Chapter 4: Agencies Overview

Approaches and Complaints Received

In 2011–12 we received 40,092 approaches compared to 38,919 in 2010–11. Of these 22,991 were about agencies within the Ombudsman’s jurisdiction, compared to 19,821 the previous year, a 16% increase on prior year in-jurisdiction complaints. These are complaints for which the office is directly responsible to consider for investigation and possible remedy. There was a 6% decrease in the number of complaints about matters outside jurisdiction and requests for information. Figure 4.1 shows the trend in approaches and complaints over the past seven years.

The number of complaints and approaches received electronically increased again in 2011–12. Over the past seven years the percentage of approaches received electronically has increased from 7% to 23% of the total (up a further 5% in the past financial year), as Table 4.1 shows.

Figure 4.1: Approach and complant trends, 2005–06 to 2011–12

Table 4.1: Approaches and complaints, by method received, 2005–06 to 2011–12

YEAR	TELEPHONE	WRITTEN	IN PERSON	ELECTRONIC	AFP	TOTAL
2011–12	27,953	2,156	912	9,070	1	40,092
	70%	5%	0%	23%	0%
2010–11	29,090	1,891	1,015	6,923	0	38,919
	75%	5%	3%	18%
2009–10	28,447	2,210	1,005	5,803	3	37,468
	76%	6%	3%	15%	0%
2008–09	35,738	2,654	875	6,452	-	45,719
	78%	6%	2%	14%	0%
2007–08	30,568	2,861	1,194	5,306	5	39,934
	77%	7%	3%	13%	0%
2006–07	26,081	2,626	812	3,539	264	33,322
	78%	8%	2%	11%	1%
2005-06	22,897	2,383	528	2,046	373	28,227
	81.1%	8.4%	1.9%	7.2%	1.3%

Approaches and Complaints Finalised and Investigated

We finalised 40,477 approaches and complaints, up from 38,957 the previous year. Of these, 23,317 were about agencies within the Ombudsman’s jurisdiction (compared to 19,903 in 2010–11). We investigated 4,667 separate complaints compared to 4,468 in 2010–11. Of the complaints investigated, over 18% required more substantial investigation, sometimes involving a high level of involvement by senior management and the use of formal powers (categories 4 and 5 in our five category classification system). This figure is comparable to the previous year.

Some agency error or deficiency was identified in 3% of complaints investigated. The most common type of deficiency noted was unreasonable delay (14%), procedural deficiency (30%), followed by inadequate advice, explanation or reasons (16%), flawed administrative process or systems (15%) and human or factual error (10%). The balance of deficiencies was very small in number and included legal error, unreasonable action and resource limitations.

Causes of Complaints

The majority of finalised complaint issues (70%) were about correctness, propriety or timeliness of agency decisions or actions, down from 72% in 2010–11. The remainder of the complaint issues involved other matters, such as the application of policy or legislation to the complainant’s circumstances (8%), the accuracy or completeness of advice given by agencies (6%), or the conduct of officers in agencies (2%).

Complaints Carried Forward

The number of complaints carried forward (past 30 June 2012) was 1,058, compared to 1,657 for the same time the previous year. This continued a trend of cases being carried forward. Roll-over of complaints from the previous year will always occur as some complaints are received late in the reporting period and some complaints are complex and take longer to investigate.

There was a 5% increase in the overall number of complaints investigated. Overall we finalised 1,520 more cases in 2011–12 than the previous year.

Decisions Not To Investigate

In 2011–12 we advised the complainant to take the matter up with the relevant agency in the first instance in 52% of the matters within the Ombudsman’s jurisdiction (51% in 2010–11).

Complaints falling within the jurisdiction of the office about the ‘top five’ Australian Government agencies comprised 76% of the total number of complaints received by the office. The top five agencies (or programs within agencies) were:

1. Centrelink, Department of Human Services - 6355 (28%)
2. Australia Post - 4137 (18%)
3. Australian Taxation Office - 2717 (12%)
4. Child Support, Department of Human Services - 2228 (10%)
5. Department of Immigration and Citizenship (DIAC) - 1873 (8%)

This chapter assesses our work with these top five agencies in handling complaints and dealing with broader issues during 2011–12. We note that Centrelink and Child Support are now part of the Department of Human Services (DHS) agency, so we have placed our discussion of complaints about Centrelink and Child Support together.

Figure 4.2: Approaches and complaints within jurisdiction by agency/area 2011–12

Department of Human Services

The Department of Human Services (DHS) provides access to Commonwealth social, health and other payments and services. As part of the government’s Service Delivery Reform agenda, on 1 July 2011, Medicare Australia, Centrelink and Commonwealth Rehabilitation Service (CRS) Australia were integrated into DHS along with the Child Support program and Australian Hearing.

Over a period of four years, Service Delivery Reform is intended to deliver more one-stop shops, more self-service and more support for people based on their individual needs and circumstances, especially people who need more intensive support or have more complex needs. DHS intends to transform its services by offering more convenient options to customers who prefer to manage their own affairs (such as online, or over the phone) while giving extra assistance and referrals to people who need more intensive support. DHS says that its customers will have the option of accessing services and information in ways that best suit them.

As part of its integration strategy, DHS has decided to use the generic terms ‘the Department’ or ‘DHS’, rather than referring to each of the individual programs (Centrelink, Child Support or Medicare Australia). However, most of DHS’s customers still deal with staff employed in one of the individual DHS programs. The people who complain to us about DHS still refer to the particular ‘program’ that took the decision or action. We have therefore continued to record complaints about DHS against the particular program the complainant identified as the source of their complaint. Where appropriate, we have referred to those individual DHS programs in this chapter.

In 2011–12 the office received a total of 8967 complaints about DHS. This is 24% more than the combined 2010–11 complaints to the Ombudsman about the individual programs and agencies in the Human Services portfolio. We received more complaints about DHS in 2011–12 than about any other Commonwealth agency.

If we consider each of the DHS programs as a separate agency, two of those programs make it into the Ombudsman’s ‘top five’: Centrelink at number one and Child Support at number four. We discuss these two DHS programs in detail. Complaints about DHS’s Medicare program ranked at number eight and is discussed as a separate feature in this chapter.

DHS - Centrelink Program

This year has been a time of great change in the Centrelink program, not only because of its integration into DHS. Centrelink has also amended its internal complaint handling and review processes in response to our report Right to review—having choices, making choices (04/2011) and reformed two areas of its Income Management decision making in response to our report Review of Centrelink Income Management Decisions in the Northern Territory. Among these significant changes, Centrelink has continued to deliver a complex and diverse array of programs in a high volume environment to some of Australia’s most vulnerable people.

Complaints themes

In the 2011–12 financial year we received 6355 complaints about Centrelink. This constitutes 28% of the total number of in-jurisdiction complaints we received from the public during this year and is the highest number of complaints received about any agency. It also represents a 28% increase in complaints about Centrelink, reversing a two-year trend of declining complaint numbers.

Despite this increase, we investigated 1532 (almost 24%) of the Centrelink complaints we closed during the period. Last financial year we investigated 1098 (22.4%) of the Centrelink complaints we closed during that period. It is unlikely that we will be able to sustain this rate of investigation if the number of Centrelink complaints continues to rise.

We believe that there are two significant factors driving the trend of increasing complaints to this office about Centrelink. One is the significant wait times on Centrelink’s telephone lines (discussed below under the heading ‘Inability to get through to Centrelink on the phone’). The second is that many Centrelink customers seem to call us, rather than using the DHS Feedback and Complaints line. We think this can be attributed to the way Centrelink promotes the DHS Feedback and Complaints line. Although Centrelink letters encourage customers to give feedback about Centrelink’s service, since January 2012, Centrelink has been gradually changing the way it tells people to do so. Centrelink is progressively amending its standard letters to remove the telephone number for people to give feedback and instead tells them to “go to humanservices.gov.au/feedback”.

Figure 4.3: Centrelink—received complaints 2004–05 to 2011–12

Immediately following that instruction, Centrelink includes the Ombudsman’s telephone number for people to call if they remain dissatisfied with Centrelink’s service. Centrelink’s intention is that people should first try to resolve their problem by using its internal complaints service, but many people skip that step and call the Ombudsman instead. While we are keen for Centrelink to continue including our number in its letters, we think that it should also include a telephone number for the DHS Feedback and Complaints service. This simple step would improve accessibility and promote the DHS Feedback and Complaints service as a responsive and efficient way for Centrelink customers to quickly resolve problems.

Consistent with last year, the top four payment types that we investigated complaints about were Newstart Allowance, Disability Support Pension, Family Tax Benefit and the Age Pension. However, Youth Allowance was overtaken by an increase in complaints about non-program services. These complaints typically concerned:

• problems getting through on Centrelink’s phone lines
• service provision at interface points such as Centrelink counters or over the phone
• the loss of, or repeated requests for, documents or information
• poor or confusing letters.

The increase in this type of complaint stems, in part, from the difficulties that many Centrelink customers have had in accessing Centrelink via one of its phone lines. It may also reflect media and stakeholder reports about increasing levels of dissatisfaction with Centrelink’s customer service.

