Get help with Centrelink's automated debts

Get help with Centrelink's automated debts

How does the automated system work​?

Centrelink is using an automated system to try to detect overpayments to welfare recipients.

The system uses information held by government agencies, including the Australian Tax Office (ATO), and compares whether it matches income reported by a person to Centrelink. If the system finds a difference, it will send you a letter requesting further information and advising of a potential debt.

Flaws in this system have resulted in large numbers of Australians receiving inaccurate debt notices. The main problem has been comparing fortnightly income reported to Centrelink with annual pay information held by the ATO. This has led to errors where people have not worked consistently throughout a financial year. There have also been reports of employer’s names being recorded differently in separate systems. This means when the data between the systems is ‘matched’, it appears that a person had two jobs rather than one.

We have called on the government to immediately suspend the system until these flaws are fixed.

What if Centrelink finds a difference in my reported income?

If the system shows a difference between income you reported to Centrelink and income information held by government agencies, Centrelink will send you a letter or an SMS. This will ask you to you update your information by logging in to your Centrelink account through the myGov website. You can ask for more time to provide the requested information. For information on how to provide information through myGov, see the National Welfare Rights Network fact sheet, Centrelink’s online debt system.

You have the right to appeal Centrelink’s decision to raise a debt. See How do I get a review of Centrelink's decision?

Centrelink has asked me to confirm my employment information – do I need to respond?

If you no longer have copies of past payslips and other relevant information, then this should be considered a reasonable excuse not to provide the supporting documentation. However, if you do have supporting documentation and are able to access myGov to correct any data-matching errors, then it is in your interest to do so. This does not affect your right to seek a review of any debt that Centrelink might later raise.

If you do not respond to Centrelink’s request for further information, then Centrelink will rely on their automated system to determine that you have been overpaid. It will then send you an ‘Accounts Payable’ notice with the alleged debt amount and payment options. They may add a 10 per cent penalty fee.

You have the right to appeal Centrelink’s decision to raise a debt. See How do I get a review of Centrelink's decision?

How do I get a review of Centrelink’s decision?

You have the right to appeal almost any decision that Centrelink makes about you. This includes the decision to raise a debt.

If you have received an accounts payable notice from Centrelink, you can ask that the debt be reviewed by an authorised review officer (ARO).

An ARO is a senior Centrelink officer who has not previously dealt with your matter. They will have a fresh look at the decision and call you to discuss. You can give new information to the ARO to consider. The ARO will either confirm, vary or set aside the debt.

The ARO is required to make the ‘correct’ decision based on all the information available. This means that a debt could be increased, decreased or cancelled on review. This should not stop you from exercising your appeal rights. The ARO should send you a detailed letter explaining their decision.

If a debt is cancelled on review, any recovery fee should also be waived. If you have made repayments towards the debt in the meantime, you will get that money back.

You can seek an ARO review in the following ways:

You can also ask Centrelink to suspend repayments while the review is taking place. If Centrelink decides not to suspend repayments, you can request that an ARO also review that decision as well, and complain if Centrelink refuses to do so.

Make sure you request a receipt number from Centrelink for every request you make and keep copies of any documents you lodge with Centrelink.

Further appeal rights

If you are not happy with the decision of the ARO, you have a further right of appeal to the Administrative Appeals Tribunal (AAT).

The AAT is free and informal but it does not have discretion, it must apply the same laws as Centrelink does. Centrelink will provide information from your file and the AAT will schedule a hearing where you will have an opportunity to explain why you think the decision is wrong.

There are two divisions of the AAT that review Centrelink decisions. If you disagree with the outcome of the first Division (Social Security & Child Support), you can apply for a second review by the General Division of the AAT.

Is there a time limit on seeking a review?

There is no time limit on appealing Centrelink debts to an ARO. However, Centrelink may ask you to pay back the money while the decision is being reviewed. As of 1 January 2017, actions by Centrelink to recover a debt can be commenced at any time.

There are time limits on applying to the AAT, so if you have a decision from an ARO and are thinking about appealing to the AAT, contact Legal Help on 1300 792 387 as soon as possible.

What happens if I don’t pay the debt when it is due?

If, by the due date, you do not pay your debt, seek a review by an Authorised Review Officer, or enter into a payment plan, Centrelink may:

  • request that the ATO send your tax refund to Centrelink to pay off the debt
  • add an interest charge to the debt
  • refer the debt to a debt collector
  • reduce your Centrelink welfare payments
  • recover the debt from your wages or bank account
  • take legal action to recover the debt
  • issue a departure prohibition order to stop you from travelling overseas.

Debt collectors

Two debt collection agencies are contracted by Centrelink to follow up debts – Dun and Bradstreet and the Probe Group. They may contact you by phone or letter to try and arrange payment of the debt.

If you have lodged an ARO review and are contacted by a debt collector, you can tell them that you want the debt referred back to Centrelink because you are appealing the debt. You do not have to enter into a payment plan with a debt collector.

If you feel that a debt collector is harassing you or giving you misleading information, contact the ACCC on 1300 302 502.

How do I make a complaint about Centrelink?

If you are not happy with the service you have received from Centrelink, you have the right to complain. Your right to lodge a complaint is separate from your appeal rights and should not have any negative impact on your appeal. You may have asked for an ARO review of the decision to raise and recover the debt and the decision to not suspend recovery while the ARO review is being undertaken.

You can complain if:

  • Centrelink refuses to consider your ‘write-off' request prior to taking recovery action
  • Centrelink are unable to tell you how long the ARO review will take
  • Centrelink refuse to process a request for an ARO review unless you do it via MyGov, or unless you provide further information or documentation

You can complain to:

Many people are raising their concerns and sharing their stories on social media at www.notmydebt.com.au or on Twitter using the hashtag #notmydebt

If you have suffered loss as a result of Centrelink’s conduct you can apply for compensation under Compensation for Detriment caused by Defective Administration Scheme. For details see the Department of Finance website.

Further information

Read more on our website about Centrelink.

Read more about reviews and appeals of a Centrelink decision on the Department of Human Services website.

Read more about owing money on the Department of Human Services website.