First published on The Guardian – here
When it comes to income tax we allow people to claim $300 worth of tax deductions without receipts because we think it petty to record of every minor expense. When the Australian Tax Office is in dispute with billionaires it adopts a “business like” approach, often settling for far far less than the initial estimate.
But there is no such leeway, nor respect, shown to those people the parliament has deemed worthy of welfare support. Centrelink has sent tens of thousands of letters of demand to citizens based on a computer algorithm that suggests they might have been overpaid. In the lead up to Christmas some of the most vulnerable Australians have been forced to choose between wasting days looking for six-year-old pay slips, spending days on the phone to Centrelink, which is notorious for not answering, or to succumb to enormous pressure from their own government and repay hundreds or thousands of dollars that they might not even owe. It’s obscene.
Like the economic modelling used to argue that a $50bn tax cut for big business is the best way to boost the wages of low paid workers, the data matching algorithm used by Centrelink to identify “overpayment” is only as accurate as the assumptions and data it relies on. As the old adage says: garbage in, garbage out.
As anyone who has ever tried to describe it knows, the Australian welfare system is exceedingly complex. Indeed, over the past three decades there have been repeated attempts to build computerised “expert systems” to help Centrelink staff get a clear understanding of exactly who is eligible for what. All attempts have failed. Tens of millions of dollars have been wasted on the futile effort to clearly define eligibility.
But the impossibility of accurately defining eligibility has not stopped the Turnbull government from using crude data matching to justify sending intimidating letters to large numbers of Australians, an estimated 20% of which are in error.
When ATO data collected on one basis is “matched” to data held by Centrelink on another basis guess what you get? Lots of “inconsistencies”. It’s not evidence of overpayment, but this government is using it as enough evidence to send people threatening letters, often to out-of-date addresses, and then commencing debt collection procedures when people can’t or don’t respond.
Hank Jongen, the general manager of the Department of Human Services is adamant that “the department is determined to ensure that people get what they are entitled to, nothing more, nothing less”. But that raises another important issue. If the department is just trying to help, how many cases of possible underpayment have they detected? How many letters encouraging people to seek back payment have they sent?
Commonwealth agencies are required to act as “model litigants” whenever they are engaged in legal action action against a citizen or a company. Going to court is expensive and, for individuals, highly stressful, which gives the commonwealth government an incredible advantage when deciding how hard to push. Should the commonwealth ever choose to be a vexatious litigant it could destroy the wealthiest of citizens, even if it had the weakest of cases.
But Centrelink is not acting as a model creditor. A company that sent threatening letters to tens of thousands of former customers demanding money when it knew that many customers owed nothing would potentially be engaged in a fraud. The willingness of the commonwealth to do similarly, to place the onus of proof on the citizen so many years after the fact, and to be hasty in the dispatching of debt collectors should shock conservatives and libertarians as much as it does progressives and welfare advocates.
Thomas Jefferson (may) have said that when governments fear their people there is liberty, and when people fear their governments, there is tyranny. But whether he did, or didn’t, there is no doubt that the Turnbull government has abandoned any hint of philosophical support for small government and the rights of the individual. A genuinely liberal government would never consider reversing the onus of proof and sending such threatening letters to its citizens. Nor would a “liberal” politician place the cost of fixing a bureaucratic mistake by a government agency like Centrelink on the individual victim.
Of course we all know that it is the Christian conservatives, not the “small l” Liberals that dominate the modern Liberal party. But since when is sending threatening letters to vulnerable people a Christian thing to do?
While the philosophy behind this assault on the citizenry is hard to fathom, the political strategy is pretty obvious. There are already 730,000 unemployed people in Australia and the government’s own forecasts suggest this will rise before the next election. As the government has no faith in its ability to manage the macroeconomic problem of unemployment, it is instead ramping up the political attack on the unemployed.
Just as the 2014 budget was meant to be perceived as harsh, so too the decision to demean hundreds of thousands of welfare recipients was meant to attract attention. But, just like the 2014 budget, it seems the tin-ear of the Coalition cabinet has ensured that they are slow to react to the reality that they have pushed too far and upset too many people. Millions of Australians are happy to believe that strangers are “dole bludgers” but no one thinks that their mum’s Christmas should be ruined by a bureaucrat.
True to form, the Coalition is responding to the growing anger at its gung-ho approach to debt collection by spending more money training Centrelink staff how to deal with angry customers.
Here’s a better tip: take the Labor party’s advice and stop sending letters that make so many people so angry. Stop treating citizens who are accessing benefits that the parliament has deemed them to be eligible for as “customers”. And stop telling the people with the least that they have already had too much.
Even the Business Council of Australia supports increasing the unemployment benefit, which at $250 per week is less than Coalition MPs pay themselves for one night’s travel allowance. Maybe it’s time we built them a dormitory to live in and gave them a Basic Card when they travel to Canberra. The statistics suggest they are more likely to defraud the commonwealth than welfare recipients.