widened the data matching criteria for selecting cases for compliance reviews. The pilot has proven successful in identifying incorrect social welfare payments that would otherwise have remained undetected. The programme will increase the number of compliance reviews conducted each year by 43,000 and the measure will be ongoing.

This measure is expected to generate savings in social welfare payments of $107.8 million and will cost $18.5 million to administer, giving net savings of $89.3 million over four years.

Disability employment assistance - improved viability of business services

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 14.6 9.3 -0.4 -0.8

The Government will provide $25.4 million over three years for the improvement and quality assurance of businesses providing employment assistance for people with disabilities. The measure aims to assist business services to provide quality support that is affordable while maintaining profitability, and to achieve quality assurance certification under the Disability Services Act 1986.

Assistance to these services will include advice, training and support in business and change management, marketing and production processes. Some funds will also be provided to promote the use of new technologies across the sector.

In addition new and ongoing voluntary reporting arrangements will be introduced to allow more accurate customer income assessments, expected to generate savings in social welfare payments of $2.7 million over four years.

Disability employment assistance - introduction of a case based funding model

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 6.5 17.2 44.2 44.0

The Government will provide an additional $135.3 million over four years for disability employment services to implement a new outcome-focused funding model for disability employment assistance. The new model replaces existing block grant funding with funding linked to a job seeker's assessed employment barriers, support needs and outcomes achieved. Improved employment outcomes achieved under the case-based funding model are expected to reduce social welfare payments by $23.5 million over four years.

The new funding model will be introduced progressively from 1 July 2004 for business services and from 1 January 2005 for open employment services.

The measure is expected to improve employment outcomes for 6,000 job seekers and provide additional incentives for employment services to increase Vocational Education and Training placements for job seekers with disabilities. The measure will also increase funding and expand services for job seekers with a disability in rural and remote areas.

Implementation of this measure follows the evaluation of the three-year trial of the case-based funding model.

Disability Support Pensions - enhanced reviews

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services -8.0 -25.7 -27.3 -28.2

The Government will enhance the present process of reviewing Disability Support Pension (DSP) payments by introducing Service Update reviews. Service Update reviews will be better targeted than previous reviews, involving the use of face-to-face interviews, phone calls and risk-profiling techniques. In addition, the number of targeted reviews conducted each year will increase by 61,000. This measure will help ensure DSP recipients receive their correct entitlement.

The reviews will be ongoing. This measure is expected to lead to savings in social welfare payments of $107.9 million and will cost $18.7 million to administer, giving a net savings of $89.2 million over four years.

Holocaust payments - extension of means test exemptions

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 0.2 0.1 0.1 0.1
Department of Veterans' Affairs .. .. .. ..

The Government will provide $0.6 million over four years to extend the exemption from social security income testing to all restitution payments made to Holocaust victims regardless of the payment's country of origin. Previously only payments from German and Austrian Governments were income test exempt. The measure will ensure consistent treatment, under the social security income test, of all income support recipients who receive restitution payments in relation to Nazi persecution.

Household, Income and Labour Dynamics in Australia (HILDA) Survey - extended funding

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 0.5 2.8 0.2 -

The Government will provide additional funding of $3.5 million over three years to extend the HILDA survey by an additional fourth wave of data collection. The survey was established in the 1999-00 Budget as the measure Establishment of an Australian Household Panel Survey. The measure will provide data needed to assess the effects of policy and other changes on families and household formation, labour market and education participation; and retirement and retirement preparation.

Identity fraud - improving and increasing the number of investigations

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services -7.6 -17.5 -21.8 -23.6
Department of Health and Ageing -0.2 -0.5 -0.6 -0.7
Office of the Director of Public Prosecutions 2.0 3.0 3.0 3.0

The Government will increase the number of investigations into identity fraud. The measure will involve enhanced use of external and internal data sources to detect cases of fraud and will apply to all payment types.

