Fictional debt, initially 3300, beaten back to 1300, more to go

First, some good news. I challenged the fictitious debt when it arrived, and had it reduced from ~ $3100 to ~$1300.

Because of bad advice from Centrelink Compliance, it was not reduced to zero as it should have been. I am still pursuing the revocation of the fictitious debt.

I am happy to help anyone with similar problems track down evidence. Check your old emails for payslip attachments, and dig up your old bank statements. If you have online banking, you can probably download older statements.

Here's the story.

My first notification about this was a request via SMS, without context, to update my income details. No explanation was given. As I had not been on Newstart for two years, I could not see what this had to do with me. My.gov.au is somewhat unreliable, at times showing incorrect data, at times crashing or hanging, at times producing error messages. (I have informed Centrelink of these bugs repeatedly.)

As I was not on Newstart, I ignored the mysterious SMS. Why should I be notified by SMS alone by the government? Where's the letter?

These SMSs were sent in September or October.

In November, I received a letter dated 27 October declaring that I had a debt of $3,154.11. Actually, so that you can see how obscure the letter is, here is the text:

"Dear Dr _________
Your employment income review has been completed
We have completed our review of your employment income details and made a decision to change the amount you were entitled to received. This means you have a debt of $3154.11. You will be sent a separate notice about how to pay this debt.

This is a notice of decision under social security law.

[...stuff about going to my.gov.au to get details...]"

Notice that there was no explanation of how this debt was determined, not even a mention that it had to do with Newstart.

Of course, going to my.gov.au to "get details of this decision" revealed nothing, no explanation, no computation. So I took the letter and went to the Centrelink office, and joined the queue. The queue there is frequently long enough to reach the automatic doors, which are constantly opened by the people standing in the queue.

At this point, I will outline my story in the relevant period. In March 2013 I was made redundant by my employer after working there for eleven months. From March 2013 to November 2014, I was unemployed and provided for myself and my family using my savings, being super thrifty, and some help from family. By September, however, it was clear that the money was running out. A family member told me I should apply at Centerlink for Newstart. I had to wait several weeks before payments began. The same family member even told me to lie about my assets to get Newstart sooner, but I did not. I used my own resources until they were exhausted, before applying for Newstart.

My bank statements show that Newstart payments began on 21 December 2014, and were paid fortnightly ($407.03) until 13 March 2015. The last payment was $353.99.

I began work again in late February 2015, casual work until July 2015, 1.5 days per week. The first payment was March 2015. Later that year In April, I got additional contract work with a Consulting firm, 3.5 days /week.

The Centrelink officer heard my story. She told me that this was to do with Newstart / ATO matching and gave me a telephone number to call Centerlink Customer Compliance. This phone number is 1800 086 400.

[At some point before here, I remember going through my bank statements and gathering the dates and amounts of pay. I sent these in as a spreadsheet via my.gov. This was before I got the debt notice.]

The Centerlink officer said that the spreadsheet was insufficient, I needed to supply payslips. The debt arose because my ATO payment summaries listed start and end dates for my employment at Allegro from 7/2014 to 6/2015, and for ACU from Jan 2015 to Jun 2015. In fact the start and end dates were: 4/2015 - 6 2015, and : 3/2015 to 6 2015. (Maybe 2/2015 depending on how the rules work for Newstart - is it when I'm hired, or when I'm paid?)

The Centrelink officer said that the computer system had averaged out my income over the year, and determined that I earned an average of about $1000 per week. It then just made shit up - it assumed that the _average_ fortnightly earnings were _actual_ fortnightly earnings. This is going to bite anyone who was on Newstart for part of the year, and earned income for some other part of the year, as I did. These fictitious fortnightly incomes will overlap with the Newstart period, automatically implying that other sources of income were undeclared, and that there was a Newstart overpayment.

This is the much discussed scam that Centrelink Compliance is pulling at the moment - assuming that the _average_ fortnightly earnings were _actual_ fortnightly earnings. The assumption relies on the dates shown on ATO payment summaries prepared by employers. In the case of my 2nd employer, they just used blanket dates of 1 Jul 14 - 30 Jun 15, covering the whole financial year, not the actual dates which were Apr 15 to Jun15. 1st employer used dates of 3 Jan 2015- 30 Jun 2015, going by semesters I would guess, being a university, and not the actual dates of 2/15 to 6/15.

