Officials from the Department of Human Services told a Senate inquiry it contracts three external debt collection agencies to collect the so called "robo-debt": Dun & Bradstreet, Probe Group and Australian Receivables.

Each debt collector is paid a commission based on the amount they recover.

"It's a commission based on the amount collected for each debt... no flat fee, it's just commission," an official from the department told the inquiry.

But the department wouldn't reveal the rate of commission that debt collectors receive under the tiered payment system.

Officials claimed that because there was a competitive tender for the contracts, the payment amount fell under "commercial in confidence" and couldn't be publicly disclosed.

Centrelink's debt collection system differs from the Australian Tax Office's, which contracts people on a flat fee with no commission, officials said.