New whistleblower says staff ‘are struggling daily with our consciences’ after being told not to correct errors they see unless the customer points them out

This article is more than 3 years old

This article is more than 3 years old

Centrelink’s compliance teams are being told not to correct errors with its flawed debt recovery program, allowing the “unjust system” to generate millions of dollars in bogus debts, a new whistleblower has alleged.

The explosive claims are detailed in a lengthy letter anonymously sent by a Centrelink compliance officer to the progressive political group GetUp, which released it publicly alongside the Community and Public Sector Union on Thursday.

The department of human services has dismissed the letter as inaccurate, and general manager Hank Jongen said it did not “accurately represent how the system works”.

Jongen said “some staff do not welcome technology driven change” and the department would continue to try to explain how the system operates to workers.

The letter details a litany of errors with the new automated compliance system and speaks of the despair felt by Centrelink’s compliance officers as vulnerable Australians are wrongly issued with welfare debts.



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“We are struggling daily with our consciences and pushing back against our leaders every single day,” the whistleblower wrote. “We are telling the [online compliance intervention system] help desk over and over that what we are doing is wrong.

“Nothing changes and gradually I can see officers simply accepting that they are powerless to change anything, powerless to help customers have accurate outcomes and powerless to stop this process. I see these reviews every working day and I am horrified at what I am being directed to do.

“I am risking my job sending this information in the desperate hope that exposing such an … unjust system might just make a difference.”

Guardian Australia has independently verified the claims with another high-ranking source who recently left Centrelink.

Some of the allegations in the letter have already been aired, including that the system is erroneously doubling up an individual’s income because of “fuzzy matching” between Centrelink and tax office records of business names, leading to the creation of inaccurate debts.

The whistleblower said this was occurring hundreds of times a day.

The department again dismissed that claim as incorrect, saying it gave customers an opportunity to “confirm or change those details in the online system”.

But many other claims in the letter are new. The whistleblower said compliance officers were being expressly told not to fix errors generated by the automated system, even when they could prove the debts were wrong.



The whistleblower alleges that the teams were told they should only correct errors if they were identified by customers, who were rarely in a position to understand the complex factors behind their debt.



Compliance officers have also been told they cannot consider evidence the customer has already provided, including documentation to prove they were not working, or payslips previously provided to Centrelink.

“Within the organisation it is well known that that there are errors in the program and compliance officers are directed to ignore incorrect debts without being permitted to correct them,” the official said.



“When we report errors, it falls on deaf ears or we are told that the issue is already known and we must not make any attempt to fix the error or our work will be returned as wrong and we will have to cancel the corrections.”



This accords with the story of a separate compliance officer, who spoke to Guardian Australia last month.

But the department said it was inaccurate, and that the system was designed only to pick up anomalies, which are sent to staff for review.

The new whistleblower said the errors with the system were contributing to the issuing of millions of dollars of incorrect debts. The automated system was also counting income types it shouldn’t, they said.

Income exempt from Centrelink assessment – meal, laundry and uniform allowances, for example – was being counted by the automated system, even when it had been previously excluded in earlier reviews by staff.

“It puts [in] all the income that is exempt from assessment and staff are not allowed to fix it by removing it,” the whistleblower wrote.

Paid parental leave was also being wrongly counted as income by the automated system, the whistleblower said, and staff were told not to correct the error if the customer had accepted the debt.

The department again rejected this claim.

“Assessments are made to appropriately consider assessable and non-assessable income,” Jongen said.

“It’s important to note, paid parental leave wasn’t considered as assessable income up until October 2016. So cases prior to this change are assessed under the legislation that was in place at the time.”

Debt recovery fees were also allegedly being misused, the whistleblower said. The fees were only designed to penalise a customer who had no reasonable explanation for under-declaring their income.

“Under the [online compliance intervention system] recovery fees are simply applied in most cases even if a customer has never been contacted or spoken to a staff member.

“Strict direction has been given that we cannot remove the fee and customers must lodge a separate appeal even if it is obvious it should not apply.”

The system was not readjusting the 10% fee when a debt was reduced, the whistleblower said, meaning customers were charged more than they should be.

Jongen dismissed that allegation as well, saying recovery fees were calculated on the final assessment. He said there had been an error in initial testing of the system that saw the recovery fee inappropriately calculated, but that had been fixed before rollout.

The system was generating debts based on welfare payments that were never made, the source said. In some cases, the source said, individuals were being handed a debt that was more than the welfare benefits they had received.



It was also duplicating portions of a person’s income in cases, for example, where a termination or leave payment had been made. Termination payments were also wrongly being used to calculate debts for aged pensioners, the source said.

The tool being used by staff for manual debt calculation, a tool named Multical, was flawed, the whistleblower said, and non-ongoing staff and less experienced workers were struggling to use the complex system to properly calculate debts.

“I’m writing because I along with so many of my coworkers have tried to stop the wrong that is being done to thousands of our customers on a daily basis and I can no longer live with what we are doing,” the whistleblower wrote.



“Within the organisation it is well known that there are errors in the program and compliance officers are directed to ignore incorrect debts without being permitted to correct them.”

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Jongen said the letter inaccurately portrayed the way the system worked.

“The online compliance intervention takes advantage of data from the ATO and when a mismatch between that data and the data reported to Centrelink is identified, the payment recipient is asked to clarify the information,” Jongen said.

“In the past, staff did this work for the recipient. This was very time consuming and meant that a relatively small number of overpayments could be addressed.

“Some of our staff believe that intensive one-on-one management of recipients is always required. As with other online initiatives in Centrelink, this intensive support is still available for those recipients who need it and complex cases.”



GetUp said it was planning to campaign on the issue, including in the electorate of the social services minister, Christian Porter. It is setting up an online tool to allow individuals to dispute false debts.



It is also considering legal action against the government on behalf of welfare recipients who were wrongly billed.

“The entire automated debt letter program is untenable and the Turnbull government needs to shut it down immediately and act to provide relief to the 230,000 Australians who have already received these threatening letters,” GetUp campaigns director Mark Connelly said.

Porter has been asked for comment.