Demand for Centrelink causing millions in payments to be delayed

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Many Australians waiting for injury compensation payments are being forced to wait an extraordinary length of time because Centrelink is struggling under the strain caused by the increased demands for its services as the economic fallout from the pandemic continues.

The Australian Lawyers Alliance (ALA) says that millions of dollars in compensation payments are being delayed and has accused government services minister Stuart Robert of doing little to address the problem.

Once injury compensation payments are settled, Services Australia is required to produce a clearance recovery notice before payment can be made.

Most settlement terms allow 28 days for Centrelink to process the paperwork and a claimant to receive their money. ALA president Graham Droppert says that currently some claimants are waiting 60 days or more, while that money sits in insurers’ trust accounts rather than being delivered where it is needed most.

“Addressing these delays will inject some $100 million into the economy at a time when it is greatly needed,” Mr Droppert said. “COVID-19 has resulted in extraordinary demand for Centrelink services which means that normal business is being seriously delayed. The minister has now had months to resolve these capacity issues but we have not seen any improvement.

“These delays are causing significant hardship to people who are unable to work due to injury or illness and are waiting on Centrelink to clear their compensation payment.

“We are gravely concerned about the mental health of many claimants who have suffered a serious injury and finding the extended wait for their compensation to be re-traumatising and very stressful.

“Many are relying on their compensation payment to feed their families or pay medical bills. Others need their compensation payment to purchase equipment or modify their homes so that they can manage their life with a disability,” said Mr Droppert.

The ALA has outlined these concerns in a submission to the Australian National Audit Office as it assesses whether Services Australia has effectively managed risks related to the rapid preparation for, and delivery of, COVID-19 economic response measures.

“We are disappointed that despite our passionate advocacy, both to the minister and directly to Services Australia, this situation has not improved. The minister seems to be missing in action while injured people continue to suffer. It is appallingly neglectful of him to ignore this issue,” said Mr Droppert.

“Services Australia staff are being stretched beyond capacity by the welfare demands of the pandemic and the minister must address this problem.”

Services Australia general manager Hank Jongen said that since mid-March Centrelink had processed more than 1.5 million JobSeeker claims, which is more than they would normally process in two years.

He also said that at the same time there was an increase in compensation activity due to the increase in people coming on to a compensation-affected payment such as JobSeeker.

“In response to this surge in demand, we rapidly redeployed our workforce and hired and trained thousands of new staff to deliver critical payments to the millions of Australians relying on us,” Mr Jongen said.

“Staff were reallocated to help with compensation clearances and our focus is on actioning outstanding compensation settlements.

“We prioritise compensation activities for people most in need. This includes those experiencing severe financial hardship, and we encourage anyone in these circumstances to contact us. 

“We are working to further streamline our compensation clearance process to deliver more efficient outcomes for our customers.”

Are you waiting for an injury compensation payment to be cleared by Centrelink? How long have you been waiting? Should the government do more to tackle the increased welfare demands caused by the pandemic?

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Written by Ben



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