Annual Report 2002–03 Volume I

Departmental outputs

Cost

For every dollar spend on administered items under Output Group 3.2 in 2002–03, 4.7 cents were spent on departmental outputs.

Policy advice

Quality—Client satisfaction

Ministers and their offices did not provide feedback on individual output groups but did provide feedback on departmental performance as a whole. Information on ministers’ and their offices’ assessment can be found in Part two—Ministerial and parliamentary services.

Technical quality of policy advice for Outcome 3—Satisfactory.

Quantity

267 ministerial submissions and other written briefings or advice prepared; 848 ministerial replies to correspondence completed.

Price

Purchasing, funding and relationship management

Quality—Assurance

The Business Partnership Agreement with Centrelink sets out key result areas and performance measures that apply to payments and services for Output Group 3.2. Centrelink monitors performance against agreed standards for the delivery of services and provides quarterly performance reports to FaCS.

Service providers’ performance is monitored through regular reports specified in funding agreements. All service providers meet the term and conditions of funding.

Service agreements/contracts that meet legislative, government policy and FaCS requirements are in place with all service providers

Such agreements are in place with all providers.

Quantity

Price

Research and evaluation

Quality—Assurance

Research and evaluation during 2002–03 met the timelines, terms of reference and used sound methodology. All research and evaluation was of a consistently high standard.

Quantity

Price

Service delivery

Quality—Assurance

All service providers delivered services to agreed disability services standards.

Quality—Client rights and obligations

Mechanisms common across most payment types for detection and control of incorrect payment and fraud are described in the section on Right payments to the right people.

In 2002–03, an interrogation of the Centrelink mainframe data indicated that 584 697 DSP, Wife Pension (DSP) and Sickness Allowance reviews were completed. Some 84 308 rate reductions resulted in fortnightly savings of $8 152 677 and 88 445 upward variations resulted in fortnightly increases of $3 440 177. It is estimated that some 33 264 debts totalled $77 396 797. Performance outcomes for debt recovery and prosecution activity are reported in the section on Right payments to the right people.

Significant increases in the numbers of reviews reported over previous years’ results reflect a widening of the definition of what constitutes a review rather than an increase in underlying review activity.

Rehabilitation services—CRS Australia

Effectiveness—Capacity

New clients assisted: 22 704

Existing clients assisted: 13 188

Percentage of clients achieving a durable employment outcome after a completed rehabilitation program

Of the 12 043 clients who completed a vocational rehabilitation program, a total of 7290 (60.5 per cent) achieved an employment outcome of 13 weeks or more. The remaining 4753 (39.5 per cent) completed a program with a secondary outcome (for example, study or voluntary work) or with a non-employment outcome (for example, seeking work-work ready, seeking work—not work ready).

Effectiveness—Targeting

Quality—Assurance

CRS Australia provides services under and in accordance with Part III of the Disability Services Act 1986, and under the terms and conditions set out in its service level agreement with FaCS. CRS Australia delivered services to the standards agreed under the service level agreement for rehabilitation services.

CRS Australia successfully completed the accreditation process under the recently introduced quality assurance framework for disability employment and rehabilitation services. Of all clients responding to the CRS Australia feedback survey, 88 per cent rated CRS Australia service as good to excellent, with 59 per cent rating CRS Australia as excellent.

Quantity

CRS Australia was contracted to provide assistance to 32 688 eligible clients (consisting of 19 500 new clients +/- 5 per cent and 13 188 existing clients) in 2002–03. CRS Australia exceeded this requirement with 22 704 new clients in addition to existing clients receiving programs.

Price

$2.9 million—Other

$116.3 million—CRS Australia

Output Group 3.3 I Support for Carers

Contribution to Outcome 3

helping to support carers through the provision of income support and income supplement payments.

Strategies

Maintain policies that encourage the social and economic participation of carers, including voluntary or paid work and study

Provide carers who wish to re-enter the labour market with assistance while in the caring role and when their caring responsibilities cease

Increase community awareness of Carer Payment programs and other support for carers provided by the Government.

Outputs under Output Group 3.3

Carer Allowance

Carer Payment

Performance summary

Key achievements included:

recommencement of the Carer Information and Coordination Group and broadening of its terms of reference to foster a whole-of-government approach to carer issues

completion of the report of the Carers Voice Steering Group. Minister Vanstone agreed to establish the National Family Carers Voice (NFCV) on the recommendation of the Carers Voice Steering Group. The NFCV will be established for two years to provide advice to the Minister about the nature, location and circumstances of family carers, and about how to meet the longer-term needs of family carers.

publication of the Young Carers Research Project Report undertaken by Carers Australia with funding from FaCS.

Work is required to:

support the work of the National Family Carers Voice

progress the issues raised in the Young Carers Research Project

complete the review of Carer Allowance customers of children quarantined from medical assessment for five years from 1 July 1998

review the Carer Allowance (child) lists of recognised disabilities

begin evaluation of the Adult Disability Assessment Tool.