Identifying and acting on vulnerability

A key component of Service Delivery Reform is ensuring that those who most need assistance and support receive services that are tailored to their particular circumstances. In order to do this effectively, Centrelink must identify those customers with particular needs and areas of vulnerability. This includes people adversely affected by mental health conditions or cognitive impairment; people who are homeless or at risk of homelessness; and those experiencing severe financial hardship. We have some concerns about the effectiveness of Centrelink’s screening arrangements for identifying customers with special vulnerabilities. We investigated many complaints where a person’s vulnerability went unidentified or where Centrelink failed to remove unnecessary barriers to resolve problems for vulnerable people.

A common example drawn from this year’s complaints is: a person who is in severe financial hardship applies for a family payment, but the processing of that claim is delayed. Sometimes, their financial hardship was not picked up or acted on by Centrelink even though this is one of the triggers for priority processing. More information about this problem is detailed under ‘Processing delays’ below.

The Centrelink case studies ‘Unreasonable barriers removed in the face of financial hardship, ‘Unreasonable delay truncated for IM customer’ and ‘Harsh, unnecessary red tape avoided’ in Chapter 5 of this report are additional examples of the kinds of remedies we have achieved for complainants who are vulnerable and in need of help to achieve an outcome that is appropriate to their circumstances.

We have recently established a ‘warm transfer’ process for those Centrelink customers who have not yet formally complained to DHS. In the past, we would have started an investigation of many of these complaints, out of a concern that the complainant’s particular vulnerability leads us to doubt they are likely to make a formal complaint to the agency themselves, or if they did, they may not be able to articulate their complaint in a way that is likely to achieve an appropriate outcome. Under the warm transfer process, we obtain the person’s consent to transfer their complaint directly to DHS’s complaints area with a request that DHS engage directly with the person. We do not investigate the matter at that time, but if it is not resolved, we invite the person to contact us again. This gives Centrelink an opportunity to fix the individual problem, and any associated systemic issues, as quickly as possible, which is in the best interests of its current and future customers.

Accessibility

Many of the complaints we receive about Centrelink arise from problems people have accessing its services and understanding its programs. The difficulty people have experienced in reaching Centrelink by telephone is one example which is detailed under ‘systemic issues’ below. It is also common to find that people struggle to understand Centrelink’s correspondence. Consequently, they can miss out on opportunities to resolve a problem, to provide additional information to Centrelink or to claim an appropriate service or payment.

In addition, we have sought remedies for people who are unhappy with the emphasis on online service delivery and processes, particularly if they are not skilled or equipped to conduct their business online or require help to do so. This is most evident in complaints from people who are receiving the Age Pension, although it is also raised by some Disability Support Pension recipients and carers.

This issue is illustrated by complaints that arose earlier in 2012 when Centrelink stopped posting printed Centrelink Statements to its customers. The statement details key information that Centrelink has recorded for a person which it also takes into account when calculating payments. Centrelink has replaced the printed statement with an online version that provides fuller details about payments, income, assets advances and any debts. It issued a flyer to its customers to explain the change and set up a support system to encourage people to move to online servicing.

When we met with Centrelink to discuss the change, we expressed concern that there was no communication strategy to remind those people who were not inclined or able to conduct their business online that they could obtain the statement by calling Centrelink. After the meeting, Centrelink advised that it would conduct a review of the change in mid-2012 and implement an ongoing communication strategy to ‘make sure that … customers are well informed and advised about the options available to them to access their information’.

Following feedback from customers and other stakeholders, such as the National Welfare Rights Network, Centrelink also improved its explanatory flyer so the various methods by which people can now obtain their statement are more prominent. We no longer receive complaints about this issue. However, we are conscious that Centrelink’s move to online servicing may have a tendency to shift responsibility to its customers to seek out and check the information that Centrelink is using to calculate their entitlement. We will monitor whether this leads to vulnerable people missing out on their entitlements, or being overpaid, through lack of information.

As the above example shows, when people have difficulty accessing information from agencies, they often turn to other sources of information or assistance, such as advocacy groups, members of Parliament or this office, in order to address matters that would otherwise be dealt with by the agency. We hope that further integration under Service Delivery Reform as well as better phone systems, online services, and ongoing improvements to Centrelink’s letters will see a reduction in these kinds of complaints. We will continue to work with Centrelink to see that result.

The reforms to Centrelink’s review processes, resulting from our report Centrelink: Right to review—having choices, making choices (04/2011), have improved people’s access to the reasons for decisions and information about their review rights (see ‘Improving Centrelink’s internal reviews’ below). These changes are expected to improve the procedural fairness, quality and accessibility of Centrelink’s decisions.

Processing delays

Another recurring theme in the complaints we received this year was delays in processing claims. One source of complaint was the length of time that Authorised Review Officers (ARO) took to process and decide reviews of Centrelink’s decisions. When we raised this with Centrelink it acknowledged delays and explained what it was doing to address the issue. We used this information to assess whether delays in individual complaints were unusual or unreasonable, and therefore warranted investigation.

Another and more frequent source of complaint arose from delays in the processing of claims for family payments such as family tax benefit and the baby bonus. Centrelink confirmed there was a backlog for these payments and explained that since January 2012 it had permitted family payment officers to work overtime and, since February 2012, call centre and service centre staff had also been assisting. It also implemented processes so that customers who were experiencing financial hardship, an indicator of vulnerability or other difficulties had their claim prioritised. Where we identified that people should have been given priority processing due to financial hardship or some other difficulty, we investigated the matter to establish why priority had not already been given. The remedy achieved in these cases was usually priority processing and payment of the claimed benefit and any arrears.

While complaints about processing delays have gradually decreased, we recognise that Centrelink has very little control over peaks and troughs in application numbers. Nevertheless, these kinds of complaints may point to underlying problems with Centrelink’s ability to quickly move resources in response to changes in demand. Processing delays also have a flow-on effect, with higher levels of enquiry from customers who fear their application may have been lost, or for whom the delay leads to financial hardship.

We also received complaints about delays in Centrelink’s processing of Paid Parental Leave (PPL). The government introduced PPL on 1 January 2011. Our investigation of these complaints indicated that Centrelink was generally managing PPL claims within its service standards. However, we did find a range of problems associated with the newness and complexity of PPL that were contributing to delays in processing. Some complaints were about the PPL process itself but others pointed to problems with documentation or evidence, computer systems and employer cooperation. Consistent with government policy, Centrelink pays the employer, who pays their employee according to their usual pay cycle.

FaHCSIA and DHS are aware of and working to address PPL timeliness issues, with a focus on improved claim processing timeliness. Other strategies being developed include improved processes to minimise payment arrangement delays, improved proof of birth arrangements, and further promotion of pre-birth claiming. Changes implemented are improving timelines.

Systemic Issues

Inability to get through to Centerlink on the phone

Service Delivery Reform is intended to:

• make it easier for people to do business with government in a time and manner that suits their circumstances
• give people better quality services and more intensive help and support at times in their lives when they need it
• give people better service from government that ensures they receive the benefits and support they are entitled to in ways that are effective for them.

As part of these reforms, Centrelink has promoted the use of online information and services as well as telephone based contact. While we recognise the reforms are ongoing, in the second half of 2011 we began to receive a steady stream of complaints about problems with Centrelink’s phone lines. The complaints increased in the period leading up to Christmas, when many people were becoming anxious about resolving payment problems before the public holidays. Although the numbers have decreased, we continue to receive complaints from people who just cannot get through to Centrelink on the telephone.

People complain about phone queue delays of tens of minutes through to more than an hour, while they wait for their call to be transferred to a Centrelink officer. Others complain that they waited in the phone queue for extended periods but believed they had been disconnected when the ‘hold’ music suddenly stopped. Some phone queues contained messages advising that the average wait time would be ten minutes, when it was significantly longer. People also complain that they have been transferred between phone queues or, having waited on hold for an extended period of time, were simply told to call another number which resulted in further delays.

Some people have tried to call Centrelink on many numbers at various times of the day and on different days of the week. Others have attended Centrelink offices in person but have expressed frustration when Centrelink staff have referred them to the phones in the Centrelink office itself.

These phones experience the same delays and people may have to wait for a phone to become available.

Many of Centrelink’s customers have very limited incomes and a high proportion have mobile phones rather than landlines. A call to Centrelink on a landline is charged as a local call, but it is a timed call on a mobile phone. Centrelink customers with mobile phones can incur an expense they can ill afford while waiting to speak to someone at Centrelink. For many, the need to contact Centrelink arises from their payment obligations such as the need to make contact if they missed an appointment and to regularly report income. Others are seeking information about the types of payments they may be entitled to, assistance with a claim form, or to have a decision to suspend or cancel a payment reviewed.

The problem with Centrelink’s phone lines has received considerable levels of media attention and has been the subject of questions in the Senate. We have discussed this problem with Centrelink at three meetings this financial year. Between October 2011 and May 2012, we provided Centrelink with monthly data on the number and types of complaints we received about its telephone service.

