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The cost of ideology

By 2353NM

Given recent events in Australia, you could say the price of political ideology is $1.2 billion, as that is the settlement the Coalition government negotiated to make the ‘robodebt’ class action go away without a court case. Probably more telling is there appears to be nothing for the thousands that are suffering long term psychological effects as a result of being falsely accused of large debts or even more sadly, nothing for relatives of those who felt the only way out of the financial issues caused by the Coalition’s systemic use of the ‘income averaging’ process to calculate Centrelink debts was suicide. The Conversation provides a detailed timeline of what it calls the fiasco as well as a discussion on Centrelink’s apparent long standing policy of settling any legal disputes resulting from ‘robodebt’ letters before they reached a court determination.

Despite the evidence of the former head of the Department of Human Services at one Robodebt Senate Enquiry claiming the scheme wasn’t linked to anyone’s death it seems there are a number of people with first-hand experience that have a different recollection

Handwritten letters were submitted to a Senate inquiry this afternoon by Queensland mothers Kath Madgwick and Jennifer Miller.

The women were responding to a comment made by Department of Social Services secretary Kathryn Campbell at a previous senate hearing on July 31 that assertions people had died over robodebt were “not correct”.

In her statement, Ms Madgwick wrote of her “amazing, caring and intelligent boy” Jarrad, who died on May 30 last year.

Others have claimed the death toll from robodebt is 2030 people, a number far higher than the Australian death toll from COVID-19 (at the time of writing this article).

Robodebt is a process within Centrelink that matches income reported through various government computer systems over a financial year and compares the income with benefits paid by Centrelink throughout the year. The problem is where a recipient doesn’t receive the annual income on a consistent basis.

For example, a student earning the (apparently mythical) $3,000 a week picking fruit over the three month Christmas break will report no income to Centrelink for the period of the year they are studying full time. As the wages earned run out, the student honestly reports no or minimal income in a Centrelink income support application as they are a full-time student. Centrelink assesses the claim and pays the relevant payment according to its rules.

When the student completes their tax return sometime between July and October and submits it, the ATO computer reports to Centrelink that the student received $36,000 from an employer in the past financial year. The Centrelink payment received while the student is studying full time is (according to the ideology of the Coalition) undeserved as it will be frittered away on trivialities but in reality is spent on essentials such as rent, food, uni fees and so.

Centrelink’s robodebt system then comes into play, looks at the $3,000 a week income earned in 3 months picking mangoes in northern Australia in the height of summer, annualises the income and sends a letter out some time later to the student saying they were overpaid. The justification for the letter is the automated system believes our student ‘earned’ close to $700 a week for the entire year. By the time the robodebt letter is sent, the student has moved, uses a different email address and knows nothing until a debt collector (whose job it is to get the money as per the details provided, not re-assess the accuracy of the claim) comes knocking on their door, chasing the original but incorrectly calculated debt, plus debt collector fees plus interest.

If only there was a way for someone to look at the computer calculated claim and follow the trail before sending out the letter. Well there was; until the Coalition in their ongoing battle to victimise those that need assistance, tweaked the system

In the past a Centrelink officer would do a basic investigation before deciding whether to send out a letter. But since July 2016, the computer prints out and sends the letter on its own.

The letter asks people to log on to myGov and explain why the income they’ve reported to the welfare agency is different to what their employer has reported to the tax office.

Before the system was automated, only 20,000 interventions were made a year. Now the amped up system is running at 20,000 a week [in 2017]

The Government says it’s wrong to characterise these as “debt letters” — Centrelink is just trying to get more information about what’s behind the discrepancy.

‘Gaining more information’ is probably fair enough as Centrelink does have an obligation to recover benefits claimed incorrectly, but oversight by someone that can make a judgement call is far preferable to reliance on a machine that applies the logic it has been programmed to apply. If 20,000 ‘information’ letters are sent out in a week rather than the previous 20,000 a year, surely someone would have noticed (even when boasting they had exceeded their performance indicators if nothing else).

You would have also thought that if a considerable number of people are complaining about a process to their local MPs and the media, the responsible minister would have asked for some information on how the system was working and if it was legal. Apparently not. It took two Senate Enquiries and a class action to find out what was happening.

The Coalition Treasurer in 2016 was Scott Morrison. He announced the change from human oversight to reliance on data matching as a part of a plan to expand automation, implemented to save costs just prior to the 2016 budget. “Responsible” ministers for the operation of robodebt also include Alan Tudge and Stuart Robert, both of whom seem to have an interesting set of moral and ethical values.

