The head of Centrelink's parent department has told a Senate inquiry the agency’s controversial robo-debt recovery system should remain in operation, despite thousands of Australians receiving inaccurate debt notices.
Senators grilled senior bureaucrats from the Department of Human Services over the effectiveness of the automated debt recovery system in Canberra on Wednesday.
The computer algorithm, which cross-references Centrelink welfare payments with Tax Office data to identify discrepancies, has led to more than 200,000 Australians receiving letters asking for clarification since July last year.
The department said around 20 per cent of those people ended up not needing to pay any debt.
Thousands more were billed for debts owing but subsequently had the amount reduced, in some cases to zero, after providing further evidence.
“The view of the department is that there are a number of refinements that needed to be made, those refinements are being made, and that the system should continue,” department head Kathryn Campbell said.
Ms Campbell said those refinements included sending letters via registered mail, “different use of colours” on the online portal and simpler language.
Watch Labor senator Murray Watt speaking at the inquiry:
Letter recipients will now have 28 days to provide clarifying information rather than 21.
Centrelink will also ‘pause’ debt recovery operations while debt claims are under review.
Labor senator Murray Watt, who sits on the Senate committee investigating the scheme, said those improvements were not good enough.
“This system should be put on hold immediately,” Mr Watt said.
“It is fundamentally flawed. It is hurting people all around the country.”
“It is not an exaggeration to say that the Department of Human Services is an agency in crisis, and it’s not something I say lightly.”
The Australian Taxation Office (ATO), which provides the department with welfare recipient’s tax data under the scheme, distanced itself from the scandal over debt notices.
“I don’t think we were complicit,” the ATO’s Robert Ravanello told the committee.
“We are required to provide the data, which we’ve done. How [the Department of Human Services] uses that data and matches it … I think is better asked of DHS.”
The department also came under fire from the Community and Public Sector Union (CPSU), which represents many Centrelink staff.
Union officials told the Senate committee many Centrelink staff felt “morally conflicted” over the debt notices.
The CPSU’s Nadine Flood said staff had been dealing with increased levels of client aggression, triggered by outrage over the notices.
“It is not an exaggeration to say that the Department of Human Services is an agency in crisis, and it’s not something I say lightly,” Ms Flood said.
Social service advocacy groups also presented evidence at the committee, raising examples of former payment recipients who had debt bills in the thousands reduced to as low as $50 after an erroneous calculation was revealed.
“They’re being discouraged from exercising their entitlements in the income support system by this poor public administration,” Susan Helyar, of the ACT Council of Social Service, said.
“Some people cynically suggest that, perhaps, that may be the point,” she said.
The Turnbull government has previously expressed its ongoing support for the program, saying it is needed to recoup $4.5 billion in welfare overpayments.
The Human Services department head, Ms Campbell, said critics of the scheme, including the unions, had only provided “general” criticisms and recommendations – mostly, that debt notices should be done manually, with every case reviewed by a human being.
