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Page 20 House of Representatives Wednesday, 30 November 2016 Dr Charker: From my perspective, that is in fact intrinsic to the new agreement that is being developed between the agencies and how it is actually measured going forward in terms of the measurement of the service delivery aspect of it. CHAIR: Ms Wilson? Ms Wilson: I concur with Dr Charker. Perhaps the other thing that I could also identify is that we are in the process of a review of the government contracted doctors component of the assessment process, and we have a post-implementation evaluation in respect of the review. We look to capture transactional, process and performance data and also to look back at what the anticipated results were of a government initiative and what has been the process against those results. We do that through an evaluation activity. CHAIR: Mr Hehir, why is the cost per customer for each program criteria important? At the footnote of table 5.4 it makes the reference that the cost per customer is not reported to DSS. Ms Kairouz: At the time of the audit, we found that the cost per customer was not reported. The reason that we felt it was important is that we considered that DSS was required to make decisions around whether or not there would be value in more review activity. We took the view that, where it is not efficient or effective to review all of DSP recipients, there was scope to target that. Given people stay on DSP for very long periods, if they no longer meet the criteria after a certain period of time, there may be value. For the cost of an assessment, you could then get a person off DSP—perhaps forever. We thought that there was certainly more required or needed so that DSS could then advise government on whether or not there was benefit in expanding review activity or targeting it better. CHAIR: This goes to the core of the cost-benefit analysis. Ms Kairouz: Yes, it does. CHAIR: Ms Wilson, do you have a response? Ms Wilson: Certainly the outcome of the activity against the anticipated expenditure related to it is something that the evaluation will focus on. I guess it is also worth identifying that, when new policy proposals are put to government, such as the additional review activity, the cost that DHS incurs in respect of that activity is scrutinised, monitored and agreed by the Department of Finance. DHS is separately directly appropriated. Its funding does not come through our agency. The Department of Finance will scrutinise and agree those costs and provide government advice on whether, as part of the expenditure review committee deliberations, that is an appropriate level of expenditure and resourcing for the activity. I would note that the overall measure was in fact a cost measure to government, not a savings measure, and that one of the significant elements of the additional investment related to the measure is around employment assistance and other supports that people who are found to be no longer eligible for the disability support pension receive, if they are cancelled and transferred to the Newstart allowance for those who are eligible for the Newstart allowance. So it wasn't a savings measure per se, and I think that is important for the committee to understand. CHAIR: Dr Charker, would you like to make a comment at all. Dr Charker: No, nothing further; I am in complete agreement. Ms MADELEINE KING: Thanks for coming in and thank you for your work of course in the service of the public. I want to quickly talk about the new medical assessments, and I might just make a comment about submissions and follow that up with a question. It is primarily directed at DHS but, obviously, I welcome any input from others. The submissions contend the decision to discontinue receiving reports from treating doctors in the introduction of medical assessments by government contracted doctors, which is only for certain claimants, has reduced the efficiency of DHS, compromised the veracity of the process and led to some administrative errors. The submissions also reminded us that policies, guidelines and procedures should foster the correct decision at the earliest possible stage. The A NAO report indicated that a significant proportion of rejected claims were later approved on appeal. DHS advised that: a primary reason for successful appeals was a provision of new information. Multiple submissions state that the new process substantially reduces the medical evidence available and makes it more difficult for claimants to provide the required information the first time. We also heard growing concerns from the NGOs that were in the room earlier, and I also note the concerns of Financial Counselling Australia that saw that the delays in some of the assessments were leading into increased risks of eviction and potentially for people to slide into homelessness. It is obviously a fair concern. PUBLIC ACCOUNTS AND AUDIT COMMITTEE
Wednesday, 30 November 2016 JOINT Page 21 Given these growing concerns and—in relation to the new medical assessment process, including the delays in obtaining a disability medical assessment appointment—what we see to be a waste of resources in successful appeal, is the DHS proposing to conduct an independent assessment to determine value for money for the taxpayer and identify potential improvements in its system? Dr Charker: If I could just make one brief point and then I might ask my colleagues—I will come back, if that is okay. My brief comment was: if someone is approached for a medical review, as we have been discussing, it is really important to note that their DSP does not stop while that process is underway. So any concern that they might suddenly lose payment through that process is not the case and, in fact, to date, in the entire medical review processes that we have started—and we have initiated about 12,000—no-one has been cancelled from DSP for medical reasons at all. Ms MADELEINE KING: I will clarify—and that is my fault: Financial Counselling were pointing out that this was also the review process when people potentially move from when they first hit a disability issue from Centrelink onto the DSP and it added impact. Pardon me, if I have confused the matter. Dr Charker: Not at all, I just wanted to make sure that there was no clarification. Ms MADELEINE KING: I understand that is fine. Please continue. Dr Charker: I might actually check with my colleagues about the main part of your question and about whether we are planning any particular review of the process. We certainly do ongoing reviews of all our processes in the interests of— ACTING CHAIR: The question was about an independent assessor that has just been suggested to us by multiple submitters. Dr Charker: In that case, I do not think we have—no. At this minute in time, there are no plans or proposals for that. I would just check with my colleagues at DSS, however. Ms Halbert: We will be undertaking an evaluation of the government contracted doctor and the disability medical assessment. That is underway at the moment. ACTING CHAIR: That part of the process or the entire process? Ms Wilson: That is the process that is specifically new. ACTING CHAIR: I will go back to Ms King, because we are following the same thread. What we heard earlier repeatedly in written submissions—and VLA's was particularly clear on this and I think the Auditor- General's report might be able to assist—and the Auditor-General's report suggested that one of the primary reasons for the very significant overturn rates at each stage of the appeal system, as we understand them, was that the right information was not available to the decision maker at the right stage—the early stage. I am happy to be corrected, but that was our understanding of what has been heard from the NGOs. Ms Wilson: If I could note something, with the data that I have for affirmed versus set-aside rates—I guess it is a matter of opinion as to whether it is a considerable rate—around 75 per cent of regional decisions are affirmed at the first level of the AAT and 18 per cent are set aside. As I understand it, across the two tiers, tier 1 and tier 2—which previously used to be the SSAT and AAT but now is all contained within the AAT—there has been a significant change in rates over recent years. So it has varied, I think, between the 75 and 80 per cent affirm. So I just wanted to provide that information to the committee. ACTING CHAIR: The question that we are getting to, though, and Ms King mentioned it at the start, if there is a sensible principle—I am sure everyone would agree that the right decision should be made at the earliest possible stage in the interests of the claimant, and the department has then wasted resources from overturning decisions—then you need good information. Our understanding from the Auditor-General's report and submitters is that the primary reason that decisions are not being made correctly at the early stage is that the right information is not available to the decision maker. Is that a— Ms Wilson: I think it is fair to characterise that the reasons for decisions being set aside when they go to external appeal are primarily around additional information being provided that was not available to the original decision maker. Unidentified speaker: I concur with that. ACTING CHAIR: We have heard a number of submissions. I encourage you to have a close look at the submissions of Victoria Legal Aid and the National Welfare Rights Network in particular, suggesting that, if you could improve the information available to applicants at the outset on websites, on application forms, and provide some reasons for rejection that people can understand, as opposed to gobbledegook letters that do not actually PUBLIC ACCOUNTS AND AUDIT COMMITTEE
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