I am providing a further update on the department’s work under the Targeted Compliance Framework Integrity Assurance program.
This program encompasses independent and internal reviews and activities to assure the integrity of the administration of the Targeted Compliance Framework that applies to people required to meet mutual obligations.
The Targeted Compliance Framework can lead to decisions which have an impact on people’s experience of the employment services system and critically, their social security payment.
Under this program, the Department has paused certain decisions which reduce or cancel a person’s social security payments for failing to meet mutual obligation requirements.
Further decisions
The department has taken the precautionary step to pause decision making under section 42AG of the Social Security (Administration) Act 1999 (Administration Act) which applies to cases where a person refuses or fails to accept an offer of suitable employment, including accepting but not commencing a job. These decisions were paused on 5 July 2025 and will remain paused while work is underway to determine whether the decision-making processes align with the legislative framework.
Newly released information
The Department has been providing updates to its website on this work. Today the department has updated this material to provide further information about:
- Compensation paid or backpay to some people impacted by decisions which cancelled their social security payments for persistent mutual obligation failures and for unemployment failures (payment cancellations under section 42AF(2)(d) and 42AH of the Administration Act respectively).
- Numbers of people who may have been impacted by some of the decisions which are now paused under the Targeted Compliance Framework.
There have been media reports concerning people who may have had a payment cancellation under section 42AM of the Administration Act. I want to provide some information about the circumstances in which people receiving a social security payment may have had their payments cancelled as a result of not meeting a reconnection requirement.
People who don’t meet mutual obligation requirements are notified that they must contact their provider or the Digital Services Contact Centre to understand the steps they need to take to avoid their payment being suspended. They now have 5 days to take those steps to avoid their payment being suspended. However, if those steps are not taken and their payment is suspended, they continue to be notified and reminded of a requirement to reconnect with employment services to avoid payment cancellation. People in this cohort are contacted up to 4 times through various communication methods over approximately 4 weeks, before their payment would have been cancelled.
There are a range of reasons a person may not re-engage with employment services, including where they no longer require a social security payment as they have found work or decided to study. Previous data published by the department, noted that a large majority of people who did not reconnect with the employment services system reported being employed three months later. This analysis suggests that many people who do not re-engage within the time notified to them may not have experienced detriment as a result of the cancellation of payments.
Decisions under consideration
The effect of decisions taken by the Department is that all payment reductions and payment cancellations made as a result of mutual obligations failures under the Social Security framework are paused.
The Department is progressing consideration of the nature and approach to compensation that may be appropriate with respect to other decisions that are currently paused.
I will not take any decision to resume social security payment reductions or cancellations unless and until it can be clearly demonstrated that the process to support the decision making complies with the law.
Independent assurance review
Reviews are underway to ensure that decisions are taken in a lawful and robust manner.
This includes a legal review and an independent assurance review which has examined the IT system operating the framework against policy and business rules.
The independent assurance review was published on the Department’s website on 14 August 2025, with an accompanying statement.
There have been media reports indicating concerns about citation accuracies which were contained in these reports.
Deloitte conducted this independent assurance review and has confirmed some footnotes and references were incorrect.
A correct version of the statement of assurance and final report has been released.
The department continues to focus efforts on addressing the substance and recommendations included in the report.
Bringing the TCF into lawful operation
The Ombudsman’s findings and recommendation from its investigation into the Targeted Compliance Framework and the Independent assurance review undertaken by Deloitte make a number of important findings and recommendations, including areas for urgent action and longer-term improvements.
The department is taking immediate steps to address the urgent actions identified, including:
- Strengthening assurance processes between DEWR and Services Australia to ensure the decisions to pause all payment reductions and cancellations are being upheld.
- All processes that might impact a person’s payment are being tested, mapped end to end, clearly documented and assured.
- Any IT changes are limited to only essential changes, thoroughly tested before implementation, and focused on improvements that are beneficial to participants.
- Governance and assurance mechanisms have been strengthened to confirm that any changes are aligned with law, policy and operations.
Background
Over the past year, in response to concerns that the TCF system was not operating in alignment with the law and as intended, the department has established the TCF Integrity Assurance Program.
Under this work, we are actively working to consider what needs to change to ensure appropriate transparency and discretion is applied to decisions that impact a person’s social security payment.
I will not take any decision to resume social security payment reductions or cancellations unless and until it can be clearly demonstrated that the process to support the decision making complies with the law.