Some of the steps Centrelink says it has taken to improve this include:

• putting more staff on the phones and using overtime to address peaks in demand
• prioritising certain kinds of calls and improving call volume monitoring
• implementing an automated call back facility to enable people who are registered for phone self service to request that Centrelink call them back
• improving wait time messaging to more accurately reflect wait times
• enabling more staff at Centrelink offices to provide face to face service, rather than referring customers to the phones.

Despite these improvements, we continue to receive complaints from people about the difficulties they have with Centrelink’s phone lines. For those who are experiencing financial hardship or vulnerability as well as phone problems, we established a separate process for transferring their complaint to Centrelink for direct contact. However, the number of complaints we receive about this problem makes it impossible for us to do this in each case. We will continue to monitor and engage with Centrelink on this issue.

Financial Information Services

One issue that was present in previous years but became more prominent this year was the information and records of Centrelink’s Financial Information Services officers (FISOs). FISOs provide an important and free service to Centrelink customers and members of the public who wish to know more about the payments they may be entitled to and how their financial arrangements may affect their entitlement. FISOs do not give financial advice but they are an important source of information.

During this financial year we examined our records to identify complaints in which the actions, information and records of FISOs were central to the issue complained about. We found that FISO activities were an underlying cause of a number of complaints about Centrelink refusing to compensate people under the Compensation for Detriment caused by Defective Administration (CDDA) scheme. The CDDA scheme allows Centrelink to compensate a person for financial loss arising from Centrelink’s failure to provide information, or giving wrong or misleading advice. CDDA claims are often made months or even years after the event. We highlighted to Centrelink the need for more stringent FISO record keeping obligations, improved record content and retention of records for a longer period of time because the records were inadequate for both customers and Centrelink, leaving them uncertain about the accuracy and quality of the information provided by some FISOs.

As a result of our engagement with Centrelink on this issue, it has revised the FISO user guide to take account of our concerns. Improvements continue and we will remain engaged with the further reforms that are planned such as amendments to FISO training course material.

Cross-agency issues

It is not uncommon for an issue to involve Centrelink as well as other agencies that have policy responsibility for a program administered by Centrelink. For instance, our investigation into Income Management required us to engage with, and make recommendations to, Centrelink and the Department of Families, Housing, Community Services and Indigenous Affairs (FaHCSIA). Similarly, our investigation into the implementation of an Administrative Appeals Tribunal decision has necessitated enquiries with Centrelink, FaHCSIA and the Department of Education, Employment and Workplace Relations (DEEWR). Both of these investigations are discussed in more detail below.

Before Centrelink and Child Support merged into DHS, we frequently investigated the actions of both agencies where the complaint concerned the interaction of Centrelink and Child Support in relation to Family Tax Benefit (FTB). As discussed below in the section of this chapter concerning Child Support complaints, we envisage that the divide between Centrelink and Child Support will diminish as Service Delivery Reform brings closer alignment.

Social Security Appeals Tribunal / Child Support

In our 2010–11 Annual Report we mentioned that the Social Security Appeals Tribunal (SSAT) had questioned the Ombudsman’s power to investigate complaints about decisions made by SSAT members. In October 2011, we wrote to FaHCSIA about this issue, but have yet to receive a response. We will pursue this in the coming year.

We are pleased to report that the SSAT has cooperated with our investigations in 2011–12. We include a case study in Chapter 5, ‘Written review decision amended’, where the SSAT promptly altered a decision to correct an obvious error that we brought to its attention.

Reports and submissions

Bringing about changes to income management decisions

The Ombudsman’s investigation into Centrelink’s Income Management (IM) decision making and our report, Review of Centrelink Income Management Decisions in the Northern Territory: Financial Vulnerability and Vulnerable Welfare Payment Recipient Decisions led to extensive changes to Centrelink’s practices. Our investigation examined two types of Centrelink decisions:

• to not exempt a person from IM because they were considered financially vulnerable, and
• to apply IM to a person because they were determined to be a vulnerable welfare payment recipient.

The investigation concerned both Centrelink, as the service delivery agency, and the policy agency, FaHCSIA.

The report highlighted that initial decision-making tools and guidelines did not enable decision makers to meet legislative requirements. We also identified problems with the use of interpreters, record keeping, training and the handling of review and exemption requests. As a result of the investigation, significant improvements were made to the way these decisions are made, documented, explained and reviewed. This report is also discussed in Chapter 5 and in our feature ‘Ombudsman oversight of Northern Territory Emergency Response’.

Update from last year

Implementation of tribunal decision

In our 2010–11 Annual Report we mentioned our concerns about the processes for scrutinising and responding to tribunal decisions. As case study ‘Integrity of a tribunal decision maintained’ in Chapter 5 shows, this remains an area of interest for us.

In our last annual report, we also raised concerns about the way tribunal decisions that have broader implications for policies and procedures are dealt with. This is particularly the case where those decisions require Centrelink to consult with policy departments such as FaHCSIA and DEEWR. During this financial year we started an own motion investigation into these agencies’ responses to a particular Administrative Appeals Tribunal decision. The investigation is largely complete and we will write to the agencies early in 2012–13 to communicate the outcome and our recommendations.

Improving Centrelink's internal reviews

Our 2011 report, Centrelink: Right to review—having choices, making choices led to extensive reforms to the way Centrelink dealt with its customers’ requests for a review of a decision. These reforms were trialled throughout 2011 and progressively implemented by Centrelink across all of its decision making areas in the first half of 2012. We met with Centrelink many times to discuss the proposed reforms and their implementation. We also attended trial sites to discuss the changes with staff and reviewed Centrelink’s amended policy documents and instructions.

Centrelink made the following key improvements in response to our recommendations:

• people only have to ask for review once in order to obtain an internal review of a decision by an Authorised Review Officer, whereas they previously had to ask for review at two points or they were taken to have accepted the adverse decision
• each review request receives a unique identification number that enables the review to be tracked through each stage from end to end
• before adverse decisions are made, Centrelink attempts to contact the customer to discuss the intended decision. This new step provides people with information about the reasons for the decision and enables Centrelink to correct its understanding if there has been an error
• there is now a standardised quality assurance process before a decision is reviewed and a process that enables the officer conducting that quality assurance to quickly implement a fully favourable decision where appropriate
• reviews can be prioritised at the point of request according to standardised criteria that take account of vulnerabilities and hardship
• ‘payment pending review’ and revised debt repayment arrangements can be considered during the review process, whereas only AROs had this authority previously.

This office has been closely monitoring the agency’s response to our recommendations. The only recommendation that we are not satisfied Centrelink has implemented yet is recommendation 3(a): ‘In debt cases … analyse cost effectiveness of suspending debt recovery action through write‑off during reviews’. We will continue to engage with Centrelink about this recommendation and monitor complaints to assess the efficacy of the changes.

Reforming agency approaches to people with mental illness

In October 2010 we published the report Falling through the cracks— Centrelink, DEEWR and FaHCSIA: Engaging with customers with a mental illness in the social security system. Centrelink subsequently established an interagency working group comprised of representatives from the DHS, DEEWR and FaHCSIA to plan implementation of the recommendations. Centrelink also set up a working party consisting of agency representatives, and a number of welfare, disability, advocacy and carer organisations to guide implementation of some of the recommendations.

Given the work being undertaken as part of Service Delivery Reform, we decided to engage with the periodic DHS Consumer Consultative Group and Service Delivery Advisory Group meetings to ensure that this important issue remains a prominent feature in the program and administrative changes that are underway.

Debts

We continue to receive complaints about Centrelink’s decisions to raise and recover debts, particularly where it has intercepted a person’s tax return, garnisheed their bank account or referred the debt to a private debt collection agent. A portion of the complaints highlight problems, particularly where Centrelink recognises a debt has been raised in error but proceeds to recover the debt nonetheless. We have met with Centrelink’s debt area three times this year to discuss emerging issues and explore what further improvements it can make to its debt-related processes. Centrelink has been very cooperative and forthcoming during these meetings, but we continue to receive complaints about unfair or insensitive debt recovery practices. Centrelink has proactively reviewed its practices and instructions to staff to address some of the underlying causes of debt recovery complaints. In 2012–13 we will be monitoring Centrelink’s implementation of changes to debt-related practices and procedures.

Customers in crisis

There were fewer complaints about crisis payments this financial year. We expect that we will now use our new warm transfer process to refer these complaints directly to Centrelink for resolution.

Stakeholder engagement, outreach and education

The office’s working relationship with Centrelink involves regular communication, meetings and briefings, in addition to our contacts to investigate individual complaints. We have also participated in the DHS Consumer Consultative Group and Service Delivery Advisory Group.

During the latter part of 2011, we conducted consultations with community and advocacy groups in Sydney and Perth. These consultations enabled us to establish new relationships with community stakeholders, and to build upon existing connections. One of our key stakeholders is the National Welfare Rights Network, as well as Welfare Rights Centres in capital cities and regions. We continue to have contact with many of our community stakeholders outside of formal meetings and find that our engagement with them enriches our understanding of people’s experiences with the social security system. This ongoing contact often brings matters to our attention that would not otherwise have been evident from complaints alone.

We have maintained our regular complaint sessions at the Women’s Information Switchboard in Adelaide. This is a joint activity with the South Australian Ombudsman. We have also continued with complaint clinics at several homeless shelters in capital cities around the country (see the feature on Homelessness in this report).

