Services Australia chasing billions in unpaid debt – including some which may have been unlawfully calculated
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Agency pursuing $4.9bn in unpaid debts, including some potentially calculated with controversial method, question to parliament reveals. Services Australia is chasing billions of dollars in decades-old debt, it has been revealed, some of which may have been incorrectly calculated.
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Data released under questions on notice shows that, as at the end of October last year, Services Australia was pursuing $4.9bn in unpaid debts from 829,266 customers. The oldest debt dates back to 1979, with thousands from the 1990s. Across the two last years, Services Australia undertook two investigations, finding 147,773 debts that may have been unlawfully calculated with income apportionment.
Sign up for Guardian Australia’s breaking news email. Income apportionment was the complex system used by Services Australia when it could not determine whether payslips that were relied on to calculate welfare debts aligned with the fortnightly income reporting periods, such as when a payslip did not show hours or days worked.
In this situation, the agency created a “daily” average, which caused problems as customers were overpaid and then served a debt despite reporting honestly. Income apportionment was used to calculate debt between the 1990s and 2020, with the government pausing recovery of income apportionment debts last year. The government is waiting on the outcome of an appeal in the federal court after an administrative appeal tribunal found income apportionment meant recipients of social security benefits could end up being “pursued for debts that are either not owed or are for amounts that exceed what is owed”.
