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Benefit Sanctions - December 2017 quarter

A sanction is a penalty imposed on a person’s benefit for failure to fulfill their work obligations.

Sanctions can affect benefit recipients in a number of ways depending on their circumstances and the number of times they have had a sanction imposed over the last 12 months. There are three types of sanctions: graduated (ie percentage reduction in benefit amount), suspended and cancelled. Not everyone who fails their obligations gets sanctioned; if benefit recipients recomply or provide additional information, their failure to fulfill their obligations can be withdrawn.

Sole parents and couples with dependent children face a maximum 50 percent reduction of their main benefit when sanctioned within a 12-month period. For single people with no dependent children, the first sanction is a maximum 50 percent reduction of their main benefit; for a second failure, they face a 100 percent suspension of their main benefit; and a third sanction will result in the main benefit being cancelled.

Sanctions data is reported in two different ways to show different aspects of the data: flow data and point-in-time data.

Flow data is the sum of all sanction events that occur in the quarter (eg for the December quarter, it is the sum of all sanction events in October, November and December). This data contains graduated, suspended and cancelled sanctions imposed due to the failure to fulfill work obligations.

Point-in-time data is the number of sanctions imposed at a point in time due to the failure to fulfill work obligations (eg for December, it is the number of sanctions as at 31 December). Only graduated sanctions can be reported using point-in-time data.

Two-year trend for all sanctions (flow data)

The number of benefit sanctions imposed due to the failure to fulfill work obligations increased by 30.1 percent in the December 2017 quarter compared to the December 2016 quarter but decreased by 10.1 percent compared to the December 2015 quarter (Figure 1).

Figure 1: Quarterly benefit sanctions numbers, December 2015 to December 2017

Figure 1: Quarterly benefit sanctions numbers, December 2015 to December 2017

Failure to attend arranged appointment(s) was the main reason for issuing 9,528 sanctions. This was 64.5 percent of the total number that failed to fulfill their work obligations in the December 2017 quarter (Figure 2).

Not everyone who fails their obligations gets penalised; if benefit recipients recomply or provide additional information, their failure to fulfill their obligations can be withdrawn.

Figure 2: Quarterly benefit sanctions reasons, December 2015 to December 2017

Figure 2: Quarterly benefit sanctions reasons, December 2015 to December 2017

Annual comparison – all sanctions (flow data)

December 2016 quarter

December 2017 quarter

Annual change

Total number of sanctions

11,355 14,778 30.1 percent increase

Number of sanctions imposed on Jobseeker Support recipients

8,555 11,889 39.0 percent increase

Number of sanctions imposed on Sole Parent Support recipients

2,757 2,756 0.0 percent decrease

Number of graduated sanctions

9,451 12,049 27.5 percent increase

Number of suspended/cancelled sanctions

1,904 2,729 43.3 percent increase

Annual comparison – graduated sanctions (point-in-time data)

31 Dec 2016

31 Dec 2017

Annual change

Number of work-tested benefit recipients with graduated sanctions

1,105 1,806 63.4 percent increase

Number of benefit recipients with work obligations

208,564 201,874 3.2 percent decrease

Percentage of work-tested benefit recipients with graduated sanctions

0.5% 0.9% 0.4 percentage point increase

Note 1: A small number of non-work tested benefit recipients may be included in point-in-time data because they had a sanction on a previous benefit but have since transferred to a benefit which is not work-tested.