Looking ahead

We continue to look for ways to improve Centrelink’s service delivery to vulnerable people. As noted above, a warm transfer process started in July 2012 and we are pleased with its progress to date. We will continue to monitor its effectiveness throughout the coming year and, should we find that transferred complaints are not being resolved by Centrelink, it is likely that we will conduct more investigations into the agency’s complaint handling processes.

We are mindful of the potential for increasing numbers of complaints about income management as that program is delivered in trial sites across the nation. Similarly, recent changes to payments and services as a result of Budget announcements may see an increase in certain types of complaints.

The coming year will see further integration of the Centrelink, Child Support and Medicare programs under the Service Delivery Reforms. This will bring opportunities to suggest service delivery improvements. Ideally, we would like to see improved standardisation of procedures and policies across DHS. We are also keen to see a decrease in the number of complaints about problems with Centrelink’s phones and will continue to raise this with the agency.

DHS-Child Support Program

DHS’s Child Support program (Child Support) assesses and transfers payments between separated parents of eligible children (and less commonly, from parents to step-parents or other carers such as foster carers). Child Support also registers and collects court-ordered child and spousal maintenance. The Ombudsman has jurisdiction to investigate the decisions and actions that Child Support officers take in administering the child support scheme. Child Support routinely advises its customers, through information in letters and brochures, how they can contact the Commonwealth Ombudsman to make a complaint.

In 2011–12, we received 2228 complaints about Child Support, slightly more than in 2010–11, when we received 2121 Child Support complaints. Complaints about Child Support comprised just under 25% of the complaints we received about DHS in 2011–12.

In 2011–12, the Ombudsman finalised 2276 Child Support complaints, of which just over 29% were investigated, the same proportion as in 2010–11.

A large proportion of the Child Support complaints that we decided not to investigate were matters that we considered appropriate for the complainant to pursue in another way. For example, there is an internal Child Support complaint service that can deal with a customer’s service delivery complaint. There is also a legislated internal review process (objections) that Child Support customers can use to challenge a decision they think is wrong or unfair. If a Child Support customer is dissatisfied with an objection decision, they can apply to the Social Security Appeals Tribunal (SSAT) for a review.

We categorise all the complaints that we receive, investigated or not, to monitor trends and track systemic problems in Child Support’s administration. Our analysis of the trends helps us to understand how members of the public experience the Child Support Scheme and identify emerging problems in Child Support’s administration.

We continued our quarterly liaison meetings with Child Support in 2011–12. These meetings provide us with a valuable opportunity to exchange information about the program and complaint issues with senior program staff.

In July 2011, Child Support introduced a single telephone number for our staff to contact Child Support officers with direct access to customer records and authority to take a range of actions to quickly resolve complaints with minimal formality. Those arrangements ceased from July 2012 when DHS centralised responsibility for all Ombudsman matters to a single team located in its national office. We have advised DHS of our concern about the impact that this centralised contact arrangement will have on our capacity to efficiently resolve a large volume of complaints. We will be carefully monitoring the timeliness and quality of DHS’s responses to our investigations this year.

Last year we reported our intention to develop a process in consultation with Child Support to directly transfer some complaints to its internal complaints process for resolution. We were not able to introduce this ‘warm transfer process’ in 2011–12, but hope to do so early in 2012–13.

Figure 4.4: Child Support—received complaints 2004–05 to 2011–12

Complaints

Common complaint issues and trends

Who is most dissatisfied?
Payers or payees?

Every child support case has a payer (the person liable to pay child support) and a payee (the person entitled to receive child support). Almost all the complaints that we receive about Child Support are made by payers and payees unhappy with their own child support case. Sometimes we receive complaints from the new partners of payers, or less commonly, the new partner of a payee, or another family member acting on behalf of the payer or payee. We hear very rarely from the other people affected by the Child Support Scheme, such as employers and third parties who Child Support requires to make deductions to collect child support from payers, and the children for whom child support is payable.

Child Support’s role is to assess how much money the payer should transfer to their former partner for the care of the children of their relationship. In approximately half of all cases, Child Support is also the debt collector. In 2011–12, we dealt with slightly more than twice the number of payer than payee complaints about Child Support, consistent with the trend we noted last year. We think that the actions that Child Support takes to assess and collect debts from payers are more likely to lead to payer dissatisfaction than payee dissatisfaction. However, we do not have any basis for concluding that Child Support tends to treat payers ‘worse’ than payees, or that it treats men worse than women, although some complainants believe that this is the case.

In descending order, the three most common Child Support issues that we investigated in 2011–12 were:

1. debt enforcement
2. assessments (which is Child Support’s calculation of the amount of child support a person is liable to pay or receive for a child)
3. customer service (which includes correspondence, publications, face-to-face service, and telephone communications and Child Support’s complaints service).

Very few ‘customer service’ complaints were about delays in accessing Child Support by telephone. Our complaints statistics suggest that complaints about telephone delays are in the main limited to DHS’s Centrelink program.

Debt enforcement

As was the case in 2010–11, the most common issue in the Child Support complaints that we investigated was debt enforcement. In 2011–12, we investigated 299 payer complaints and 246 payee complaints about Child Support’s debt enforcement. The payer complaints tended to be that Child Support’s actions were harsh or unfair; payee complaints tended to be that Child Support had not done enough to collect the debt from the payer.

In Chapter 5 we have included a case study ’Debt recovered from responsible party’ that shows how we assisted a man who maintained he had already paid his Child Support debt. His employer had deducted child support from his wages, but had gone into liquidation without sending the money to Child Support. Once we contacted Child Support, it was able to resolve the matter by discussion with the liquidator. We believe that Child Support’s decisive action to remedy this complaint reflects the work that it had done to improve its procedures in the light of our investigation of a similar complaint discussed in last year’s annual report.

Overseas cases

We continue to receive complaints about Child Support’s management of cases where one of the parents is located outside of Australia. In our 2010–11 report, we observed that Child Support’s administration of some overseas cases is marred by communication problems, delays or a general lack of responsiveness. We are aware that Child Support has implemented a range of strategies to improve its management of overseas cases, including introducing ‘account managers’ to deal with the reciprocating maintenance authorities. However, we will continue to monitor the way that the agency deals with international cases.

In Chapter 5 we have included a case study ‘Payments finally extracted from Child Support and provided to the rightful owner’ about a complaint made by a payee living outside of Australia. Ms P complained to us that Child Support had failed, over an extended period, to collect money from her former husband in Australia; and that it would not communicate with her directly. She was also unhappy that Child Support would not respond directly to her communication and would only deal with her local maintenance authority. Our investigation revealed that Child Support had actually collected significant amounts of child support for Ms P, but that this had not been paid to her because of a series of administrative errors. She has now been paid the money and Child Support is communicating with her to resolve the other issues in her complaint.

Child Support overpayments

Last year we reported that Child Support had advised that it was developing a new approach to child support overpayments. We were keen to see whether the new approach was an improvement. However, Child Support’s approach has remained largely unchanged while it works through a range of legal, policy, and administrative issues related to the proposed change. We remain concerned about child support overpayments.

In 2011–12, complaints about child support overpayments were few in number (20), but significant in impact. In Chapter 5 we have included a case study about a child support overpayment ‘Consequences of payment error sorted out’. Child Support paid $6000 to Ms R in error and was seeking to recover it from her. Ms R’s case is just one example of a situation where Child Support will decide that a payee has been overpaid child support. In some cases, an overpayment arises because the payee has failed to tell Child Support about changes in their circumstances (such as their income), or those of the children. In other cases, the overpayment occurs because the payer belatedly advises of a change in their own situation, or when Child Support delays acting upon information that it has received about a parent’s income or other dependants.

The Child Support legislation provides that a payer can apply to court for an order to recover overpaid child support directly from the payee, even if Child Support was responsible for transferring the money between the parents. In recovery proceedings, the court must consider a range of factors, including why the overpayment occurred, in deciding whether it is fair to require the payee to repay the overpaid child support.

However, for those cases where Child Support transferred the overpaid money between the parents, Child Support considers that it is obliged to recover the money from the payee. Child Support has taken the view that its obligation to recover from the payee, in order to repay the payer, is unaffected by the payer’s right to recover from the payee.

We have a range of concerns about Child Support’s procedures for raising and recovering overpayments from payees. Child Support does not provide written reasons for an overpayment decision. A payee cannot challenge Child Support’s decision to raise and recover an overpayment through its internal objection process, or in the Social Security Appeals Tribunal. When Child Support raises an overpayment, the payee’s child support payments immediately stop, even if there is still an ongoing child support assessment. The exception is when Child Support decides to refund the overpayment to the payer, and then recovers it from the payee by withholdings from future child support payments. Even then, those future payments are reliant upon the payer making further payments to Child Support. In several complaints, a payee negotiated a repayment arrangement with Child Support which failed because of problems in the way Child Support administered it, leaving the payee still in debt and without any regular child support. Child Support has assured us that it is working to address these administrative problems. We will continue to monitor this in the coming year.

