Welfare recipients who fail to update their employment or relationship status could become the subject of covert surveillance as Services Australia looks to engage private investigators to spy on claimants suspected of wrongdoing.
The welfare agency insists its invasive investigations are only used as a last resort and have been the norm for more than two decades.
Services Australia is seeking private investigators to undertake optical and covert surveillance from July this year as it zones in on suspected welfare "frauds".
It comes as Government Services Minister Linda Reynolds announced in December a COVID-19-related pause on debt recovery would be lifted from early January, with repayments required from the beginning of July.
In agency tender documents, published last Monday, successful private investigators would be required to probe Australians the agency has "reasonable suspicion" are engaged in "serious non-compliance".
Surveillance rationale would also need to demonstrate "the benefits of obtaining relevant information by optical surveillance substantially outweigh the intrusion on the privacy of the [Services Australia] customer or third party", the documents state.
The government agency listed allegations of undeclared employment or relationships as examples of cases that could constitute as requiring surveillance.
Those claiming medical incapacitation could also be investigated if there is suspicion the welfare recipient has misrepresented their situation.
Investigators would also be expected to tail and monitor non-recipients suspected of being in an undeclared relationship with the support payment recipient.
Recipients suspected of defrauding the support system could be monitored in secret by investigators using cameras while locations could be bugged to determine movements and patterns by the recipient.
Services Australia spokesman Hank Jongen said his agency had delivered more than $230 billion in support payments during the 2020-21 financial years to people affected by COVID-19, bushfires and floods.
But not all recipients were compliant, he said.
"Most people claiming payments from Services Australia are honest and do the right thing," Mr Jongen said.
"However, some individuals and groups try to get payments they are not entitled to by committing fraud, often enabled by stealing the identities of other people."
He added the agency had specialised teams skilled in detecting and investigating fraud, identity theft and other related crimes.
"Optical surveillance is an important part of those capabilities and used to support our investigations into suspected criminal activity," he said.
"We use it only where other avenues of inquiry are unsuitable or inconclusive."
Services Australia did not respond to questions asking how it defined "serious" non-compliance, nor how it determined whether the benefit of obtaining information through surveillance outweighed the intrusion on recipient privacy.
But the Australian Council of Social Service is concerned the tough approach could place vulnerable people under surveillance for mistakenly failing to update their records.
A spokesperson warned the government needed to exercise great care over how it approached potential breaches, as many people relied on income support to meet their basic needs and about a third of those on Jobseeker had chronic illness or disability.
"Given the serious risk of harm to affected individuals through intimidation and breach of privacy, any surveillance powers should be very narrowly defined and subject to close administrative oversight and review," an ACOSS spokesperson said.
"Investigations should be conducted by public officials who are fully accountable and expected to exercise the highest standards of care and due diligence."
It comes more than a year after the federal government lost a class action suit over its problematic debt recovery program, known as "robodebt", forcing it to pay nearly $2 billion back to about 430,000 recipients.
The program raised compliance notices against more than 430,000 current and former welfare recipients using an "income-averaging" system to spread a person's reported taxable income across every fortnight of the year.
The Commonwealth Ombudsman said the debts raised using this information were "legally insufficient".
The opposition's government services spokesperson Bill Shorten said the government's recent track record with robodebts should cast doubts over whether the federal government will undertake appropriate surveillance of support payment recipients.
"The Morrison government cannot expect Australians to trust the people, who slapped them with illegal robodebts, to spy on them without going too far and doing damage," he told Australian Community Media.