Appendix D - Data matching
The legal authority for data-matching is governed by the Data-matching Program (Assistance and Tax) Act 1990. Under section 12 of the Act, participating agencies are required to table reports in both houses of the parliament.
Data-matching program (Assistance and Tax) Act 1990
The legal authority for data-matching is governed by the Data-matching Program (Assistance and Tax) Act 1990. Under section 12 of the Act, participating agencies are required to table reports in both houses of the parliament. This appendix covers the progress of the programme for the department for 2014-15.
Data-matching program objectives
The Data-matching Program aims to:
- detect people who may be receiving incorrect payments from an income support agency
- verify the accuracy of customers’ income declared to agencies that make income support payments
- encourage voluntary compliance including:
- deterring people from attempting to claim payments to which they are not entitled
- the voluntary surrender of payments to which people may not be entitled
- the voluntary disclosure of changes in circumstances which affect rates of payment
- identify debtors who have resumed receiving an income support payment
- detect fictitious or assumed identities
The programme plays an important role in identifying dual payments and undeclared or understated income that cannot be detected by other control measures. It is part of the department’s comprehensive system of controls that enables us to detect incorrect payments and fraud.
The Data-matching Program (Assistance and Tax) Act 1990 specifies that a programme cycle must be completed within two months of its commencement and that a new cycle cannot begin until the previous one has finished. No more than 9 cycles may be conducted each year. During 2014-15, 4 cycles were conducted.
The programme operates within a framework of comprehensive and strict privacy safeguards that cover the collection, storage, use and disclosure of personal information. Close attention is paid to adhering to these requirements. The main safeguards associated with the programme ensure that:
- the Data-Matching Agency (DMA) does not hold source agency data for any longer than necessary
- source agencies cannot link or merge the information used in the programme to create a new, separate, permanent database of information
- the source agency data used is as up-to-date as possible
- data received and generated by the DMA is protected by strict physical and system security arrangements
- source agencies establish reasonable procedures for confirming the validity of results
- people are advised of the existence of the programme and the use of their information when they begin receiving a payment or service from an assistance agency
- people are contacted only when the department cannot explain a discrepancy by examining their records
- information no longer required is destroyed
The department continued to monitor the operation of the programme closely, in consultation with other participating agencies and the Office of the Australian Information Commissioner (OAIC). Monitoring is undertaken in a variety of ways including regular reports, OAIC audits and ongoing project analysis.
This section contains the statistical details required under guideline 12 of the Schedule to the Data-matching Program (Assistance and Tax) Act 1990. The information is divided into two parts. The first part, which has been compiled for the DMA, details the input and output from the programme cycles. The second part outlines the action taken by the department on discrepancies.
The legislation requires that the following information processed by the DMA be provided:
- the total number of matches undertaken
- the number and proportion of matches that resulted in discrepancies
Discrepancies can result from invalid Tax File Numbers (TFNs), identity matching or payment and income matching. Table 80 shows the DMA input and output for programme cycles in 2014-15. Table 81 shows the number and proportion of matches that resulted in discrepancies and outcomes for the same period.
|Department||Matches undertaken||DMA output||DMA output as a percentage of total departmental matches|
|Department of Human Services||106,881,052||2,270,183||2.1%|
|Department of Veterans’ Affairs||1,393,782||15,811||1.1%|
Many people will have more than one component including married, maiden or previous legal names. For the Department of Veterans’ Affairs, maiden and married names are separated into two records after receipt by the DMA.
|Discrepancies which resulted in a notice under section 11 of the Data-matching Program (Assistance and Tax) Act 1990 being sent1||3,039|
|Discrepancies which resulted in action being taken2||17,985|
|Cases in which action proceeded despite a dispute about the accuracy of the data3||101|
|Discrepancies which did not proceed to action after the individual was contacted4||4,777|
|Cases where an overpayment was identified5||23,675|
|Cases where recovery action was initiated6||21,087|
|Cases where the debt was fully recovered7||17,006|
1. Section 11 of the Data-matching Program (Assistance and Tax) Act 1990 requires that people must be given written notice of any proposed action as a result of information gained through the programme. People have 28 days to respond.
2. Following the completion of a cycle, departments undertake further refinements before releasing the discrepancies for follow-up action. These refinements are to reduce the number of unproductive discrepancies that are released.
3. In any year a small number of people challenge the accuracy of the information on which the proposed action is based—usually because they do not fully understand conditions of eligibility for payment.
4. There will always be a number of cases where people are sent a notice of proposed action but the action does not proceed. In these cases people or a third party such as an employer are able to provide details to show that the payments received were correct.
5. The number of overpayment cases identified, including the number of debts waived.
6. The number of cases where recovery action was commenced on a debt. The department recovers debts in two ways, either through withholding part of a customer’s entitlement or through cash repayments.
7. Recovery of a debt can take place over a number of years and the number and value of debts raised in a year does not necessarily correspond to the number and value of recoveries.
This section sets out the savings and other benefits of the Data-matching Program.
It includes details of direct savings in outlays and the actual direct costs of the programme. See Table 82 on page 262 for cost-benefit information.
Direct savings methodology
There are three direct savings components from the programme:
- downward variations in rate or the stopping of payments
- raised debts
- ceasing payments to new customers for failure to comply with TFN requirements
The programme is also used to match details of former customers of each assistance agency who owe a debt to the Australian Government. Detection of these customers means that withholdings can be made from their current entitlement to assist in repaying their debt.
Direct savings achieved
In 2014-15 the Data-matching Program achieved $163.2 million in savings compared to $154.7 million in 2013-14.
Direct cost methodology
Administrative costs included computer and associated costs—the equipment used to run the programme cycles has some ongoing administrative costs associated with computer hardware and software maintenance.
The programme’s main salary costs were costs associated with:
- managing and supporting the programme within the department
- the department’s network review activity, including its management and coordination
Direct cost-benefit summary
When the costs and benefits (direct savings) are compared, the net benefits of the programme are significant. In 2014-15 the net benefit of the programme was $134.6 million, compared to $132.7 million in 2013-14.
1. Net savings, including the effect of upward variations.
2. Calculated by subtracting costs from benefits.
3. Calculated by dividing benefits by costs.
The events listed below include data-matching cycles run in accordance with the Data-matching Program (Assistance and Tax) Act 1990 and consultation with the OAIC in 2014-15.
- 28 July 2014 Cycle 3/2014 commenced
- 19 August 2014 Step 5 of Cycle 3/2014
- 26 August 2014 Cycle 3/2014 completed
- 24-25 July 2014 OAIC staff audited teams from Business Integrity
- 20 October 2014 Cycle 4/2014 commenced
- 10 November 2014 Step 5 of Cycle 4/2014
- 17 November 2014 Cycle 4/2014 completed
- 6-7 November 2014 OAIC staff audited teams from Business Integrity
- 2 February 2015 Cycle 1/2015 commenced
- 23 February 2015 Step 5 of Cycle 1/2015
- 2 March 2015 Cycle 1/2015 completed
- 4 May 2015 Cycle 2/2015 commenced
- 25 May 2015 Step 5 of Cycle 2/2015
- 1 June 2015 Cycle 2/2015 completed
- 24-25 June 2015 OAIC staff audited teams from Business Integrity