Disability support pensions wrongfully reviewed

A budget measure to review 90,000 disability pension recipients captured more than 4200 who shouldn’t have been reviewed.

The Department of Social Services estimated 10 per cent of reviewed recipients would have their payment cancelled.

A bungled budget measure to medically review 90,000 people on the disability support pension captured more than 4200 people who should never have been reviewed and whose payments were reinstated by the department, an audit report has found.

The Australian National Audit Office report into the $16 billion payment found the Department of Social Services missed its forecast by more than 8 percentage points when the budget measure resulted in an almost total majority of medical reviews recommending no change to DSP eligibility.

The department had estimated 10 per cent of reviewed recipients would have their payment cancelled. Instead, fewer than 2 per cent were moved off the pension.

The budget measure was dropped in October this year because it had failed.

“In the vast majority of cases (4041) there was medical evidence of a condition that was now on the exclusion list as it was indicative of a severe disability,” the report, tabled today, says.

“The remainder had a range of vulnerability or complexity factors, such as having a nominee or significant mental health conditions.”

Despite a requirement to do so in 2014, neither the Department of Human Services (which administers the payment) nor the DSS have ever come up with a way to measure the performance of the program between the two agencies.

There is one key performance indicator which is so inadequate the audit office considers it to be “biased” because it ignores all DSP claims that take longer than 84 days.

“A large proportion of claims each quarter take more than 84 days to be finalised,” the report says.

“Between quarter three 2016—17 and quarter four 2017—18 this accounted for about 40 to 60 per cent of all claims finalised, compared to around 10 to 20 per cent in 2014—15 when the exclusion was agreed.”

The departments use this exclusion to alter the median time they say it takes to finalise a DSP claim — bureaucrats told senators it was 34 days during a May hearing — when the real averages range from 71 to 168 days.

“While the (key performance measure) clearly states the exclusion, it still results in an inherently biased performance measure,” the report says.