Minister Rishworth should not be restarting a penalty system that has been found to operate unlawfully. Cutting off a person’s income for four weeks is unfair, disproportionate and serves no purpose other than punishment, especially when these decisions are being made as part of a system that has such a troubling history of unlawfulness.
Members of the Department of Employment and Workplace Relations’ Targeted Compliance Framework Reference Group strongly oppose compulsory activities for people on Centrelink payments, and the Government’s plans to restart some payment cancellations and suspensions under the problematic framework.
In an update on Tuesday 4 August 2026, the Secretary of the Department of Employment and Workplace Relations set out a timeline to progressively resume penalty provisions that are currently paused, including payment cancellations and suspensions for people who do not meet often unreasonable, oppressive compliance requirements. The update confirmed me penalty provisions are now scheduled to recommence from 26 October 2026, with others to recommence early 2027.
These penalties were paused because the Department failed to administer the law correctly.
The Commonwealth Ombudsman found 964 people had their income support unlawfully cancelled between April 2022 and July 2024, and warned the consequences for people affected were potentially “catastrophic”. A second Ombudsman’s report found more than half of the penalty recommendations made by private employment services organisations were later overturned. However, this occurred after people had already been forced into financial crises, with the report finding the Albanese Government’s approach to remediating people harmed by the Government’s unlawful system was neither fair nor reasonable.
Independent analysis by Economic Justice Australia found more than 300,000 people were potentially affected by unlawful payment cancellations, with DEWR recently admitting “It’s in the vicinity of that” during a Senate Estimates hearing. Throughout the period since unlawful cancellations were identified, most payment suspension penalties have remained in place and have been used millions of times to punish people.
Losing income support has catastrophic consequences for people in poverty, causing significant distress, putting strain on relationships and derailing people as they try to manage complex challenges or make progress towards their goals. It means going without food, missing rent and potential homelessness. Aboriginal and Torres Strait Islander people are disproportionately affected by the welfare penalties framework. The framework also applies to many people using disability employment services. Putting these penalties back in place means there will be more harm to people affected by racial and disability discrimination. Penalties like these have no place in a system that is supposed to help people into paid work.
We are particularly concerned that the Government is moving to restart these penalties while it is simultaneously consulting on broader employment services reform as well as undertaking consultations on Governments’ use of automated decision-making. Trust in these services cannot be re-built if punitive measures such as payment cancellations and suspensions are retained in the reformed system.
The lessons of the Targeted Compliance Framework are clear: punitive financial penalties cause harm, deepen poverty and undermine trust. Building a better employment services system requires leaving behind failed and coercive policies such as compulsory activities and investing instead in proper support and genuine pathways to employment.
We call on the Government to:
- Remove the Targeted Compliance Framework immediately, including payment suspensions and financial penalties.
- Provide full back-pay and compensation to every person affected by unlawful decisions.
Signatories
- Members of the Targeted Compliance Framework Reference Group:
- National Aboriginal and Torres Strait Islander Legal Services (NATSILS)
- Antipoverty Centre
- Australian Council of Social Service (ACOSS)
- Economic Justice Australia
Quotes attributed to CEO of ACOSS, Dr Cassandra Goldie AO:
“Removing income support payments for four weeks pushes people to the brink and does absolutely nothing to help them find paid work.
“The Ombudsman has now twice found that these unlawful cancellations under the Targeted Compliance Framework and a remediation process were neither fair or reasonable. People who are already in severe financial distress struggling on poverty-level Jobseeker at $400 per week will again face an oppressive and punitive system of sanctions and penalties.
“The Government has said it wants to reform employment services so people are genuinely helped into paid work. Restarting harsh, unreasonable penalties sends the opposite message to the people whom these services are meant to support. We strongly opposed the Targeted Compliance Framework when it was first introduced by Minister Cash under the Coalition Government. It should be abolished once and for all.”
Quotes attributed to Antipoverty Centre co-coordinator, Kristin O’Connell:
“The decision to prioritise turning cancellations back on is extraordinary negligence on behalf of Amanda Rishworth, who is responsible for both the wellbeing of welfare recipients and the lawful administration of welfare compliance rules. She is ignoring every alarm bell that is ringing about the widespread misuse of payment suspension penalties by privatised employment services, which are inflicted millions of times a year.
“The bottom line is, we have zero confidence in DEWR’s capability and competence to know whether they are operating this system lawfully, and it will never be possible to fully protect the safety and wellbeing of people in poverty while compulsory activities remain.”
Quotes attributed to Economic Justice Australia CEO, Kate Allingham
“Last year, our own analysis revealed that roughly 310,000 people had had their payments cancelled illegally. Time and time again, our Member Centres hear from people who are not able to pay rent, or who cannot afford to eat, when their payments are suspended without notice. The fact that people’s lives are being put at risk because of catastrophic flaws within a Government system should trigger a crisis response, but that is not what we have seen happen.
“The Government has recently committed to a suite of reform measures to employment services, and we urge them to ensure a thorough overhaul of how the system operates and to ensure discretion is applied by human beings who take the time to understand a person’s circumstances before making decisions that directly affect their ability to survive. It is hugely important that any decisions related to people’s essential payments are subject to procedural fairness, oversight and review.”
Quotes attributable to National Aboriginal and Torres Strait Islander Legal Services General Manager, Nick Espie
“The Ombudsman’s Office has found that Aboriginal and Torres Strait Islander people have been grossly and disproportionately impacted by the unfair Targeted Compliance Framework. Of all people who had their welfare payments unlawfully cancelled between April 2022 and July 2024, 46% were Aboriginal and Torres Strait Islander people.
This is another example of systemic and structural racism at play, and demonstrates a significant failure of the Government to take measures to improve the economic prosperity and social and emotional wellbeing of Aboriginal and Torres Strait Islander people under the National Agreement on Closing the Gap.”