Settling this class action has cost $1.2 billion, plus the fees and costs associated in the negotiation of the settlement. It took two Senate Enquiries to publicise the details of the people having long term financial or psychological problems because our government was effectively acting illegally. And most importantly, the Coalition’s settlement doesn’t help and support those who felt so alone and depressed they took their own or their families’ lives. The Coalition claims that the ALP used a similar system, and they did. But the ALP system had human oversight which implicitly understood the truism that not all income should be annualised.

In January 2020, Morrison only committed $2 billion to bushfire recovery across the nation. It cost $1.2 billion to buy their way out of the robodebt fiasco they created, and we don’t know the cost of the legal and administration fees on top of that. Shows where the Coalition’s priorities lie, doesn’t it?

What do you think?

This article was originally published on The Political Sword

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  1. pierre wilkinson

    and let us not mention the $10,000 to $14,000 administration fees for each card, per annum
    – not that we could afford to give the buggers an extra $200 a week,
    especially as our “donor mates” are laughing all the way to the banks that we have just released from one of the more stringent requirements of their loan business
    ah, now to just beat the drum about how we are going to meet and beat our kyoto targets
    then throw in a photo op of our PM
    and I felt sorry for the USA :'(

  2. New England Cocky

    This CentreLink abuse of Mathematics and Statistics clearly demonstrates why the COALiiton is easily the worst financial managers in Australian history and unfit to run a pub chook raffle, let alone the Australian economy.

    It is the same Mathematical thinking that has cost shearers too much in tax paid during the shearing season doing a skilled physical job that for 4x 2 hour runs (=8 hours/day) that most Canberra bubble occupants would have difficulty completing for 8 minutes a day!!

    Say a gun shearer on piece rates shears 200 sheep a day @ $4.00 per sheep, times five (5) days; that is $4,000 per week. But shearing only runs for about nine months, say 40 weeks to earn gross about$160,000 if they follow the sheds, while local shearers may only work for a couple of months. The remaining three moths lay-off is time for the body to heal from the physical punishment of working in the sheds and drinking, often excessively, to drown the boredom of life in remote Australia.

    Now the ATO taxes shearers on the weekly wage earned without averaging in the lay-off period, meaning that most shearers get a tax refund eventually when the ATO gets around to completing their part of the accountancy.

    Obviously this is NOT a fair tax system compared to a metropolitan office desk jockey shuffling papers and drinking lattes in air-conditioned comfort, while earning the same $160,000 per year but taxed over 52 weeks rather than 40 weeks.

    FYI: yes I have worked in shearing sheds, picking up not shearing, and it was the hardest physical work I have ever done1

  3. king1394

    While, thankfully, I have not seen the standard letter that Centrelink sent to Robodebt debtors, I have had enough communications with them over the years to be sure that said letter was headed with a bald statement announcing the person’s indebtedness, and probably stating that the amount was payable immediately and that all benefits would cease. The letter would have been brusque in tone and probably strongly implied that the recipient had committed a crime.
    I still view letters from Centrelink with fear as bringing trouble and hardship. I have no doubt that vulnerable people could be driven to suicide.

  4. wam

    I think for the lack of a human thousands of the unemployed poor suffered fearful hardship.
    I think for the lack of a human the politicians steal $millions
    I think for the lack of humanity indue steals millions from welfare
    I think macklin’s acquiesence to the lying rodent’s stereotyping Aborigines as one rather than as individuals is alive in today’s labor whose attitude is hardly encouraging to the inhabitants of remote settlements.
    Perhaps we can judge labor’s robodebt attacks on roberts, tudge and scummo have been somewhat less than the late dennis healey’s description of being criticised by geoffrey howe.
    it would be nice if albo could find a bloody rubicon and with a iacta alia est cross the bastard.

  5. New England Cocky

    @wam: It would be nice if Albo found his balls and spoke up for the Australian voters he hopes will vote for Labor to rid us of this corrupt and corrupting COALiiton misgovernment.

  6. leefe


    Letter in my inbox from them today. It was just about the latest teensy little extra bit of pocket-money that is supposed to make up for axeing the usual cost-of-living adjustment on pensions. I knew it was probably just that. Still the usual gut-roiling panic attack just in case it’s something else, because there’s no telling what they can come up with to make people’s lives a misery.

    All that aggro over a few hundred here or a thousand or two there, when they dole out millions elsewhere without rhyme, reason or proper oversight.

  7. paul walter

    I wonder if it was even ideology.

    The like of Porter, Robert and Tudge would be the most willing of abject and debased dupes, but in the end, finally, the scheme lies squarely at the feet of the irrational, savage and sadistic pathology of a PM unfit to run a chook raffle for fear of gross injuries to the defunct chook.

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