Extending mutual obligation—court-ordered fines and arrest warrants

Budget Review 2018–19 Index

Don Arthur

According to the original principle of mutual obligation, recipients of unemployment payments have obligations to search for work, take advantage of opportunities to improve their employability, and to work in return for income support.[1] Recipients who fail to meet their obligations can have their payments suspended or cancelled.[2]

Two new budget measures extend this principle to include obligations under state and territory laws—to deal with outstanding arrest warrants and to pay court-ordered fines. Including these as obligations for income support recipients is consistent with the Government’s view that dysfunctional behaviour and a failure to abide by reasonable social norms have become important causes of welfare dependence and entrenched poverty.[3]

These measures are subject to the passage of legislation.[4] They will also require extensive cooperation from state and territory governments. It is not evident whether the Australian Government has consulted with the states and territories before announcing this measure. The Queensland State Attorney-General is reportedly critical of the lack of consultation on the issue of data collection.[5]

The measures

Under the ‘Encouraging lawful behaviour of income support recipients’ measures, the Australian Government will work with states and territories to ensure people on income support pay fines and clear outstanding arrest warrants.[6]

These measures depend on the cooperation of state and territory governments. According to the Department of Social Services (DSS), the Government has yet to determine their feasibility. Each state and territory government will need to work out how to identify income support recipients targeted by the policy and how to provide this information to the Commonwealth.[7]

Arrest warrants

According to a DSS fact sheet: ‘From 1 March 2019, people receiving welfare payments with outstanding arrest warrants for indictable criminal offences will have their payment suspended or reduced by half if they have dependent children.’[8]

Recipients who clear their warrants within four weeks will have their payments reinstated from the date the warrant was cleared. Recipients who fail to clear their warrants within four weeks will have their payments cancelled.[9]

People who make a new claim or transfer between payments from 1 March 2019 will be required to provide information about any outstanding arrest warrants and agree to police checks. If they have an outstanding warrant and fail to clear it within seven days, their claim will be rejected.[10]

According to the DSS fact sheet the measure applies to people on ‘welfare payments’ but not to those receiving Farm Household Allowance or Department of Veterans’ Affairs payments. It is not clear which payments count as ‘welfare payments’.

What counts as an indictable offence varies between jurisdictions. They are generally serious criminal offences that are tried before a judge and jury (although some jurisdictions allow trial by judge alone).[11]

Court-imposed fines

A court-imposed fine is a monetary penalty imposed as the result of criminal proceedings. Under this measure, ‘welfare’ recipients with outstanding court-imposed fines will be encouraged to make repayment arrangements using Centrepay, a service offered by the Government whereby deductions can be made from Centrelink payments to cover regular bills and other expenses.

Centrelink will contact recipients with outstanding fines and encourage them to enter a repayment arrangement with the relevant state or territory government. If they fail to arrange repayment then Centrelink will make compulsory deductions to pay the fines.

This measure does not apply to debts to the Commonwealth such as Centrelink overpayments and tax debts.[12]


International experience

Similar requirements have been imposed in New Zealand, the United States (US) and the Canadian province of British Columbia.[13]

The US Social Security Administration experienced some difficulty obtaining and processing state government data.[14] It faced a number of lawsuits and responded by changing the way it administers the program. Congress is currently considering new legislation.[15]

Implementation has been more straightforward in New Zealand. Most recipients have their warrant cleared without a benefit suspension or reduction.[16] Unlike the US and Australia, New Zealand has only one level of government.

Court-imposed fines and vulnerable recipients

The National Social Security Rights Network and the Australian Council of Social Service argue that the court-imposed fines measure could push some vulnerable income support recipients into homelessness.[17] These groups appear to be concerned, not just with this budget measure, but with the appropriateness of fines being applied to vulnerable people.

Some groups are particularly vulnerable to accumulating unpaid fines. Agencies that deal with people with intellectual disabilities and mental illness argue that these groups often struggle with the system and that fines may not be an appropriate tool for reducing offending.[18] Indigenous people are also disproportionately affected by fines.[19] The National Aboriginal and Torres Strait Islander Legal Services (NATSILS) and the National Congress of Australia’s First Peoples have expressed concern about this measure.[20]

This suggests that if governments are going to work together to deal with the problem of offending by income support recipients, they could look at the problem more broadly and consider a wider range of options.


