Here’s The Lowdown On The Centrelink Debt Crackdown Shitstorm

Over the holiday break – and I hope you had a bloody corker – you probably noticed a few stories about Centrelink starting to worm their way out of the woodwork. Many people who had received financial support from Centrelink in the past have been receiving notices accusing them of being overpaid – and demanding they cough up the illegitimate funds ASAP.

Many of these notices were absurd and plainly based on error. The Guardian – through reporter Christopher Knaus, who has been doing stellar work on this issue – reported that a single mother was slapped with a $24,000 bill because of an error in how the system registered the name of her employer.
According to MP Andrew Wilkie, a man who suffered from severe anxiety reported feeling suicidal after receiving a notice from Centrelink that he owed over $10,000 – despite the fact that an inquiry from Wilkie’s office found Centrelink actually owed the bloke $700.
The minister in charge of this nightmare, Alan Tudge, is currently enjoying an extended Christmas break. In his absence, Social Services Minister Christian Porter has appeared on the ABC and claimed that the system is actually working extremely well, and that they have received a low number of complaints for the 169,000 letters that were sent out last month.
“These are not debt letters,” he told the ABC. “They are polite letters, the initial letter that goes to the welfare recipient saying that an issue has arisen, that there may be a discrepancy and we require some further information.”
So what’s actually going on, where are these letters coming from, and what the hell should you do if you’ve got one?
Righto, so Centrelink is just reclaiming illegitimately issued welfare. Seems fine to me.

That’s the claim from the government, and they’ve flagged for a while that part of their budget strategy was to claw back the alleged $3 billion in excess Centrelink payments.
You can very easily argue that there’s probably more money to be made in making sure companies are paying appropriate tax than shaking down low income earners, but even if you’re from the richly thought out ‘GET A FUCKIN’ JOB’ school of economic planning, you should find this somewhat concerning.
This is merely a preview of what the social safety net will look like administered by ruthless algorithms.
behold: the welfare-bot 3000

Basically, the way the automatic matching program works is that it connects welfare recipients to the data held by the Australian Tax Office. It’s a classic case of the left hand not knowing what the right hand is up to – these databases aren’t perfect, work on different parameters, and are often hobbled by decades of incorrect data entry practices.
As in the case of the single mum copping a $24K notice, sometimes the data doesn’t line up, and there’s little human oversight to pick through the rubble. A computer decides you owe money, and a notice is churned out and sent to your address. If a response isn’t heard within 21 days, the government assumes it’s 100% right and proceeds to pursue debt collection measures.
As The Guardian reported on the 23rd of December, a Centrelink compliance officer said that the system was error-prone and hugely punitive, but that many people receiving the notices were just paying up without challenging the discrepancies. A *jaded cynic* might well say that this is exactly what the government wants them to do.
Not to mention the fact that anyone who has ever had to call Centrelink, visit a physical location or use their online services would know they are completely useless – it’s a Kafkaesque nightmare labyrinth which seems to immiserate by design.
Even if you’re someone who hates welfare recipients for some fucked reason, pay attention. This is the kind of over-reliance on Big Data at the expense of human concerns that’ll almost certainly bite you in the ass some day.
Where is the system fucking up specifically?

Obviously many of these mechanisms are somewhat opaque, but the main issue at hand here is a bit of clumsy bit of blanket math done on the matched data between the ATO and Centrelink.
People who are on Centrelink programs such as Newstart and Youth Allowance often do work, but in casual or non-permanent roles, often with flexible and uncertain hours. Regardless of what people were reporting as their earnings to Centrelink on a fortnightly basis, the system merely divides the income the ATO provides by 26 fortnights and works from that figure.
But obviously, people’s income will fluctuate. You might earn more or less in one fortnight, you might get a new job or lose one, so on and so forth. The onus is on you to pull out those payslips and prove that you didn’t consistently earn throughout the year, despite the fact Centrelink ought ostensibly to have that info already.
Oh, and the government literally knows this is a problem, by the way.

OK, so how are people trying to get out of this?

Porter’s statement today clarified that these letters are actually not debt notices but merely polite letters requesting clarification. Which is a particularly charitable way of describing text messages like this one:

Everyone knows what it’s like when you cop that kind of message from a government agency like Centrelink or the ATO. It’s frightening – especially to someone on low income. It’s unsurprising that many pay these debts quickly – even if they may be illegitimate.
This mirrors the statement from Department of Human Services general manager Hank Jongen last week:
Over 70 per cent of people who received an online compliance letter since September this year have completely resolved the matter,” he said.

Only 2.2 per cent of customers were requested to supply supporting documentation, which means 97.8 per cent of customers did not need to supply supporting documentation.

The department is determined to ensure that people get what they are entitled to, nothing more, nothing less.

These figures are not particularly illuminating in and of themselves. The alleged 97.8% of people who received notices but were not required to provide supporting documentation does not include those who may have paid an illegitimately issued debt, or how many of those 70% of people were unnecessarily stressed with a false debt.

How do people challenge it? Well, Porter says that these notices mean they merely have to go online and ‘update their information’. What this ends up meaning in practice – especially for larger debts – is that the person needs to dig in and start providing proof, often in the form of payslips.
To challenge these discrepancies could mean that you might be digging back through some pretty damn old payslips to sort this shit out. A HR representative at a large company, speaking to PEDESTRIAN.TV anonymously, confirmed that she had received a number of recent inquiries from employees about old payslips – as old as five years prior, in one particular case.
Given that Centrelink has in the past recommended that people only keep six months of payslips, this change is likely to cause even more stress.
I’ve copped one of these notices, and I don’t think it’s right. What the hell should I do?

A social media campaign has emerged in response to the general anger about this. The Reddit thread documenting cases only grows larger, and the #NotMyDebt website has emerged as a collection of stories as well as a directory of resources one can utilise in addressing the problem. They provide a clear set of steps you can take.
If these really are just polite letters as Christian Porter claims, and that a huge proportion of applicants are not required to provide additional payslip information to clear their debt, then hopefully this spot of bother was really nothing to be concerned about in the first place, right?
Not so much. This is, unquestionably, a dirty trick from a government that doesn’t believe in welfare at all, and is making a conscious effort to disincentivise the use of Centrelink through the social services equivalent of drone warfare. It’s not unfathomable that people, afraid of being slugged with a huge bill later down the line, will do their best to avoid receiving welfare in even desperate circumstances.
It’s also an issue that the Opposition needs to be standing up on. Social services spokesperson Linda Burney has put up a fight, and Labor and the Greens have both demanded a freeze while the issue is sorted out. By the same token, it was Labor’s support of the Omnibus savings bill which gave the Coalition the power to go on this warpath against low-income Australians.
It’s a bad situation. But support networks are developing. If you’re hit with a notice – don’t panic. Send your story to #NotMyDebt, and follow the steps.
CORRECTION: An earlier edition of this article associated the image content of a quoted tweet to the individual who tweeted it. PEDESTRIAN.TV regrets the error.
Source: Getty Images / Matt King.