Aussies panicking over centrelink demands to pay up to avoid debt collector

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DEMANDS for Centrelink payments are putting Aussies under intense pressure, with the Government agency even tweeting the Lifeline suicide helpline number.

Like many Australians, Catherine Hehir, from Brisbane, was sent a letter just last month telling her she owed thousands in overpaid unemployment benefits.

In FY2011 to 12, she claimed benefits after leaving her admin job for full-time study, but Centrelinks new automated system introduced in October to claw back money from claimants had spread her wage across the whole year and calculated she needed to pay back $4500 she claimed while not working.

The 27-year-old told she spent a month trying to sort out the issue online, making calls to Centrelink and chasing up old employers from five years ago.

They suggested that I start a payment plan even before my review was complete to avoid being taken to a debt collector and they would reimburse me later if they found the debt was incorrect, which I refused to do because I knew it was wrong. Maybe that is what they are talking about their recovery success rate because people start paying to avoid worse outcomes.

I finally had enough and had a lengthy conversation with a Centrelink rep where the phone call went on for over an hour. I wouldnt take no for an answer, so she did my review manually in minutes and then, sure enough, found I was not guilty at all. Human common sense overriding an incorrect computerised system.

I was stressed and anxious about the debt and my case was straightforward, I couldnt imagine any pensioner, person with a disability or illness trying to manoeuvre this system.

Ms Herirs ordeal is finally over, after she received a letter today confirming she owed nothing. The young woman is one of the lucky ones. Thousands of Aussies are being forced to pay back welfare payments because of suspected Centrelink computer errors. has been contacted by scores of scared and angry Australians who say they or their loved ones have been falsely accused of owing money to the social security program, and even pursued by private debt collectors. Several said they had begun paying the unexplained debt because of short timeframes given to sort out the mess, but others do not have a cent to spare.

They include people with autism, those in care, a woman undergoing chemotherapy, the elderly and people with other mental and physical disabilities.


Colleen McCormack, from Melbourne, suffers from chronic pain and has had multiple surgeries that forced her out of her job in the healthcare industry for most of FY2013-14. The 36-year-old told that after receiving a Centrelink letter saying she owed more than $3000 she cried all the way through Christmas.

Ms McCormacks documents show she was out of work on sick leave, yet the automated system said her earnings must apply to the whole year, and she was ordered to pay back $3000.

Having mental health issues, suicide was my first thought, she said. She wrote back explaining her situation, but two weeks after the initial request, she received a letter from a private debt collection agency demanding payment on behalf of Centrelink. She has now set up a GoFundMe page in a desperate attempt to get financial help.

Independent MP Andrew Wilkie yesterday said he had heard more than 100 complaints from terrified people, at least four of whom said they were suicidal.

Centrelink is paying three private debt collection companies to recover money from Australians. Many have expressed fear and frustration at receiving the letters but being unable to explain their case to a human, with phone lines clogged, branches unable to help and an online system incapable of comprehending nuance and complexities.

Michael Griffin, from Brisbane, told on Tuesday that after he was on the dole for three months in 2013, the automated system had gone back and averaged out his earnings for the year, assuming he was employed in those months and therefore owed just over $3000. The 34-year-old filmmaker labelled it extortion and calling it the biggest issue in Australia right now.

Im wondering if everyones going to get these letters, he said. Its preposterous.

Linda Steven, from rural NSW, was also asked to pay back her welfare payments of $8500 in FY2014-15 because the system decided she was in work for months when she was not.

She printed out two years worth of her payslips and visited a Centrelink office where staff tried to help her change her employment dates online.

It was soon discovered they cannot be changed because a debt has already been raised, she told The issue now has to go through a full administrative review process. Even though staff can look at my payslips and know I do not owe the money, nothing can be done.

At almost 64 years old and suffering from high blood pressure and a heart condition I can assure you the stress was overwhelming at first. Not to mention the lengthy phone wait times and expenses.

In the meantime, payment of the debt must still be made but they reduced the payment

that I must make to the minimum of $15 per fortnight for three months. Three months is the longest time they can reduce it for, and the staff member expressed the hope that my review would take place before then.

So all the money the Government is hoping to claw back is in fact non-existent in a lot of cases, and is actually costing Centrelink more in trying to sort out the mess.


The system was brought in three months ago, with the government claiming it would recover $4 billion in overpaid benefits owed to taxpayers by retirees, the unemployed, families, carers, parents, people with disabilities and indigenous Australians.

Social Services Minister Christian Porter on Tuesday maintained the automated system was working incredibly well. He told ABC radio less than one per cent of review letters had resulted in complaints and said they were not debt letters but polite letters.

The government has sent out 169,000 of the review letters regarding potential overpayment since July, and Mr Porter said one in five people who received one would not owe a debt.

In 80 per cent of instances the debt is repayable to the Commonwealth, in the final 20 per cent of instances the matter is resolved, generally speaking, by people simply providing information online, he said.

Department of Human Services general manager Hank Jongen, who has released his email for people to complain to him directly, told the ABC last night the letters sent out by Centrelink were not debt letters, and said there had only been just over 200 complaints.

I really am surprised that people are seriously suggesting that when we are obliged under the law to recover outstanding debt when it is identified, that we are being asked to stop doing this, Mr Jongen said. I think you need to keep all of this in context.

But Centrelink workers who told they wanted to remain anonymous said the program was in chaos.

The government is just cutting corners, calculating debts fast is their goal, and its just wrong, said one. Staff morale is so bad everywhere.


Centrelink sends people a letter warning of a potential overpayment and asking them to clarify their details online. It will also send an SMS.

ISSUE: Some people have moved or changed phone number and dont receive the messages.

You have 21 days from the date of the letter to update online.

ISSUE: Some have complex situations they cant explain in the online system. