LEIGH SALES, PRESENTER: There aren't many groups of Australians as pilloried as dole bludgers and welfare cheats, so when the Turnbull government announced a major crackdown in 2016, most Australians were happy to see it.

That move has relied heavily on automation to pursue suspected rorters.

More than 400,000 people have received so-called robo-debts but there are questions about whether they've always been accurate and lawful.

This report from Paul Farrell produced by Alex McDonald.

DEVI BARKER: I have spent quite a bit of time speaking on the phone to Centrelink.

I have never had any outstanding debts and I have always had a clean credit rating, so I'm quite concerned about the impact that the debt will have on my financial future.

PAUL FARRELL, REPORTER: While at home in Hobart in January, Devi Barker received a message from a debt collector that shocked her.

Devi was told she owed a debt of more than $7,000.

When the debt collector demanded Devi pay up immediately and in full, she wondered whether it was a scam.

DEVI BARKER: I felt quite stressed especially when they said that my wages would be deducted and that I wouldn't be able to leave the country.

RECORDED MESSAGE: Thank you for calling the Department of Human Services, Centrelink debt recovery.

PAUL FARRELL: It wasn't a scam. It was a so-called robo-debt from nine years earlier when Devi was at university and receiving youth allowance.

RECORDED MESSAGE: Please hang up and phone 1800 ...

PAUL FARRELL: Centrelink was demanding she repay the debt plus interest.

DEVI BARKER: When I got in touch with Centrelink, they told me that I would need to provide bank statements and pay slips to be able to disprove the debt.

But when I went to try and get bank statements from the bank they said they don't hold records for longer than seven years.

PAUL FARRELL: Devi asked Centrelink to review her case, but the debt remains.

She's now being pursued by another debt collector.

DEVI BARKER: I feel like I'm being made out to be a criminal.

I recorded my hours in my uni diary and I was very diligent in reporting the correct hours, and I know that I don't owe Centrelink any money.

PROF. TERRY CARNEY, UNIVERSITY OF SYDNEY: There are real legitimate concerns about false debts being raised or inflated debts being raised against people.

It affects their credit rating and it affects their reputation.

SCOTT MORRISON, PRIME MINISTER: What we're doing in the welfare system is strengthening it.

PAUL FARRELL: During the 2016 election campaign, the Coalition announced a welfare crackdown to claw back $1.5 billion over three years.

SCOTT MORRISON: But we ensure the system does not have the leakage and have the waste and have the overpayments or the abuse of the system which, at the end of the day, costs Australian taxpayers.

PAUL FARRELL: By the end of this month, the expanded welfare crackdown is expected to have recovered $579 million.

Obviously some debts to Centrelink are legitimate. The concern here is that robo-debts cast the net too widely and put the onus on the individual to prove they don't owe any money.

BIANCA LANE: It was a big shock finding out that the debt was that large, and it was stressful to be told that you owe that much money when sometimes you weren't even making that much money.

PAUL FARRELL: Based in the New South Wales Snowy Mountains, Bianca Lane has a robo-debt of more than $14,000.

BIANCA LANE: I was on youth allowance because I had just started studying. The nature of living down here is that a lot of the work is seasonal.

PAUL FARRELL: She spent months trying to gather pay slips from half a dozen former employers.

BIANCA LANE: I was keeping track of exactly how much hours I did each day.

There's always possibilities that I made some mistakes, I'm only human, but I find it impossible that I would have a debt even remotely that large from it.

PAUL FARRELL: As she prepares to challenge the debt, it looms over her life.

BIANCA LANE: I did have plans to travel and things like that as well. I want to start saving for a house. It's stopping me from doing a lot of things.

KATHERINE BOYLE, EXECUTIVE DIRECTOR, WELFARE RIGHTS CENTRE: This is a classic robo-debt for a number of different reasons.

PAUL FARRELL: Katherine Boyle from the Welfare Rights Centre has looked closely at Bianca's case.

She believes Bianca has a strong chance of having her debt wiped by Centrelink.

KATHERINE BOYLE: One of the errors made in this particular debt schedule is they're saying she worked for two employers when in fact she just worked for one.

So, that's effectively doubled her income. So that's a whole portion of the debt that shouldn't exist.

TERRY CARNEY: There's half a million Australian citizens whose rights are being traduced and compromised by a scheme which is not lawful.

PAUL FARRELL: Professor Terry Carney presided over a handful of cases similar to Bianca's as a member of the Administrative Appeals Tribunal.

He's come to the conclusion that the system of automated debt collection is fundamentally flawed.

TERRY CARNEY: Under social security law, the onus to prove a debt lies exclusively, entirely with Centrelink, and this system operates by shifting all of that onus on to the alleged debtor.

PAUL FARRELL: In the robo-debt cases that Terry Carney heard at the tribunal, he claims the Department of Human Services, which oversees Centrelink, took extraordinary steps to avoid legal scrutiny of the system.

TERRY CARNEY: The department's conduct is abysmal.

It's the conduct that you would expect of a tin pot third world country administration because at no stage does Centrelink ever seek to defend the unlawful basis on which it's raising those debts.

DEVI BARKER: A lot of people who are on Centrelink and have received these debts are too nervous to speak out about it because they are receiving income support and they're relying on that income support.

So, because I have a job and I'm in a situation where I can speak out about it I felt like I should.

PAUL FARRELL: 7.30 asked Terry Carney to take a look at Devi Barker's robo-debt.

TERRY CARNEY: Look, there may be a small debt, certainly not $7,000 and I'd be pretty shocked if the calculation, when the figures were correctly ascertained, came in over $1,000.

So on the face of it, this person is being asked to pay, it's a bit like the mafia saying, "You owe me money." Do I have to prove that you owe me money? No, I don't. That, as people say, is what we usually say is extortion.

PAUL FARRELL: In response to questions from 7.30, the Department of Human Services said the Commonwealth Ombudsman had investigated and found it was reasonable and appropriate to ask people to explain discrepancies in data matching with other agencies.

ROWAN MCRAE, EXECUTIVE DIRECTOR, VICTORIA LEGAL AID: We have helped over 500 people who have received robo-debt notices, and every day we continue to receive phone calls from recipients of robo-debt letters, and we help them to figure out what the best course of action is on a case-by-case basis.

PAUL FARRELL: Victoria Legal Aid is preparing two legal challenges to the robo-debt regime.

Rowan McRae is its executive director.

ROWAN MCRAE: We're asking a court to scrutinise the scheme and determine whether or not it is in fact lawful.

We know it's unfair, we know it's having a terrible impact on our clients but we also think the scheme is unlawful and we'd like a court to test that.

DEVI BARKER: It's extremely stressful and especially when you can't prove that you don't have any debt. You have no power and yet they are still pursuing the debts. I just think that it's wrong.