Senate Finance and Public Administration Legislation Committee, , 8:30:52 to 9:01:02
Services Australia discusses workforce management, potential staffing redundancies, and the processing of aged care hardship provisions.
Topics: Public service staffing, Social services, Health
Speakers: Penny Allman-Payne, David Hazlehurst, James Paterson, Hon Katy Gallagher, Stuart Turnbull, Chris Birrer, Karen Grogan, Speaker 4, Speaker 41, Speaker 44
I would like to welcome Mr. David Hazlehurst, Chief Executive Officer of Services Australia and other members of Services Australia team who have joined us today. Mr. Hazelhus, would you like to make an opening statement? which case, we'll go straight to questions and we'll go to Senator Paterson.
>> Thank you, Chair. Um, Mr. Hazlehurst, what's your current ASL that services
>> Uh, I'll invite my uh CFO to join me and c to join me at the table, but I can kick us off on that. Um, it's uh the most recent numbers are 3 thou 34,019, I think. No, that's not right.
Okay, I'll
>> let you answer the question. >> I'm thinking of headc count. That's actually head count rather than ASL.
Just just >> get both record.
>> Uh Senator Randle Brujo, chief operating officer. Um our ASL as at 31st of December 2025 was 30,912.
>> Thank you. Uh how many of them are subject to the terminating measure the minister was referring to in the with
I might see >> our CFO may be able to help.
>> Good afternoon. Angela Diamond, chief financial officer. Sorry, can I ask the question? Have you to repeat the
question? hearing what the ASL numbers at Services Australia are and I asked how many of those employees are subject to the terminating measure for Services Australia that the minister was talking about in the previous session. You might not have heard it but
that there was 4,241
Obviously uh that ceases that particular measure, but that is something obviously as part of our budget process we'll
>> So has Services Australia put in a bid to government to continue to employ those 4,241 people? Uh, Senator, that >> I'm just asking about whether Service Australia has put forward a proposal, not what the government's decisions
>> Yeah. And Services Australia and um, you know, all matters relating to the portfolio will be considered uh through the budget process.
>> Sure. But 4,241 people as of today don't know whether they're can going to continue to be employed beyond 30 June.
>> Um we well uh we we agreed to some funding to uh support the work Services Australia does uh and subjected that to further consideration by ERC and that will be done. Um and you know those decisions will be taken and any updates will be provided in the budget
>> but but not until May and you know the budget will be roughly 6 weeks before the end of financial year. I mean presumably these people would like more than 6 weeks notice to know whether they're going to continue to be employed at Services Australia or not.
>> Well um Services Australia manage their workforce um at their decisions for Mr. Hazlehurst and the team. But I can tell you that uh the any decision that's going to be made by government will be made and and reported through the budget process.
>> What what have you told these employees about uh the nature of their ongoing employment with Service Australia? What
>> Well, Senator, that the employees aren't earmarked as associated with that measure. They were employed as APS staff. Mhm. >> Uh and so whatever decisions are taken by government in the coming months, uh we will then uh manage manage that that those decisions in in a way that um is leads to a smooth outcome in terms of both the employment of staff and of course their own performance.
>> But they have contracts presumably. Do their contracts expire on June 30?
No, Senator, they were employed as permanent APS staff consistent with the
>> So, if this funding is not renewed, >> what happens to them?
>> Uh, we manage the fundings across the whole agency and we would need to uh work out how to absorb those reductions across the agency. If that was to occur,
>> you'd have to have redundancies of some kind, wouldn't you?
>> Well, we're getting into hypotheticals here. I mean,
>> not really. Yeah. like I'm sure >> service Australia has had to contemplate what to do here if this doesn't continue. It would be irresponsible not to um plan for this contingency.
