Employment secretary admits to questionable legality of Centrelink payment penalties, refuses to pause suspensions

Today the Department of Employment and Workplace Relations secretary Natalie James has revealed there are legal questions over tens of thousands of decisions¹ – decisions that reduced or cancelled people’s Centrelink payments – made under the Targeted Compliance Framework. Based on information provided to the Antipoverty Centre, these issues stretch back to 2020. The actual number of people affected is likely to be far higher once the full extent of this scandal is made public by the secretary. Previously the department had admitted to potentially unlawful decisions affecting about 1000 people in November 2024.²

Key points:

• The secretary’s decisions so far indicate she has no confidence that her department has been lawfully administering “mutual” obligations under the TCF, but implies she has full confidence in the appropriateness of decisions made by (un)employment services providers, who have a delegated power to stop a person’s payment. We reject any claim made by the secretary that payment suspensions are generally applied in line with the policies and requirements that are supposed to dictate provider behaviour. There is a long history of evidence to the contrary, and it is negligent if she is unaware of this.

• The effect of the secretary’s decisions is that a person can have their payment indefinitely suspended. The department is supposed to consider whether cancelling a person’s payment would cause unreasonable financial hardship. We struggle to see how the degree of financial hardship or other harm done to a person receiving an indefinite suspension is meaningfully different to that caused by a payment cancellation.

• The department’s proposed process for redressing wrongful payment reductions and cancellations places the burden of proof on people harmed by these decisions, requiring them to provide documentation going back years. It is unacceptable to add this burden to people who have already suffered such cruelty at the hands of the department, some of whom would also have been affected by Robodebt and additional income apportionment decisions that are currently being challenged in federal court.³

Media contact: 0403 429 414‬ / media at antipovertycentre.org

Included below: comments from Antipoverty Centre spokesperson Jay Coonan and welfare activist Jeremy Poxon; what to do if you have “mutual” obligations or are affected by potentially unlawful payment reductions; crisis line contact information.

While the secretary has temporarily removed penalties that involve payment reduction or cancellation, she seems determined to continue allowing privatised unemployment cops – deceptively called “employment providers” – to suspend poor people’s Centrelink payments at a rate of millions per year.⁴ We know this is about the financial viability of providers, which has been prioritised over the wellbeing of welfare recipients under successive governments.

Of critical importance is that people subject to these frameworks are often our most vulnerable, including those who are homeless, First Nations people and people with a disability. – employment secretary Natalie James

The most recent quarterly data shows that 29.6% of 651,000 payment suspension notices in Workforce Australia Services were issued to First Nations people, 28% to people with disability and 13.8% to parents. 50 per cent of the 420,000 payment suspensions applied in the quarter were the result of a provider recording a participant as failing to attend an appointment – this does not mean the person failed to attend, or even that an appointment was scheduled. Provider malpractice, abuse and incompetence is widespread.⁵

There is an extraordinary amount of evidence that (un)employment services providers routinely wrongly suspend peoples poverty payments going back many years. The secretary has no plausible deniability of this fact.

If I am not confident decisions are lawful and robust, I will take action to stop those decisions immediately. – employment secretary Natalie James

The secretary must:

• Immediately stop all payment suspensions that are currently applied under the “mutual” obligations framework. Ultimately, the paternalistic system of compulsory activities imposed people to punish them for poverty must end. All “mutual” obligations must be abolished.

• Provide generous compensation to every person affected by a potentially unlawful payment reduction or cancellation, without requiring people to provide further information about their circumstances at the time their payment was cut.

The secretary has the power to end the harm being caused by a system she clearly has no confidence in, based on her own decisions.

Her repeated claims that she cannot immediately pause compulsory requirements are an unacceptable excuse and demonstrably untrue. This has been done frequently, including in 2022 when “mutual” obligations were paused initially for the month of July, and then the pause extended by an additional month.

To date all she has done is show that she is still willing to choose to inflict harm on people, when she could choose not to. The secretary’s chaotic response to the clear failure of administration regarding the cruel, pointless “mutual” obligations system breaches her duty of care to welfare recipients.

