Government to continue 'robo-debt' in the name of mutual responsibility

Minister for Government Services says there are 1.54 million outstanding social welfare debts that he claims have a value just shy of AU$5 billion.
Written by Asha Barbaschow, Contributor

Minister for Government Services Stuart Robert has once again held firm that the data-matching project undertaken by the Department of Human Services (DHS), on behalf of Centrelink, is part of the government's legal responsibility.

According to the minister, across Australia, as at 30 June 2019, there are 1.54 million outstanding social welfare debts he claims have a value just shy of AU$5 billion.

While the Coalition claims AU$1.9 billion has been returned funds thanks to the Online Compliance Intervention (OCI) program, or "robo-debt", the program has cost AU$375 million so far, but has only recovered a little over AU$326 million in overpayments, while at least 31,000 debt claims have been wiped.

Justifying robo-debt in Parliament on Tuesday, Robert said of the 800,000 finalised income compliance reviews conducted by DHS since 1 July 2016, 80% have resulted in a debt being collected.

"This government like all governments has a lawful responsibility to collect where citizens have mismatched what they said they'd earn versus what, through their tax return, they've been shown to earn," he said.

DHS has been automatically issuing debt notices to those in receipt of welfare payments through Centrelink since 2016.

The OCI program automatically compares the income declared to the Australian Taxation Office (ATO) against income declared to Centrelink, resulting in debt notices -- along with a 10% recovery fee -- subsequently being issued when a disparity in government data is detected.

One large error in the system was that it was incorrectly calculating a recipient's income, basing fortnightly pay on their annual salary rather than taking a cumulative 26-week snapshot of what an individual was paid.

See also: Services Australia has six weeks to work out what exactly it's meant to do

Robert is also the minister responsible for the National Disability and Insurance Scheme, an Australia-wide scheme that is aimed at funding the costs associated with a disability.

It emerged on Monday that the family of a welfare recipient who was receiving payments before he passed away was contacted by DHS to have his debt paid.

Former Labor Leader and now Shadow Minister for Government Services Bill Shorten asked Robert if he had any advice for the mother who was confronted by her disabled son's debt after his death.

"In many cases when the department raises a debt against someone who is deceased and they knowingly know about it, if the debt is large enough they'll seek to recover it through the trustee of the estate," Robert said in response.

"In the vast majority of times, compassion will step in and the debt will be wiped. In this particular case, because of the size of the debt being both uneconomical to recover as well as the length of time, the department should have simply waived the debt but they didn't.

"My department was wrong I apologise for it."

Continuing with the same level of compassion, Robert warned Australians in receipt of welfare that they best ensure Centrelink has the same information as the ATO.

"Can I say to all citizens who are receiving income support, or indeed family assistance payments regularly, update through either the myGov application, through a telephone service, or through a service centre, update the assessment of your income because when your tax return is returned, they will be matched," he said.

"They'll be checked and if there is any discrepancy at all, we have a legal obligation to contact the citizen concerned and seek to explain the deficit."

Labor Leader Anthony Albanese asked Robert during Question Time when the government was finally going to admit that its robo-debt experiment has failed.

"The government has a lawful requirement to recover debts that Australians owe ... debts are raised either on income support -- there's approximately 13 income support payments -- and income compliance goes across eight of them. And then there is family benefit debts. Together, those debts equal AU$4.99 million," Robert said in response.

"To give the House an idea, with family tax benefit debts, there are 373,712 outstanding at AU$1.3 billion; when it comes to Newstart, there are 408,895 debts equalling AU$1.121 billion -- does the leader of the opposition seriously want the government to wipe AU$1.121 billion from 408,000 debts because the member doesn't believe in income compliance?"

Ahead of the May federal election, Labor had promised it would conduct all government data-matching activities with a human eye if it was elected, not wipe them.

Labor on Monday urged the Coalition to stop robo-debt. Labor has been asking for the data-matching project to be halted since reports emerged in early 2017 on what exactly the government department was doing.

It also continued to ask it be paused when it was revealed robo-debt caused anxiety, fear, and humiliation, and reportedly even resulted in suicide.  

"Governments of all persuasions over the last 20-plus years have sought to recover debts that have arisen because citizens have put forward an assessment of their income and when their tax return came through, that was different, and that difference has to be accounted for. That's the mutual obligation that citizens have with their government," Robert said.

Robert in October was found to have spent 20 times more than other MPs on his home internet, clocking up more than AU$2,000 a month and blaming "connectivity issues" for the high costs.  


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