In July 2016 the federal Coaltion Government began
to issue income
compliance notices
based on automated data
matching.
At
the time the then Minister for Social Social Services Scott Morrison
expected to clawback an est. $1.7 billion dollars over
five years from
individuals who were, or had been in the past, receiving a
Centrelink pension,
benefit or allowance.
By
2019 at least
570,000 of those
over 600,000
income
compliance notices were
considered to be
unlawful.
As were Australian
Taxation Office garnishee notices associated with these alleged debts.
Refunding
these wrongfully raised debts would see at least $555.6
million
returned to Centrelink clients.
Becoming
a member of a class action does not expose a ‘robodebt’ recipient
to any additional legal liability with regard to the alleged debt.
However,
the Morrison Government is possibly
hoping
many victims will not realise this and sign the Centrelink “Opt
Out Notice – Federal Court of Australia – ‘Robodebt’(Social
Security Debt Collection) Class Action (VID1252/2019)”
notices
it is currently sending out.
Gordon
Legal has outlined
possible court dates:
On
6 March 2020 the Honourable Mr Justice Murphy of the Federal Court
ordered that the parties hold a mediation prior to 19 June 2020. This
is an opportunity for the matter to be resolved with the consent of
both parties.
Justice
Murphy also ordered that, if the matter does not settle at mediation,
a trial will begin in the Federal Court on 20 July 2020 (or if that
date is not available, on 21 September 2020).
Services
Australia (formerly
the Dept. of Social Services-Centrelink) despite its denials continues to raise alleged
debts and send out notices.
Hundreds
of thousands of Australians affected by the government’s robodebt
scheme will receive notices from Centrelink about an upcoming class
action under orders from the federal court.
Guardian
Australia last month revealed
secret government advice showing the commonwealth hopes to settle
the case and has privately admitted more than 400,000 welfare debts
were unlawfully issued under the scandal-ridden “income compliance
program”.
But
the parties are yet to reach a settlement, setting up a potential
trial as early as July where law firm Gordon Legal will seek interest
and compensation as well as the repayment of debts unlawfully claimed
by the government.
Under
court orders issued in March, the government has been told to
identify all potential class action members and send out notices via
MyGov or by post about the upcoming court challenge by 25 May.
More
than 12,000 people have registered with the firm, but under
Australian law people identified as members of the “class” are
considered part of the action unless they “opt-out”, which would
allow them to pursue their own individual claim.
Labor’s
government services spokesman, Bill Shorten, said the government
should “settle this case immediately, restore public confidence in
Centrelink by allowing the court to be the independent umpire, and
pay the victims back their money as well as interest”.
“This
would allow the hundreds of Centrelink workers working on limiting
the government’s robodebt exposure to be moved back to the
frontlines of helping their fellow Australians with their social
security needs in this time of national challenge,” he told
Guardian Australia.
Since
July 2015, more than 600,000 debt notices had been sent out under the
scheme, which the government conceded was unlawful in federal court
in November, while thousands more received letters demanding they
prove they were not overpaid by Centrelink.
Some
debt recipients had their tax returns seized over the debts, while
others were also forced to pay a 10% “recovery fee” on top of the
alleged debt.
Gordon
Legal believes the case would represent one of the largest class
actions in Australian history.
Late
last week, the government declined to answer several written
questions about the robodebt scheme, successfully applying for public
interest immunity in the Senate.
Services
Australia declined to answer how many debts had been issued using the
unlawful “income averaging” method or whether it would repay
victims, including debts recovered from deceased estates.
“This
question relates to a court case that is currently before the federal
court of Australia,” the agency said. “Services Australia will
abide by any decision of the court.”
But
a ministerial submission to cabinet, leaked to the Guardian, revealed
the government hopes to settle the case and that Services Australia
expects to “administer 449,500 refunds determined under the
programme”, worth $555.6m.
The
robodebt class action notices come as the government pushes ahead
with plans for an inquiry into class actions in Australia.
Porter
last week claimed a “lack of regulation governing the booming
litigation funding industry is leading to poor justice outcomes”.
But
Labor has argued the inquiry is a response to Gordon Legal’s class
action against the robodebt scheme.
If
the parties do not reach a settlement, a trial is expected between
July and September.
The
government’s legal advice shows it expects to lose the class action
under Gordon Legal’s claim of “unjust enrichment”, although it
believes the compensation claim is less likely to be successful.
“This
is likely to result in the commonwealth being ordered to repay debts
within a timeframe set by the Court, and to pay interest and legal
costs,” the advice said.
Court
documents show the number of potential victims expanded in March
after the government withdrew an earlier claim that people receiving
Carer Payment were not subjected to the scheme.
The
government has conceded in court that debts that relied on income
averaging were invalidly raised, but claims it should not have to pay
compensation because it does not hold a common law duty of care to
welfare recipients…...