>> Well, we've been working uh for some time with services Australia over um you know the raising resourcing requirements for the organization >> matched matching the resourcing requirements with the delivery outcomes the government is is wanting to see. We've seen significant improvement in timeliness of delivery of payments and services. Um these these additional resources were put on to manage you know increased demand and backlog of work that were had existed. Uh and the government took the decision then to consider what the ongoing kind of essentially baseline resourcing that was required for services Australia and that work has been ongoing. Um, it's not something that's done in six weeks or uh two months. It's done over a longer period of time and we've been doing that throughout the year.
>> I assume that's the case. That's why I think they should be able to answer presumably they're not going to come up with a plan. Service Australia is not going to come up with a plan in 6 weeks to deal with 4,241 people who are no longer funded to work at Services Australia. Presumably, it's something you've discussed at the executive level at Services Australia,
most I can really say about that is that you, as you would expect, we would seek to manage that in a way that [clears throat] had a smooth outcome. Whatever the outcome ends up being, >> uh, it would be in no one's interests for it to happen in a way that created a shock to the institution.
>> Sure.
>> So, beyond that though, I don't think I'm really at liberty to discuss further what what plans, if any, we have at this >> Why not? because they're subject to budget consideration.
>> The whether or not they're funded are subject to budget consideration, but what you do about it, you would have to have planned for be grossly responsible not to have planned for that.
>> Well, he's answered that question. >> Um, when you you manage, you know, a large organization like this, um, you know, you're managing staffing pressures all the time. >> Sure. And you know
>> this is more than 10% of the services Australia workforce
>> which was never funded under your government and we've come in and again tried to find what a what a realistic baseline of of resourcing is for services Australia. That work has been comprehensive and will be considered further by government.
>> Sure. I I don't think talking points about the previous government though are going to help these 4,241 people who have an uncertain future until the government makes a decision. And so, Mr. Haz, what would be the impact on your ability to deliver services if you had to uh remove 10 more than 10% of your
I suppose it's uh obvious to say that if we went back to the level of resourcing that we were before, you would expect to see a deterioration in our performance. >> That's why the funding was provided in the first place.
>> Yep. But it's a terminating measure about which the government hasn't made a decision. So what contingency plans do you have in place to maintain the quality of service as best you can if you lose that many people?
Uh well, we'll just we'll manage the resourcing against the uh in the way that we do as a national uh service delivery organization to achieve the best outcomes we can >> and as I say the approach to implementing whatever the outcome is would be one that we would do in a in a way that smoothed out those impacts.
>> Sure. But
>> so that they wouldn't be experienced if
>> the funding disappears on one July. I mean, how much smoothing can you do?
>> Well,
>> well, if if if there's a lot of hypotheticals there, like
>> just one actually and and not a
>> some of your other questions have been
>> Not a very um you know, outrageous one given that we just don't know whether or not this measure is going to terminate >> So, I mean, is it your position, Mr. Hazlehurst that you'll make a decision after the budget or that you'll start planning or preparing for this after the budget or have you been planning and preparing for it with in advance of the
>> Senator, as the government makes decisions on things, of course, then we're in a position to then confirm how we're going to implement them. >> Um, I'm sure you would know that decision-m process occurs over a number of months well before the budget. M >> uh so as that becomes clear we will make >> smooth application of whatever the decision is >> uh and you would expect to see that happen over a number of months and with a change that's quite big it would potentially be longer than that >> if it were a change that was quite big and as the minister has said that is hypothetical at this stage.
>> Um so were you saying that you would hope to know before the budget uh what direction this is going in? You'll have a sense even before the budget is handed down what direction this is going in.
>> Yes, of course. Before the budget, the decision-m processes of the budget are not a secret. They happen as in the decision-m process is not a secret. It happens progressively over a number of months.
>> Sure. But
>> and and once those decisions have been taken, they're not yet announced. >> Mhm. And of course the government reserves the right to change them if it if it chooses to [clears throat] >> but we would then like with any other measure.
>> Yeah.
>> Uh we would then be working towards implementing them.
