Budget 2018: Fugitives and fine defaulters to have welfare payments suspended

Fine dodgers and fugitives from justice will have their Centrelink payments suspended for the first time in a welfare crackdown.

Fine dodgers and fugitives from justice will have their Centrelink payments suspended for the first time in a budget welfare crackdown that will also chase down ­ex- recipients with outstanding welfare debts.

Under strengthened “mutual obligation” measures, the commonwealth will work with the states to make compulsory deductions from the welfare payments of serial defaulters with outstanding fines imposed by state or territory courts.

Welfare recipients with outstanding state or territory arrest warrants for indictable criminal offences will have their payments suspended or cancelled.

The government is forecasting savings of $300 million over three years from 2019-20 by ramping up fraud detection and debt recovery, with the savings redirected to repair the budget.

Debt-collection activities will focus on ex-welfare recipients with debts of $10,000 or more, clawing back some of the $1.2 billion in Centrelink overpayments owed by those no longer on welfare.

The government will spend $316m on a four-year overhaul of Centrelink services, replacing the agency’s “ageing technology platform”.

The changes will automate claims, assessment and payment processes. A further $50m has been allocated to answering Centrelink calls faster, as waiting times for some services average up to 38 minutes.

New migrants will also be forced to wait longer before they receive benefits, saving $202.5m over five years. The waiting period for new migrants, except refugees and vulnerable groups, to access Centrelink payments will be extended from three years to four.

The budget will ease financial pressures on families in regional areas by relaxing the parental income test for access to Youth Allowance for independent students from January 2019 by an additional $10,000 per year, and an additional $10,000 for each additional child.

An additional $11.5m has been allocated to telephone trauma counselling for women and children affected by domestic violence, while the trial of the cashless debit card in Ceduna (South Australia), and East Kimberley (Western Australia) has been extended for one year.

Social security and welfare payments — the biggest component of government spending at 36 per cent — will hit an estimated $176bn in 2018-19 and a whopping $194bn in 2021-22. This is driven largely by the growth in the number of pensioners, the transition to the full National Disability Insurance Scheme, and growth in support for families’ childcare.

Scott Morrison said the government was getting welfare spending under control, as the growing economy helped people get off benefits.

“After record jobs growth, the proportion of working-age Australians now dependent on welfare has fallen to 15.1 per cent — the lowest level in over 25 years,” the Treasurer said. “Improved compliance and better targeting has also assisted in getting welfare spending under control and we will continue to take action.”

Family tax benefit payments are projected to decline from $18.3bn in 2018-19 to $17.8bn in 2021-22, following the reforms of recent years.

Spending on the disability support pension is forecast to rise over the forward estimates from $16.5bn in 2018-19 to $17.7bn in 2021-22. Total outlays on jobseeker support are forecast to rise from $10.2bn in 2018-19 to $11.9bn in four years, but the government has rebuffed calls to lift the New­start allowance.

Childcare fee assistance is expected to rise by 8.9 per cent over the next financial year, and a further 10.9 per cent over the forward estimates.