Financial and staffing resources summary

b Budget prior to additional estimates.

c FaCS includes the Social Security Appeals Tribunal.

Performance information

Administered items

Carer Payment and Carer Allowance

Effectiveness—Adequacy

Carer Allowance is indexed against the CPI on 1 January each year.

Carer Payment is adjusted twice a year in line with the CPI. After the CPI adjustment, if the single pension rate (excluding the component added in as part of the new tax system) is less that 25 per cent of MTAWE, it is increased to that level with a proportional flow-on to the partnered rate of pension. Rent assistance is also indexed to the CPI.

Effectiveness—Independence

Effectiveness—Take-up/coverage

80 926 Carer Payment care receivers

337 508 Carer Allowance care receivers, including 183 955 adults and 153 553 children under 16 years (including 15 192 Health Care Card only)

Effectiveness—Targeting

Quantity

177 251 received Carer Allowance (adult)

119 003 received Carer Allowance (child)

2 744 received both Carer Allowance (adult) and Carer Allowance (child)

11 749 received Carer Allowance (child) Health Care Card only (also 611 ‘not coded’)

75 937 received Carer Payment

Price

$702.6 million—Carer Payment

Commentary

demographic changes, such as the ageing of the population and an associated increase in the incidence of people suffering from a disability

a reduction in access to other forms of income support, such as widow pensions and increase in the Age Pension age for women

greater public awareness of these two payments

the increase in numbers of people with disabilities and medical conditions being cared for at home

the liberalisation of the qualification criteria for Carer Payment.

Departmental outputs

Cost

For every dollar spend on administered items under Output Group 3.2 in 2002–03, 1.2 cents were spent on departmental outputs.

Policy advice

Quality—Client satisfaction

Ministers and their offices did not provide feedback on individual output groups but did provide feedback on departmental performance as a whole. Information on ministers’ and their offices’ assessment can be found in Part two—Ministerial and parliamentary services.

Technical quality of policy advice for Outcome 3—Satisfactory.

Quantity

64 ministerial submissions and other written briefings or advice prepared; 283 ministerial replies to correspondence completed.

Price

Purchasing, funding and relationship management

Quality—Assurance

The relevant areas in FaCS and Centrelink negotiated the Disability and Carers Output Specification for 2002–03. It establishes performance measures for the delivery of carer payments and services that FaCS purchases from Centrelink. This specification forms part of an overarching Business Partnership Agreement between the two organisations. A framework was developed to monitor and report against agreed standards for delivering services.

The FaCS and Centrelink Business Partnership Agreement is in place. All contracts, as outlined below, satisfy the requirements.

Quantity

1—Business Partnership Agreement with Centrelink

1—Centrelink, through the FaCS Business Partnership Agreement.

Price

Research and evaluation

Quality—Assurance

Research and evaluation in progress met the timelines and terms of reference, and used sound methodology. All research and evaluation was of a consistently high standard.

Quantity

Price

Note: This figure reflects residual operating expenses related to underlying research and evaluation activity as determined under the FaCS output costing model.

Service delivery

Quality—Assurance

The Business Partnership Agreement with Centrelink sets FaCS’ key result areas and performance measures for carer program payments. Centrelink monitors performance against agreed standards for the delivery of services.

Quality—Client rights and obligations

Mechanisms common across most payment types for detection and control of incorrect payment and fraud are described in the section on Right payments to the right people.

In 2002–03, an interrogation of the Centrelink mainframe data indicated that 165 309 Carer Payment reviews were completed. It is estimated that some 10 895 rate reductions resulted in fortnightly savings of $1 259 975 and 10 619 upward variations resulted in fortnightly increases of $274 153. Some 3 783 debts totalled $8 307 992. Performance outcomes for debt recovery and prosecution activity are reported in the section on Right payments to the right people.

Significant increases in the number of reviews reported over previous years’ results reflect a widening of the definition of what constitutes a review rather than an increase in underlying review activity.

Price

$15 million—Centrelink

Output Group 3.4 I Support for the Aged

Contribution to Outcome 3

assisting retirees to make the best use of savings and investment to maintain their standard of living

helping support the aged with limited means through the provision of income support

providing information and fostering opportunities for mature-age people to participate in their community.

Strategies

Contribute to an adequate, sustainable and appropriately targeted social safety net through the means test and policy directions that focus on older Australians

Enter into international and social security agreements to enable Australians to gain access to overseas pensions and domestic benefits that would be otherwise unavailable

Influence the policy debate about population ageing issues and retirement income issues

Provide recognition for the contribution made by older Australians to building the community

Outputs under Output Group 3.4

National Information Centre on Retirement Investments Inc (NICRI)

Support for the aged

Age Pension

Widow B Pension

Wife Pension (Age)

Pension Bonus Scheme

Self-funded Retirees’ Supplementary Bonus

FaCS seniors publications

Over 335 000 copies of the publications were distributed during the 2002–03 year.

