The Commonwealth Ombudsman is investigating the cancellation of income support payments after advocates warned technology glitches and slowdowns had exposed a broken system and that some cancellations were unlawful.
The investigation was revealed on Tuesday by Commonwealth Ombudsman Iain Anderson, who rarely makes public statements before having a formal report in hand.
The probe will focus on the Department of Employment and Workplace Relations (DEWR) and Services Australia’s cancellation of income support payments under the Targeted Compliance Framework (TCF).

Running since 2018, the TCF is the mechanism by which participants’ income support may be suspended, reduced or cancelled.
It purports to increase job seeker compliance with mutual obligations – tasks like applying for jobs or attending training that must be completed while seeking employment to receive payments. Failure to comply can trigger automated payment suspensions or cancellations, which critics say give little regard to individual circumstances.
A Parliamentary inquiry in 2023 found Australia’s current approach to mutual obligations is “ineffective, self-defeating, and needs reform” but stopped short of calling for a voluntary system.
DEWR paused mutual obligations last month because of multiple technology issues, reigniting advocates’ calls for an extended freeze to investigate the TCF.
An earlier technology issue in November forced jobseekers to adjust their reporting methods or risk losing their support payments, with the message delivered through “not very helpful” automated emails that DEWR later apologised for.
The tech issues followed revelations earlier in 2024 that income support payments may have been cancelled unlawfully or inappropriately, which remains under review by DEWR.
The Ombudsman is now conducting its own inquiry into the TCF to determine whether “income support payments may have been cancelled unlawfully or inappropriately”, Mr Anderson said.
“My Office conducts its investigations in private and I generally do not make a public statement in the absence of a formal report,” he said. “However, in the current circumstances, I believe it is in the public interest to share my plan to investigate this matter.”
The Australian Council of Social Service (ACOSS) had pushed for the inquiry in the wake of the payment cancellations and tech issues, while warning the system was “broken” and failing thousands of vulnerable people.
“This investigation into this harsh and potentially illegal compliance system is urgently needed,” said ACOSS CEO Dr Cassandra Goldie.
“Payment suspensions and cancellation have extremely harmful impacts on people, including not only the loss of income but also potential homelessness, relationship breakdown and destitution. The fact they may be happening illegally is extremely serious.”
The Ombudsman investigation has begun before the Parliament has passed new laws that will compel agencies and officials to cooperate with Ombudsman inquiries.
The new laws were triggered by the failure of Ombudsman inquiries to expose the illegal Robodebt scheme.
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