>> So it'll only be public on budget night but you might have known for a number of weeks or months that the government's decided not to do this
>> like any measure.
>> Yeah. I think for any around a whole >> for any department on any measure once a decision is taken departments are informed so that they can prepare the necessary papers and and statements and financial input for the budget papers. So >> you know departments are you know advised as those decisions are taken.
>> So when are you going to let services Australian I assume you haven't yet.
Well, it'll be in accordance with normal budget processes.
>> Will that be a week before the budget, a month before the budget? How how much lead time that you're going to give
>> Senator, the minister. >> I feel like I'm channeling Senator Corman here again. >> I have to get him on the hotline.
>> I mean, this is like a very significant proportion of the workforce that has both implications for those people and for people who rely on the services of services Australia. Um, I'm surprised that you seem relatively relaxed about this, Mr. Hazlehurst, that it just can be smooth, can be managed. I'm not sure how you could manage such a a big departure of people.
>> Well, it's a good thing he's the secretary then.
>> Well, I mean, we've made significant investments into services Australia since coming to government and
>> we might be about to take them away
again. We've seen the impact of those investments but it's reasonable I think for government to consider in an ongoing way really about you know the the resourcing requirements for um public service agencies. So we do that. Um and you know I think if you look at our record uh our record speaks to managing these things responsibly but you know going through the detail and considering all all of the um you know various pressures and resourcing needs.
>> But Minister you've ruled out a reduction in the ASL. So can't you rule out that these 4,000 people won't uh
lose their jobs? Senator Paterson, you will be um advised when the budget is
take. >> When are they going to
>> and on that point, Senator Paterson, we will rotate the call.
>> Okay.
>> hopefully you maintain this concern for public servants throughout your tenure as a shadow finance
>> Thanks, chair. Um my first question is in relation to support at home hardship provisions. Am I correct in my understanding that services Australia is the one that manages the operation of those?
>> We're certainly involved in that. Senator, yes join me at the table. Um
I'm interested to know since the change to support at home um what is the total number of people who've provi who've applied for hardship provisions.
Uh, Senator Stewart Tambble, acting deputy CEO Program Design Group.
>> Senator Bo Robertson. I'm the deputy CEO of the customer service delivery group. We'll have to take on notice uh the total number of claims that we've received over that period of time. Um, but I do have the total number of claims that we have on hand.
if you can tell me how many you've got on hand and then I might run through a list of of information that you might
need to take. I've got both. So, >> so this is from one November um so from the start of support at home and this is total hardship claims. So it would go across age care programs. Uh in the month of November we received 1,326 claims. >> Yep. And in the month of December, we received 1,272 claims. Uh if you go back um the months preceding that, um we were getting between 500 and 800 claims. So it has increased um as we anticipated.
>> All right. Thank you. Um now, so that's November and December. Um, do you have figures to hand for January?
>> I don't, Senator. No, not yet.
>> All right. Can I get those on notice, please? Um, I'm also interested to know then what percentage of people in receipt of support at home do those numbers represent? So, I'm not sure if you can give that to me now, whether you need to take that.
>> We'd have to take that on notice. As I said, um that figure would include different types of age care. Uh to give you an indication, um so for support at home, we send out about 303,000 transition letters. >> Um so that's an indication of the total total customer base.
>> Yes. so of the numbers that you've given me >> are they that's applications how many of those have been approved?
>> Uh so Senator um I can give you a statistic for in the December quarter approved and rejected claims. >> So in that quarter we approved 68% 68.4% 4%. Uh we rejected 24.3% and 7.3% were withdrawn in that period. So that's sorry I should say that's the month of December. >> Um the quarter ending December the statistics were very similar. So 67.7% approved, 24% rejected and 8.3% withdrawn.
when you've got those January figures, would you be able to just put that in a breakdown of um number of people who've applied for hardship provisions per month? Um breakdown per month of the number of approvals just so we can see that picture. Thank you. That'd be very helpful. Um what is the average amount of time it's taking for someone to have their hardship provisions approved?