It is so disingenuous for Centrelink Compliance and Government Ministers, to claim that this is a sound accounting calculation. Certainly there are many employers who fill in ATO payment summaries using start/end of FY dates, and not the actual employment dates, as default employment dates. To conclude that these represent actual employment dates is naive or lazy, or willful.

It occurs to me that lazy employers not using the actual employment dates may have some culpability here, and perhaps if a class action begins, a lot of employers will start grumbling about having to go back through their records to retrieve actual start/end dates.

Also the payment summary provides for a single start and a single end date. What does an employer do if they engage people for multiple short term contracts in a financial year. Issue multiple payment summaries? I bet not. I bet you get one payment summary with one start date, and one end date. The payment summary format that I see is not suited for multiple gigs at a single employer.

Hence my fictitious debt, based on fictitious fortnightly earnings.

The Centerlink Officer told me to send in my paysheets for the 2nd employer. Curiously, he did not ask for my University paysheets. I wish I had queried it at the time. Perhaps he thought the Uni payment summaries, with a 3 Jan start date had the right dates. (Which they did not.)

SUCCESS! Partially. On 24 November 2017, I got an Account Payable letter saying that my calculated debt amount had been changed to $1312.98. So the employer 2 paysheets helped. But why not zero?

Pretty clearly, they were still averaging out my University payments and claiming an overpayment. I was very annoyed at the Centrelink Compliance officer who told me to only send one employer's paysheets. (I made a complaint about this via the complaint line 1800 132 468.) So I gathered up my other paysheets, wrote a cover letter and took a chance with the not fully reliable my.gov.au and uploaded them. A bit of a chance, as I have had uploads through the my.gov.au upload mechanism hang and fail. It feels like an early 2000s dodgy website, sorry my.gov devs, but there it is. Read my bug reports. If the uploads failed, my fallback was to trek to Centrelink with a fat novel with enough pages for an hour or two.

Fortunately, the uploads succeeded this time. So I had done what it said in the letter: I went "online [...] to provide us with more information."

But then December 28, and I get a Payment Now Due letter! Did no-one look at the supplementary information?

I phoned them today, January 11, and indeed, it turns out, as i was told by the Centrelink Compliance Officer, that no-one had reviewed the University information. He told me they would look the material I submitted. I fully expect most of the debt to be revoked. Maybe not quite all, as there was one last payment that occurred after I started, but before my first pay.

However, as a debt was raised I had to make arrangements to start paying it. Otherwise the debt would be referred to a debt collection agency. I was transferred to "Debt Recovery". I told them I have no income, but that I'm hoping for a new contract at the end of February. They deferred my repayment until the 11th of February, with a possibility of extension.

I fully expect the fictitious debt to be revoked. I intend to pursue this whole question vigourously. I have a couple of FOI requests planned; a letter to the Ombudsman; a letter to the DHS Director-General; letters to my MP, the Ministers, and one for the Deputy Prime Minister rebuking his silly comments. Furthermore, I have already given my story to Crikey once, but I will write to other media outlets as well. If necessary, I will raise the matter at the Administrative Appeals Tribunal, and I will willingly assist any organised activism or legal class action against this bullshit. .

I have a number of reactions to the matter. When one has no income, it is a frightening thing to be suddenly hit with a $3000 plus debt with no explanation for its creation. It's a grim thing to have to deal with the government over the phone, or in person - it takes hours. I have had phone batteries die on me while on hold.

(Today, they hung up on me twice. I was civil, but assertive. I wonder if anyone else is getting hang-ups?)

The menacing repeated references to debt collection agencies are even more frightening. I have no idea how that would work. I have been a little jumpy lately, expecting burly thugs to show up one night with truncheons to take my car away.

Consider that this is also a de facto accusation of fraud. When I applied for Newstart, I had to sign a declaration that all my information would be correct, and there were warnings about penalties for false declarations. By claiming a debt, they are claiming that my declared income was incorrect. This is evidence that I committed a fraud. So will I be charged with fraud? Interestingly, when I asked the Centrelink Compliance officers this, they seemed to pause for a second. Surely this was not a new thought to them. Perhaps they have to be careful about ruling out fraud charges. Then they said that no, I would not be charged with fraud, and one threw in that my credit rating would not be affected.

Nevertheless, I feel like I am under threat of some criminal action based on fictitious data. It is also an insult to be implicitly accused of frauds and rorting...especially given what we are seeing in the news today. And that I explicitly did not commit a fraud when urged to do so once.

I do not burden my children with these worries, as I don't want them to worry helplessly. Sorry kids for seeing this, but I have to fight back now.