People With Robodebts Celebrate Legal Challenge To 'Sh*t' Welfare System

After having his tax return "taken" to pay a robodebt he never knew he had, Morris is happy the Centrelink system is being taken to court in a class action lawsuit.

"I'm happy. Cautiously optimistic," Morris, who asked his last name to be published, told 10 daily, a day after Gordon Legal announced it would be testing the legality of the controversial automated data-matching debt collection system in court.

"The government has taken my tax return without asking me. I'm happy this is happening, that these cases are becoming public knowledge."

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The 'robodebt' system sees data from various government services -- health, tax, welfare, education -- matched by a computer algorithm, looking to detect discrepancies where Centrelink clients may have been paid too much. The government maintains it is an important tool to prevent over-payment or "rorting", but countless cases have been raised where people have disputed how their debts were calculated.

In many cases, debts of many thousands of dollars have been dramatically reduced, or wiped entirely, after a review. The Department of Human Services admitted that, as of March 31, there had been 500,000 debts raised but nearly 58,000 of those had been reduced, and more than 31,000 fully waived.

Those handed debts were threatened with penalties if they did not enter plans to repay the debts. 10 daily is aware of cases where Centrelink has had to give back money that clients paid over alleged debts, when that debt was reviewed and found to be false.

"People have a right to be angry: the Coalition automated cruelty into the architecture of the automated social security system," campaigner Asher Wolf said told 10 daily.

Bill Shorten and Gordon Legal senior partner, Peter Gordon, announce the robodebt court challenge. Photo: AAP

After a years-long campaign from activists and Greens MPs to raise awareness about the problems in the system, robodebt will now be challenged. Standing alongside former opposition leader Bill Shorten on Tuesday, Gordon Legal accused the government of levelling "unlawful debts" against welfare clients, and asked for people to join a class action.

Shorten called the system "toxic", "flawed" and "built on shaky legal foundations".

"The robodebt scheme - including its reverse onus of proof - is at best legally dubious and should rightly have its legality determined by a court," he said on Tuesday.

"Stress, heartbreak, suicides - this is the trail of carnage that robodebt has wrought."

Prime Minister Scott Morrison shrugged off criticism, saying "where the system needs to be improved then we’ll always continue to do that" but that "we won’t make any apologies for actually making sure we recover overpaid taxpayers’ money."

Photo: Getty

One of those already signed on to the class action is Morris, from Sydney. He received a student allowance while at university in 2016-17. He told 10 daily that, rather than receiving a debt notice, his tax return this year was simply garnished.

"The first I found out about it was when my return didn't end up in my bank account... I didn't even know it existed," he said.

"I did my own investigation and found the money had gone to Centrelink."

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More digging found that, in addition to the $1,500 garnished from his tax return, he is on the hook for another $8,000 in alleged debt. Morris said he had always updated his job and study details with Centrelink to ensure he was receiving the right payments, and said he is unsure how he has racked up such a large debt -- which represents close to the entire amount he received in the first place.

"I was lucky, I didn't budget my whole year around getting my tax return, but I worry about other people who do that," he said.

"I'm in a comfortable position with my current job [but] this would have ruined me last year.

"Mainly I want my debt wiped. There's still $8,000 left, there's no way I could pay that."

Photo: AAP

Alistair, also from Sydney, is also happy to hear news of the class action challenge. (He preferred not to have his last name published.) He copped a $2,000 debt last year, after receiving disability support pensions between 2012 and 2016. He repaid the debt in full, just to get the debt collectors off his back.

"It's quite an anxiety-inducing situation. My mental health was deteriorating, it was better to just get it out of the way," he told 10 daily.

"I also had a whole lot going on at home with other issues, really was this cherry on top of this sundae of sh*t."

Alistair wants to see that money come back, if the robodebt system is successfully challenged in court.

Photo: AAP

"I'm pretty angry on behalf of the people less fortunate than me, and absolutely appalled it has targeted pretty vulnerable members of our society," he said.

"If it came back, that'd be sweet... but I don't have much hope it will come back, I don't think it's going to happen."

Those behind the robodebt campaign -- many coalescing under the online hashtag #notmydebt -- have also welcomed the legal challenge.

Photo: Getty

"The campaign against robodebt came from a diverse grassroots collection of people... particularly as that movement expanded," campaigner Asher Wolf said, citing the work of digital rights activists, Legal Aid, the Australian Unemployed Workers Union and Greens senator Rachel Siewert.

"It’s been a very long struggle to get the campaign from bubbling social media anger to a class action. And not everyone who was fighting a robodebt is still here with us."

Lyndsey Jackson, creator of the Not My Debt website, also noted the hard work of campaigners.

"Anything like this is validation that people were right to fight it and be frustrated... there's an embarrassing technology stack behind this," she told 10 daily.

"It's a step in the right direction, and a strong step toward putting real pressure. We're pleased Labor is coming out finally so strongly on this."