$15.4 million in robodebts raised against vulnerable people

The government has raised more than $15 million in debts against people considered vulnerable by Centrelink through the robodebt system.

Services Australia has revealed that over the three years the online compliance system has been in place, 9149 people with vulnerability indicators in their files had debts raised against them.

Of those, only 288 people had their debts waived and only $86,000 worth of the debts were waived.

More than 9000 people with robodebts were considered vulnerable by the department.
Picture: Karleen Minney

More than 9000 people with robodebts were considered vulnerable by the department. Picture: Karleen Minney

The average debt for someone with a vulnerability indicator was $1683.24.

Just over 1800 of these debts were referred to debt collectors.

In information provided to the Senate inquiry into the compliance program, often referred to as "robodebt" because of the automated way it averages a person's income and signals they could have a debt, Services Australia said it used information already on a person's file to indicate whether they were considered vulnerable.

Services Australia spokesman Hank Jongen said on Tuesday the department currently removes people from the debt recovery process if they have a vulnerability indicator on their file.

"This was one of the early changes made to the program as part of our commitment to continual improvement," he said.

Mr Jongen said no debts had been raised against people with vulnerability indicators under the second and third versions of the online compliance regime.

But a trial last year did include some people with vulnerability indicators being contacted and asked to explain discrepancies in their income.

"It's important to note vulnerability indicator status can change and the flag may have been applied to a customer's record after a review was initiated," Mr Jongen said.

He also emphasised that those with vulnerability indicators made up a small percentage of the total number of income reviews.

Greens Senator Rachel Siewert, who is chairing the inquiry and requested the information, said she was astounded by the number of people with vulnerabilities that had had debts referred to debt collectors.

David Pope's view.

David Pope's view.

"People with vulnerability indicators on their files should never have been getting robodebts in the first place," she said.

"It is shameful that the Government has been pursing people that Centrelink had themselves identified as facing vulnerabilities."

In the face of next week's court hearing challenging the validity of the case, and a class action also filed last week, Government Services Minister Stuart Robert announced no new debts would be raised against people where income averaging is the only tool used to calculate the debt. Mr Robert also promised that debts already issued to those where averaging was used as the only indicator of a debt would be reviewed. It's believed hundreds of thousands of debts could fall into this category.

The class action's statement of claim says all recipients of robodebt letters should be considered vulnerable.

This story Vulnerable people hit with $15.4m in robodebts first appeared on The Canberra Times.