Integrated Services Project – October 2020

In 2016 Centrelink raised five debts for overpayment against Mathilde*. Centrelink alleged that she incorrectly declared earnings from her (casual) income, for periods between early 2010 to late 2014 while receiving Newstart Allowance (Jobseeker). The combined total overpayment / debt amounted to $38,000.

Mathilde was working on a casual basis while receiving Newstart Allowance during the relevant debt periods and she advised she was contacting Centrelink each fortnight to declare her fortnightly income as per her obligations.

In 2016, through data matching with the Australian Taxation Office (ATO), Centrelink determined that she had been overpaid, and raised debts against her.

These types of debts are often referred to as “Robo debts”. An essential feature of “Robo debts” is where Centrelink uses income data from the ATO and averages that income as a means of calculating the debts.

Averaging earned income is an inaccurate way of calculating a client’s income, and it was unlikely that she would have ever been paid the same amount fortnight to fortnight.

In Amato v Commonwealth – which is the legal precedent which stopped “Robo debts” – it was found that income averaging was not a legal basis on which to raise a debt against a client.

SSRV’s lawyer and in-house financial counsellor worked together to assist Mathilde by taking a holistic approach: Applying to the Administrative Appeals Tribunal (AAT) for a review of the decision, and identifying financial and non-financial options available to her to help improve her circumstances.

Together with the client SSRV developed a detailed assessment of the client’s financial circumstances, income and expenses and identified issues that could assist in the consideration by the AAT under special circumstances.

The client and financial counsellor developed an action plan to address the client’s other issues outside of the social security debt matter.

The financial counsellor assisted the lawyer by providing additional supporting documentation to be submitted to the AAT. A detailed statement of financial position for this client clearly demonstrated an average shortfall of $121 per fortnight and a support letter outlining and summarising the client’s individual issues and the limited options available to them in improving these circumstances.

This documentation aimed in supporting the existence of special circumstances and the client’s inability to service a debt / additional expense. Together, through the SSRV integrated service we advocated at the AAT to take the client’s financial hardship and personal circumstances into consideration, and argued that a waiver of the Centrelink debt would greatly reduce Mathilde’s stress and remove the emotional and financial burden.

The result of the AAT hearing was a finding that two of the five debts had been raised unlawfully, and the three remaining debts were written off as a result of the AAT’s consideration of the client’s poor financial circumstances.

With the support of the SSRV Financial Counsellor, Mathilde applied for the Victorian State Government’s Utility Relief Grant (URG) to pay her outstanding electricity and gas bill, allowing the client to use her heating during our recent cold winter months.

At the end of the service from SSRV, the client said:
This has consumed me for 4 years!
I have found it hard to focus or concentrate on other parts of my life.
I thank you both, the relief I feel – I am lost for words.