No extra compensation for victims of Robodebt scandal, PM says

Scott Morrison has been pressed about the issue of compensation for victims of the Robodebt scheme.

Scott Morrison has been pressed about the issue of compensation for victims of the Robodebt scheme. Photo: Getty/TND

The 400,000 Australians unwittingly caught up in the Robodebt scandal will get little more than their own money finally paid back, after Scott Morrison appeared to rule out any further compensation for people hounded over unlawful debts.

“We’re resolving the issue by ensuring that the money is paid, $1.2 billion,” the Prime Minister told The New Daily at a press conference over the weekend.

But the money Mr Morrison refers to is simply refunding cash wrongfully claimed from welfare recipients under the automated income averaging system.

The government essentially admitted fault in this system by settling a class action lawsuit on the morning it was due to appear in the Federal Court, agreeing to a billion-dollar payout despite claiming the agreement was “not an admission of liability”.

Scott Morrison at a virtual press conference on Saturday. Photo: AAP

More than $720 million of that is money already paid by some of Australia’s most vulnerable people to the government, after trusting the arguments of Centrelink that they had been overpaid, or – as many did – simply surrendering in the face of debt collectors.

Another $398 million is in outstanding debts being cancelled by the government.

The final $112 million in the $1.23 billion settlement was described by law firm Gordon Legal as “compensation”, but Government Services Minister Stuart Robert said it was for “interest payments”.

The sum represented approximately what those who paid their wrongful debt notices could have earned in simple interest if they’d left it in the bank, instead of forking it over to Centrelink.

Which leaves the welfare recipients simply getting a reimbursement of money that was inaccurately gouged from them.

In financial terms, they simply go back to square one – potentially, even a little further back, considering the interest/compensation will have Gordon Legal’s fees skimmed off the top.

This essentially means the victims of Robodebt have gone through years of stress and financial hardship, to only get their money reluctantly reimbursed.

Countless hours devoted to bureaucratic nonsense, paperwork, endless phone calls to Centrelink, disputing debts, chasing ancient payslips from former employers, and not a dollar of extra compensation for the inconvenience.

Thousands of people were slapped with incorrect debts. Photo: AAP

That’s before you even consider the stories of families linking the suicide of their loved ones to the stress of receiving a debt; the mental anguish; the compounding of poverty as Centrelink recipients had meagre welfare cheques garnished by debt repayments.

Some Robodebt victims told TND last week they were “fuming” and “shattered” over the final figure.

“It doesn’t make up for the torment,” one victim, Nina, told TND.

“May as well give me a Woolies gift card and send me on my way.”

Mr Morrison apologised in June for “any hurt or harm” from the program, saying he “would deeply regret any hardship that has been caused”.

But the court settlement included the line from the government that it was “not an admission of liability by the Commonwealth”.

TND asked Mr Morrison, appearing at a virtual press conference from his COVID quarantine at The Lodge, if he was considering extra compensation for those affected by Robodebt.

The short answer: No.

“Income averaging has been found not to be a way of raising a debt that can be relied upon. And the government has changed its practice,” the PM said.

“We’ve addressed the situation by ensuring that all of those payments and debts that have been raised in that way are no longer valid.”

Mr Morrison said he will allow “other processes” to “complete their course”. Photo: AAP

This is the same Prime Minister who has his fingerprints on every stage of this; from overseeing its conception when he was social services minister, to introducing the plan as a “cost-saving measure” then accelerating it as treasurer, to continuing it as PM.

Mr Morrison spoke on Saturday of ensuring social security is not “taken advantage of”, despite the fact the government had agreed to repay the Robodebt money it had clawed back.

“As for any other processes that are underway, I’ll allow those to complete their course”, he added, but didn’t commit to any extra payment on top of the settlement.

When pressed again at the press conference, he said the money was being paid back, with more than $700 million already flowing to those it was wrongfully claimed from.

He also praised Services Australia for carrying out that task while also managing pandemic payments through JobSeeker and JobKeeper.

“So I really want to commend Services Australia for the way they’ve been able to move so promptly to get $700 million paid out to people. And the total amount, we expect to be around $1.2 billion,” the PM said.

But nothing of extra compensation. Nothing for the hundreds of thousands of Australians who were essentially forced on a wild goose chase (under threat of debt collectors) unless they navigated the Rube Goldberg machine of our welfare system; fighting a battle with the onus of proof reversed, considered guilty until proven innocent.


Centrelink clients will have $1.1 billion in debts cancelled or repaid. Photo: AAP

“It’s a failure inside a debacle wrapped in a fiasco,” Labor’s shadow assistant treasurer Andrew Leigh said last week.

Reimbursement of illegally garnished debts, and the $112 million in interest that the money would have gathered if it sat in the bank of welfare recipients rather than the coffers of treasury, is the absolute bare minimum that should have been given here.

People have literally died as a result of Robodebt. That is not an exaggeration.

We may never know exactly how many Robodebt recipients took their own lives, but there is a number. Numerous families directly linked the suicide of a loved one to their receipt of a sudden and shocking debt.

And it was avoidable. The government was warned, and it took no action.

Indeed, it doubled down, linking more programs to the system even as legal experts, social advocates and charities warned something was terribly wrong with the system.

They knew. And did nothing.

Labor, the Greens and social advocates have called for a royal commission into Robodebt.

The government has shrugged off those calls, pointing to the repayments and promises to tinker with the system.

But considering the fact the case didn’t lead to a court judgment, and none of the multiple ministers across the social services and treasury portfolios have suffered any punishment for their actions, what’s to stop it happening again?

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