At LCollect we believe that knowledge is power. Every month our debt collection blog gives you practical tips, stories and news from around Australia and the world.
In our December 2016 issue we covered in our blog the story of Centrelink issuing $650 million in debt notices. You can read this article here.
While there has been some noise in the local media since we first released this article, information obtained under Freedom of Information from the Administrative Appeals Tribunal ("AAT") indicates that one third of these Centrelink welfare debt recovery cases were appealed and are being overturned by the independent tribunal.
Of the 2,699 appeals lodged between March 2016 and March 2017, 960 debt decisions have been overturned with a further 132 varied. A spokesperson for the tribunal, who asked to remain anonymous said, "There's a lag time with the robo debts specifically … you’re looking at a minimum of six to eight months [until they appear in the tribunal]. We’re all suspecting that there is going to be some kind surge but it hasn’t come through yet."
A debt, according to Centrelink, may be overturned for several reasons including that the debt was calculated incorrectly or pursuing the debt would cause the recipient severe financial hardship. A varied decision can also indicate that the debt was calculated incorrectly or the debt was waived or set aside for the same reasons.
The Australian Council of Social Service's Chief Executive, Cassandra Goldie said, "We do not know how many of these were robo debt cases but our firm view is that, without human involvement in the detection and calculation of debts, mistakes will be made and there is a high risk that people will pay debts they do not owe. The government must only issue a debt notice if it has solid proof that a debt exists and that it is accurate. This is not the case under the robo debt program and is why it must be stopped immediately."
The Department of Human Services however indicated that during the Senate Inquiry that only a small number of the cases heard before the AAT related directly to the automated debt notices within only 106 people having lodged a request for review.