Uh so we have that in here. It's uh 20 as at 31 December 2025. It was 22 calendar days.
>> And do you know what the median time is?
>> No. I'd have to
>> on on notice. Could I get the median and also the 90th percentile for time for approvals? Okay. Um, is Services Australia receiving a high volume of correspondence and calls regarding hardship provision? So, are you tracking how many inquiries you're getting around those?
Uh Senator, we don't have the details on the specific inquiries related to hardship, but we certainly given the scale of the reform have seen an increase in in customer demand, just general inquiries.
>> Okay. All right. Thank you. Um I now want to move to um heat waves. So um not sure who you need at table. Maybe I'll start my first question. Um Mr. Mr. Hazlehurst and then you can tell me who else needs to be there. Um, uh, I'm I'm interested in this is around the criteria for pausing compulsory activities. So that's what the questions relate to, but specifically to heat waves. Um, so my first question is, heat waves are the deadliest natural hazard in Australia, causing more deaths than cyclones, floods, and bush fires combined. And my initial question is why are heat waves not included in the department's criteria for pausing compulsory activities when other hazards
>> Uh Senator firstly uh I think this is a question you'll need to direct to
>> Jer
>> to Ju.
I might leave it there actually and I might actually go to Ju. Do you have any involvement at all in the guidance that's provided around those things? What is the extent of services Australia's role? I guess in in relation to the pausing of compulsory activities.
>> We will activate we will help to activate the pauses. Um
>> do you make the decision around the pauses? Who makes the decision?
>> Uh the department makes the decision. Um there would be communications like if we have on the ground intelligence >> um we would discuss that at various levels. Um but those decisions to pause mutual obligations that's that's a matter for the department. They'll make the decision and then we'll enact the decision.
>> Okay. All right. I might I might take pause on those. It's so much easier when you're all in the same room. Um all good. Um All right. All right. So, I have some questions about um the social security and other legislation amendment bill that's come into the house and particularly schedule three. Um the explanatory memorandum says that the schedule introduces rules for how partners' income should be considered for the purposes of working out the recipient's rate of payment. Um are you able to explain to me what what the schedule one in that bill is seeking to
responsibility for that sits with the Department of Social Services. Um, >> Services Australia is the delivery arm.
>> Yep, I understand that. >> Um, I guess I Well, I'll ask you my next question. My next question is, does the change in that bill mean that Services Australia had previously been attributing partner income without clear statutory authority?
My understanding of that one is no. It it doesn't mean that um uh DSS will be able to explain further, but as we understand it, this is simply about removing any ambiguity and clarifying the requirements as they're currently applied. Um but yeah, it it's not um demonstrating any non-compliance at present.
>> Okay. Um do you know how many um recipients have been affected by the ambiguity in the legislation? No, >> Um, when did Services Australia become aware that they'd been attributing partner income without this clear unambiguous statutory authority?
>> I think you're going to have to Sorry, Senator. I think these questions will need to be directed to the department later in the week.
in relation to the legal compliance and remediation program that services Australia that's developed that. Okay, how about I jump straight to that? >> and thank you very much for the answers to the question on notice that were given to actually a question from Senator Whiteaker. um SAS SQ250036 um is the document that I'm looking at. I note that in April 2025, Services Australia established the legal compliance and remediation program to coordinate issues in the administration of payments and service. Do any of the schedules of the bill currently in the House seek to address issues identified
>> Uh hi hi Senator Chris Berup, deputy CEO payments integrity group. Uh yes, the the bill addresses two issues that are in the schedule. Uh one relating to the 35% care issue and the child support program and the other relating to to urgent payments. But um as uh as Mr. Turnbull articulated earlier that uh the Department of Social Services has been leading the policy work and in the legislative work relating to that bill.
