: Repayment of social security debts

Repayment of social security debts

Kate Browne

The Social Services Legislation Amendment (Enhanced Welfare Payment Integrity) Bill 2016 (Cth) ('the Bill') was introduced into the House of Representatives on 2 March 2016 by the Minister for Social Services and has been under inquiry by the Senate Community Affairs Legislation Committee. The Bill and inquiry have now lapsed as a result of the election being called; however, they may be re-introduced after the election.

The Bill provides the Secretary of the Department of Social Services with the power to issue Departure Prohibition Orders ('DPOs') on individuals travelling overseas who have unpaid welfare debt (under the family assistance, paid parental leave, social security and student assistance schemes) and have not made 'satisfactory arrangements' for repayment.

As Ms Sarah Henderson MP noted in her speech on the Bill, the average value of social welfare debt is around $2350 and the average length of the debt is just over three years. Approximately 270 000 former recipients of social welfare payments do not make sufficient or regular payments and together they owe around $870 million to the Commonwealth. This is the group being targeted by the Bill.

The Bill requires the Secretary to have regard to the capacity of the individual to repay the debt and any previous actions or attempts to repay the debt. An individual subject to a DPO may apply for a Departure Authorisation Certificate ('DAC') to be granted if they provide adequate security or if there are humanitarian grounds or where refusing to issue the certificate would be detrimental to Australia's interests.

If an individual breaches a DPO by travelling overseas without a DAC they may be subject to a criminal offence under the Bill with 12 months' imprisonment. This system is similar to the departure prohibition order system currently in place for unpaid child support debts.

The Bill also removes the six-year limitation period for the recovery of welfare debts.

The Parliamentary Joint Committee on Human Rights ('PJCHR') report on the Bill notes that it engages the right to freedom of movement in art 12 of the International Covenant on Civil and Political Rights, which includes the right to leave any country. The PJCHR accepts that the Bill's objective (encouraging the repayment of social security debts) is a legitimate objective.

However, the PJCHR questions whether the Bill adopts a least rights-restrictive approach as it contains no minimum thresholds for the amount of debt or length of time for repayment of debt before a DPO can be issued and there is a very broad discretion under the Bill to issue a DPO.

The two public submissions made to the Senate Community Affairs Legislation Committee raised similar concerns.

The National Welfare Rights Network ('NWRN') notes that the Department of Human Services already has extensive powers to recover debts and opposes the introduction of DPOs as unnecessary. NWRN also opposes the removal of the six-year limitation period, arguing that it is important to encourage the early identification, notification and recovery of debts.

The Law Institute of Victoria's ('LIV') submission notes that the Bill may disproportionately infringe on individual liberties and freedoms and expose vulnerable people to unfair restrictions. The LIV also notes with concern the possibility of people with welfare debts not being made aware of a DPO in place and then being subject to the criminal offence if they have been found to be 'reckless as to whether the order is in force' when travelling overseas.

KATE BROWNE is a Legal Policy Lawyer at the Law Institute of Victoria

(2016) 41(2) AltLJ 135
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