Exclusive: 161 homeless or at risk welfare recipients were hit with a financial sanction between July and September

This article is more than 1 year old

This article is more than 1 year old

Nearly 20,000 people considered homeless or at risk of losing their accommodation were handed at least one “demerit point” – a warning that often comes with a temporary payment suspension – in the first three months of the government’s welfare compliance regime.

Government data also shows 94 people with a “homelessness” indicator in their case file were kicked off income support for four weeks due to a “work refusal” or “unemployment failure”. In total, 161 homeless or at risk welfare recipients were hit with a financial sanction between July and September last year.

Of the more than 50,000 people considered homeless or at risk across five welfare programs, 19,371 or 39% had received between one and five demerit points, according to a demographic breakdown.

Life on the breadline: 'Writing these articles have given me a reason for being' | Gavin Ritchie Read more

The data, contained in documents tabled during Senate estimates last year and analysed by Guardian Australia, also shows more than 300 people considered homeless or at risk had already received enough demerit points to be handed a financial sanction. They would face a future financial penalty – such as having a fortnight’s payment docked or being kicked off welfare – for further infringements.

Centrelink includes a vulnerability indicator in a jobseeker’s file if it is believed their circumstances could impede their ability to meet their mutual obligations. Providers are supposed to consider these factors when creating job plans and when deciding whether to impose a penalty on a welfare recipient.

The government introduced the demerit points system as part of a broader welfare reform package that it said would make the system fairer while saving $204m over four years.

The points are issued to welfare recipients for missing or turning up late to an appointment or failing to meet other activity requirements unless they have a “reasonable excuse”. Those who receive demerit points also often have their payment cut off until they “re-engage” with their employment services provider.

Under the new regime, jobseekers lost the ability to appeal their providers’ decision with the Department of Human Services until they have racked up five demerit points.

Advocates for the unemployed argue this has placed too much power in the hands of private providers, citing figures that show Centrelink staff overturned their demerit points decisions in about 50% of cases.

That discrepancy is also contained in the data analysed by Guardian Australia, which shows 1,348 (or 51%) of Jobactive participants with a homelessness indicator were deemed incapable of meeting their job plan when their circumstances were reviewed by Centrelink.

Welfare groups were outraged by the figures. Cassandra Goldie, the chief executive of the Australian Council of Social Service (Acoss), said the Department of Jobs and Small Business had assured the peak body its “serious concerns” about the new regime “were unfounded”.

“It is grossly unacceptable for people to have their payments cut for up to four weeks at a time where this will lead to severe hardship and homelessness,” she told Guardian Australia.

Jenny Smith, the CEO of the Council To Homeless Persons, said the new figures supported the peak body’s “worst fears” about the new regime, while the Australian Unemployed Workers Union’s Jeremy Poxon called on the government to restore the right of welfare recipients to appeal decisions made by their provider.

The opposition, which has earmarked Jobactive for reform if it wins government, also said it was “gravely concerned”.

“The Morrison government must explain what it is doing to avoid leaving people destitute,” said Labor’s employment services spokeswoman, Terri Butler.

ParentsNext: single mothers say they were forced to allow 'sensitive' data to be collected Read more

The Greens’ spokeswoman, Rachel Siewert, said the government was outsourcing to “private contractors who make millions of dollars to implement ineffective and punitive programs that ultimately punish people on income support”.

A spokesman for the Department of Small Business defended the new regime, saying it gave jobseekers “more opportunities to demonstrate their particular circumstances, situation and capability to meet their requirements”.

He said providers were “required to take into account both vocational and non-vocational barriers when setting a jobseeker’s mutual obligation requirements. This includes factors such as homelessness and access to technology”.

“Jobseekers may still be required to undertake mutual obligations, however these should be set in a manner that is commensurate with their ability to actively search for employment,” he said.

The minister for jobs, Kelly O’Dwyer, was contacted for comment.

Overall, there were 503,098 people across the five welfare programs – including Jobactive, Work For the Dole and Disability Employment Services – between July and September last year, according to the data. About 360,000 had not received a demerit point.