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Appendix C: Data Matching Program

The Data Matching Program is a program of computer matching of identity and income data held by certain government agencies, including DVA, to detect incorrect payments in the income support system.

The legal authority for the data matching is contained in the Data-matching Program (Assistance and Tax) Act 1990 (Data-matching Act). The Office of the Australian Information Commissioner oversees the implementation of the Act through guidelines for the conduct of the Data Matching Program.

Section 12 of the Act requires participating agencies to provide annual and three-yearly reports to Parliament on the operation of the program. DVA's most recent three-yearly report was submitted in 2016 and the next one will be submitted in 2019.

This appendix focuses on the operation of the program within DVA in 2016–17.

For a full explanation of the progress of the Data Matching Program within DVA, this report should be read in conjunction with previous data-matching annual reports.

Program overview

The Data Matching Program identifies cases where there is a risk of incorrect payment through:

  • detection of invalid tax file numbers (TFNs)
  • identity matching, which detects fictitious or assumed identities
  • payment matching, which detects people who may be in receipt of incorrect or dual payments from the same or different agencies, where the receipt of one payment precludes or limits payment of the other
  • income matching, which detects instances where the income information disclosed to DVA differs from the income declared to the Australian Taxation Office (ATO).

Section 6 of the Data-matching Act allows agencies to conduct up to nine data-matching cycles in a year, with only one cycle in progress at a given time. Each data-matching cycle has six steps, as detailed in section 7 of the Act.

Five Australian Government departments participate in the program: DVA, the ATO, the Department of Education and Training, the Department of Human Services (DHS) and the Department of Social Services.

The ATO provides details of identity and tax data of people in receipt of income support payments for comparison with the details provided by the other agencies.

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Data-matching investigations

This section provides a summary of how DVA acts on discrepancies identified through data matching.

Invalid tax file numbers

DVA actions all discrepancies found through detection of invalid tax file numbers by contacting the client and obtaining the correct number.

Identity matching

DVA actions all discrepancies found through identity matching by correcting administrative errors, investigating anomalies that may potentially be fraudulent or seeking the correct identity details from the client and providing those details to the ATO so that the ATO can correct its records.

Payment matching

DVA runs payment matching in one data-matching cycle each year, solely to confirm the validity of the checks and balances conducted currently within the Department.

Income matching

Income matching is run in every cycle by the Department. Income discrepancies are selected during this process for further investigation.

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Deselection of cases

There are no exclusions from data matching within the Department. However, deselection is applied to ensure that the same discrepant case is not picked up in more than one cycle each year.

Analysis

Discrepant cases are analysed before any investigation is undertaken to ensure the integrity of the data provided, to identify areas for improvement of selection, and to ensure all data-matching business rules are applied.

Investigations

All investigations of discrepancies involve examination of the client's DVA electronic records and then, if necessary, hard-copy records. Any administrative errors are corrected at this stage without the client needing to be contacted.

If the discrepancy remains after the initial checking, the client is sent correspondence in accordance with section 11 of the Data-matching Act, requesting further information and documentation to assist with the investigation. Clients are given 28 days under the Data-matching Act to comply, then a further seven days based on the Evidence Act 1995.

In cases where the initial investigation has revealed potential fraud, the investigator may apply subsection 11(4), and not send a section 11 letter as it may prejudice the effectiveness of an investigation into the possible commission of an offence.

Based on the information that the client provides, the payment rate is corrected and, where appropriate, overpayments are calculated, raised and recovered.

Further information may be obtained from Commonwealth, state or territory government or private agencies to help ascertain the correct client details.

The client's right to privacy is protected at all times by application of the Australian Privacy Principles (under the Privacy Act 1988), which governs the collection, storage, use and disclosure of personal information.

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Actions under the Data-matching Act

This section contains information required by paragraphs 9(i) and 9(vi) of the Data-matching Program (Assistance and Tax) Guidelines.

Table C1 details the discrepancies in 2016–17, and the ensuing actions.

Table C1—Actions under the Data-matching Act
Discrepancies and actions 2016–17
Total number of records read 1,082,216
Number of matches that resulted in discrepancies1 7,930
Proportion of matches that resulted in discrepancies 0.73%
Number of discrepancies referred for investigation 2,571
Number of discrepancies referred for investigation that resulted in a notice under section 11 of the Act being sent 147
Number of cases where the section 11 letter was followed up by action being undertaken2 131
Proportion of discrepancies that resulted in action being taken 1.65%
Proportion of discrepancies which did not proceed to action after a section 11 letter was sent 10.88%
Number of overpayments raised3 146
Number of cases where debt was fully recovered4 156
Number of pensions cancelled, suspended or reduced 145
Number of pensions that were continued 56
Number of pensions that were increased 9

Data-matching Act = Data-matching Program (Assistance and Tax) Act 1990

  1. Discrepancies include those resulting from detection of invalid tax file numbers, identity matching, payment matching and income matching. The number of discrepancies does not represent the number of pensioners: more than one discrepancy may be detected in respect of the same pensioner.
  2. Refers to the action set out in section 10 of the Act—a pension was reduced, cancelled, increased or continued.
  3. Overpayments raised include some for cases where section 11 action took place in a previous financial year.
  4. Figure includes debts fully recovered from previous financial years.

