A Senate inquiry has called for Centrelink’s controversial automated debt recovery system to be suspended until its many flaws can be resolved.

The inquiry released its report on Wednesday night, which made 21 recommendations for fixing the robo-debt system.

The inquiry has urged all debts calculated using the error-prone “income averaging” process to be reassessed. It also called for a redesign of the system with a robust risk assessment process.

Horror stories have continued to emerge about false debts imposed by the system, despite the government announcing a series of changes earlier this year.



One man, who asked to remain anonymous, said he fought for months to force Centrelink to concede it had issued him a $4,000 debt in error. He said he suffers depression and became suicidal during the ordeal.

The department agreed he owed nothing in December, but sent him another debt letter in early April, again demanding payment of the debt.

That meant he had to begin the dispute all over again. His second fight against Centrelink ended in mid-May, after the department again conceded that he owed them nothing.

“This time hasn’t been quite as bad, it’s just sort of made me angry,” he told Guardian Australia. “The first time around it was just making me suicidal, I have depression, and I’ve worked through that with my therapist.”

“I’m working on a PhD. As you can probably imagine, doing that I don’t have much money.”

Correspondence between the man and Centrelink supports this version of events.

The inquiry began hearings in March, and its chair, Greens senator Rachel Siewert, said it had exposed serious flaws in the system.

“The evidence presented to the committee as it travelled across the country was compelling, consistent, and showed a program that was putting huge pressure on some of the most vulnerable members of our community,” Siewert said after the report’s release.

“Procedural fairness is lacking in every stage of the robo-debt program; whether it be the forcing of people to reach back through their paperwork from six years ago, sending debt letters to the wrong address and/or not engaging with concerned recipients, or averaging out of income data, often producing incorrect results.”

The Department of Human Services used the inquiry to highlight the changes it had made to the system, which it said had largely resolved the problems. But others say the changes don’t go far enough.

The Australian Council of Social Service chief executive, Cassandra Goldie, said on Wednesday said the system is unworkable and must be abolished.

“Since its adoption 12 months ago, robo-debt has issued thousands of debt notices in error to parents, people with disabilities, carers and those seeking paid work, resulting in people slapped with Centrelink debts they do not owe or debts higher than what they owe,” Goldie said. “It has been a devastating abuse of government power that has caused extensive harm, particularly among people who are the most vulnerable in our community,” she said.

Anglicare Australia released a similar statement on Wednesday, saying the system has unfairly shifted the onus of disproving debts onto vulnerable Australians.

Its executive director, Kasy Chambers, urged the government to pay heed to the significant evidence the inquiry heard about the hardship caused by the system.

“The shift in the onus of proof onto recipients, the barriers to people trying to fix these problems through the Centrelink system, and the growing stigmatisation of welfare, is a step towards the criminalisation of poverty and disadvantage,” Chambers said.

“Let’s suspend this failing system and work together to design one that works for people – not just the government,” she said.



The system was introduced in July but began in earnest in September, and issued about 220,000 letters in the five months to February.



Almost half of the debts raised between July and March were referred to private debt collectors.

The system was quickly beset by complaints from vulnerable Australians, who said they were lumped with inaccurate debts, but struggled to get help through Centrelink’s overloaded phone system or its new online portal.



The system removed a key layer of human oversight and placed greater reliance on a process of data matching, which automatically compared Centrelink and tax office records to detect discrepancies in reported income.

Where a discrepancy in the two income records was detected, letters are automatically generated and sent demanding explanations from welfare recipients.

If no reply was received, the department used an error-prone process of “income averaging” that crudely divided a person’s yearly income by 26 fortnights, and assumed they were working for the entire year.

Letters were sent to thousands of old addresses, and many who did receive them were unable to explain the discrepancy or found it impossible to obtain years-old documentation to prove their income from past employers.

Others simply assumed the government was correct, accepted the income information, and paid the debt without question.

Some welfare recipients became confused by the new online portal that they were to use to check and dispute the discrepancy.

Progressive activist group, GetUp, urged the government to adopt the inquiry’s recommendations in full.



GetUp’s economic fairness campaigns director, Natalie O’Brien, expressed concern about the debt recovery scheme’s reported focus on pensioners from 1 July.

“It’s clear that their robo-debt threat disaster has caused immeasurable harm in the community,” O’Brien said. “Now they want to inflict this harm on pensioners across the country.”