>> Yeah. Um I know um you've said that the things in schedule one and two so um child support urgent payments are dealt with in that legislation. And that legislation also has a third schedule being around the partner income test. Um in relation to um as far as I can see that question on notice that has the schedule that those changes to the partner income test are not on that remediation program. Um are they part of that program or are they something
>> Uh and I don't have anything to add other than what Mr. Turbo mentioned earlier that um the services Australia understanding is that it's a clarification of uh of a provision in the act and the the genesis of that is best directed the department of social services.
>> Okay. So it's not on your schedule of your program of remediation I guess is what I'm trying to get.
>> That's correct.
>> Okay. I'll go to DSS with a couple more things. Have some questions around call center operations with services Australia. Um do you still have some call center operations that are being conducted by external contractors?
>> Yes, we do. Senator um Miss Robinson Robertson join us at the table for that.
>> Sorry to make you backwards and
we have we have arrangements with what we call service delivery partners which um M. Robertson can some more detail on. If you pardon
>> SDPs,
>> correctdeed service delivery partners? Yes, Senator, we do um still have a contract with uh two providers that um
provide.
>> Pardon?
>> Who are those two?
>> TSA Australia is one and Concentrics is the other.
>> Okay. Um and what type of work is included in those contracts?
>> Uh they do our very high volume, low complexity, what we call to be tier one services. So general, very general information. Um most of it is digital related. So the staff are trained to coach customers uh to do their business um online either via my or any kind of online service. So it's very limited uh the type of work they do. At the moment they take about 60% of that call type. Um it is the kind of um entry way for staff coming into the agency. So we use that for training purpose for APS employees and it's very contained to that.
>> Okay. Um I is that work ongoing?
>> It is.
>> Okay. And when do the contracts to those
two companies end? uh they end um we signed a three-year contract on the 1st of July 2023 and so we are um considering our options now for whether or not we uh execute an extension.
>> So has a decision been made about whether they will be extended or whether work will be bought in house?
>> Not as yet. Just to give you a sense of it though, Senator, the there's about um around 700 y >> people engaged in that kind of way against a total service delivery workforce of between 20 and 23,000. >> So, it's it's a modest and increasingly has been a more modest um part of our workforce. We brought a lot of that work already inhouse. Um, in fact, you might recall from previous estimates I described that uh we we were a first mover on that and and it didn't get counted in the first reporting around the strategic commissioning framework. Um, but we actually brought several thousand staff back in back in house.
>> So, I guess if I'm going to have to rotate the two questions and that's it and then I'm done and I'll be out of your hair. Yeah. Um, so what I'm interested in is depending on whether that work is brought inhouse or those contracts are extended, will that change the nature of the work
>> of that particular call type? No.
>> I guess of the work that they're doing, I guess. So, will it be a case that if the contract's not extended, it'll just be that people inhouse just pick up that work as it is?
>> That's correct.
>> Okay. Um, and is there a plan to manage that additional workload if it's the case that the contract's not extended?
>> Should we make that decision? Yes. So,
okay. And
>> as um, M. Robertson explained, um, that work is often high volume, low complexity work. And we tend to use that as a way to um provide the initial experience of people coming in as permanent employees, but they then move on to more complex work. Um so at one level we want to actually reserve >> um for the our ongoing staff the more complex work that we invest more training into. Um the advantage of the service delivery partners too is we can use them for kind of flex.
>> That's right.
>> Which is which is a bit different.
>> So what's the time frame for making a decision around that contract extension? Does the contract itself have a time frame for when the contractors need to be notified about when when those contracts are renewed or not?
>> Yeah, we're we're actively um having a look at whether or not we uh extend their contract now, Senator.
>> Okay. So, the time frame,
>> so the three-year contract ends in 20 in July 2026.
>> Yeah. And is there is there a term in the contract that states when the contractor must be advised if it will be renewed or not?
>> Um, I'll have to take that on notice.
>> Okay. Could you let me know? And if there is, can you tell us what that term is?
>> Sure.
>> Great. Thank you.