Critics pillory consultant work on veterans’ claim processing

By Melissa Coade

Tuesday October 19, 2021

Veterans’ affairs minister Andrew Gee said consultants would be working with families of ADF personnel who had lost their lives to suicide
Veterans’ affairs minister Andrew Gee. (AAP Image/Mick Tsikas)

The Community and Public Sector Union (CPSU) and Labor have slammed a federal decision to ‘overhaul’ the claims processing system at the department of veterans’ affairs (DVA), describing the move as the government ‘outsourcing’ its mandate to fix a broken system.

This week the government announced that McKinsey & Company consultants had been engaged to advise on how the department’s claims processing systems for veterans can be improved. 

Veterans’ affairs minister Andrew Gee said consultants would be working with families of ADF personnel who had lost their lives to suicide to develop recommendations for reform. He added that this first-hand testimony would help the consultants charged with ‘rebuilding the system’ understand the impact of veteran suicide. 

“This is not another review,” Gee said.

“McKinsey will immediately examine how the department can simplify the claims process, how it is currently processing claims, and identify how we can have a faster, more efficient and effective system for all veterans and their families.”

The consultancy group has been asked to produce a report by December this year. 

In a statement responding to the government announcement on Monday, the CPSU deputy national secretary Brooke Muscat took aim at what she called ‘ideological departmental staffing caps’ designed to limit APS numbers and force ‘monstrous amounts of labour hire’ to be given to contract workers in order to deliver essential government services. 

If the federal government decided to cancel its labour-hire contracts at the department and absorb the temporary workforce into the Australian public service, Muscat said the problem it had hired McKinsey to address would be resolved. There would be an additional 400 workers to process claims and millions of taxpayers’ dollars saved in service provision.

“The Morrison government has known the cause of backlogs and processing issues for years, but has failed to act,” Muscat said.

“Since 2019, DVA has spent $53,091,615.47 on labour-hire contacts alone, and it is clear that the government intends this to increase. 

“The government must lift DVA’s staffing levels to give them the workforce needed to clear the backlog of veterans claims, and provide the best support they can for those that have served our nation,” she said. 

Explaining his decision to outsource the report, the minister said he believed it was important that the issues experienced by the department’s claims processing team were looked at with ‘independent eyes’ because he wanted to action the recommendations of the report immediately. 

“McKinsey will provide recommendations with clear milestones and deliverables that can be tracked, measured and monitored by the Department of Veterans’ Affairs and the Australian Government at three, six, 12, 18 and 24-month intervals,” Gee said.

“I won’t be waiting to action this roadmap.”

In his media blitz announcing the review, Gee said the government was presently supporting more than 336,000 former defence force members and their families. 

Because the issue of veteran suicide was such an acute problem, he added that government could not wait to hear the findings of a planned royal commission to start ‘crucial reform’ sooner rather than later. Australia’s veterans deserved nothing less than the ‘best possible care and support’, he said. 

“In the recent budget, $98.5 million was delivered for hundreds of new claims processing officers for veterans which is welcome news. However, I don’t want to see these officers dropped into an inefficient system, tangling themselves up in red tape.

“If that budget boost is to have maximum effect we need to make sure that the fundamentals of the claims processing system are right,” Gee said.

Muscat painted a different picture regarding the staffing capacity to meet the department’s workload. She said that since the government refused to provide veterans’ affairs with enough resources and employees, workers’ hands were tied when it came to addressing ‘appalling’ delays for veterans’ claims to be processed, and reduced service support more generally.

“This is on the government, not the people doing the work – the workers’ hands are tied,” Muscat said. 

“Minister Gee is handing big bucks to consultants to tell them what the workforce and Parliament Inquiries has been telling the government for years. There is no point changing a process if there are not the workers there to staff it,” she said. 

The CPSU argues that measures such as renaming department processes or amending KPIs would be superficial. If any reform was needed, Muscat said, it should be changes to limit the suffering of the veterans’ community by employing more public servants to process the claims and cut waiting times that have now blown out to 12-18 months. 

“The government has an obligation to make sure that it spends public money wisely and efficiently,” Muscat said. 

“If the government transferred all labour-hire workers to secure APS positions today, it would walk away with huge savings. It could reinvest in more staff to address the backlogs and wait times.” 

Labor’s Shayne Neuman, shadow minister for veterans’ affairs and defence personnel, said the review announcement was an admission of failure by the government. With report after report, including coronial inquests highlighting this departmental issue, Neumann asked what it was the government had been doing for the last eight years while pursuing its so-called ‘veteran-centric reform’ program. 

“DVA is struggling to deal with a huge backlog, with 68% of veteran disability pension claims and 42% of claims for war widows/widower benefits yet to be finalised as of April this year,” Neuman said. 

“This latest review follows a number of recent reports and inquiries, including a landmark 2019 Productivity Commission report on the veteran support system, which the government has failed to fully respond to.

It further highlights the results of years of outsourcing, labour hiring and privatising DVA by the Liberals and Nationals.”

Axing the planned external McKinsey review and investing that money back into the public sector was the most sensible thing to do, Neuman added.

This would allow DVA to hire the permanent staff it needs to support veterans’ and not rely on record levels of poorly trained labour-hire workers, which has been as high as 50% for frontline claims processing staff in recent years. 

“Veterans and their families deserve better,” he said.

The Mandarin contacted the department and minister to comment on the claims that the money being used on the consultants’ review could be better spent on staffing, and whether the findings of the final report could have been accessed in an assessment of previous senate committee reports and parliamentary reviews. No response was given by the time of publication.


Audit finds Veterans’ Affairs is effectively managing reform program, but must address DVA underperformance

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