A woman who was looking forward to her tax refund was left shocked after finding Centrelink had taken it.
Queensland mother Emily Banks was due for a $790 return around Christmas time in 2018.
When it didn’t hit her bank account, Ms Banks called Centrelink.
She was devastated to learn not only she wouldn’t be receiving the refund, but also owed a further $3000 for being overpaid family tax benefits more than two years ago.
Queensland mum Emily Banks was due for a $790 tax return around Christmas 2018 but when it didn’t turn up she made a call only to find it was taken by Centrelink to repay a debt she owed
Ms Banks called Centrelink and to make matter worse, she was informed that she owed a further $3000 for being overpaid from more than two years ago
‘I thought I had done the right thing, I did everything they asked me. I rang them as soon as my husband got a pay rise,’ she told Nine News.
Centrelink blamed Ms Banks for not updating her address and but she said her email address and phone number did not change and they had a means of contacting her.
‘I hadn’t received a payment from them in two years, so I didn’t think I needed to tell them. My phone number and my email address hadn’t changed.’
The family have been put on a $10 a week payment plan to repay the debt, which Ms Banks has described as ‘stressful’.
‘I thought I had done the right thing, I did everything they asked me. I rang them as soon as my husband got a pay rise,’ Ms Banks told Nine News
It comes just days after 7.30 reported about Devi Barker, who was contacted by Centrelink claiming she owed nearly $8000 in alleged debts from nine years ago.
Ms Barker from Hobart was contacted by debt collectors saying she owed Centrelink $7,616.05 – and demanded she make a full repayment with interest.
‘They were demanding that I make payment. I felt quite stressed, especially when they said that … my wages would be deducted, and that I wouldn’t be able to leave the country,’ Ms Barker told 7.30.
Devi Barker was back at home in Hobart when she was contacted by debt collectors saying she owed $7,616.05
The apparent debt was a result of the Department of Human Services’ automated debt recovery program.
The controversial system compares Australian Tax Office data and Centrelink data to decide if a welfare recipient owes money.
Ms Baker’s debts dated back from between 2010 to 2012 but she is adamant that she reported the correct income.
But to prove she is right is proving more of a struggle.
She tried to get her bank statements, but was told they are not held for longer than seven years.
‘I’m being made out to be a criminal,’ she said.
‘It’s extremely stressful and especially when you can’t prove that you don’t have any debt. You have no power, and yet they’re still pursuing the debts.’
The Department of Human Services is currently in a legal battle after Victoria Legal Aid launched two federal court cases challenging the authenticity of automated debts (stock)
Department of Human Services General Manager Hank Jongen told Daily Mail Australia the Commonwealth Ombudsman has independently and exhaustively reviewed the earned income compliance program.
‘After reviewing the processes around the department’s debt recovery, the Ombudsman found it is reasonable and appropriate to ask people to explain discrepancies in data matching with other agencies,’ Mr Jongen said.
‘The Ombudsman’s 2019 report shows we have significantly improved the way we communicate with people to ensure they better understand the way debts are calculated and have greater access to support if they wish to have a debt reviewed.’
The report showed that complaints have reduced since 2017.
‘Because of the work that has been done to enhance our processes,’ Mr Jongen said.
‘There has also been a decrease in the number of debts that are later reduced.
‘No debt notice is issued until the person has been afforded ample opportunity to assist with explaining and resolving the discrepancy.’
Mr Jongen said debt recovery was a fundamental part of the welfare system and the department is legally obligated to pursue ‘recovery of the over payment’.
The Department of Human Services is currently in a legal battle after Victoria Legal Aid launched two federal court cases challenging the authenticity of automated debts.
The second case was filed in June this year after the debt of one of their clients was successfully wiped.
Victoria Legal Aid executive director Rowan McRae told the program that they’re pushing to see if the debt collecting scheme is or isn’t lawful.
‘Many people will be watching these cases with much interest to see what implications they may have for their own robo-debts,’ she said.
Shocking figures from the Senate Estimates in March 2019 reveal there were 444,989 robo-debts launched from July 2016 to December 2018.