Robodebt refunds start but most will still wait months for payments

Centrelink recipients will be refunded, some in installments. Picture: Karleen Minney
Centrelink recipients will be refunded, some in installments. Picture: Karleen Minney

The government spent almost $50 million on the robodebt clean up operation in just five months this year, as costs related to the bungled program are set to add up to billions of dollars.

It has also been revealed that despite the government previously committing to starting refunds on July 1, many of those who are owed a refund will wait many more months before seeing money in their accounts.

Services Australia says it has this week started to pay back a small number of the unlawful debts that were raised under the system, but it expects the bulk of payments to be made by November this year.

In an answer to a question on notice, the department has conceded that between January 1 and May 31, the cost of administering the program was $47.1 million.

In that time the department had hundreds of staff dedicated to identifying which debts were raised under the program using income averaging, a process which has been found to be unlawful.

In May the government announced it would pay back $721 million in unlawfully collected debts from current and former Centrelink recipients, but the price tag attached to the failed program is set to enter the billions.

Minister for Government Services Stuart Robert at question time earlier this year. Picture: Dion Georgopoulos

Minister for Government Services Stuart Robert at question time earlier this year. Picture: Dion Georgopoulos

As well as the money to be refunded, the department will also not take in hundreds of millions in debts that had been raised but were yet to be paid under gradual repayment programs.

In a question on notice to Senate estimates, the department said the cost of running the program between 2015-16 and 2018-19 was $606 million.

That excludes the cost of last financial year and this financial year.

On Wednesday Services Australia released a statement saying refunds would start in early July to test the system and that some larger payments would need to be repaid in installments.

"These tests are happening now and we have started paying refunds, however none have been paid by installment to date," general manager Hank Jongen said on Friday.

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There had been reports the installments could be made fortnightly, but Services Australia said this was not the case.

"Only a small proportion of refunds may need to be paid in installments. This is due to system limitations on the size of daily payments," Mr Jongen said.

"For these cases, installments will be made over consecutive days once the refund has been processed. Any suggestion these payments will be paid fortnightly or monthly are incorrect."

It is unclear what the limit is on a daily payment but it is believed to be $10,000.

Calls for a royal commission into the program have been growing, and the class action against the debt scheme is next due in court on July 17.

The department is encouraging people who believe they may have a debt that will be refunded to ensure that their contact details with Centrelink are correct to allow them to be contacted.

This story Robodebt refunds start but most will be waiting months for payments first appeared on The Canberra Times.

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