レポート 1056

Retail worker Laura has had a $24,000 debt hanging over her head since October last year.

Laura, who’s asked Hack not to use her surname, works casually and had been getting income support payments through Centrelink from 2011 to 2014.

Late last year, Centrelink told her she owed them thousands of dollars.

She was one of the thousands of people caught up in what’s known as the robo-debt policy - that’s when Centrelink started using an automated system to send out letters when it detects discrepancies in payments.

The old non-automated system generated 20,000 letters a year. But in the early days of the new system, that jumped to 20,000 a week.

“It popped up with a debt amount of just over $24,000... That’s my year’s wage,” Laura said.

[I felt] physically sick and I lost my shit straight away.”

Over that three year period, Laura had received about $38,000 in welfare payments. To be told she owed $24,000 was a big shock.

“I’m logical, I know it’s a big system and that things can go wrong. If it was a small amount, that things were inconsistent, then I would understand that,” Laura said.

‘No one is listening’

Laura looked into it.

An initial review saw the debt drop - but only by a couple of grand.

In December last year, Laura said a Centrelink employee told her that her debt looked like an administrative error. But the debt still stood.

“They said straight away that I had to be on a payment plan and pay it back. They sent me to their debt recovery person. He told me that they wouldn’t take less than $100 a fortnight to pay back. And I said, well that’s impossible for me,” Laura said.

“Since last year I’ve been paying back $20 a fortnight.”

She’s had to cut corners in an already tight budget. Paying for the internet was what had to give - and it’s the very thing she needs to help find more work.

Laura has engaged the services of Legal Aid and is appealing the debt.

She said her file is full of inconsistencies and faults. Hack has not viewed the documents.

Hack has asked former Human Services Minister Alan Tudge, and the incoming minister, Michael Keenan, for comment on this story.

Laura said the whole process is taking its toll on her.

“I’ve suffered from depression for a very, very long time and especially at the end of last year when I first got this debt I was already not feeling well because of other things, so I ended up not being at work for a month,” she said.

“No one’s listening… I’m basically being called a fraud and a liar and that I don’t matter.”

“It straight away said I was guilty, and a year later [I’m still trying] to prove I’m not guilty,” Laura said.

“That’s a year’s worth of my life of stress and struggle that I shouldn’t have had to deal with… It’s a joke.”

‘I was panicked’

Joy* knows exactly what that feels like. When she spoke to Hack early this year, she was absolutely distraught.

Just before knocking off work for Christmas break in 2016, Joy got a letter from Centrelink saying she owed $26,000 - more than half her yearly wage.

“I was really panicked. I was finishing up for Christmas feeling really happy and excited. And then all of a sudden I was thrown into this awful panic. I didn’t know what I was supposed to do.”

She was told she’d have to pay, in full, by 9 January.

“No Legal Aid type places were open to give advice,” Joy said.

“I had to make repayments otherwise my Family Tax Benefits would have been cut off. I’m a single parent, I work part time - I kind of rely on that,” she said.

Debt recovery told her to pay $800 a week - a near impossible feat for someone in Joy’s financial situation.

Both Joy and her brother - who had incurred a much smaller debt of a few thousand dollars - went public with their stories. Suddenly, they had Centrelink’s attention.

“A couple of days later, miraculously, he had a call from a mysterious Centrelink big wig.”

Joy’s debt was reviewed and reduced to only a couple of thousand dollars - a ten-fold decrease in the original sum. Her brother had his debt reduced to just $50.

All of that happened within days.

“If my brother hadn’t gone public… I would still be sorting it out now and still be in stress about it,” Joy said.

I’d be paying it off for more than a decade. That’s a way to make a person feel like they can never get ahead.”

“This was great for me, but there are thousands and thousands of people who did not know, who were not able to advocate for themselves in the same way, didn’t have this luck,” she said.

Letters on hold over Christmas

One of the biggest criticisms of the handling of the robo-debt program is the timing of it all. Thousands of letters were sent out over Christmas last year, making it hard to get in touch with Centrelink and appeal the debt.

Greens senator Rachel Siewert was part of a Senate inquiry into Centrelink earlier this year.

“It was deeply distressing for people last year when they were receiving notices over Christmas and the summer break,” she told Hack.

This year, Centrelink paused the program at the end of November, a