We are also concerned that Child Support’s policy of recovering all overpayments from payees, regardless of the reasons why the overpayment occurred, may not be an appropriate response in some cases. In our view, it is inequitable for Child Support to recover an overpayment from a payee if a court would not order the payee to repay the payer directly. We are continuing to watch for further cases. One situation where we believe a court would be unlikely to order a payee to repay is an overpayment arising from Child Support’s retrospective decision that a payer was no longer an Australian resident because he or she is working in another country with which Australia does not have reciprocal child support obligations.

Child Support is considering our views about its approach to overpayments, in consultation with FaHCSIA, which is the policy agency responsible for the Child Support Scheme. We will continue to work with DHS and FaHCSIA to monitor this very complex issue over the coming year.

Cross-agency issues

Interaction of child support and family tax benefit

There is a very close link between the child support and Family Tax Benefit (FTB) systems. Centrelink makes FTB payments to parents and carers to help with the costs of raising the children in their care. The amount of child support that a person receives for a child may affect their FTB. If a parent is separated from the other parent of their child, and they receive child support for that child, any child support above the maintenance threshold will reduce their FTB for that child.

In Chapter 5, we include a case study about Ms Q ‘Consequences of payment error sorted out’, in which Centrelink reduced Ms Q’s FTB because she received a lump sum of child support. The lump sum exceeded the maintenance threshold for FTB. However, Child Support decided that it had paid the lump sum to Ms Q in error and it raised an overpayment against her. Our investigation led Centrelink to review Ms Q’s FTB so that it did not take into account the lump sum that Child Support paid her in error.

Taking 'reasonable maintenance action'

The FTB rules are designed to encourage separated parents to apply for, and collect, child support wherever possible. FTB Part A is paid subject to a ‘reasonable maintenance action test’ (RMAT). Under the RMAT, if Centrelink decides a parent has not taken reasonable action to obtain child support, their FTB Part A is reduced to the base rate.

There is a significant difference between the base rate and the maximum rate of FTB Part A. As at 1 July 2012, the base rate of FTB Part A for a child aged 13 or more was $54.32 per fortnight. The higher rate of FTB Part A was $220.64 per fortnight, and a person receiving more than the base rate of FTB Part A may also be entitled to rent assistance of up to $140.98 per fortnight for a single person (or $159.46 if they have three or more children). Given the significant financial detriment attached to failing the RMAT, we think it is critical that both Child Support and Centrelink make it very clear to parents, at the earliest possible time, what they are expected to do.

In the Ombudsman’s last annual report, we noted that we had been working for some time on a project with Centrelink and Child Support, looking at why some FTB customers acquired large FTB debts when Centrelink decided they had retrospectively failed the RMAT. When we started this project, Centrelink and Child Support were separate agencies and neither seemed to have a detailed understanding of the legal and practical interactions of the FTB and child support systems. Part way through, the two agencies became part of the new integrated DHS and the DHS areas responsible for the Child Support Scheme and FTB were also amalgamated. At around the same time FaHCSIA integrated its policy branches responsible for the Child Support Scheme and FTB.

Throughout 2011–12, we made concerted efforts to bring DHS and FaHCSIA together to discuss the underlying policy and administrative problems that were revealed by a range of FTB and Child Support complaints that we had investigated and finalised. We were satisfied that some of the underlying problems that led to retrospective RMAT failures no longer applied because of unrelated changes to the Child Support Scheme. We also identified that Centrelink could do more to ensure that FTB recipients are aware of the need to apply for child support and given a reasonable period in which to do so, before their FTB is reduced to the base rate.

Centrelink has undertaken to refine its procedures and review its automated communication with FTB customers to improve its administration of the RMAT. We will continue working with DHS to monitor its implementation of these improvements. We want Centrelink to take all reasonable steps to ensure that FTB customers do not miss out on the higher rate of FTB through confusion or ignorance about the RMAT, or its misapplication.

Care percentages: how much time does a child spend with each parent?

Another area of close interaction between the Child Support and Centrelink programs is the process for deciding the ‘care percentage’ to be used in calculating a parent or carer’s child support assessment and, where relevant, their FTB entitlement. Since 1 July 2010, whenever Child Support makes a care percentage decision, this will also apply to Centrelink’s FTB records (and vice versa). However, Child Support and Centrelink have different computer systems, so Centrelink must transfer data about any changes it makes to the parent’s care percentage to Child Support, for Child Support to apply to its record for that parent (and vice versa). In our 2010–11 annual report we noted that we had investigated a small number of complaints about the transfer of ‘care percentage’ data between the programs.

In 2011–12 we monitored complaints about the transfer of care data between Centrelink and Child Support, to establish whether there were simply ‘teething problems’ or something more serious. The people who complained to us, although few in number, all gave similar accounts of repeatedly being referred between Child Support and Centrelink in their efforts to have the correct care percentage applied to their cases. This fell far short of the standard of service that people should be able to expect from an integrated DHS.

We raised this systemic problem with DHS and were assured that Child Support’s complaint service was best placed to deal with individual complaints about data transfer problems. We started to refer most new complaints to Child Support to resolve, but continued to receive complaints from people frustrated by the delays, or who were told that there was a ‘computer glitch’ that was preventing Child Support or Centrelink making a correct assessment. While we were able to resolve these complaints individually, we remained concerned about what appeared to be a range of system and training deficiencies in both Centrelink and Child Support. We wrote to DHS about this in October 2011 and February 2012, with details of all the individual complaints that we had received and investigated.

DHS advised us that it established a ‘Care Review Project’ in January 2012, to investigate the underlying causes for the persistent problems it was experiencing in transferring care data between Centrelink and Child Support and applying it accurately to customers’ records.

We received a briefing about the project in late April 2012. We continue to receive complaints about this problem and are very keen to see the results of DHS’s Care Review project in the coming year.

Child Support and the Australian Taxation Office (ATO)

DHS and the ATO are separate Commonwealth agencies. However, Child Support used to be part of the ATO and at the time of their separation, administrative and legislative arrangements were made to ensure that Child Support was still able to get access to the ATO information it needs to administer the Child Support Scheme. The ATO informs Child Support when it makes an assessment of a Child Support customer’s taxable income, so Child Support can make a new child support assessment. We investigated several complaints in 2011–12 where problems in the transfer of income information between Child Support and the ATO meant that Child Support failed to make a new assessment at the appropriate time. Child Support attempted to remedy this by making a retrospective assessment when it discovered the problem. It has recently acknowledged that the child support legislation does not permit it to make retrospective assessments in these cases. We will continue to investigate this problem in the coming year.

Another frequent interaction between the ATO and Child Support is the tax refund intercept process. If the ATO is about to make a refund to a taxpayer who is also a child support debtor, Child Support can require the ATO to transfer that refund to Child Support, to be applied to the person’s child support debt. In 2010–11, Child Support collected $108.7 million by intercepting payers’ tax refunds.

In 2011–12 we investigated a complaint from Ms M (2011-100688; 2011-100994), which led to the ATO paying Ms M compensation for failing to send her former partner’s tax refund to Child Support.

The error occurred through a human error in the ATO’s manual processing of returns when it was implementing its new computer system. Ms M’s former partner remains liable for the full amount of his child support debt. Ms M has agreed to repay the ATO when and if Child Support ever collects that debt from him and pays it to her.

Child Support's response to compensation claims

We believe the ATO’s remedy for Ms M’s complaint is an appropriate response to a missed collection opportunity. It is a very different result to the way that Child Support responds to compensation claims lodged by its customers when Child Support makes a mistake that causes it to miss a certain collection opportunity to the detriment of one of its customers. We suggested that Child Support reconsider its usual approach to compensation claims of this type. We intend to pursue this matter further when an appropriate case arises.

Update from last year

Child Support's 'capacity to pay' investigations

In our 2010–11 annual report we mentioned that we intended to monitor Child Support’s implementation of recommendations in Report 11/2010— Child Support Agency, Department of Human Services: Investigation of a parent’s capacity to pay, published August 2010. We are satisfied that Child Support has acted on all the recommendations. We did not receive any complaints in 2011–12 that indicated any significant ongoing problems with this area of Child Support’s administration.

Child Support's 'write only' service restrictions

We also mentioned in our 2010–11 annual report that we planned to examine Child Support’s records of its review of the cases where it had restricted customers to ‘write only’ access. We recommended that Child Support conduct that review in Report 14/2010—Department of Human Services, Child Support Agency: Unreasonable Customer Conduct and ‘Write Only policy’, published November 2010. In August 2011, we wrote to Child Support to report on our review of the cases, acknowledging significant improvements to its procedures for imposing and reviewing service restrictions.

In April 2012, DHS briefed us on the work it was doing to align the way that Child Support and Centrelink impose and review service restrictions on their customers. We made comments on the early draft DHS ‘Alternative Service Arrangement’ (ASA) procedures and have agreed to provide further feedback as DHS develops ASA procedures that will apply across all of DHS.

Stakeholder engagement outreach and education activities

Last year we noted our intention to do more to ensure that Child Support customers are aware of their right to complain to the Ombudsman’s office. Set out below are some of the things that we did.