Identify fraud investigation services will be purchased from the Australian Federal Police. Funding will also be provided to the Director of Public Prosecutions to assist in the prosecution of cases.

This measure is expected to lead to savings in social welfare payments of $97.4 million and will cost $37.3 million to administer to give a net savings of $60.1 million over four years.

See also the related capital measure titled Identity fraud - improving and increasing the number of investigations in the Family and Community Services portfolio.

Men and Family Relationships and Family Relationships Education Programmes - extended funding

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 6.1 6.2 6.3 6.5

The Government will provide funding of $25.1 million over four years to continue the Men and Family Relationships and Family Relationships Education Programmes. The two programmes form part of a larger Family Relationships Services Programme that is funded by the Department of Family and Community Services and the Attorney-General's Department.

The Men and Family Relationships Programme provides counselling services to assist men to deal with family and relationship issues. The Family Relationships Education Programme assists couples to improve their relationship skills by providing education and training in these skills.

The continuation of these programmes is part of the Government' response to the Family Law Pathways Advisory Group report Out of the Maze - Pathways to the Future for Families Experiencing Separation.

See also the related expense measures titled Family Law Pathways - continuation of Children's contact services, Family Law Pathways - continued contribution to the Victorian Court Network, Family Law Pathways - measures to improve compliance with Family Court child contact orders and Family Law Pathways - online access to family law information and services in the Attorney-General's portfolio.

Notification arrangements for people departing Australia and consistent treatment of foreign debt recovery

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 2.7 -0.2 -2.0 -3.5

The Government will strengthen the notification obligations for income support recipients who travel overseas through the:

  • immediate suspension or cancellation of payments to recipients who fail to notify Centrelink of their departure overseas; and
  • cancellation of payments to recipients identified as being involved in terrorist activities overseas.

In addition, this measure will ensure that the full amount of a debt incurred as a result of receiving a foreign pension lump sum payment is recovered from both single and partnered customers.

Currently, single people have their full debt recovered whereas partnered people have the income from a foreign pension lump sum apportioned to each partner, resulting in only half the debt being recovered.

These changes are expected to generate $9.0 million in savings over four years. The Government will provide funding of $5.8 million over four years to administer the changes.

Parenting Payment - enhanced profiling capacity to ensure correct payment

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services -3.4 -8.3 -8.6 -9.0

The Government will enhance the profiling capacity of Parenting Payment. This measure will increase the number of face-to-face reviews of Parenting Payment recipients by 27,000 each year. The reviews will identify recipients who are at risk of being incorrectly paid as a result of not declaring changes of circumstances.

This measure builds on arrangements that were announced in 2001-02 and is expected to lead to savings in social welfare payments of $41.6 million and will cost $12.3 million to administer to give a net savings of $29.4 million over four years.

Pensioner Education Supplement - matching payments to study periods

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services -5.1 -10.2 -10.4 -10.7
Department of Education, Science and Training -0.6 -0.9 -0.8 -0.7

Payment of the Pensioner Education Supplement will be made during periods of actual study, consistent with the intention of the scheme to assist with the cost of study. Students participating in full year or longer courses will be paid over the academic year including the mid-year break(s). Students participating in shorter courses will be paid for the duration of the courses and not over breaks between courses. For courses without defined study periods, such as those offered through Open Learning, these courses will be deemed based on arrangements for mainstream courses.

The measure is expected to lead to savings of $39.3 million over four years. This change will affect payments made by the Department of Family and Community Services and the Department of Education, Science and Training.

Reconnect and Job Placement, Employment and Training

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 1.5 1.6 1.8 2.0

The Government will provide additional funding of $6.9 million over four years to:

  • extend the Reconnect programme until 2006-07 with ongoing indexation;
  • provide funding to improve and streamline the administration of Reconnect; and
  • maintain service delivery provided through the Job Placement, Employment and Training Programme in regional Australia.

