The government is crowing about its new automated system tracking down money incorrectly paid to welfare recipients, but Crikey is aware of multiple cases of people who have been unfairly and incorrectly targeted under the system. Using a computer program launched in July, the department has issued almost $650 million in debt notices by matching people’s tax records with the earnings they reported to Centrelink. People have been contacted by Centrelink about payments they received more than six years ago — longer than the five years the Tax Office requires records to be kept — and some who no longer live at the address where they received payments have been contacted by debt collectors. Many have been told to pay the government thousands of dollars, and The Australian yesterday reported $4.5 million in debt notices are generated every day. At least three people Crikey knows of have been incorrectly targeted by the system. One person says that they did not receive Newstart for a full financial year, but undertook contract work that was reported to the ATO after they discontinued their welfare payments. The tipster has since had Centrelink come calling, claiming that they owe money because their earnings reported to the Tax Office are above what was reported while receiving a payment:

“Their default assumption, unless proven otherwise, seems to be that any employment that occurred in a financial year when Newstart was claimed, occurred over the whole year, and therefore overlaps with the Newstart period, and therefore there was a Newstart overpayment that must be paid back. If this is how their defaults do indeed work, it means that anyone who had employment in an financial year that they also drew on Newstart is automatically treated like a fraudster. Their tacit accusation is that I was claiming Newstart while employed, defrauding the Commonwealth. And the reverse burden of proof is on us, to prove our innocence, rather than for them to prove our guilt.”

This seems to be a common problem with people doing contract, casual or intermittent work in years they have received Newstart or Youth Allowance. Have you been contacted about a Centrelink debt that you think has been incorrectly applied? Get in touch here.

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UPDATE: An earlier version of this article incorrectly said the computer program used for the debt system was called WPIT or Welfare Payment Infrastructure Transformation. That is a separate computer system at Centrelink.

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Peter Fray
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