Centrelink bid to chase decades-old debt from 72-year-old's estate

Centrelink is again under scrutiny for its debt recovery practices after a disturbing story emerged on Wednesday about a 72-year-old woman hit a with a debt notice that was over a decade old, and continuing to chase the debt after the woman passed away.

The government changed the law in 2017 to give it greater powers to chase historical welfare debts, removing a six-year statute of limitations.

The report in The Guardian detailed the story of Centrelink chasing a $1600 welfare debt from a 72-year-old woman caused by her failing to lodge a form around 12 years prior.

Read: Centrelink threatens to withdraw pension of 102-year-old woman

The woman’s daughter, Tarnya Widdicombe, told The Guardian that she discovered the letter after her mother’s death last month.

The letter explained that unless she repaid the debt quickly, she would be charged interest daily and her debt would increase.

It said that the debt in question was for overpaid Centrelink payments between 9 January and 7 March 2009 and listed the reason for the debt as: “Failed obligation: form not lodged.”

Read: What you need to know about earning an income on the pension

“I did contact Centrelink in that first week after she died,” Ms Widdicombe told The Guardian. “The bill made me livid, I don’t know why, it just did.

“I asked what the form they were asking for was, told them that she passed away, and they said given those circumstances, they would assess the appropriateness of whether to chase the debt.”

Ms Widdicombe then received a new letter addressed to her as the executor of her mother’s estate, reasserting the debt.

Read: Government assistance failing older Australians

“Initially I felt quite ill,” Ms Widdicombe said of finding the letter. “Because I know my mother was a very proud woman and I know this would have caused her a lot of stress and humiliation.

“I spoke to her best friend who she told everything to and she didn’t know anything about it,” she said.

“It’s so inappropriate to be chasing up the non-lodgement of a form that is that old when people are not required to hold records that long.”

Services Australia spokesman Hank Jongen said the “letters were sent in error”.

“We’re following up with Ms Widdicombe to apologise and confirm that no debt exists and therefore no repayments from the estate are required,” he said in a statement.

“This related to circumstances originating in 2009 and wasn’t a new debt raising activity.

“We regret this mistake at such a difficult time for the Widdicombe family.”

Centrelink’s treatment of older Australians also came under fire last month when it was revealed in Parliament that the agency had threatened to withdraw the pension of a 102-year-old woman unless she provided proof-of-identity documents.

Centrelink’s willingness to chase down small debts from individuals sits in stark contrast to the government’s refusal to try to claw back money from profitable businesses that claimed JobKeeper when they did not require the money.

An age pensioner, who was slugged with a $1000 recovery notice for JobKeeper payments last month, accused the Morrison government of double standards for its unwillingness to clamp down on businesses who accessed the money.

Have you ever received a Centrelink debt recovery notice? How many years ago was the reported overpayment or problem? Should the government reintroduce the statute of limitations on chasing Centrelink issues? Do you think it is unfair that Centrelink chases individuals over old and small debts while allowing big businesses to keep their JobKeeper money? Why not share your thoughts in the comments section below?

If you enjoy our content, don’t keep it to yourself. Share our free eNews with your friends and encourage them to sign up.

Written by Ben



SPONSORED LINKS

LOADING MORE ARTICLE...