This measure will be in addition to funding of $155.2 million over four years for the existing programmes, which has already been included in the forward estimates.

Research into emerging areas of risks to the social security system

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 2.6 - - -

The Government will provide funding of $2.6 million in 2003-04 for research into emerging areas of risk to ensure that social welfare payments only go to those entitled to receive them and to ensure the correct level of payment. Areas for attention will include customer identification, the cash economy and systems to gain better information on the geographic distribution of risks.

Respite support for carers of young people - continuation of funding

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services - - - -

The Government will provide $22 million over four years to maintain respite support for the carers of young people with disabilities. This measure provides support to over 7,200 carers per annum across Australia who are not able to access existing State and Territory respite care or assistance provided under other Commonwealth initiatives.

This measure will involve funding of $5.2 million in 2003-04, $5.5 million in 2004-05, $5.6 million in 2005-06 and $5.7 million in 2006-07. Provision for this funding has already been included in the forward estimates.

Social Security Act 1991 - further legislative simplification

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services - -0.8 -0.7 -0.7

The measure contributes towards the Government's commitment to implement a simpler and more coherent social security system and will continue the simplification of the Social Security Act 1991. The measure includes:

  • consolidation of the rent assistance calculation process;
  • clarifying the payments recoverable when customers receive economic loss compensation payments; and
  • clarifying the definition of independence for Disability Support Pension youth customers to be consistent with that applied to Youth Allowance customers.

This measure is expected to result in savings of $2.2 million over four years.

Social Security Agreement with Chile

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services - - - -

The Government has decided to extend the current network of reciprocal social security agreements to include Chile.

This agreement will mean an ongoing improvement to the access to income support by people whose adult lives are spent in both Australia and Chile and will cover Age Pensions and Disability Support Pensions. Australia and Chile will share financial responsibility for these pensions, each paying a proportion of their pension based on the length of residence or contributions that recipients have accrued in each country.

This measure will involve funding of $0.03 million in 2002-03, $0.9 million in 2003-04, $0.6 million in 2004-05, $0.7 million in 2005-06 and $0.8 million in 2006-07. Provision for this funding has already been included in 2002-03 and the forward estimates.

Social Security Agreement with Malta - revised agreement

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 0.3 .. -0.2 -0.3

The Government will modify its international social security agreement with Malta to limit overseas payment of the Disability Support Pension for non-severely disabled persons to a maximum of 26 weeks. The measure will bring the agreement with Malta into line with the majority of international agreements in relation to the treatment of Disability Support Pensioners. This measure is expected to result in savings of $0.2 million over four years.

Special Needs Subsidy Scheme - additional funding

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 6.3 6.4 6.5 6.7

The Government will provide additional funding of $25.8 million over four years to enhance the Special Needs Subsidy Scheme, which supports children with high ongoing support needs.

The scheme provides assistance to child care services to employ additional carers to support children with such needs. The scheme has experienced high demand since its inception in 1997. The additional funding will provide assistance to around 1,250 additional children.

Student Financial Supplement Scheme - repeal

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 20.6 58.4 48.5 38.9
Department of Education, Science and Training 5.3 12.7 10.7 8.8
Australian Taxation Office 0.2 0.1 0.1 0.1

The Government will repeal the Student Financial Supplement Scheme (SFSS) from 1 January 2004 in response to increasing levels of bad and doubtful debt and reduced take-up of loans under the scheme. The take-up rate for the scheme has declined by 28 per cent over the past three years. This has followed the introduction of Youth Allowance and increased access to alternative commercial loan products and opportunities for students to supplement their income. It is currently estimated that more than one half of the loans provided under the SFSS are never likely to be repaid.

Repeal of the scheme will not affect entitlements for Youth Allowance, Austudy, Abstudy or Pensioner Education Supplement. The scheme previously required students to trade in part of their entitlements in order to access loans.

