Government must release modelling on planned cuts to family payments: ACOSS

26 November 2015

The Australian Council of Social Service today called on the Federal Government to release modelling on the impact of the planned $4.8 billion cuts to family payments.

“These are significant cuts that will have a devastating impact, especially on single parents and low income couple families, and should not be pursued,” said ACOSS CEO Dr Cassandra Goldie.

“It is unfortunate that the Government continues to resist disclosure of the full impacts. Until now it has only released selected cameos of families in paid work with younger children who are also using child care. What we haven’t seen is separate modelling of the impacts of family payments and childcare packages and cohort analysis of impacts on single parent and couple families with children of different ages. Without this information it’s hard to see how parliament could be expected to vote on such changes.

“ACOSS has presented our own analysis of the current Bill to a recent Senate Committee Inquiry showing that a low income single parent family with two children would lose more than $60 per week or $3000 per year once their youngest child turns 13 and the measures are fully implemented.

“Low income, single income couple families with two children would lose about $77 a week or $4000 per year.

“In a context in which there are already 600,000 children living below the poverty line, and following severe cuts to payments for single parents over the last decade, this is unacceptable and cannot be supported.

“ACOSS is also concerned by persistent overblown reports in some sections of the media of a supposed ‘welfare spending’ and ‘fraud’ crisis. This appears to be part of an ongoing strategy to justify harmful and unnecessary cuts.

“We support efforts to better integrate tax and transfer IT systems to improve efficiency and reduce over and under-payments. We have also supported better targeting of income support payments in areas of the greatest growth – but this is not in the areas of working age or family payments.

“However, we reject misleading reports about the level of welfare fraud or expenditure which distort the debate about fiscal sustainability. We don’t think it’s fair to take vital money away from struggling low income people and families to pay for higher costs associated with necessary additional investment in childcare and the NDIS, when there are other ways to repair the budget.

“Further, evidence suggests that overall benefit fraud is very low, with just over one thousand people referred by Centrelink to the Commonwealth Director of Public Prosecutions for potential prosecution in 2014 and 1,366 in 2015. The proportion of social security recipients who are prosecuted for ‘welfare fraud’ is just 0.02%.

“ACOSS has advised the Government that its projected revenue savings from new systems to detect and deal with overpayments ($1.7 billion) are unrealistically high since benefit fraud is not widespread and the new systems will reveal underpayments as well,” Dr Goldie said.

Media Contact: Fernando de Freitas 0419 626 155.

More information:

ACOSS supplementary evidence to the Senate Inquiry into family payments changes here.