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Centrelink debt system: government knew of error risks 'for decades'

17 February 2017
Christopher Knaus
Guardian

The man who led the first audit of Centrelink data-matching in 1999 says the government has known for decades that the process was prone to error without human oversight.

John Mayger, a retired auditor with the Department of Social Services, said his audit showed that detecting overpayments through data-matching was problematic without a high degree of staff vetting to provide an effective balance.

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But last year the government automated the process, reducing human oversight, while automating the recovery process to claw back what it says is $4bn of debt.

“Management ... would have known exactly what percentage [of debts] were going to be incorrectly raised, but they took no notice of that,” Mayger said.

He plans to make a submission to the pending Senate inquiry, which was prompted by sustained complaints about the system. 

The Department of Human Services said it had recently conducted audits. Its communications manager, Hank Jongen, said they had found the system was largely working well to identify overpayments. 

“These reviews have found the system generally effective in identifying overpayments, while recommending enhancements that we have acted on,” Jongen said. “The department takes any recommendations for improvements seriously and implements them as appropriate.”

Guardian Australia has requested those audits.

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The Coalition, after initially rejecting criticisms, has now made a series of changes designed to improve the system’s fairness

The Digital Transformation Agency is also working with the department to implement changes, according to the assistant minister for digital transformation, Angus Taylor. 

Labor’s Linda Burney and the Greens’ Rachel Siewert continue to press the government to scrap the system. They appeared alongside unions, community groups, a victim, and the campaign group GetUp, outside Parliament House this week, arguing for human oversight to be added back into Centrelink’s debt recovery efforts.

Siewert said the government was knowingly mistreating people who had done nothing wrong.

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“The government knowing for two decades that automated debt recovery results in a high level of error demonstrates their heartlessness and callousness.”

Mayger said that when he worked in the department in the late 1990s, regional offices included teams of fraud-control officers, known as “fieldies”, who would scrutinise potential overpayments. The teams would include a senior manager, who looked at data-matching to decide whether debts had been validly raised. 

“Well, the government decided it would have what’s called an efficiency dividend, which just means you cut staff,” he said.

Staff losses have been a constant criticism of the Community and Public Sector Union, which represents many Centrelink staff. 

The union has said the debt recovery system’s problems were a product of bad policy and cuts to resourcing.