Robodebt: government abandons key part of debt recovery scheme in major overhaul | Welfare
The robodebt program will be completely renovated after the government committed to abandon a central plank of the program’s automation which has seen tens of thousands of welfare recipients overcharged for alleged debts.
In an email to staff on Tuesday the department of human services revealed it will abandon sole reliance on the controversial “income-averaging” method and instead require additional proof before demanding welfare recipients pay back alleged debts.
The department also revealed it will review all existing alleged debts and freeze existing debt recovery pending the review.
The dramatic overhaul of the program could result in hundreds of millions of dollars of debts waived as part of the $3.7bn program, and comes just months after Labor lent its support to a class action challenging the legality of the program.
Bill Shorten, the shadow government services minister, declared that the government had taken robodebt “to the wreckers yard” by finally “junking the reverse onus of proof where victims have to prove they don’t owe the debts”.
The robodebt program operates by sending automatically generated notices to welfare recipients urging them to clarify alleged discrepancies in their income or pay back an alleged debt to the commonwealth.
The former Administrative Appeals Tribunal senior member Terry Carney has warned the alleged debts are unlawful – as income averaging is not a proper basis to claim a debt.
In an internal email, seen by Guardian Australia, the department promised to strengthen the program by no longer raising a debt where the only information it relies on is its own averaging of Australian Taxation Office income data.
In future, the department will seek more information to determine if a debt exists – even if the recipient of a notice refuses to respond – rather than proceed on the assumption it does.
The department committed to reviewing all existing alleged debts with a focus on people who did not respond disputing the calculations. The review will assess whether there is proof of a debt beyond the income-averaging method.
Shorten said the changes amounted to an admission from government services minister Stuart Robert that “his pet scheme that terrorises innocent Australians - is not actually alright”.
“Mr Robert has repeatedly assured the public the scheme is fine, and that there is nothing immoral or illegal or overwhelmingly inaccurate about it,” he said.
“But now under immense pressure from Labor and with a looming class action he has hit the emergency brakes on this scheme.”
The Community and Public Sector Union welcomed the “stunning reversal of its controversial robodebt program” but called on the department to lift its staffing cap to deal with the workload of reviewing debts.
CPSU national secretary, Melissa Donnelly said: “This is a really important shift and acknowledges the dedication and expertise of CPSU members working in DHS, as well as the community members, and community advocates who spoke out to tell their stories and worked tirelessly to raise awareness of the issues.”
On Thursday Robert was asked at the National Press Club about the contention that robodebts are unlawful, and two-high profile cases in May and September when Centrelink waived the debt rather then defend the legality of the program.
Robert responded that “averaging as the basis to say to a citizen ‘there may be a debt, please engage with us’ was entirely appropriate”.
“As Australians engage with us and provide information to us, many times they can actually prove that they haven’t earned too much, and in fact in 19.9% of cases, Australians when they engage with us actually demonstrate through their bank account records or salary payslips that they don’t have a debt,” he said.
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