Reforms and rationalisation of the Human Services delivery agencies

Budget Review 2011-12 Index

Budget 2011–12: Reforms and rationalisation of the Human Services delivery agencies

Peter Yeend and Michael Klapdor

The 2011–12 Budget announced several initiatives to reform and update business operations and information technology (IT) inside the Department of Human Services (DHS).  These reforms largely have their origins in the rationalisation of several separate government service delivery agencies announced in December 2009.[1]  Those reforms involve the incorporation of two major service delivery statutory agencies, Centrelink and Medicare Australia, into the DHS.  Another agency affected by this budget initiative, the Child Support Agency (CSA), which is responsible for the delivery of the Child Support Scheme, is already a part of the DHS.

The DHS initiatives funded in the Budget include:

  • a new organisational structure amalgamating the business operations of Centrelink, Medicare Australia and the CSA
  • the provision of a single point of telephone and website contact for all Centrelink, Medicare Australia and CSA customers
  • integrated and automated online business operations allowing customers to interface with the three different service delivery arms through a single access point
  • the physical and administrative integration of the different service delivery arms of the DHS and
  • the integration of the IT elements of the three service delivery agencies.[2]

Legislation for the rolling in of Centrelink and Medicare Australia into the DHS, the Human Services Legislation Amendment Act 2011, was recently passed by Parliament and is awaiting Royal Assent.[3]

IT rationalisation and savings

While there are other elements of administrative rationalisation in these Budget initiatives, the budget reforms feature a rationalisation and amalgamation of the IT functions and services of these agencies.

That the rationalisation of these separate agencies into the one DHS would realise savings should not come as a surprise. In particular, it will be cheaper to support these currently separate businesses with a centralised IT service. The scale of their business activities and their reliance on IT to conduct their business is substantial.  In 2009–10, Centrelink serviced 7.02 million customers, provided $84.2 billion in payments, had 32.7 million phone calls, sent out 113.8 million letters and had 85 million website visits.[4]  It is one of the biggest business operations in Australia.  Similarly, Medicare Australia is a significant operation and in 2009–10 provided $40 billion in benefits, received 15.3 million phone calls and had 7.8 million website visits.[5]

Further IT and business rationalisation?

The intention of these measures is to ‘provide customers and staff with a complete picture of a customer’s interactions across the portfolio’, and will see both consenting customers and DHS staff accessing the customer’s different accounts through a single transaction.[6]  The Government has maintained that it is only the IT platforms that are being brought together and not personal information, that is, unless individuals request information sharing for their own convenience:

We are bringing IT platforms together, not information itself. Apart from the limited data that is already shared between agencies like Medicare and Centrelink, no more information will be shared, unless the individual concerned asks us to share the information for their convenience. Personal health information is of particular sensitivity for most people, which is why we have excluded health information from these reforms.  That’s not to say we are closing our minds to the advantages or benefits of the agencies’ closer integration for people who deal with us regularly. If, for example, you inform Medicare of a change of address, we’ll ask if you would like us to let other parts of DHS know.[7]

However, it is possible that notwithstanding current intentions, over time there may be pressures on future governments to find further efficiencies by reconciling any differences in customer records as well as streamlining the databases.  However, it should be noted that any reconciliation of personal information on the different databases could not be achieved without amending the statutes which govern these. In view of the amount of personal information held on these databases such a possibility could give rise to questions about information security, and concerns about the protection of privacy.

[1].       C Bowen, Address to the National Press Club, ‘Service delivery reform: designing a system that works for you’, Canberra, 16 December 2009, p. 10, viewed 12 May 2011,

[2].       Australian Government, Budget measures: budget paper no. 2: 2011–12, Commonwealth of Australia, Canberra, 2011, pp. 250–255, viewed 12 May 2011,

[3].       For more information on this Bill see P Yeend, Human Services Legislation Amendment Bill 2010, Bills digest, no. 82, 2010–11, Parliamentary Library, Canberra, 2011, viewed 12 May 2011,

[4].       Centrelink, Annual report 2009–10, ‘Centrelink overview’, Canberra, 2010, p. 8, viewed 12 May 2011,

[5].       Medicare Australia, Annual report 2009–10, Chapter 1: Overview, Canberra, 2010, p. 7, viewed 12 May 2011,

[6].       Budget measures: budget paper no. 2: 2011–12, op. cit, p. 251.

[7].       C Bowen, Address to the National Press Club, ‘Service delivery reform: designing a system that works for you’, op. cit., pp. 20–21.