Telephone Allowance to Commonwealth Seniors Health Card holders

Performance summary

Key achievements included:

research designed to test FaCS seniors publications. Reaction to the publications was extremely positive in all respects

major contribution to the development of Commonwealth legislation to prohibit age discrimination

influencing the policy debate around retirement incomes through submissions to two parliamentary enquiries—the Senate Select Committee Inquiry into Superannuation and Living Standards in Retirement and the Senate Select Committee on Superannuation Inquiry into Planning for Retirement—and input into the House of Representatives Standing Committee on Ageing’s Inquiry into long-term strategies to address the ageing of Australia’s population over the next 40 years.

Work is required to:

develop policy responses to the effects of population ageing and long-term demographic change. including through work with other departments

further influence policy debate through effective stakeholder consultations

continue working with Centrelink to implement recommendations in relation to payment accuracy from the November 2002 Australian National Audit Office (ANAO) Audit of Age Pension Entitlements.

Financial and staffing resources summary

b Budget prior to additional estimates.

c FaCS includes the Social Security Appeals Tribunal.

Performance information

Administered items

National Information Centre on Retirement Investments

Quantity

addressed 71 retirement or Financial Information Service seminars (60 Financial Information Service, 11 other). Feedback was very positive.

distributed 145 568 information leaflets on types of investment, financial planning and preparation for retirement

responded to 4401 telephone and 53 email inquiries from the general public, financial advisers or Financial Information Service officers.

maintained a web site at www.nicri.org.au that was accessed 16 593 times.

Price

Commentary

Support for the Aged: Age Pension, Widow B Pension, Wife Pension (Age), Pension Bonus Scheme

Effectiveness—Adequacy

The maximum basic rate and pension supplement for Age Pension, Wife Pension (Age) and Widow B Pension are indexed twice a year in line with the CPI. If after CPI adjustment the maximum basic rate is less than 25 per cent of MTAWE, it is adjusted up to that benchmark with proportional flow on to the partnered maximum basic rate.

Effectiveness—Independence

with government pension as principal source of income

The Age Pension represents a large proportion of most people’s retirement income. Australian Bureau of Statistics (ABS) figures show that the proportion of income units relying on pensions and benefits as their principal source of income where the person is aged 65 years or more fell from 75 per cent in 1999-2000 to 71 per cent in 2000-01:

74.1 per cent in 1996-97

73.4 per cent in 1997-98

74.7 per cent in 1999-2000

70.6 per cent in 2000-01.

ABS 2000-01 data show the proportion of income units headed by a person aged 65 years and over with government pension contributing to less than:

50 per cent of their income—29.3 per cent

20 per cent of their income—17.8 per cent

1 per cent of their income—11.6 per cent.

Effectiveness—Independence

In June 2003, 95 per cent of persons receiving Age Pension, 94 per cent of women receiving Wife Pension (Age) and 81 per cent of women receiving Widow B Pension had assessed private income from sources other than their pension. Across all payment types included in Table 67, assessed income made up on average 24 per cent of total income (including pension).

In 2003, 94 per cent of people receiving Age Pension had income from their own savings, the annual average being $1070. The proportion of age pensioners receiving income from superannuation was 13 per cent. The annual average income from superannuation rose from $6088 to $6153.

Table 67: Percentage of clients with assessable income and their average assessed income

	2000-01		2001-02		2002–03
	$	Per cent	$	Per cent	$	cent
Single age pensioners	3005	91.5	2811	91.8	2932	91.8
Partnered age pensioners	3476	97.6	3336	97.8	3458	97.8
Wife pensioners (Age)	2411	94.5	2200	94.4	2266	94.4
Widow B Pensioners	2574	80.7	2541	80.7	2928	80.7

Percentage of age pensioners with assessed income greater than $500 p.a.

62.8 per cent in 1999-2000

66.2 per cent in 2000-01

62.9 per cent in 2001-02

63.7 per cent in 2002–03.

Ratio of assessed income to total income

$24.70 of assessed income to every $100 of total income in 1999-2000

$25.90 of assessed income to every $100 of total income in 2000-01

$24.00 of assessed income to every $100 of total income in 2001-02

$24.10 of assessed income to every $100 of total income in 2002–03.

Percentage on part-rate due to means tests

Average reduction per part-rate pensioner

$96.20 per fortnight in 1999–2000

$94.80 per fortnight in 2000–01

$102.35 per fortnight in 2001–02

$103.32 per fortnight in 2002–03.