In July 2011, the Ombudsman’s office held a Community Roundtable meeting in Melbourne to discuss child support issues. We invited people from parent and carer support groups; community legal centres and Victoria Legal Aid. The people who attended said that they learned a lot about the role of the Ombudsman’s office and how we can help people who are having problems in their dealings with Child Support, or associated Centrelink problems.

In September 2011, we produced brochures for distribution at the Family Relationship Services of Australia conference on the Gold Coast, explaining the sorts of complaints that the Ombudsman can investigate.

In November 2011, we gave a presentation at Victoria Legal Aid to a group of solicitors who deal with child support matters.

Also in November 2011, we attended the Conference of the National Council of Single Mothers and their Children— Diversity, Dignity and Determination, in Melbourne. A copy of our brochure explaining the sorts of complaints that the Ombudsman can investigate was included in each conference delegate’s package.

We attended four meetings of the Child Support National Stakeholder Engagement Group (CSNSEG) in Canberra (July and November 2011, March and June 2012) convened by DHS and FaHCSIA. The CSNSEG members include a range of people and organisations with an interest in the child support scheme: parent and carer support groups; the courts; researchers in the field of families, children and separation; family relationship centres; community legal centres; migrant resource centres; solicitors in private practice; community legal centres; state and territory legal aid bodies and other government organisations.

Throughout 2011–12, we attended Child Support State Stakeholder Engagement Group (CSSEG) meetings in Parramatta; Adelaide and Melbourne. These meetings put us in touch with a range of local people and organisations with an interest in the Child Support Scheme, similar to those who attend CSSEG meetings.

In August and November 2011, we attended meetings of the NSW Child Support Legal Liaison Group convened by Legal Aid NSW in Parramatta.

We participated in the DHS Child Support Family Violence Reference Group, attending meetings in July, August and November 2011. The reference group advised Child Support on its development of a definition of violence, and how Child Support could make its processes more responsive to victims of family violence.

Looking ahead

In 2012–13 we will continue to participate in activities that will enrich our understanding of the way DHS customers experience the child support scheme and any associated impacts on their FTB entitlements.

Our top two priorities in 2012–13 are to assist DHS to improve:

1. the way that the Child Support program responds to payee overpayments
2. its administration of the reasonable maintenance action test.

Postal Industry Ombudsman and Australia Post Complaints

Overview

The Commonwealth Ombudsman has served as the Postal Industry Ombudsman (PIO) since 6 October 2006. The PIO was set up to offer an ombudsman service for the postal and courier industry, with the aim of recovering its costs from the industry it regulates.

An Australian Government business enterprise, Australia Post is subject to the jurisdiction of the Commonwealth Ombudsman and the PIO. Other private postal operators (PPOs) can voluntarily register with the PIO. In 2011–12, in addition to Australia Post, eight PPOs were registered under the PIO scheme.

The PIO can only investigate complaints made about a postal or similar service, and only if made within 12 months after the action that caused the complaint. The PIO cannot investigate complaints about other aspects of a postal provider’s operations, such as retail services, employment matters or environmental issues. The exception is Australia Post, where the Commonwealth Ombudsman may investigate administrative actions of Australia Post that do not fall within the jurisdiction of the PIO.

Typical examples of matters that fall within the Commonwealth Ombudsman’s jurisdiction include complaints about Australia Post’s retail products and services, damage to property, processing of passport applications and bill payments.

Complaints

Australia Post remains the main provider of postal services and 99% of complaints received are about Australia Post mail services. While the number of complaints received was a relatively small proportion of the number of daily transactions completed by Australia Post, the impact of a disrupted mail service upon an individual or business can be significant.

In 2011–12 we received a total of 4173 complaints about postal matters. Over 350 of those were outside the jurisdiction of the PIO. Postal matters accounted for 18% of the total number of complaints received by our office during the year. This is 1014 more postal complaints than we received in 2010–11, an increase of over 32%. This follows an increase of 19% the previous year. The following table shows the continuing growth in complaints received about the postal industry since the start of the PIO in 2006–07.

Table 4.2: Complaints received about the postal industry since 2006–07

YEAR	AUSTRALIA POST COMPLAINTS RECEIVED	PRIVATE POSTAL OPERATORS COMPLAINTS RECEIVED	TOTAL COMPLAINTS RECEIVED	COMPLETED INVESTIGATIONS
2011–12	4137	36	4173	486
2010–11	3123	20	3143	513
2009–10	2626	11	2637	557
2008–09	2219	13	2232	648
2007–08	2083	4	2087	745
2006–07	1819	1	1820	706

Of the total complaints received, 3816 or 92% were within the jurisdiction of the PIO. This proportion is consistent with previous years.

The largest proportion of complaints received related to one-off problems with mail, with most of these being about parcel deliveries. Australia Post reported that it experienced significant parcel volume growth in 2011–12, with 70% of that volume generated by eCommerce, as growing numbers of Australians do their shopping online. Complaints about parcel delivery are largely about parcels that have been lost or damaged. We may investigate if it appears that Australia Post has unreasonably refused to pay compensation, or has been unable to reasonably resolve the complaint.

In dealing with complaints about single instances of mail service failure by Australia Post and assessing what is fair and reasonable, we consider Australia Post’s commercial and community service obligations. Part of our role is to help complainants better understand these obligations as Australia Post customers often appear to either be unaware of or reluctant to accept them.

We take into account Australia Post’s terms and conditions for the particular mail service that has been used. Generally, we are able to obtain a better outcome when a parcel has been sent using a service that includes tracking or delivery receipt, and the loss of the parcel can be directly attributable to a failure of Australia Post to comply with the requirements of that service. Examples of this include when a person can verify they did not sign for an article, appropriate identification checks were not completed by Australia Post, proper records have not been kept, a policy has been misapplied, or the customer service response has been inadequate. In addition to resolving the individual case, our investigation aims to identify any errors that might indicate a more systemic problem.

When a one-off problem occurs due to a failure to correctly implement an Australia Post procedure, we expect Australia Post to try to identify how the problem occurred and if necessary, to raise the issue with the staff involved to prevent similar problems in the future.

The next most common area of complaint relates to recurrent mail issues. These issues are broad-ranging and, in addition to complaints about lost or damaged mail, they also include complaints about:

• repeatedly misdelivered mail
• incorrect safe drop procedures
• failure to attempt delivery of parcels
• refusal to deliver mail
• irregularity of service to a new area
• errors with the address database, and
• repeat or ongoing failure of a mail redirection or hold service.

We have managed to resolve a number of complaints where confusion about an address has caused ongoing misdelivery of mail. We have also been able to resolve some issues where parcels were being left for collection at inconvenient locations.

During the year we investigated multiple complaints from Australia Post customers about failed mail redirections or holds. These customers reported a variety of problems, including missing or lost mail, mail delivered incorrectly to them or another address, and unauthorised mail redirections. Customers also reported problems with Australia Post’s complaint-handling, particularly in relation to the advice provided by Australia Post and its requirements regarding evidence to prove failure. We generally investigated when there was evidence of failure and an unreasonable response from Australia Post. In many cases we achieved a better result, such as increased checking of mail by Australia Post to ensure correct delivery, and refund of the redirection fee covering the period of failure.

Systemic issues

In 2011–12 we did not publish any new reports about Australia Post, but we followed up its progress in implementing our recommendations from a number of reports released over recent years. We sought information about what improvements and changes Australia Post has made in the administration of these services. We sought follow up information on the following five reports:

• Use of notification cards— December 2008
• Administration of the mail redirection service—June 2009
• Community polling practices: gauging community support for changes to postal delivery services—March 2009
• Passports lost in the mail—June 2010
• Safe drop program—a review of the first year—March 2010

We are analysing the further information and will continue to monitor Australia Post’s implementation of the recommendations from our earlier reports.

Looking ahead

We do not anticipate significant changes to the trends in postal complaints in 2012–13. As Australia Post’s geographical delivery network expands each year, it is likely that complaints will also continue to grow, particularly if the parcel volume continues to increase.

We will continue to focus on referring complainants to Australia Post’s customer contact centre to resolve their issues of concern, especially in instances of one-off problems. We will focus our limited resources on identifying systemic issues and possible improvements. In particular, we will aim to work with Australia Post to examine how its own complaint handling could be improved to achieve better and more lasting solutions at the first point of contact. As foreshadowed in last year’s annual report we have conducted a review of how we charge for investigations conducted under the PIO scheme. We completed an analysis of investigations completed over a period of time to better ascertain the resources required to undertake investigations at different levels of complexity. We will be seeking to discuss changes to the fee structure for PIO investigations with Australia Post, PPOs and the Department of Broadband, Communications and the Digital Economy over the coming year.

Taxation Ombudsman and ATO Complaints

Overview

The Taxation Ombudsman role was created at the suggestion of the Joint Committee of Public Accounts and Audit (JCPAA) in 1995 in recognition of the unequal position between the Australian Taxation Office (ATO) and taxpayers. The role aimed to increase the focus on the investigation of complaints about the ATO. The Taxation Ombudsman appears at the annual hearings of the JCPAA with the Commissioner of Taxation and provides a review of the ATO’s performance based on the complaints received by this office and our liaison activities with the ATO. The role does not otherwise confer any additional duties or functions other than these under the Act.

