Centrelink's debt recovery system working, Human Services Minister Alan Tudge says

Extract from ABC News

By political reporters Stephanie Anderson and Henry Belot

Updated about 5 hours ago

Photo: Human Services Minister Alan Tudge says Centrelink's debt recovery system is working. (ABC News: Nick Haggarty)

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Human Services Minister Alan Tudge will not scrap Centrelink's debt recovery system, despite public backlash and ongoing warnings over inaccuracies.

Key points:

• Human Services Minister says debt recovery system is working
• The system cross references employment data from the Australian Tax Office and Centrelink
• The Commonwealth Ombudsman is investigating Centrelink's system

The automated system, which cross-references employment data from the Australian Tax Office and Centrelink, has produced nearly 170,000 notices of potential overpayments since July.
Mr Tudge, who this week returned from holidays, rejected assertions people were being issued with unfounded debt notices or having difficulties in updating their details.
He told the ABC the Government would retain the system, rejecting reports it was flawed.
"The system is working and we will continue with that system," he said.

"I'm not aware of individuals who are completely convinced that they don't owe money but have been given a debt notice."

Mr Tudge rejected reports clients trying to update their details had been struggling to contact Centrelink on the phone, instead asking people to be patient if they were required to wait "longer than what they would like to wait".
He said he was surprised to hear reports of lengthy waiting periods, despite the National Audit Office reporting Centrelink blocked more than 13 million calls in the 2013-14 financial year (meaning callers heard only a busy signal).
"I know the call wait times at Centrelink can be long at times," he said.
"The average call wait time at present is about 12 minutes."
Mr Tudge added that people could also go to a Centrelink office and see someone "within 10 minutes", despite reports people were being directed to update details online or over the phone.

Waiting time comments 'laughable'

The Commonwealth Ombudsman launched an independent investigation into the system and Labor has called on the National Audit Office to investigate the Centrelink system, with Opposition human services spokeswoman Linda Burney compared the situation to an episode of British sitcom Yes, Minister.

Time to adopt a lighter touch?

In the wake of the debt recovery debacle, Helen Hodgson asks if it is time for Centrelink to change tack.

Ms Burney told the ABC Mr Tudge's comments on waiting times were "laughable", saying she had heard of one wait of up to 6.5 hours.
"The average wait time is not 12 minutes, that is just absolutely bunkum," she said.
Ms Burney said she was surprised to hear Mr Tudge defend the system, which she described as "fundamentally wrong and fundamentally unfair".
"It is bad public policy and it is making at least one in five mistakes," she said.
"Please, just suspend this system and get the algorithm right."

Debt collectors target welfare recipients

Coalition ministers and the Department of Human Services have insisted notifications are not debt letters and that welfare recipients have ample opportunity to update their records.

How the debt recovery system works:

• The system sends you a letter advising you of a potential welfare debt and asks you to review its figures online. It also sends an SMS
• When you log on you can update the information. You have 21 days from the date of the letter to go online and update
• If you don't log on, Centrelink will make a default judgement its information is accurate. You will then be issued with a debt notice
• If you do update the information, Centrelink may ask you to provide supporting documentation. This can include bank statements, letters from an employer, or payslips
• If you think the decision is wrong you can ask for a review
• If you or someone you know needs help, call Lifeline on 13 11 14

But welfare recipients have told the ABC they have been contacted by debt collectors about outstanding debts worth thousands of dollars.
"I had no idea that I had a $3,836 debt to repay to Centrelink until I spoke to [debt collector] Dun and Bradstreet," one said.
"They advised me to contact Centrelink to sort out any issues, but first, pay the debt. I did not pay the debt as I don't believe I have done anything wrong and I don't even know what the debt is about."
The debt collection letter, seen by the ABC, said the Department of Human Service would "consider further recovery action" including legal action.
In some cases, welfare recipients are being told to provide Centrelink with pay slips dating back to 2013.
Centrelink has since removed advice from its website telling the public they only need to keep payslips for six months.