Reducing the risk

10.47   An elder abuse strategy should have broad reach into all areas of social security that interact with older persons. The ALRC does not make proposals on the exact content of the strategy proposed at Proposal 10-1. The ALRC has, however, observed that there are knowledge gaps produced by Centrelink processes, and does make particular proposals to address these.

10.48   The ALRC proposes frontloading practical safeguards in areas that intersect with elder abuse.  This includes provision for direct and personal contact with older persons about to enter certain arrangements; clear articulation of the roles and responsibilities of people entering into these arrangements; and community education and staff training. These proposals aim to support older persons in protecting their rights in situations that interact with Centrelink and the social security system.

Direct contact principle

Proposal 10–2          Centrelink policies and practices should require that Centrelink staff speak directly with persons of Age Pension age who are entering into arrangements with others that concern social security payments.

10.49   Many arrangements involving Centrelink that are entered into by older persons arise because the older person has limited, intermittent or diminishing decision‑making ability or mobility. This is apparent in payment nominee arrangements when the principal is an older person, and when a carer for an older person qualifies for Carer Payment. The capacity or mobility of an older person may even be a driving factor to enter into a granny flat arrangement. The vulnerability of older persons entering into these arrangements heightens the risk of abuse, and invites a discrete Centrelink response.

10.50   Currently, Centrelink staff are not required to have direct personal contact with an older person entering into the arrangements discussed above. Accordingly, there may be little way for Centrelink to know whether the arrangement accurately reflects the will and preferences of the older person or whether the arrangement will leave the older person at risk of abuse. Stakeholders have suggested that greater involvement by Centrelink staff early in processes involving older persons may expose and prevent at‑risk situations.[73]

10.51   Payment nominee arrangements provide a stark example. Payment nominee applications are able to be done online via the ‘myGov’ website, in person at a Centrelink service centre, or by post or fax. On approval of a payment nominee application, Centrelink sends letters in the mail to the principal and nominee confirming the nominee appointment. This may not be enough to safeguard a principal against coercion or fraud, especially where the payment nominee applicant is also the person’s correspondence nominee.[74] Seniors Rights Victoria noted that

older people can be seriously disadvantaged by the payment nominee system implemented by Centrelink, where elder abuse is at risk of occurring. In circumstances of financial abuse, or emotional or psychological abuse there is a strong likelihood that the authority to a payment nominee may not have been given freely by the older person. It is also likely that there has not been a detailed explanation of the operation or consequences of the authority to the older person. Often an older person will feel compelled to make this arrangement, particularly if they are impacted by health or mobility issues and reliant on the person nominated.[75]

10.52   To protect against coercion or fraud, stakeholders suggested that Centrelink run compulsory background checks on proposed nominees.[76] It was also suggested that Centrelink staff interview proposed principals and nominees so that Centrelink officers may identify any risk factors associated with undue influence.[77] Legal Aid NSW suggested that the principal should be contacted to verify that the nomination is genuine and to have explained what the effect of the nominee arrangement is, and to let the person know how to revoke the nomination.[78]

10.53   The ALRC considers that a requirement for direct personal contact strikes an appropriate balance, retaining the accessibility of nominee applications for principals, while putting in place a simple preventative measure against abuse and misuse by nominees. Early and direct telephone or personal contact with principals could help to avoid forgeries or inappropriate nominees.

10.54   A policy in favour of direct personal contact with people over Age Pension age would have wide application. For example, it could also be applied to people who receive care from applicants for Carer Payments. Where care providers qualify for Carer Payment, it would be prudent for Centrelink staff to speak with the person under care to confirm that the person is seeking the arrangement before authorising Carer Payment.[79]

10.55   A direct contact policy could also be applied in the context of the gifting rules. Legal Aid NSW suggested that when Centrelink becomes aware that an aged pensioner has, for example, transferred an interest in their home for little or no value, Centrelink should not immediately suspend payments. Legal Aid NSW suggests that Centrelink should instead deploy a social worker to clarify the circumstances and make an assessment of the person’s decision-making ability and whether the transfer was made knowingly. Centrelink could also use this contact to make it known to the person that they can seek Legal Aid.[80]

10.56   Similarly, granny flat arrangements, which require the older person in receipt of Age Pension to advise Centrelink of the arrangement, provide Centrelink staff with an opportunity to have contact with the older person. Direct contact could enable Centrelink to confirm that the person is entering the arrangement willingly; is aware of the criteria required to show a granny flat interest and the exceptions where elder abuse is apparent; and has been advised of the free financial counselling service offered by Centrelink.

10.57   This proposal does not stand alone. The following proposals—to articulate roles and responsibilities and provide education discussed below—would also strengthen protections for principals in nominee arrangements and other older persons interacting with Centrelink.

Enhanced understanding of roles and responsibilities

Proposal 10–3          Centrelink communications should make clear the roles and responsibilities of all participants to arrangements with persons of Age Pension age that concern social security payments.

10.58   Older persons and third parties to arrangements involving Centrelink may not have a full understanding of their roles and responsibilities under the arrangement. For example, payment nominees may not be aware that they have fiduciary duties; carers may not understand the scope of their role and responsibilities, including their entitlement to respite; and older persons may not understand their rights.

