House of Representatives

Second Reading Speech

Mr TRUSS (Wide Bay-Minister for Community Services)

I move:

That the bill be now read a second time.

The data-matching program is an important aspect of the continued efforts of this government to ensure the integrity of Australia's social welfare system. Over the past seven years, the data- matching program has been conducted under the Privacy Commissioner's scrutiny with careful regard for individual privacy, and is an important control on personal financial assistance schemes, helping to keep them free of abuse and fraud. It has been proven over the past two years that it can achieve substantial savings in public expenditure.

The data-matching program is also valuable in encouraging voluntary compliance with the rules in place to ensure payments are targeted to those in need. It reminds the community that it is not a case of if fraud will be detected, but when. It has now become an important feature of the review mechanisms that are helping to build the integrity of the system and the confidence of the public that the system is, in fact, secure from fraud.

There are ongoing review and reporting arrangements in place to allow the parliament to maintain its scrutiny of the program. The present government, when in opposition, argued successfully for continuation of this scrutiny. The Privacy Commissioner continues to play an important role in ensuring that the government agencies participating in the data-matching program abide by the strict conditions already set down in the legislation to protect the privacy of individuals.

In addition to the Privacy Commissioner being able to seek information and scrutinise the activities of the agencies involved in the data-matching program, there is a requirement that those agencies report annually to the Privacy Commissioner. The act also requires that these reports are laid before the parliament. There is also a triennial report to the parliament covering the three previous financial years. The first triennial report is due in the second half of this year.

In 1996 the Australian National Audit Office, ANAO, conducted a follow-up of its 1993 audit of data matching within the Department of Social Security. This review was in keeping with this government's 1996 election commitment to review the data-matching program. It can be noted that the ANAO's audit opinion given in its 1996 report was as follows:

Overall the department has made substantial achievements through implementing legislative changes, improved reporting procedures, savings collection, better targeting and project evaluation processes. These changes have resulted in both substantial increases in savings generated by the program and in efficiency improvements.

When the Data-matching Program (Assistance and Tax) Act 1990 was first enacted it incorporated a sunset clause to take effect in January 1993. That sunset clause has, however, been extended by the parliament on three separate occasions. The latest occasion was in 1995 when the sunset clause was extended until 23 January 1999. In part, the sunset clause was kept in place because of concerns in the parliament that the data-matching program would not achieve the expected savings and in part as an attempt to allow the parliament to maintain scrutiny of the program.

The data-matching program has now proven that very substantial savings can be achieved, and the parliament has been regularly informed of the operation of the program in addition to its deliberation of bills previously introduced to deal with the sunset clause. The program has become an important feature of the overall social welfare system and one that needs to be given a permanent place in the continuing efforts to maintain and improve that system. In the event that the sunset clause is allowed to come into effect, the loss of savings that could be achieved would be in the order of $560 million over the four years from 1998-99. Accordingly, this bill seeks to remove the sunset clause. I commend the bill to the House and present the explanatory memorandum.