18 September 2019

Gordon Legal has announced it will launch a class action against the Robodebt program. Dr Kate Galloway of Bond University Law School provides a succinct explanation of how this extortion scheme works: “The program, operating since mid-2016, matches Centrelink data with data from the Tax Office to reveal ‘inconsistencies’ between income declared to Centrelink with that declared for tax. However, Centrelink is paid fortnightly, and tax is declared as an annual sum. The program therefore averages annual taxable income to compare against Centrelink payments. The effect is that even if you earned nothing for six months while correctly collecting Newstart, the amount you earned in the next six months is averaged over the entire period to make it look as though you were collecting Newstart payments to which you were not entitled. The department automatically generates letters demanding that the former social security recipient prove the calculation to be incorrect. As these calculations span back as far as nine years, it is usually all but impossible to prove the calculation wrong. A debt notice then issues, followed by pursuit of debt collectors, and ultimately tax returns are garnisheed putting alleged debtors in a position where they just cannot win. … The robodebt system… operates … by manufacturing a debt, using unconscionable, and likely unlawful, means to do so.”