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Prosecutions

Reviews of entitlement by the Department may bring to notice cases where an offence may have been committed under the Veterans' Entitlements Act 1986, the Safety, Rehabilitation and Compensation Act 1988, the Military Rehabilitation and Compensation Act 2004, the Social Security Act 1991, the Criminal Code Act 1995, or the Crimes Act 1914.

The Department's role in the prosecution process is to investigate cases where it appears an offence may have been committed and to forward these cases, if warranted, to the Commonwealth Director of Public Prosecutions (CDPP) for a decision as to whether prosecution action should proceed. Depending on the type of investigation required, a case may be referred to the Australian Federal Police for further investigation.

Any suspected fraud cases detected are referred to the Personnel, Security and Investigations Section within the People Services Branch for an initial case assessment, prioritisation and further action, if appropriate.

Where sufficient evidence is obtained from an investigation, the Personnel, Security and Investigations Section makes recommendations to senior management on the appropriateness of referring the matter to the CDPP.

Table C2 details the prosecutions prompted by the Data Matching Program in 2016–17.

Table C2—Prosecutions prompted by the Data Matching Program
Cases 2016–17
Cases referred to the Personnel, Security and Investigations Section identified through data matching 1
Cases referred to the CDPP identified through data matching -
Cases successfully prosecuted -
Cases dismissed by the CDPP due to insufficient evidence or not in the public interest -
Cases with the CDPP pending consideration -
Cases still under investigation by the Personnel, Security and Investigations Section1 1
Cases finalised by the Personnel, Security and Investigations Section without CDPP referral 1

CDPP = Commonwealth Director of Public Prosecutions

  1. Figures may include cases that were identified in previous financial years.

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Costs and benefits

This section contains information required by paragraph 9(i) of the Data-matching Program (Assistance and Tax) Guidelines.

The Department's involvement in the program has shown substantial savings can be gained through comparison of data held by different agencies.

Expenses

Table C3 sets out the costs to DVA of operating the program in 2016–17.

Table C3—Costs to DVA of operating the program ($)
Costs 2016–17
Salary costs 93,051
Administrative overheads 26,153
Support costs for data-matching processing system 1,547
Total 120,751

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Projected savings

DVA calculates savings for clients whose payments are suspended, cancelled or reduced. For clients in receipt of a pension, it is assumed that they would have continued to receive the same rate of payment for 52 fortnights. These savings are in line with the methodology used by DHS to calculate savings.

Table C4 and Table C5 set out the pension adjustments resulting in projected savings, and the total savings achieved in 2016–17. Table C6 shows savings achieved through the program in the past three years.

Table C4—Pension adjustments resulting in projected savings
Pension adjustments 2016–17
Number of pensions reduced 122
Number of pensions suspended/cancelled 23
Total 145

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Table C5—Total savings achieved through the Data Matching Program
Detail 2016–17
Number of pensions cancelled or reduced/suspended1 145
Number of potential overpayments identified2 102
Number of overpayments raised3 146
Number of debts fully recovered 156
Value of overpayments raised $997,939
Debts waived or written off -$12,586
Subtotal $985,353
Value of projected savings $766,222
Total gross savings $1,751,575
Departmental expenses -$120,751
Net savings $1,630,824
  1. The number of cases that result in projected savings. Although a person's pension may be cancelled, reduced or suspended, an overpayment may not necessarily exist.
  2. Where a case officer believes there may be an overpayment, a potential debt identifier is registered. The figure reflects the number of potential debts identified.
  3. The discrepancy between the number of overpayments identified and the number of overpayments raised is due to several factors:
    • Where a potential overpayment has been identified, further investigation may result in a determination that no debt existed.
    • Debts may be raised and consequently recovered separately for both members of a couple.
    • Overpayments raised during each financial year may have been identified in previous financial years.

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Table C6—Cumulative savings achieved through the Data Matching Program ($)
Detail 2014–15 2015–16 2016–17
Value of overpayments raised 1,033,967 1,236,951 997,939
Debts waived or written off -4,717 -27,680 -12,586
Value of projected savings 770,929 579,490 766,222
Total gross savings 1,800,179 1,788,761 1,751,575
Departmental expenses -195,961 -171,598 -120,751
Net savings 1,604,218 1,617,163 1,630,824
Cumulative net savings 28,914,928 30,532,091 32,162,915

Note: For full explanation of previous years' savings, this table should be read in conjunction with previous data-matching annual reports.

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