How Centrelink will chase debt

Last Tuesday’s Federal Budget 2018 announcement included a significant expansion of its highly criticised robo-debt recovery scheme.

The Budget anticipated savings of $300 million from the expanded crackdown program, which is targeting people that are already paying back debts.

From 1 July 2019, the Government will focus on the recovery of Centrelink debts over $10,000 and speedier repayments from people who have the capacity to pay and are no longer reliant on welfare.

The Government claims that over $1.2 billion in Centrelink overpayments is owed by people no longer on welfare payments and not in a repayment arrangement.

Data-matching programs will continue for another year to reduce overpayments and maintain the integrity of the welfare system.

Robo-debt has been widely criticised for sending out incorrect debt notices and putting the onus on often-vulnerable welfare recipients to track down payslips from as far back as seven years to prove their income was correctly declared.

The system also required those that wished to contest their fine to use a complicated online system, with many complainants unable to ask their questions over the phone or in person at Centrelink offices.

As a one-off budget measure to solve this, the Government committed $50 million in 2018-19 to better address Centrelink call waiting times.

Human Services Minister Michael Keenan said the funding for technological enhancements in this year’s Budget would deliver multiple benefits such as reducing claim-processing times and the cost of administering the payment system.

“Enabling people to conduct most of their business online removes the need for them to visit government offices or call us with questions, speeding up the time it takes to process their claims,” Mr Keenan said.

“While we deliver these major transformation projects, we remain committed to ensuring Australians can access the services they need which is why we are also boosting our telephone capacity.”

Centrelink’s ageing IT systems will also be overhauled with $316 million over four years for more efficient automated claim, assessment and payment processes.

One of the more controversial measures introduced in the Budget targeted welfare recipients owing money for fines.

From 1 March 2019, welfare recipients who have not paid a court-imposed fine will have money deducted from their regular payment until the debt is paid.

Welfare recipients with outstanding warrants for indictable criminal offences will have their payment suspended for up to four weeks or until the warrant is cleared, and cancelled thereafter where the warrant remains outstanding.

What do you think of the Government’s new efforts to recover debt? Are they attacking those that can afford it least?

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Written by Ben

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