Revelations come as new data shows Centrelink has ramped up its debt recovery efforts to record levels

This article is more than 1 year old

This article is more than 1 year old

Centrelink staff have continued to issue welfare debts they know could be incorrect under pressure to meet performance targets despite the government’s efforts to reform the controversial scheme, employees have alleged.

The Department of Human Services “strongly refutes” the claims, which come as new data shows it has ramped up its debt recovery efforts, with the online compliance intervention scheme on track for a record year.

Since 2017, the department has been rolling out a series of changes to blunt the harshest aspects of the welfare debt recovery scheme.

New processes give people a chance to provide payslips and bank statements before a review is “finalised” and a commonwealth debt is raised. Now, the department will only use its contentious “averaging” method where a person cannot be contacted.

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But Guardian Australia has been told under-pressure labour hire staff are skirting the process to meet key performance indicators. While there are no target figures for debts raised, teams are expected to complete a set number of reviews each week, current and former staff have claimed.

The targets varied, but “that kind of pressure makes people cut corners”, said a former employee who left recently. “It gets to the point where customers will be receiving debts that they may not necessarily owe. It’s more legwork for DHS, for the staff and for the customers to work out what is going on.”

He said employees would commonly complete a review using “income averaging” despite managing to contact the welfare recipient, because “the main stat they care about is a finalisation, a completed review”.

The insider added: “What people would do is complete the review … and say, ‘You’re going to receive a letter in the mail where you owe X amount of money, you can either pay this, or to appeal the decision, send the paperwork through to see how much you’ve earned.’”

Critics of the scheme have argued many people, including the most vulnerable welfare recipients, will simply repay an official debt due to stress and fear.

They have also lashed the “income averaging” process, which results in a person’s annual income being spread over 26 fortnights to calculate whether they were overpaid. The process is currently the subject of a court challenge.

The Department of Human Services strongly refuted the employees’ claims.

“No review is finalised until a person has been given ample opportunity to help resolve the discrepancy, and we strongly refute any claims to the contrary,” said its spokesman Hank Jongen.

“Staff working on income reviews are not required to finalise a prescribed number each week.

“Like any service delivery organisation, we review performance to meet government priorities, but always put people at the centre of our work.”

robodebt Source: Department of Human Services, Senate Estimates



Note: 2018-19 figures to 31 March

Meanwhile, new figures show the department has already raised $552.2m in the eight months to 31 March, about 30% more than it raised in the entire 2017-18 financial year. The figure refers to debts the department says is owed, not money that has been paid back.

It is also on track to issue well in excess of 200,000 debts in 2018-19, while 173,000 have been referred to an external debt collector.

About 113,000 debts – or around 20% of all debts issued – have been waived or reduced since the scheme began in 2016, though the rate has improved markedly since changes to the scheme in 2017.

But Jongen said a report by the commonwealth ombudsman “comments positively on the improvements we’ve made to the income review process”.

“We have agreed to all the ombudsman’s recommendations and are committed to further improving the customer experience,” he said.

In April, Guardian Australia revealed that a court challenge to the program may not be heard by the federal court after the Department of Human Services waived the debt owed by the plaintiff.

Do you know more? luke.henriques-gomes@theguardian.com