Robo-debt: Minister claims the government is not built for refunds

The federal government will begin issuing refunds next week, but in chunks due to tech restraints and only as individuals update their payment information.

With the federal government in May admitting its bungled robo-debt scheme incorrectly issued 470,000 debts to those in receipt of welfare, Services Australia has been gearing up to refund around AU$721 million to Australians.

But it isn't as easy as pressing a refund button, Minister for Government Services Stuart Robert said on Tuesday.

"The government is not geared to do refunds, it doesn't have a system for it, so we've actually built out that system," he said.

He said Services Australia is waiting for Centrelink customers that were a victim of the Online Compliance Intervention (OCI) program to update their details.

"[For] about a 190,00ish, we have all their details … so the other almost 200,000 … we'll reach out to say, 'Hey, come into myGov, update your bank details, and as soon as they're updated we'll pay you'," he explained. "So we suspect it'll take through to November for all those Australians to update their details. If they all updated their details in one go, great, we could pay them progressively over a number of weeks. Our experience indicates that won't be the case, but Australians will take time and update their details progressively."

Services Australia will start issuing refunds from the 13th of this month through the end of November, but some refunds will be delivered in chunks.

"So 373,000 Australians, the average repayment will be about AU$1,900," Robert said, answering a question following his address to the National Press Club.

"One of the reasons there'll be some instalments, and about 7,000 give or take, Australians will have two instalments only because there is a check in the system where the system can't pay out any more than AU$6,999 in one instance."

Robert said this failsafe was implemented after a Human Services staff member put over AU$4 million in the amount to be refunded field, believing it was a date field, a number of years ago.

"That was considered by the government of the day to probably not be the right thing, so the Labor government of the day put in a check at that AU$6,999," he explained. "So that's still there as a check and sum, so that's why there'll be about AU$7,000 give or take that will be done in two instalments."

On expanding the refund project to those in receipt of welfare prior to 2015, Robert said he knows "it's been going on for 10, 20, or 30 years" as the Ombudsman report made that clear.

"We know that it started probably as early as 2007 ... as I said in Parliament, we've done a sample of 500 in 2009 and 16.6% -- or about 4,000 debts -- were raised wholly or partially with average ATO data," Robert said.

"We did the same thing in 2011 and in 24.4% of those, debts were raised either solely or passing through averaged income data. So that's the only data sets we have at present in terms of where we sit, which just goes to show I guess the long history of the use of averaged ATO data that had been common practice for many, many years."

He said expanding the project to sift through data from pre-2015 is difficult, as post-2015 "computing systems were built to do the income average process" allowing Centrelink to have oversight of who was affected by the OCI initiative.

"The amount of debt that was raised prior to that, there was no computing system that existed to do it," he said.

Still refusing to apologise for the trauma robo-debt caused individuals, Robert said he acknowledges that the use of average ATO data was "insufficient" and wasn't "helpful or respectful or transparent".

See also: Services Australia accused of 'covering up' robo-debt's automation mess

"But going forward, and this is where the transformation is so important, is that we've put down some solid markers, we're saying to the Australian people, 'This is how we're going to operate when it comes to your data digitally going forward and this is how we're going to be measured'.

"The nation's leaders have made it clear right across the country that no one wants to see longstanding practices turn around and be shown to be unworkable and not wanted.

"We don't want to see any of these areas of contention come up again."

Currently, 1.6 million Australians are on payments, Robert said, and as the COVID-19 Jobkeeper package times out, the minister said Services Australia is preparing to have more people sign up for welfare.

"If they don't come on, superb, but the nation can be assured that Services Australia will not be flatfooted on this. It'll have the capability and the resourcing to deal with any increase should it arrive," he said.

"Services Australia is the largest IT shop in the Commonwealth -- the big IT shops are Services Australia, Home Affairs, Defence, and the ATO, they are the big four in terms of where it sits -- and if you look at our experience with myGov, we can take 300,000 concurrent users … so we've scaled our platforms to deal with huge numbers of users in anticipation of any change in government policy."

In addition to sharing his vision for government service delivery to make it similar to watching Netflix, Robert also touched on the cybersecurity capacity of his department.

According to Robert, in just Medicare payments, Services Australia processes 600 million transactions a year.

"That's just Medicare alone, forget everything else we do," he said. "Now transactional flow is the big four banks put together, it's more than them, it's huge, AU$210 billion flowing out and all of that without a cyber penetration or substantial assault that has taken the system down."

"Our cyber operations centre is probably one of the most effective anywhere, certainly in this country, it's an extraordinary capability we have to monitor and run it," the minister continued. "The Prime Minister announced recently and spoke of a sustained actor providing a cyber attack, suffice to say our department wasn't impacted at all in terms of penetration impact or slowing down the capacity for people to receive payments or make claims."

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