Parents could be next for robo-debt stress

UPDATE: Statement by Department of Human Services General Manager Hank Jongen in relation to the original article

  • Claims, such as that made by QUT, suggesting our department is using our online compliance system to balance family payments are inaccurate.
  • Linking the family payment balancing process with online compliance only serves to confuse and potentially alarm families at a busy time of the year.
  • The way we balance family payments is very different, and completely separate to our online compliance program.
  • Our online compliance program reviews cases where there is a discrepancy between income a customer has reported and what their employer reports to the ATO. It reviews payments like Newstart and Youth Allowance.
  • Family assistance payments including Child Care Subsidy are not income support payments and are not included in the online compliance program.
  • At the end of each financial year, we balance family assistance payments. ‘Balancing’ is when we compare a family’s estimated income against their actual income after the end of the financial year, to see if they were paid the right amount. If parents have received less support than they were entitled to, they’ll receive a top up payment. Alternatively, if they received too much, they’ll need to repay that money.
  • The way we balance Child Care Subsidy mirrors the process we’ve used to balance Family Tax Benefit and Child Care Benefit for close to 20 years.

Original article (updated):

There are concerns that the stress and anxiety the notorious Centrelink “robo-debt” system has caused could well now fall upon parents claiming childcare rebates as the agency data-matches ATO income data with rebate claims.

  • Working parents could be next for data-matching pain
  • Fully-automated decisions with high impact banned in the EU
  • Burden of disproving robo-debt falls on Centrelink recipient
  • Human intervention and review is needed before debt decisions made

“Decisions made by fully automated systems on matters with a high impact on people’s daily life such as raising debts, visas and employment are banned in the EU, unless there is meaningful human oversight and review,” says Dr Anna Huggins from QUT’s Faculty of Law.

“Data-matching has its place to check for fraud and reporting errors and automation increases efficiency but with decisions affecting individual rights and interests we need manual review before decisions are made.

“The Centrelink robo-debt saga has caused a lot of human distress and is a prime example of how one algorithm doesn’t fit all cases.

“Anyone with a variable income can run into trouble with the system’s averaging process if they don’t provide income evidence to Centrelink. For example a person might have earnt $20,000 over the course of the year, with their fortnightly income varying from $0 to $1500.

 

“The robo-debt system takes the $20,000 and divides by 26 to get an average fortnightly income for a year, including the weeks when no income was earned. The system then issues a notice that the person has been overpaid, implying that they have underreported their income.

“If a discrepancy is found, a human should look at and investigate it by asking for employer or bank records, and talking to the recipient.”

Dr Huggins said it had been estimated that approximately 20 per cent of discrepancy notices sent to recipients seeking return of money overpaid by Centrelink were found to require adjustment.

“Either no debt was owed or the amount claimed was based on miscalculations.

“Centrelink puts the onus on the recipient to prove they do not owe anything. Experts in social security law argue that the Social Security Act 1991 (Cth) places the onus on Centrelink to prove that a debt is owed,” Dr Huggins said.

“Certainly there is evidence that that was Centrelink’s interpretation of the Act, at least until recently.

“However, it appears that the robo-debt system has shifted the burden of disproving a debt so that it is now on the shoulders of the recipient.

“Centrelink recipients were previously told they must keep pay slips for six months, but Centrelink has asked some recipients to provide pay slips and employment records from up to six years back.

“It is often impossible for students, for example, who might have had a number of part-time jobs or people who have moved a lot to find pay slips from that far back.

“While people with discrepancy notices can ask for human review it takes an understanding of the system and assertiveness. This is particularly hard for people who are dependent on Centrelink and those who are not computer literate.”

Dr Huggins said the new push to discover discrepancies between ATO data and Department of Human Services data for parents receiving a childcare rebate reinforces the need for human intervention and review before debt decisions are made.

“Working parents have enough on their plate without having the added stress of trying to contest an incorrect debt.”

/University Release. View in full here.