In 2011–12 we received 2717 complaints about the ATO, the highest number of complaints in 10 years and a 4.7% increase on complaints received in 2010–11. Overall, complaints about the ATO have more than doubled since 2007–08. In 2011–12 complaints about the ATO accounted for 12% of complaints received by the office.

Complaints

The most common ATO complaints received were about:

• income tax refund delay
• other processing issues
• debt recovery actions
• time taken in the investigation of unpaid superannuation entitlements owed to employees
• audit actions by the ATO, most often in relation to goods and services tax matters
• superannuation excess contributions tax imposed
• delays in processing Australian Business Number (ABN) applications.

During the year, with the ATO’s cooperation, we commenced a ‘one last chance’ referral process. We use this process when a person complains to us about a matter that has already been considered and finalised by the ATO, but where we assess that the issue is one that could still easily be resolved by the ATO.

Under this arrangement we refer complaints to the ATO for action within 14 days, identifying the possible remedies. The ATO then reports back to us on what actions it took to resolve the complaint directly with the taxpayer. We then consider whether further action by this office is warranted. This process allowed remedies to be provided quickly and efficiently. The ATO has demonstrated its capacity to satisfactorily resolve the large majority of referred complaints, without requiring further investigation by our office. Examples of the types of remedies provided by the ATO include:

• sending forms or statements of account
• providing better explanations for its decisions and tax-related matters
• processing payments.

Given the ATO’s success in implementing the ‘one last chance’ initiative, we have encouraged it to examine all new complaints referred by us to consider whether it can quickly and efficiently resolve the complaint without further involvement of our office.

We are pleased with the cooperation provided by the ATO. We continue to emphasise that the ATO should learn from their complaints, and apply the lesson to improve its resolution practices and broader administration.

We have noted a high level of complainants (around 50%) coming directly to the Ombudsman without the complainant first attempting to address their complaint with the ATO. In these circumstances, the ATO accepts and actions a transfer of a complaint from this office. This removes the need for the complainant to contact and repeat the complaint to the ATO. We intend to investigate whether the number of people coming directly to us with complaints about the ATO is in line with the proportion who come to us with complaints about other agencies. We will also seek to determine what factors may be driving this behaviour. The ATO has agreed to assist in this review in the course of its complaints re-engineering project.

We participated in and provided feedback to the ATO as part of their complaint re-engineering program which followed the completion of a consultant report on the ATO’s complaints handling in August 2011. We continue to encourage the ATO to adopt and implement the recommendations identified in its complaint re-engineering project. In particular to:

• build its analytical capability
• make better use of intelligence from complaints in policy, service design and implementation
• make executive officers accountable for the resolving root-cause of complaints
• undertake more first contact resolution.

Systemic issues

Since 1 July 2011, we have been more proactive in providing feedback at the conclusion of investigations to draw particular issues to the ATO’s attention. For example, we commented on cases where the ATO’s actions had not followed its policy and administrative guidelines. We also made suggestions to the ATO about administrative processes which warranted further consideration or enhancement. In other cases we acknowledged the efforts made by the ATO to provide remedies to problems identified through our investigations.

Income Tax Refund Integrity program 2011

A significant number of complaints we received this year related to an increase in activity in the ATO’s income tax return integrity (ITRI) checking. For the past three years the ATO has used computer system-generated models to identify, and stop for further checking, income tax returns which display certain indicators.

In 2011 the ATO stopped substantially more returns than it had capacity to process. This resulted in significant delays to taxpayer refunds. The average time until refund for these cases was five months, with 30% taking between six and nine months to conclude. These delays led to a large number of complaints to both the ATO and this office. Once we became aware of the situation we advised taxpayers and tax agents that we were aware of the delays arising from the backlogs, and that it might take the ATO some time to finalise the processing of their tax return. We held regular meetings with the ATO to provide feedback on this issue, and to seek further information based on the complaints that were coming to us; obtain updates on the ATO’s progress in addressing the backlog; and bring to its attention matters that may require priority.

The ATO states that the program resulted in it amending 75% of the returns stopped, which amounted to the protection of revenue estimated at $200 million. We acknowledge the purpose and apparent success of the ITRI program. However, we also note the consequences for taxpayers who were affected by the delays. We provided feedback to the ATO on:

• the need for better communication where the ATO identifies an issue that will impact on taxpayers, for example, the need to notify taxpayers and tax agents of expected delays in the processing of tax returns
• unreasonable delay—lengthy delays were experienced by many taxpayers. We sought an explanation as to why it was necessary to review each of the returns stopped
• the need to provide clearer explanations and reasons in correspondence when adjustments are made to a taxpayer’s return.

The ATO conducted a substantial review of its 2011 ITRI program, and has taken into account our feedback in making adjustments to the 2012 ITRI program. We anticipate that these changes will deliver a much improved program and avoid the issues we noticed in 2011.

Departure Prohibition Orders

During the year we investigated four complaints relating to the ATO’s exercise of its power to issue a Departure Prohibition Order (DPO). A DPO prohibits a person who owes a tax debt from leaving Australia. As a result of our investigations the ATO has improved its administrative processes for DPOs, including:

• providing reasons to taxpayers for why a DPO was issued
• providing information on rights of review and appeal in the ATO’s letters to affected taxpayers
• reducing further the number of officers able to issue a DPO and introducing a requirement to seek senior executive level endorsement
• directing decision makers to consider the currency and accuracy of the information they rely on
• reviewing its use of its DPO power at least yearly, and ensuring that all staff delegated to approve and/or issue a DPO undertake refresher training
• assigning a new decision maker when a taxpayer requests a review and imposing a five-day timeframe for those reviews to take place
• undertaking to revise the guidance to officers relating to the issuance of a Departure Authorisation Certificate (DAC).

While four complaints is not a significant number, over the past few years the ATO has on average issued 20 DPOs per year (not all of the complaints related to a single year). Furthermore, the impact of a DPO on an individual can be significant. The ATO acknowledges this and accepts the importance of careful administration in these circumstances.

Communication and use of plain language

We have continued to provide feedback to the ATO in relation to its letters and communication.

The ‘one last chance’ complaint program often picks up cases where ‘better explanation’ is the necessary remedy. This might include explanation of the ATO’s decision, its obligations or limitations and those of the taxpayer. The ATO should use these cases to improve its communication products. We do note that a complainant may describe their misunderstanding differently to this office than it might to the ATO. There are clear benefits to the ATO of providing as clear and straightforward information to taxpayers as possible.

In one example we provided the ATO with two of its own letters sent to taxpayers advising them of its refusal to accept a repayment plan for a debt. In both cases the letters stated only that the repayment offer was refused because it was ‘not acceptable’. The letter did not offer further reasons for the refusal, or offer to consider further repayment offers, but insisted on full payment. These letters led to complaints to our office.

The letters were found to have been issued by an area of the ATO which handled a limited number and scope of debt matters. As a result of our referral, the ATO revised its standard template letters, including providing officers with examples of reasons for refusal to be used, and developed ‘payment plan refusal guidelines’.

Cross-agency issues

We have continued to receive and investigate complaints about the ATO’s action or inaction and consequences for the complainant in their dealings with other agencies, such as Centrelink and Child Support.

Reports or submissions

We concluded an own motion investigation into certain aspects of the administration of the joint-agency taskforce, Project Wickenby. We decided not to release the report publicly to protect the privacy of taxpayers identified in the report. The agencies (it was not limited to the ATO) agreed with the recommendations. Our recommendations in relation to the ATO were that it:

• in consultation with Australian Crime Commission (ACC), develop guidance to officers who might become ACC members of staff or handle ACC material in the course of their duties
• review and improve its guidance on what officers should consider as factors in determining acceptable security for the granting of a Departure Authorisation Certificate.

Update from last year

Tax File Number compromise

For the past few years we have had an ongoing interest in Tax File Number (TFN) compromise cases and produced a report on this issue in 2010. We can report that we have received very few complaints related to this issue in the last year. Those that we have received have not been subject to any delay by the ATO but were nonetheless addressed promptly when we brought the matters to the ATO’s attention.

We have also noted fewer complaints in relation to delays in the ATO determining applications from Compensation for Detriment caused by Defective Administration (CDDA).

Immigration Ombudsman and Department of Immigration and Citizenship Complaints

Overview

In 2011–12 the office focused on two streams of complaints related to the Department of Immigration and Citizenship (DIAC or the department). One related to irregular maritime arrivals and detention issues and the second stream related to other migration programs and activities. The Ombudsman can investigate decisions or matters relating to visa applications, citizenship processing or immigration detention which cannot be resolved between the client and the department.

During 2011–12 the number of irregular maritime arrivals increased significantly and there were record numbers of people in immigration detention. This was notwithstanding the impact of the government’s policy from November 2011 to grant Bridging Visas and release people into the community after initial processing. The average period of detention decreased significantly during 2011–12 due to this policy. However, there remained a large number of people in detention for longer than three months. We investigated both systemic issues and complaints from people in detention and their advocates and representatives. As part of our active visits program we conducted complaint clinics at detention centres where 36% of the detention-related complaints were made (compared with 50% in the previous year).

