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Centrelink debt collection 'aggressive' debt collection tactics under fire in Senate inquiry

8 March 2017
Claire Bickers
News.com.au

Almost 85,000 welfare recipients were forced to repay Centrelink debts in the two months leading up to Christmas, new figures show. 

Department of Human Services secretary Kathryn Campbell defended the need to call in debts over the Christmas period during a senate inquiry into the Centrelink “robo-debt” recovery scheme today.

Ms Campbell also blamed the level of media scrutiny on the scheme in January for escalating public concern and the amount of calls to Centrelink.

Department officials were also asked to address reports that a Centrelink recipient took their own life due to their concern about the debt they owed.

Ms Campbell said the Department had a “different view” of the circumstances of that case to what was reported in the media.

When quizzed further about the distress the debt notices had caused some people, Ms Campbell said: “We often find people are distressed when dealing with the social welfare system.”

[...]

She added that people became more distressed at Christmas and in January due to “significant media attention”.

“Because of some of the stories in the media there was a belief that all debts were wrong and so therefore people started to say ‘I want this debt waived, I don’t think I should have to pay this back,” she said.

Ms Campbell also told senators there were significantly less debt assessments launched in December because the department was aware that it was a difficult period for some people.

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Figures provided to the department today show Human Services launched more than 103,000 assessments into overpaid welfare recipients in November and December alone.

The department ramped up its recovery efforts in September with the number of assessments increasing from 844 in August to more than 62,000 the next month.

Overall, about 216,000 investigations were launched from September to December and 133,078 debts were recovered.

More than 97,000 people were charged a “recovery fee”as they had not provided information about their income or a reasonable explanation for the lack of information.

[...]

Greens Senator Rachel Siewert, chair of the senate inquiry, said the government “should be ashamed” of calling in debt notices over Christmas.

“A large portion of those had a recovery fee applied, meaning struggling Australians are paying debts they may not owe as well as additional recovery fees,” she said.

“I continue to hold deep concerns that people are complying and paying debts off that don’t exist - 2875 people so far have had their debts reduced to zero since the program began but I suspect many people are still in the process of reassessment and review.