Centrelink’s new automatic debt generation computer system is generating 20,000 debt notices a week, despite more and more stories emerging about obvious problems with the system.
Since July, Centrelink has run an Online Compliance Intervention system, which matches income data provided to Centrelink by recipients to income data provided to the Australian Tax Office. If the amounts don’t match, people are told they need to update their details with Centrelink, and many are coming away with debts of thousands of dollars.
The system does not take into account people who were not receiving a Centrelink payment for a full financial year, or it picks a certain time period and averages out earnings for the full financial year — which can be wildly inaccurate for those doing seasonal, casual or contract work. Under the previous manual system of data-matching, 20,000 debt notices were issued annually. Crikey and other media outlets have reported on many people who believe they have been unfairly and incorrectly targeted by the system, and disputing debts is difficult and stressful.
Social Security Rights Victoria (SSRV) runs a phone advice service for people with issues related to social security law — and in the six months since the new automated debt notices have come into effect, people with debt issues with Centrelink have gone from half of their cases to 90%.
The first step in disputing a debt with Centrelink is to ask to speak to an authorised review officer (ARO), says Graham Wells, principal lawyer and clinical program supervisor at SSRV. This can be done through the MyGov system, over the phone or in person, and it basically means a more senior person in Centrelink will assess the case.
The ARO will look at why the debt has been raised and a person can provide evidence or new information in an attempt to reduce or strike out the debt. There’s no time limit to appeal a debt to an ARO, but repayments will still need to be paid during the review period.
Wells says it’s important to get a receipt number from the ARO to make sure you have evidence that the appeal has been lodged, and something to refer back to in subsequent dealings with Centrelink.
The Guardian has reported that those trying to dispute their debt have been told all compliance issues must be dealt with online, and the Department of Human Services is claiming that only a small number of people have had issues with the online system and that there has been no increase in the number of appeals about debt notices.
If you are unhappy with the ARO’s decision, the next step is to dispute the debt with the Administrative Appeals Tribunal — the Social Services and Child Support Division deals with Centrelink issues. This also doesn’t have a cost to the person bringing the complaint, unless they hire a lawyer. This is called the first review, and if it doesn’t go your way, it’s possible to have a second review through the AAT’s general division. The AAT released a fact sheet last month on what information it needs and how it makes a decision.
“Our experience is that at least 90% of them [debt cases] have problems, they are either wrong completely or there is legal merit to have them reduced,” Wells said. Most cases are resolved at an earlier stage than the AAT, but Wells says most cases he has been involved with at the AAT are successful. If appeals at the AAT have been successful, disputing a Centrelink debt could even go to the Federal Court, but Wells says he discourages people from going down that route as it is expensive.
It’s also possible to request information that Centrelink holds about you through freedom of information laws.
“There seems to be some sort of policy direction to claw back whatever debts they can, however they can,” Wells said. “The problem is there is no fact checking going on.”
Wells says he would welcome “any opportunity to talk to the minister’s representative to work through a better way of doing things”.
He is most concerned for people on Centrelink payments who are also in public housing. If their debts are removed from their payments, their rent is also not being paid and they face eviction. “It’s emotionally incredibly hard for people to tell their kids they can’t buy whatever they want for Christmas because they are having enough trouble feeding them or keeping a roof over their heads.”
“I’m not saying that to be hostile, it’s just that there has to be a better way of doing things.”
Independent MP Andrew Wilkie has called on the government to suspend the automatic system, telling Crikey: “Centrelink is treating people as guilty until proven innocent, rather than saying ‘there’s a reason to suspect a problem’ they are just saying ‘you have to pay the money back unless you can prove otherwise’.”