Budget 2018: DSP Suspension periods for people who are in custody

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In the 2018 Budget, the Government announced a measure that will significantly reduce the maximum payment suspension period available to people on Disability Support Pension and who are incarcerated. The Government has estimated that this measure will save $5.2 million over the next 5 years.

The measure
Currently, any person who received DSP payments and who is incarcerated can have their payments suspended for up to 2 years. After this 2 year period, their payments will be cancelled. This means that if a person is in custody for less than 2 years, their DSP payments will recommence once they are released. If a person’s payment has been cancelled, they are required to reapply for DSP and satisfy that they are eligible under the current criteria.

This new budget measure will reduce the maximum payment suspension period from 2 years to 13 weeks. This means that a much larger number of DSP recipients will have their payments cancelled due to their incarceration. The Government expects that 2,200 people will have their payments cancelled. This measure will not affect DSP recipients who are in psychiatric confinement.

The NSSRN opposes this measure.

Media commentary on this measure has already identified that many people who are in custody on remand, and presumed to be innocent, will be adversely impacted by these measures. The Guardian reported that “accused persons typically spend 3.3 months on remand in Australia, and 4.2 months in New South Wales” (Knaus, 2018). The time a person spends on remand is often due to court delays and these have increased in recent years. In 2017, it was reported that in the NSW District Court, the “median time between arrest and trial finalisation is now 714 days (up from 512 days in 2012) and there are currently around 2,000 criminal trials awaiting hearing in the District Court” (Ryan, 2017). Summary criminal matters in the lower courts are resolved more quickly, however still take several months – 95% of summary criminal trials in NSW are finalised within 6 months and 95% of pleas of guilty in the summary jurisdiction are finalised within 3 months (NSW Local Court, 2016).

Many people living with disabilities find themselves within the criminal justice system. People with are disabilities are disproportionately overrepresented in our prison populations. Almost half of people entering prison have some form of disability, despite only 18 percent of Australia’s population living with a disability (HRW, 2018).

This measure targets those who are most vulnerable. Previous studies have shown that many people experience hardship post-release, and struggle to find employment or housing (ABC News, 2014). In 2015, a report commissioned by the Department of Social Services found that “almost half of all people released from the prison system become homeless” (University of Melbourne, 2015).

The Government has stated that this measure will bring the maximum payment suspension period in line with other social security payments, such as Newstart Allowance. However, the claims and assessment processes for DSP are lengthy and require significant effort on part of the claimant. A claimant must provide comprehensive and current medical evidence to satisfy the complex legislative framework. A person must also undergo medical assessments as part of their claim determination. Navigating the complex social security system can be very difficult for people who are living with an illness or disability, and who have recently been released from custody.

DSP has undergone significant changes over the past decade. In 2011 and 2012, major changes were made to the DSP resulting in very strict eligibility criteria. A person who qualified for DSP prior to these changes may not be eligible now. Many of these people continue to live with a disability, however their condition is not considered to meet the current high eligibility threshold.

We note that there are existing processes available to review a person’s eligibility for DSP while they are still receiving the payment. This measure will essentially operate to review the eligibility for DSP of many people who have been incarcerated while they receive no payment, by forcing them to reapply for DSP post-release if they have been incarcerated for more than 13 weeks.


ABC News (2014, June 26) ‘Most ex-prisoners unemployed or homeless six months after release, study says’ ABC News Online. Retrieved from http://www.abc.net.au/news/2014-06-25/australian-study-of-ex-prisoners-finds-high-rates-homelessness/5548430

Department of Social Services (2018) Disability Support Pension – aligning suspension periods for imprisoned recipients (Briefing Paper). Retrieved from https://www.dss.gov.au/sites/default/files/documents/05_2018/d18_13642_budget_2018-19_-_factsheet_-_disability_support_pension_-_aligning_suspension_periods_for_imprisoned_recipients.pdf

Knaus, C (2018, May 17) ‘Centrelink rule change jeopardises disability pension for thousands of inmates’, The Guardian Online. Retrieved from https://www.theguardian.com/australia-news/2018/may/17/thousands-of-australian-prisoners-to-lose-disability-pension-upon-release

Human Rights Watch (HRW) (2018, February 6) ‘Australia: Prisoners with Disabilities Neglected, Abused’. Retrieved from https://www.hrw.org/news/2018/02/06/australia-prisoners-disabilities-neglected-abused

NSW Local Court (2016). ‘Local Court time standards’. Retrieved from http://www.localcourt.justice.nsw.gov.au/Pages/what_to_expect/time_standards.aspx

Ryan, E (2017, May31 ) ‘Crushing workload’ for NSW District Court’ Lawyer’s Weekly, Retrieved from https://www.lawyersweekly.com.au/wig-chamber/21201-crushing-workload-for-nsw-district-court

University of Melbourne (2015, May 27) ‘Almost half of all people released from the prison system become homeless’, The Melbourne Newsroom, http://newsroom.melbourne.edu/news/almost-half-all-people-released-prison-system-become-homeless