10.59   Arrangements that involve Centrelink can transfer significant powers and responsibilities to parties to the arrangements. Payment nominees may receive all or part of a person’s income, and are trusted to use those funds only for the benefit of the principal. Carers in receipt of Carer Payment are responsible for a person’s health and wellbeing, and can often be involved in decisions regarding medical care.

10.60   Stakeholders have suggested a number of ways in which the understanding of roles and responsibilities may be improved. For example, it has been suggested that Centrelink should develop clear guidelines and standards for payment nominees and carers, outlining their roles and responsibilities.[81]

10.61   Greater use of Centrelink forms to clearly and accurately inform people of their roles and responsibilities has also been discussed. For example, the current design of the nominee authorisation application form places little emphasis on the responsibilities of the nominee.[82] Information regarding the obligations of a nominee is put two pages before the signed declaration of the nominee. Nominee obligations are directed toward the principal, and at no point does the form state in clear terms to the nominee what their obligations to the principal are. National Seniors suggested that greater use of the nominee application form could be made to inform and deter abuse. It proposed that the form explicitly state the penalty for not producing records (60 penalty points, equating to $10,800); the penalty at law for misuse of funds to the benefit of the nominee; and information about the review process.[83]

10.62   With respect to Carer Payment, ADA Australia suggested the development of an agreed care plan between carers and older persons to be under care.[84] A care plan could be founded on ADAT outcomes,[85] provide a clear statement of what care needs to be provided, and outline respite options for the carer.

10.63   Centrelink could produce tools within their processes to provide greater protections. It has been proposed that Centrelink provide a mandatory pro-forma agreement for those older persons who receive the Age Pension (or other pension) who are seeking a granny flat arrangement. The pro-forma agreement could operate to ensure that older persons are aware of their rights and obligations under a granny flat agreement; provide protections for older persons should relationships break down; and, by making the agreement a mandatory requirement, remove the awkwardness often associated with asking family members to enter into a contractual arrangement.[86]

10.64   Another place where clarity is needed is in the relationship between payment nominees and other appointed fiduciaries. It is not clear in legal frameworks and other material whether, for example, an attorney under powers would have authority over a payment nominee where both had been appointed by the principal and there is a conflict. Stakeholders contend that the preferred approach Centrelink should take is to have nominees replaced with substitute decision makers where appointed because substitute decision makers have more robust statutory obligations.[87] This would also provide continuity of financial management and reduce complexity.[88]

Enhancing awareness of risk

Proposal 10–4          Centrelink staff should be trained further to identify and respond to elder abuse.

10.65   The ALRC views staff training as a key component of the proposed Department of Human Services’ elder abuse strategy (Proposal 10-1).

10.66   Stakeholders have told the ALRC that Centrelink frontline staff are not specifically trained to deal with elder abuse. For example, the Eastern Community Legal Centre noted that, in their experience, ‘identification of and response to elder abuse by Centrelink is either ad hoc or non-existent’.[89] State Trustees Victoria advised that it has been contacted by social workers from Centrelink concerned about a client, and it is the experience of the Trustees that Centrelink staff do not have access to clear guidelines or procedures in how to respond to elder abuse.[90]

10.67   Staff training would be required to successfully implement the policies outlined above. Stakeholders have observed that staff would need to be trained to ‘develop tools and prompts to enable staff to identify signs’[91] and to respond with appropriate referrals.[92] The financial counselling service, Care Inc noted that this is especially required in circumstances where staff are contacted by older persons enquiring about gifting, granny flat arrangements or entry into aged care. Here staff should be trained to pick up any ‘red flags’, and refer the person to the appropriate social worker or financial counsellor.[93]

10.68   The WRC said there is a need for training of specialist staff—such as the Indigenous Service Officers, Multicultural Service Officers and Community Engagement Officers—to provide support and referrals to older persons. Assessment Officers, who deal with complicated financial arrangements, could be used to identify and refer situations that may involve financial abuse. Financial Information Service Officers could inform and educate older people, families and carers about elder abuse and the steps needed to reduce it.[94]

10.69   Stakeholders also emphasised the need for Centrelink staff to be trained to proactively refer carers to existing carer-support services, maintaining that many carers only find out about the service after many years. Access to supports earlier could help reduce carer stress, and accidental neglect or abuse.[95]

Enhancing financial literacy

10.70   Community education to enhance the financial literacy of older persons forms an important strategy in the proposed National Plan against elder abuse, which focuses on helping older persons in protecting their rights (Proposal 2-1). Enhancing the financial literacy of older persons in agreements that involve Centrelink is critical to safeguarding against financial abuse.[96] Centrelink can play a key role in the financial literacy education of older persons regarding the interaction of personal finances with social security laws and legal frameworks.

10.71   The WRC specifically supported further education for older persons who are considering making gifts through loans or acting as guarantors to increase awareness of their social security obligations and to advise them where to seek help if needed.[97] Seniors Rights Service also suggested that Centrelink should provide an education and awareness campaign regarding the risk factors associated with granny flat arrangements. This would include informing people of the benefits of putting the agreement in writing and seeking independent financial and legal advice.[98]