Over 270,000 robo-debts have been paid without a review

It isn't known if the customers who paid a debt were even made aware that they could question the validity of the debt that was issued to them.
Written by Asha Barbaschow, Contributor on

The Department of Human Services (DHS), now Services Australia, has revealed that 271,224 debts that it believes to be overpaid entitlements have been paid by welfare recipients.

The debts the government considers owed have been paid by individuals where a formal review of that debt decision was not requested.

It is not known if the customers were aware that they could request a review of the debt that was determined through the use of an automated income-matching system which has since been paused by the Australian government.

In 2016, DHS kicked off the data-matching program of work that saw the automatic issuing of debt notices to those in receipt of welfare payments through Centrelink.

The online compliance intervention (OCI) program automatically compared the income declared to the ATO against income declared to Centrelink, resulting 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, colloquially known as robo-debt, 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.

The number of debts paid was made available through a response to questions on notice from Senate Estimates in October, with the department revealing the number of "debts" that were "recovered" by an external collection agents.

In 2015-16, 72,532 "debts" were recovered in full by external parties; 2016-2017 there were 58,233; in 2017-18 had 47,692; 2018-19 saw 48,421; and in 2019-20, up until August 30, there were 9,304 debts fully recovered by collection agencies on behalf of Services Australia.

The total number of debts fully recovered by external debt collectors to date is 236,182.

See also: Why Australia is quickly developing a technology-based human rights problem (TechRepublic)

Individuals who have received a letter from the department saying they owe money can have their case reviewed, with the government long touting this as the customer "providing additional information to seek a reassessment".

During Senate Estimates in October, Services Australia was asked for a breakdown of the number of debt reviews requested. It was asked for an annual breakdown of total debts up for a reassessment, those for review by a subject matter expert (SME), and those with an authorised review officer (ARO).

"There is no data available to identify where a reassessment was requested by a customer," it wrote in response.

From 1 July 2016 to 31 August 2019, Services Australia received an estimated 35,571 applications for a quality check by an SME for OCI decisions.

During the same period, the department received an estimated 9,511 applications for a formal internal review by an ARO for decisions also connected to the OCI program.

In 2016-17, there was an estimated 6,370 applications for a quality check by an SME and 2,376 applications for a formal internal review by an ARO.

In 2017-18, an estimated 7,090 applications for a quality check were sent to an SME, while 1,623 applications were handed to AROs.

The number of applications for a quality check by an SME in 2018-19 had more than doubled, with an estimated 16,396 requests, and an additional 4,509 applications for a formal internal review by an ARO.

Highlighting an error made by the department previously, Services Australia representatives were also asked during Senate Estimates to provide the amount of debts from the 2016-17 year that were incorrectly sent to debt collectors.

"Services Australia recalled 9,273 of the 10,025 debts from External Collection Agents for the period 1 January 2017 to 31 March 2017," it wrote in response.


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