Overall, we received 1873 complaints relating to DIAC in 2011–12 (compared with 2137 in 2010–11) and 1967 complaints were finalised. Of these complaints, 44% were from people in detention. We investigated 290 or 15% of complaints received (compared with 16% in 2010–11) and were able to facilitate remedial action in 67% of these cases.

We have ongoing engagement with DIAC via its Ombudsman and Human Rights Coordination Section including regular briefings on areas of interest to us. This helps us to understand the context of the complaints we receive and enables us to follow up with the department on systemic issues.

In addition to monitoring and highlighting systemic issues, our complaint investigation has achieved positive outcomes for some individuals such as: improved decision records, a better explanation for some decisions, refunds on Visa Application Costs, reconsideration of decisions by the department, and expediting processing of some applications.

Details of the Ombudsman’s immigration inspections and oversight functions is covered in Chapter 7 of this annual report, including our role under s 486O of the Migration Act 1958 in preparing reports on people who have been in immigration detention for more than two years, and every six months thereafter.

Complaint themes and systemic issues

The complaint themes we observed in 2011–12 were similar to those in the previous year with delay being the main cause of complaints. During the year several issues emerged in relation to applications for student and visitor visas which are discussed further below.

While the quality and level of information provided by DIAC’s internal complaint handling mechanism, the Global Feedback Unit (GFU) improved, the complaints we received did highlight cases where the department did not adequately respond to complaints when provided the opportunity. The Ombudsman provided feedback to DIAC on the draft Global Feedback Operating Manual for Managing Client Feedback Policy, which includes reference to the role of the Ombudsman. We will continue to monitor and work with DIAC to improve its internal complaint handling processes.

The Ombudsman identifies recurring issues through complaints and monitors these through a systemic issues register. The Ombudsman has investigated a number of complaints about the refusal of student and visitor visas and decided to raise them in a holistic manner with the department for their consideration and comment. The Ombudsman is preparing an issues paper on the department’s refusal of student and visitor visa applications on ‘genuineness’ grounds. We take a particular interest in student and visitor visa applications that are not subject to merits review or external scrutiny and oversight outside of our role.

Delay in processing claims

Processing delays remain one of the main causes of complaints to this office on immigration matters. Complaints about delay have related to: security checks; visa processing; response to complaints to DIAC’s Global Feedback Unit; primary and secondary decision making; access to property in detention facilities; and, detainees access to public health services.

Global Special Humanitarian Program

The Ombudsman’s office liaised with DIAC to improve the quality of information provided in the decision records relating to offshore applications for visas under the Global Special Humanitarian Program. This was in response to complaints from applicants and families who did not understand or receive adequate explanations and/or reasons for the visa refusals.

Overseas Posts

The Ombudsman received numerous complaints in regards to the processing of visa applications by overseas posts. Our office is aware of the difficult environment some posts operate within and we take that into account when investigating complaints. The complaints range from delays in the processing of visa applications; the approach taken in dealing with applicants; and the interpretation and application of the Migration Act 1958 and Regulations in assessing visa applications, especially in regard to a consistent application on the issue of genuineness. Some posts have been more represented than others from the complaints we have received which resulted in our office examining the department’s oversight and audit procedures at specific posts. We note that the department has been receptive to our input and has made some relevant changes.

Compensation for Detriment caused by Defective Administration

The Compensation for Detriment caused by Defective Administration (CDDA) scheme allows government agencies to provide discretionary payments to people where it believes there is a moral obligation due to detriment as a result of an agency’s defective actions or inactions. The Ombudsman provides the review mechanism for agency decisions made under the CDDA scheme. During the year we received a number of complaints about the department’s decision not to compensate for claims of defective administration and we reviewed these decisions. In the majority of cases we agreed that DIAC’s decision was not unreasonable but we asked DIAC to reconsider its decision in some. In one case DIAC agreed to change the decision and pay compensation to the applicant.

Compliance and Removals

The Ombudsman has a role in monitoring the administration of coercive powers delegated to immigration officers including powers to search premises, seize documents and valuables, and to detain and remove unlawful non-citizens from Australia. During the year, we participated as observers in the department’s compliance, removal and training activities to assist in identifying gaps in systems, policies and procedures.

To assist in the Ombudsman’s oversight function, DIAC provides us with a six-monthly report in relation to detainees who have been released from immigration detention with a system release indicator of ‘not unlawful’. These comprehensive reports explain the circumstances of the detention and release and provide appropriate mitigating strategies to either prevent lawful non-citizens from being detained, or by resolving immigration issues promptly in order to release the person lawfully back into the community. The Ombudsman maintains ongoing oversight in this area and continues to investigate individual complaints about compliance and removal activities.

Complaints from people in detention

During 2011–12 we noted a decrease in the number of complaints received from detainees, which was predominantly due to a significant drop in the number of complaints received in person at detention facilities (298 complaints compared to 491 in the previous year). Complaint clinics are undertaken during visits to detention facilities as part of our oversight function. The numbers of complaint clinics were comparable with the previous year but there was less interest from detainees and the nature of complaints changed. This may in part be the result of reduced time spent in restrictive detention following the change in government policy and introduction of Bridging Visas in November 2011.

Complaints from people in detention

During 2011–12 we noted a decrease in the number of complaints received from detainees, which was predominantly due to a significant drop in the number of complaints received in person at detention facilities (298 complaints compared to 491 in the previous year). Complaint clinics are undertaken during visits to detention facilities as part of our oversight function. The numbers of complaint clinics were comparable with the previous year but there was less interest from detainees and the nature of complaints changed. This may in part be the result of reduced time spent in restrictive detention following the change in government policy and introduction of Bridging Visas in November 2011.

Common issues raised by detainees during visits

Common issues raised by detainees include:

• concern at length of time in detention and feelings of hopelessness and uncertainty about the future; however, we observed less of these concerns with the increased granting of Bridging Visas and the decreased average time in detention by the latter part of the year
• delay in processing protection claims and the consequences of these delays on physical and mental health
• uncertainty and confusion over the immigration process and the status of their claims for protection
• confusion over contact with a department case manager—this was more apparent with detainees experiencing mental health issues who had difficulty recalling who their case manager was and the last time they had spoken to them
• problems with property management and loss of property. It is recognised that the large number of people coming into immigration detention and being moved within the detention network creates challenges for managing detainees’ property. We have received a number of complaints about this issue, particularly relating to items of high value and cash
• confusion over the medical system, their treatment regime and delays in obtaining appointments for specialist care through the public health system
• confusion about the basis of placement decisions for some detainees being moved around the detention network
• anxiety over being unable to earn money and concern for families remaining at home
• perceptions of unfair Refugee Status Assessment and Independent Merits Review decision-making including the alleged bias of some decision-makers and out-of-date country information
• concerns about the skill and accuracy of some interpreters and a perception that detainees’ claims are not being appropriately addressed.

Reports and submissions

Reports

Department of Immigration and Citizenship: Detention arrangements —The transfer of 22 detainees from Villawood Immigration Detention Centre to the Metropolitan Remand and Reception Centre Silverwater (released in April 2012).

In April 2011, a large scale disturbance at Villawood Immigration Detention Centre resulted in major damage to the centre with a number of facilities being destroyed by fire. Twenty-two detainees suspected of involvement in the disturbances were transferred from Villawood to the Metropolitan Remand and Reception Centre at Silverwater on the recommendation of the Australian Federal Police (AFP).

The Ombudsman’s office received a complaint from the legal representative of the detainees about the reason for their transfer and that DIAC’s own procedures had not been followed in this instance.

The office investigated the complaint and found that the transfer of the detainees to a correctional facility was a decision that was made in good faith on the advice of the AFP and that it was necessary as part of regaining control of Villawood IDC. However, there were a number of aspects of DIAC’s procedures that had not been followed, in particular the notification in writing to the detainees and legal representatives of the reasons for their transfer. There were also shortcomings identified in DIAC’s record keeping and the frequency of visits by case managers to the detainees while they were held at Silverwater.

The Ombudsman issued a report under s 15 of the Ombudsman Act 1976 and made a number of recommendations to DIAC to ensure that effective procedures are in place for those occasions where detainees are transferred from an immigration detention facility to a correctional facility and that proper records are kept at each stage of the transfer.

DIAC accepted the recommendations and advised this office that its procedures relating to the transfer of detainees from detention to correctional facilities will be rewritten in 2012.

Own motion investigation into suicide and self-harm in the immigration detention network.

The office announced in July 2011 it would undertake an own motion investigation to examine the incidence and nature of suicide and self-harm in the immigration detention network. This investigation is still underway.

Submissions

During 2011–12 the Ombudsman’s office contributed to the following inquiries and reviews on issues relating to immigration:

• Joint Select Committee on Australia’s Immigration Detention Network, September 2011
• Senate Standing Committees on Legal and Constitutional Affairs inquiry into Australia’s Agreement with Malaysia in Relation to Asylum Seekers, September 2011
• Australian Law Reform Commission’s inquiry into Family Violence and Commonwealth Laws, September 2011
• DIAC’s Review of the Student Visa Assessment Level Framework, March 2012