​Public sector union says Centrelink system lacks integrity

The Community and Public Sector Union has said the Centrelink debt recovery system has left the Australian public with a 'bad taste in their mouth', in response to the Coalition continuing to claim the system is 'working well'.
Written by Asha Barbaschow, Contributor

Assistant national secretary of the Community and Public Sector Union (CPSU) Michael Tull has said there is no way the government can declare the Centrelink automated debt recovery system is working well, as the automated data matching tool has left the Australian public with a "bad taste in their mouth".

Speaking on ABC RN Breakfast on Thursday, Tull said it is clear the system, which has sent some letters demanding money repayment in error to welfare recipients, is not working properly and that it "lacks integrity".

"Firstly there's the very high error rate; then there's the people forced into debt repayment plans even when they know they don't have a debt; then there's the fact that Centrelink doesn't have enough staff to deal with this workload," Tull said.

Appearing on behalf of the union representing public sector staff, Tull explained that the high error rate in letters sent to welfare recipients -- flagged previously by Minister for Social Services Christian Porter as only 0.16 percent -- has seen the impact flow on from Centrelink customers into the staff dealing with complaints.

"I think everybody understands now that there is a very, very high error rate," Tull said.

"The other issue that goes with that is that every time staff are forced to deal with one of those cases, it drags them away from other work that needs to get done and it's having knock-on effects so customers elsewhere aren't getting the service they need.

"Underpinning all of this is Centrelink is an agency that has been run into the ground and the government has cut 5,000 jobs out of the place -- it's had a terrible impact on the service standards -- and now they're trying to get this compliance work done on the cheap.

"There's no way this can be said to be working well."

The Department of Human Services (DHS) announced in December it had implemented the online compliance system in July and said that it was finding approximately AU$4.5 million that had gone awry each day. With this, the federal government hopes to improve the nation's Budget by AU$2.1 billion over the next four years.

The new system automatically compares the income people declare to the Australian Taxation Office (ATO) against income declared to Centrelink. When it detects a disparity, Centrelink automatically issues a debt notice and that debt comes with a 10 percent recovery fee.

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

"The government is using a crude and blunt tool, creating a dragnet effect, one that's roping in tens of thousands of people who haven't done the wrong thing and that's giving people the impression that the government's turning an agency -- Centrelink, that has a duty to help people -- actually turning it into the arm of a debt collection agency," Tull added. "That's leaving people with a bad taste in their mouth."

According to Tull, 36 million phone calls made to Centrelink went unanswered last year, which he noted was prior to the government's letter-sending initiative.

The automated process, which Tull explained used to be performed by staff, has been leaving staff under more pressure, and has extended the impact the system has had on the Australian public.

"This scheme is an absolute nightmare for thousands of Centrelink customers who've done absolutely nothing wrong, and the staff who are bearing the brunt of this mess," he added.

Tull's comments came in response to those made on Wednesday by Minister for Human Services Alan Tudge.

Also speaking on ABC RN Breakfast upon his return from leave, Tudge held firm the government's view that the system was working well, confirming the Coalition has no intention of suspending, let alone scrapping, the issue-plagued system.

"There's an important principle here that we're trying to implement and that is to ensure that there is great integrity in the welfare system because after all, the welfare system constitutes a third of the budget," he said.

"We want to make sure that people get the welfare entitlements that they're entitled to and no more and no less. Consequently we do have a robust compliance system in place and in the last six months alone, we've recovered over AU$300 million to the taxpayer through that process.

"So the system is working and we will continue with that system."

Last week, Independent Member for Denison Andrew Wilkie said he had personally received over a hundred complaints from citizens who have recounted "deeply disturbing" stories about their experience with the Centrelink debt recovery system, and that the thought of having to pay back demanded money has driven some people to contemplate taking their own lives.

In addition, claims have been made by individuals who have previously received welfare that they can prove they do not owe money to Centrelink, despite being contacted by a debt recovery agency, not just by Centrelink.

Michael Griffin, a filmmaker from Brisbane, told ABC earlier this year that in the space of 12 months he earned AU$26,000 in the nine months he worked, and claimed Newstart -- financial assistance provided by Centrelink while looking for employment -- for the three months he was jobless.

Griffin said that at the time he declared his earnings correctly, however the letter he received from Centrelink shows the system took his AU$26,000 and divided it over 12 months, showing incorrectly that he earned AU$1,000 a fortnight for the entire year.

Despite this, Tudge said on radio he was not even aware of individuals who are completely convinced that they don't owe money but have been given a debt notice.

"When a debt notice is issued to them, if indeed it is, they have a further opportunity to provide further information and then they have a third opportunity again if they want to appeal it to the tribunal. So, there are three opportunities for individuals to update their records if a discrepancy is identified," Tudge said in response.

Earlier this week, the Commonwealth Ombudsman Colin Neave opened an investigation into the Centrelink fiasco, with a spokesperson telling ZDNet that Neave is aware of the concerns raised and has commenced an own-motion investigation into the matter.

Privacy Commissioner Timothy Pilgrim said on Friday, however, that no investigation into the matter has been opened by his office.

Editorial standards