Nearly 48 million calls to Centrelink went unanswered last year as the agency failed again to meet its customer satisfaction targets and complaints rose despite a move to reverse deteriorating service standards.
Callers met engaged signals 7.2 million fewer times than in 2016-17, but the number remained far above levels the year before.
The Coalition government has poured money into labour hire staff to cut unanswered calls and officials have told senators they aimed to reduce the figure further.
Sceptical Labor and Greens senators greeted the improvement with scant praise at an estimates hearing on Thursday and questioned its use of contractors to solve the problem.
Greens senator Rachel Siewert, who has questioned Centrelink officials on their phone services for several estimates hearings, said the cuts to busy signals had started from a high base.
The agency's unanswered calls jumped from 29 million in 2015-16 and peaked at 55 million the next year amid an outcry over Centrelink service standards coinciding with a backlash against its "robo-debt" system targeting welfare overpayments.
"We thought it was high when we were getting to 22 million, and that was 2014-15, so we've still got a significant way to go," Senator Siewert said.
"It's good to see it's come down but sorry if I'm not popping any party poppers yet," she said.
Human Services Department secretary Renée Leon said her agency did not consider the latest engaged signals figure as "mission accomplished".
"I don't know that we're going to solve it this year, but I hope that we will continue to drive it down," she said.
Complaints to the department about Centrelink grew 68,000 last year to 237,000, and nearly half were about long waits, lack of updates on claims and the need to contact the agency multiple times.
Customer satisfaction fell from 50 per cent to 46.5 per cent in one survey of people who had used Centrelink in the past 12 months, but another questionnaire for users who had recently dealt with the agency showed an improvement.
The agency failed to meet its customer satisfaction target, falling short by 10 percentage points but edging closer compared to previous years.
The federal ombudsman investigating public services also reported a 9 per cent drop in complaints involving the Human Services Department, although these made up the bulk of its casework and figures remained well above 2015-16 levels.
Human Services spokesman Hank Jongen said the number of ombudsman complaints should be viewed in perspective as the volume of the department's interactions with the public reached hundreds of thousands each day.
Centrelink's "robo-debt" program came under fire from the Commonwealth Ombudsman last year when it found the agency's demands on former welfare recipients were neither "reasonable" nor 'fair".
The public watchdog urged the government to evaluate the program, and Mr Jongen on Sunday said Human Services responded by simplifying language in letters and its online portal, letting customers use bank statements as well as payslips, and increasing the timeframe to respond to initial letters, among other changes.
Complaints about debts fell from 7 to 5 per cent of total Centrelink matters last year, the ombudsman's annual report shows.
Ms Leon said staff numbers fell for a second consecutive year in 2017-18 to 28,521, a cut of 1300 compared to the previous year. She rejected claims from Labor the government was privatising Centrelink and defended its contracts with Serco, DataCom Connect, Concentrix Services and Stellar Asia Pacific for call centre workers.
Customer satisfaction with the Human Services Department's child support services dropped last year as its troubled new IT led to growing call wait times.
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