[1].          D Kemp (Minister for Employment, Education, Training and Youth Affairs), Unemployed young people to take responsibility for their future, media release, 28 January 1998.

[2].          Department of Human Services (DHS), ‘Mutual obligation requirements’, DHS website.

[3].          See A Tudge (Minister for Human Services), ‘Strengthening Australia’s social security safety net,’ speech to the Committee for Economic Development of Australia (CEDA), Sydney, 26 May 2017 and A Tudge, ’No child will live in poverty’—30 years later, a new direction: speech to the Centre For Independent Studies, Sydney, 20 July 2017.

[4].          DHS, Encouraging Lawful Behaviour of Income Support Recipients [May 2018].

[5].          N Bita, ‘Cop it sweet for dole’, Courier Mail, 10 May 2018, p. 1.

[6].          Department of Social Services (DSS), Encouraging lawful behaviour of income support recipients, fact sheet, DSS, Canberra, May 2018.

[7].          Ibid, p. 2.

[8].          Ibid.

[9].          Ibid.

[10].       Ibid.

[11].       LexisNexis, Encyclopaedic Australian Legal Dictionary

[12].       Department of Social Services (DSS), op cit.

[13].       Work and Income New Zealand (WINZ), ‘Arrest warrants’, WINZ website; United States (US), Office of the Inspector General (OIG), , ‘Fugitive Enforcement Program’, OIG website. Government of British Columbia (Canada), ‘Warrants’, Government of British Columbia website.

[14].       US General Accounting Office (GAO), Social Security Administration: Fugitive Felon Program could benefit from better use of technology, US GAO, Washington, 2002.

[15].       United States, Republican Policy Committee (RPC), ‘HR 2792, the Control Unlawful Fugitive Felons Act of 2017’, RPC website.

[16].       New Zealand, Privacy Commissioner, ‘Justice/MSD Warrants to Arrest Programme’, Privacy Commissioner website.

[17].       C Knaus, ‘Coalition's “brutal” plan to dock welfare for fines savaged by advocates’, The Guardian, 9 May 2018.

[18].       NSW SentencingCouncil, The effectiveness of fines as a sentencing option: court-imposed fines and penalty notices: interim report, 2006, p. 29. Include full title in link

[19].       M Spiers Williams and R Gilbert, ‘Reducing the unintended impacts of fines’, Current Initiatives Paper 2, January 2011.

[20].       National Aboriginal and Torres Strait Islander Legal Services (NATSILS), Federal Budget measures will create more legal need for Aboriginal and Torres Strait Islander people but no solutions, media release 9 May 2018. National Congress of Australia’s First Peoples, First peoples sacrificed in the name of budget surplus, media release, 9 May 2018.


All online articles accessed May 2018.

For copyright reasons some linked items are only available to members of Parliament.

© Commonwealth of Australia

Creative commons logo

Creative Commons

With the exception of the Commonwealth Coat of Arms, and to the extent that copyright subsists in a third party, this publication, its logo and front page design are licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Australia licence.

In essence, you are free to copy and communicate this work in its current form for all non-commercial purposes, as long as you attribute the work to the author and abide by the other licence terms. The work cannot be adapted or modified in any way. Content from this publication should be attributed in the following way: Author(s), Title of publication, Series Name and No, Publisher, Date.

To the extent that copyright subsists in third party quotes it remains with the original owner and permission may be required to reuse the material.

Inquiries regarding the licence and any use of the publication are welcome to webmanager@aph.gov.au.

This work has been prepared to support the work of the Australian Parliament using information available at the time of production. The views expressed do not reflect an official position of the Parliamentary Library, nor do they constitute professional legal opinion.

Any concerns or complaints should be directed to the Parliamentary Librarian. Parliamentary Library staff are available to discuss the contents of publications with Senators and Members and their staff. To access this service, clients may contact the author or the Library‘s Central Enquiry Point for referral.