Welfare rights activist Jeremy Poxon said:

Why is Natalie James telling victims of unlawful decisions that they have to continue fulfilling “mutual” obligations requirements? Why is she directing providers who make decisions on her behalf to continue enforcing penalties on people experiencing domestic violence, homelessness, mental ill health and those who have disabilities?

It is fucking negligent for the department to force people to provide information to them instead of just paying compensation, especially while you’re still making them do “mutual” obligations.

Antipoverty Centre spokesperson and JobSeeker recipient Jay Coonan said:

This whole process shows that “mutual” obligations are an immoral and destructive tool. We will not stop until they’re abolished and those responsible for these policies are held accountable.

The government has dragged their feet on this announcement after having already implemented these changes and then announcing it on a Friday right before a budget and an election hovers over. They could be stopping this immediately but they're refusing to do the right and moral thing.

The decision to keep this coercive and abusive system in operation is about money flowing to providers and their CEO's than it is about the welfare of people subjected to the abuse.

Media contact: 0403 429 414‬ / media at antipovertycentre.org

---

Note to people affected by a potentially unlawful payment reduction or cancellation

• You may be entitled to backpay and compensation. The department has not given a timeframe for providing these payments.

• The employment department, Workforce Australia or Services Australia may contact you and ask for information. If you are contacted, please be careful to not provide any personal information without confirming you are communicating directly with a government department.

• If you are in doubt about whether any message you receive is a potential scam, please contact a community legal centre to confirm the legitimacy of any communications. You can look one up on the Economic Justice Australia website: ejaustralia.org.au/legal-help-centrelink/

Information for people with “mutual” obligations

• You still have “mutual” obligations requirements, however your payment will not be reduced or cancelled if you receive multiple demerits.

• Demerits are still in place. If your provider wrongly suspends your payment, you should make sure that the demerit is removed. This is to ensure that if payment reductions and cancellations return, your payment is not affected.

• If you don’t meet “mutual” obligations requirements you could have your payment suspended after 5-business days if you do not contact your provider.

• Providers have been told about these changes. If they threaten you with a payment reduction or cancellation they are lying. We urge you to contact the National Customer Service Line on 1800 805 260, via nationalcustomerserviceline@dewr.gov.au or use the form on the Workforce Australia website https://www.workforceaustralia.gov.au/individuals/contact-us/ to lodge a complaint.

• Based on information provided to the Antipoverty Centre, we do not expect payment reductions and cancellations to be returned in the foreseeable future.

For more detailed information about how this affects you, see the Workforce Australia website:

• Landing page for updates about issues with the TCF: dewr.gov.au/assuring-integrity-targeted-compliance-framework

• Statement from the secretary: dewr.gov.au/assuring-integrity-targeted-compliance-framework/announcements/secretarys-statement-21-march-2025

---

Crisis support and counselling services

If you need support you can seek guidance, counselling or crisis help from the below organisations or talk to someone you trust.

• Suicide Call Back Service – general: 1300 659 467

• Roses in the Ocean – peer support: 1800 777 337

• SANE Australia – general: 1800 187 263

• 13YARN – for First Nations people: 13 92 76

• National Counselling and Referral Service – for disabled people: 1800 421 468

• Headspace – for young people: 1800 650 890

• QLife – fo LGBTQIA+ people: 1800 184 527

• Full Stop – for people who have experienced sexual harassment and assault: 1800 385 578

• Embrace Mental Health – multilingual service: embracementalhealth.org.au

• MensLine – for men: 1300 789 978

• Brother to Brother – for First Nations men: 1800 435 799

1. See statement from the secretary: dewr.gov.au/assuring-integrity-targeted-compliance-framework/announcements/secretarys-statement-21-march-2025

2. See reporting in the Saturday Paper: thesaturdaypaper.com.au/news/politics/2025/02/15/exclusive-ten-dead-after-welfare-glitch-ignored-government

3. See reporting in the Saturday Paper: thesaturdaypaper.com.au/news/2025/03/08/the-federal-governments-failure-deliver-welfare-debt-reform

4. See Department of Employment and Workplace Relations data: dewr.gov.au/employment-services-data/job-seeker-compliance-data

5. See DEWR data: https://www.dewr.gov.au/employment-services-data/job-seeker-compliance-data