Effectiveness—Take-up/Coverage

Percentage of estimated aged population who are clients

Quality—Access and choice

Access for target or special interest groups

Almost 45 per cent of Age Pension customers are single and tend to be older than partnered pensioners. Since single pensioners do not have a partner to share living expenses with, they are more likely to receive a full-rate pension than partnered pensioners (72.9 per cent compared with 61.7 per cent).

An increasing proportion of people receiving Age Pension are those born overseas. As at June 2003, 38.2 per cent of Age Pension customers were born overseas.

Figure 18: Percentage of Age Pension customers born overseas, June 1993 to June 2003

Quantity

Number of clients assisted

1 854 012 people paid Age Pension

20 230 women paid Wife Pension (Age)

2986 women paid Widow B Pension.

In addition, the Department of Veterans’ Affairs paid Age Pension on behalf of FaCS to 7043 people and Wife Pension (Age) to 89 people.

Number of clients paid Rent Assistance

10.1 per cent (177 419) of Age Pension clients were paid Rent Assistance

7.9 per cent (1798) of Wife Pension (Age) clients were paid Rent Assistance

10.2 per cent (580) of Widow B Pension clients were paid Rent Assistance.

As at June 2003, 26 813 Age Pensions were paid under agreements (excluding New Zealand and the United Kingdom) averaging $3548 per year per client. An additional 6587 Age Pensions were paid under the agreement with New Zealand at an average of $8890 per year per client and 1372 were paid under the agreement with the United Kingdom averaging $4809 per year per client.

As at June 2003, 3466 Wife (Age) Pensions were paid under agreements (excluding New Zealand and the United Kingdom) averaging $3816 per year per client. An additional 21 Wife (Age) Pensions were paid under the agreement with New Zealand at an average of $9159 per year per client and two were paid under the agreement with the United Kingdom averaging $3211 per year per client.

As at June 2003, 383 Widow B Pensions were paid under agreements (excluding New Zealand and the United Kingdom) averaging $5102 per year per client. An additional five Widow B Pensions were paid under the agreement with New Zealand at an average of $10 910 per year per client.

As at 30 June 2003, 55 161 people had registered in the scheme. In 2002–03 a total of $41 721 122 was paid in bonuses to 5646 people.

Price

$39.8 million-Widow B Pension

$195.1 million-Wife Pension (Age)

Self-funded Retirees’ Supplementary Bonus

The claiming period for the bonus ended on 30 June 2001. The price reflects the amount outlaid in 2002–03 in claims for the bonus which had been submitted but not processed by 30 June 2002. The overall average payment to recipients of the bonus was $1719.

Price

Commentary

Telephone Allowance to Commonwealth Seniors Health Card holders

Quantity

246 994 (87 per cent of all card holders)

Price

Departmental outputs

Cost

For every dollar spend on administered items under Output Group 3.4 in 2002–03, 1.2 cents were spent on departmental outputs.

Policy advice

Quality—Client satisfaction

Ministers and their offices did not provide feedback on individual output groups but did provide feedback on departmental performance as a whole. Information on ministers’ and their offices’ assessment can be found in Part two—Ministerial and parliamentary services.

Technical quality of policy advice for Outcome 3—Satisfactory.

Quantity

100 ministerial submissions and other written briefings or advice prepared; 1045 ministerial replies to correspondence completed.

Price

Purchasing, funding and relationship management

Quality—Assurance

FaCS ensures that service providers meet terms and conditions of funding.

Agreement with Centrelink

External agreements

Quantity

Price

Research and evaluation

Quality—Assurance

Research and evaluation in progress, met the timelines, terms of reference and used sound methodology. All research and evaluation was of a consistently high standard.

Quantity

Price

Service delivery

Quality—Assurance

Service providers deliver services to the standards agreed with FaCS

Financial Information Service

There are approximately 125 FIS officers throughout Australia. Between July 2002 and June 2003, FIS officers had conducted 201 955 calls and 73 277 interviews. Over the same period 74 198 people attended FIS seminars. The seminars are increasingly focused on assisting and encouraging pre-retirees to commence planning for retirement.

Quality—Client rights and obligations

Mechanisms common across most payment types for detection and control of incorrect payment and fraud are described in the section on Right payments to the right people.

In 2002–03, an interrogation of the Centrelink mainframe data indicated that 519 801 Age Pension, Wife Pension (Age) and Widow B Pension reviews were completed. It is estimated that some 95 673 rate reductions resulted in fortnightly savings of $4 669 778 and 118 082 upward variations resulted in fortnightly increases of $2 597 759. Some 21 063 debts totalled $50 103 346. Service profiling was introduced gradually during 2002–03. The above figures represent a total of program reviews and service profiling updates for the financial year. Performance outcomes for debt recovery and prosecution activity are reported in the section on Right payments to the right people.

Significant increases over previous years’ results reflect a widening of the definition of what constitutes a review rather than an increase in underlying review activity.

Price

$1.8 million—Other