Expenses will increase by $204.4 million over four years because students will no longer trade in part of their entitlement to Youth Allowance, Austudy, Abstudy or Pensioner Education Supplement.

This is a cross-portfolio measure between the Department of Family and Community Services, the Department of Education, Science and Training and the Australian Taxation Office.

See also the related revenue measure titled Student Financial Supplement Scheme - repeal in the Family and Community Services Portfolio.

Support for Indigenous people - continue funding for Centre for Aboriginal Economic and Policy Research

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services - - - -

The Government will provide funding of $0.6 million over four years to the Centre for Aboriginal Economic and Policy Research to allow for continued research into issues relevant to Indigenous policy in the Family and Community Services portfolio.

This measure will involve funding of $0.1 million in 2003-04, $0.2 million in 2004-05, $0.2 million in 2005-06 and $0.2 million in 2006-07. Provision for this funding has already been included in the forward estimates.

Support for Indigenous people - expansion of Centrelink's agent and access point network

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 0.7 1.6 2.7 3.0

The Government will provide additional funding of $8 million over four years to expand the Centrelink agent and access point network in rural and remote Australia by 50 new access points.

This initiative will improve Centrelink's services to Indigenous families and communities located in rural and remote Australia.

See also the related capital measure titled Support for Indigenous people - expansion of Centrelink's agent and access point network in the Family and Community Services Portfolio.

Support for Indigenous people - longitudinal study of Indigenous children

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 0.6 1.3 5.9 0.8

The Government will provide $8.6 million over four years for a longitudinal study to provide nationally representative data on Indigenous children. The study will complement the existing Longitudinal Study of Australian Children.

The study will focus on early childhood to assist with analysis of the linkages between early childhood experiences and later life outcomes for Indigenous children living in remote, rural, regional and urban locations.

The design of the study will be developed in consultation with Indigenous people, communities and organisations.

Temporary overseas absence provisions - reduction to 13 weeks

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services 3.1 0.1 -3.5 -3.7

The Government will provide funding of $11.2 million over four years to reduce the allowable period of temporary overseas absence for most pensions and allowances to 13 weeks. The measure encourages people who are of work force age and on income support payments to remain in Australia and be available to contribute through employment or social participation. The measure is expected to generate savings in social welfare payments of $15.3 million over four years.

The Age Pension will not be affected by this measure. Age pensioners will continue to be able to travel overseas, as under current arrangements.

People eligible for an Australian pension by virtue of an international social security agreement will also not be affected while they reside in the agreement country.

This change in the allowable period will be ongoing and is expected to generate savings of $4.0 million over four years.

Youth Allowance - ex-gratia payments to former recipients in South Australia

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services .. - - -

The Government will provide funding of $0.2 million in 2002-03 and 2003-04 to make ex-gratia payments to Youth Allowance recipients who became ineligible for any income support payments when the school leaving age in South Australia was increased from 15 to 16 years on 1st January 2003. Ex-gratia payment recipients may receive payments until their 16th birthday, when they may again be eligible for Youth Allowance. Ex-gratia payments will only be available to those who were 15 years of age on 1 January 2003 and ineligible for Special Benefit.

Youth and student assistance - restructured reviews

Expense ($m)
  2003-04 2004-05 2005-06 2006-07
Department of Family and Community Services -16.8 -13.9 -9.9 -6.5

The Government will align risk-profiled review activities for Youth Allowance and Austudy with those of other income support payments. This measure will mean fewer people will be paid an incorrect rate for Austudy and Youth Allowance (full-time students and jobseekers).

Under the measure, there will be:

  • 5,000 new Austudy reviews of individuals' entitlements per year;
  • 23,000 additional Youth Allowance (full-time student) reviews; and
  • an additional 17,000 Youth Allowance (jobseeker) reviews.

The risk-profiled reviews will be ongoing. This measure is expected to lead to savings in youth assistance payments of $60.4 million and will cost $13.2 million to administer to give a net savings of $47.2 million over four years.


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