Labor calls for robo-debt accountability after mass resignation of Dutch government

The Netherlands welfare scandal has seen cabinet and opposition members hand in their notice, treating the issue with the 'integrity' the ALP wants Scott Morrison to emulate.
Written by Asha Barbaschow, Contributor

The federal opposition is calling on the Coalition to take a leaf out of the Dutch government's book and react with "integrity" over the way it handled robo-debt.

In the Netherlands, tax officials wrongly accused thousands people of fraud and ordered them to repay childcare benefits between 2013 and 2019. As a result, the Dutch government resigned.

The cabinet's resignation came after the publication of a parliamentary report last month, which concluded that "fundamental principles of the rule of law had been violated".

20,000 Dutch families were targeted with debt notices. The Australian Labor Party has reminded the nation 470,000 Australians were "illegally targeted" by robo-debt.

The department in 2016 kicked off the data-matching program of work, colloquially known as robo-debt, that saw the automatic issuing of debt notices to those in receipt of welfare payments through the Centrelink scheme. The Centrelink Online Compliance Intervention (OCI) program automatically compared the income declared to the ATO against income declared to Centrelink, which resulted in debt notices, along with a 10% recovery fee, being issued whenever a disparity in government data was detected.

One large error in the system was that it incorrectly calculated 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.

Centrelink's OCI program from 1 July 2016 through 31 August 2019 saw 1,159,662 assessments be initiated using the automated data-matching technique.

The federal government in November 2019 paused the automated data-matching element of robo-debt and in May, it admitted it got around 470,000 debts wrong.

The federal government in November 2020 agreed to settle the class action brought on by Gordon Legal on behalf of five representative applicants and approximately 400,000 people who were included in the case as group members. 

The Commonwealth agreed to pay AU$112 million in compensation to all of the eligible individual group members, including legal costs. The Commonwealth is also repaying more than AU$720 million in debts that Gordon Legal said was collected from group members invalidly.

The Commonwealth has also agreed to drop claims for approximately AU$398 million in debts that Gordon Legal said it had invalidly asserted against group members of the class action.

"In reacting to their scandal, the Dutch government has acted with integrity and with respect for principles of representative democracy and parliamentary accountability. This is not just in the resignation of the entire Cabinet, but in making publicly available key documents that shed light on the origins of the Dutch Scheme and where it went wrong," a statement from former opposition leader Bill Shorten said.

"The Morrison government, by contrast, has taken a 'looking after the boys' approach of denial and cover up."

Such cover ups, Shorten said, include that there has been no inquiry launched into robo-debt and acceptance of "public interest immunity" claims.

Not a single minister involved in robo-debt has resigned, either, despite many being accused over the last few years of having knowledge the scheme was illegal.

See more: Ministers and officials named in updated robo-debt class action claim

While the current Dutch cabinet has resigned, opposition Labour party leader Lodewijk Asscher also handed in his notice on Thursday. Asscher was Social Affairs Minister in the previous government and resigned because, as a minister, he said he was partly responsible for the scandal.

Services Australia, the agency responsible for robo-debt, has revealed 506,802 people in receipt of benefits from the Australian government repaid debts last year.

In response to questions taken on notice during Senate Estimates in October, Services Australia said during the period 3 April 2020 to 30 October 2020, the agency was repaid AU$373.7 million in social welfare debts from 506,802 people.

It said in a normal year, the agency would "work" with over 1 million people in regards to their debts.

In early April, the government announced a pause on debt raising and recovery activity to help ease pressure on people during the coronavirus pandemic.

Throughout the debt pause no new debts were raised, Services Australia said, except where it related to serious fraud and non-compliance. The agency said pre-existing repayment arrangements continued unless people sought to reduce or take a break from repayments.

"This is consistent with the approach taken during disaster events, and allowed people who wanted to keep paying their debt to do so if they chose to and it could be managed within their personal circumstances," Services Australia said.

During the same period, 331,700 people made repayments from their income support payments. It said there were no tax garnishee recoveries via the Australian Taxation Office (ATO) during the nearly seven-month period.


Editorial standards