Inquiry hears Paul received no support from Centrelink to deal with the alleged overpayment
Centrelink issued a $14,500 robodebt to a disability pensioner with
an intellectual impairment and then failed to offer him support to deal
with the alleged overpayment, a Senate inquiry has heard.
Katherine Boyle, the executive director of the Welfare Rights Centre, told a hearing into the controversial debt recovery scheme on Thursday that her organisation was helping the man to challenge the debt after being contacted by his mother.
Boyle said the man, known as Paul to protect his identity, lived independently from his mother in supported accomodation and earned a “modest income” from pushing trolleys at a supermarket. Paul’s mother was not his Centrelink nominee, so she was not notified when the debt was raised.
Last year, Paul received a $14,500 overpayment related to his
disability support pension, Boyle said. He received no support from
Centrelink to deal with the alleged overpayment and was only assisted by
the Welfare Rights Centre when his mother learned of the debt.Katherine Boyle, the executive director of the Welfare Rights Centre, told a hearing into the controversial debt recovery scheme on Thursday that her organisation was helping the man to challenge the debt after being contacted by his mother.
Boyle said the man, known as Paul to protect his identity, lived independently from his mother in supported accomodation and earned a “modest income” from pushing trolleys at a supermarket. Paul’s mother was not his Centrelink nominee, so she was not notified when the debt was raised.
“[The scheme] is exploitative of people with disabilities because they have no opportunity to really understand what’s going on,” Boyle said. “Paul was lucky his mum intervened and we could provide further assistance. If he didn’t have his mother or us he would be paying back that debt without it ever being properly established.
“There is no way Paul has deliberately underreported his income in any way.”
Boyle said the agency was aware of Paul’s intellectual disability because it was the reason he was granted the pension. His case was raised on the first day of hearings for the Senate inquiry, the third to examine the program since 2017.
Since the debt recovery scheme was expanded in 2015, only 4% of debts raised have targeted disability pensioners, with the overwhelming majority aimed at recouping alleged Newstart and Youth Allowance debts.
But Acoss said that while the Department of Human Services had records of which welfare recipients were considered vulnerable, once a person moved off income support payments the agency no longer held up-to-date information about their circumstances.
That meant vulnerable people have been caught up in the scheme, despite the department saying that it had mostly shielded them from the online debt recovery process.
‘Reverse onus of proof’
The Department of Human Services was lashed by the committee after it conceded it had only helped people caught up in the robodebt scheme get payslips from 1,000 employers since 2017.That was despite widespread complaints that welfare recipients are unable to obtain this evidence, which can date back seven years and that they need to disprove an alleged overpayment. It has issued more than 900,000 debt letters in the life of the scheme.
The Labor senator Deb O’Neill said the government’s debt recovery scheme operated on a “reverse onus of proof”, a claim that was denied by the department.
Officials said they helped people get information from employers or banks where a welfare recipient could not, but O’Neill said it was inconceivable there weren’t many thousands more who needed assistance.
Annette Musolino, an acting deputy secretary at the Department of Human Services, replied: “Well, there’s no evidence of that. We help the people who contact us.”
Leaked internal documents, seen by Guardian Australia, show the department has this year considered using its coercive powers more often.
The department advised the government against this as it looked at ways to ensure the program meets its budget targets because it would increase the time involved to complete a review and result in a reduction in the scheme’s fiscal savings.
Earlier, Acoss also raised concerns that the department was using the controversial process of income averaging more often than previously thought.
Under income averaging, Centrelink staff will spread person’s annual income reported to Centrelink over 26 fortnights and compare this to their income reported to Centrelink while they received welfare payments. Critics argue the process routinely results in false debts, but the department says it is only used when a person fails to provide evidence of their past income.
“The onus should be on Centrelink to prove that a debt exists,” said Charmaine Crowe, a senior adviser at Acoss. “Likewise the use of averaging ... should be stopped immediately.”
Jason McNamara, a general manager at the Department of Human Services, said the department issued letters questioning people about their income where its data-matching algorithm detected a $1,000 difference between tax office data and income reported to Centrelink.
McNamara said the department’s “debt predictor” said there would be a debt raised in 95% of cases where such a discrepancy was detected.
However, O’Neill said that the “predictor” did not take into account if a person had “lumpy employment” over 12 months, meaning that in those cases “from the very beginning [the calculation was] wrong”.
The Liberal senator Matt O’Sullivan pushed back against criticisms of the scheme, saying welfare recipients could seek assistance from Centrelink staff once they received notice of a discrepancy between income they had reported to the agency and tax office data.
Noting evidence from the department of human services, he stressed that staff were involved in issuing debts and conducting reviews.
“The term robodebt seems to be quite a misnomer,” he said.
As with wage earners dealing with the tax office, O’Sullivan said it was the responsibility of welfare recipients to ensure the information they provided to Centrelink was correct.
The scheme is currently the subject of a legal challenge by Victoria Legal Aid and a potential class action backed by the Labor opposition.
The inquiry chair, Greens senator Rachel Siewert, flagged that the Senate committee would ask the department to front another hearing in coming weeks.
Acoss and the National Social Security Rights Network said the robodebt scheme should be abolished.
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