Two weeks before legal challenge Australian Government rewinds robo-debt

Published:: Tuesday 19 November 2019 at 12:00 am

The Australian Government has committed to immediately stop some of the worst elements of the controversial robo-debt scheme. It is due to be considered by the Federal Court in two weeks in a test case being run by our organisation.

According to media reports, the Department of Human Services will conduct a sweeping review of all debts using averaging and will no longer raise a debt which only relies on averaging of Australian Tax Office income data.

Rowan McRae, Executive Director of Civil Justice Access and Equity welcomed the announcement. 'Robo-debt is so clearly flawed and has caused hardship to hundreds of thousands of Australians, including some of the most disadvantaged members of our community. We are pleased that the worst elements of robo-debt will be scrapped,' said Ms McRae.

Our organisation has argued that using averaged income data and the reversal of the onus of proof to raise robo-debts is unlawful. The test case is due to be heard by the Federal Court on 2 December 2019.

'The Federal Court is weeks away from considering the lawfulness of robo-debt. Today’s announcement is welcome news for our clients,' said Ms McRae.

The government has not released details about whether other troubling elements of Centrelink’s robo-debt scheme will continue. Deanna Amato’s test case also raises concerns around the lawfulness of enforcing robo-debts using punitive penalty fees and seizing people’s tax refunds.

'We are waiting for further details about the system changes to make sure that Centrelink’s enforcement of unfair and flawed robo-debts are also addressed,' said Ms McRae.

Ms McRae also called on the Australian Government to take stock of the deep flaws of robo-debt and to ensure any replacement system is properly designed.

'We welcome the news that Centrelink will no longer use averaging to calculate faulty robo-debts. Now the government should work with users to design a fairer, more accurate system that people can trust,' said Ms McRae.

See our recommendations for a fairer system.