Monday 24 December 2018

How the Turnbull & Morrison Coalition Governments suspended legal principle and stooped to extortion in order to pursue vulnerable welfare recipients


In July 2016 the Department of Human Services (DHS) - Centrelink launched a new online compliance intervention (OCI) system for raising and recovering debts.

Its aim was to raise up to $1 billion dollars allegedly owed by welfare recipients.

This compliance intervention became known colloquially as robo-debt.

Current Australian Prime Minister and Liberal MP for Cook Scott Morrison was federal treasurer for the first two years of the ongoing robo-debt scheme.

During this time the suicide of welfare recipients being pursued for so-called debt recovery began to be reported.

Since 2016 only a small number of welfare recipients have brought their robo-debts before the Administrative Appeals Tribunal for adjudication. It has reportedly set aside 34 per cent of these robo-debts (or one in every three) and varied another 2,4 per cent.

Most welfare recipients don't have the resources to fight these alleged debts.

The Guardian, 18 December 2018:

Centrelink’s “robo-debt” system is a form of illegal extortion allowed by failings across a “plethora” of democratic and legal institutions, according to a former member of the administrative appeals tribunal.

Prof Terry Carney, a long-serving member of the AAT, has penned an extraordinary attack on the institutional failings that allowed the robo-debt program.

It’s the second time Carney, who helped oversee the writing of Australia’s social security laws, has used academic journals to condemn the system as illegal this year.

Carney’s last paper said robo-debt involved the enforcement of “illegal” debts that in some cases were inflated or nonexistent, an allegation that was forcefully rejected by the Department of Human Services. Hank Jongen, the department’s spokesman, said at the time that the department “strongly refutes any claims that it has conducted its compliance activities in a manner which is inconsistent with the legislation”.

This time, Carney used a piece in the Alternative Law Journal to map out the numerous shortcomings that allowed the system to come into being and operate for 18 months without challenge.

 “The pivot for this article is not so much that Centrelink lacks legal authority for raising virtually all debts based on a robo-debt ‘reverse onus’ methodology rather than use its own information gathering powers – for this remains essentially uncontested,” he wrote. “Rather it is extraordinary that this went unpublicised and uncorrected for over two years.”

Centrelink has long used a system of automated data-matching to detect discrepancies in income reported by welfare recipients, to detect and claw back overpayments. But it introduced significant changes from July 2016, reducing human oversight and expanding the system considerably in a bid to recover more debts and improve the budget. The new system effectively shifted the onus onto the welfare recipient to prove they owed no debt to the government.

The system spat out letters to individual welfare recipients as soon a discrepancy was detected in their reported income to Centrelink and records held by other agencies, like the tax office.

A flawed process was used to calculate their debt if they did not respond or could not produce evidence of their previous pay, which involved averaging out their yearly income across all 26 of Centrelink’s fortnightly reporting periods. The process often led to the false assumption that a welfare recipient had worked across an entire year and was ineligible for social security, thereby creating a debt.

Carney argues the rushed design of what he described as a “machine-learning budget ‘savings measure’” trumped good design standards. He says inquiries by the auditor general and the commonwealth ombudsman into the system had failed to consider whether it was raising debts on a lawful basis.

Carney also argues that Centrelink, by pursuing debts raised through the controversial “income averaging” technique, has failed to adhere to ethical administration. He says Centrelink has continued to use this method, despite knowing AAT rulings that it is invalid…….

The privacy safeguards in the first tier of the AAT mean that most legal challenges against welfare debts are not publicised, he writes. That means that “rulings overturning Centrelink reasoning remain hidden from the public”…..

TERRY CARNEY AO, Emeritus Professor, University of Sydney, Centre for Health Governance, Law and Ethics, 2018:

* University of New South Wales Law Journal, Vulnerability: False Hope For Vulnerable Social Security Clients?

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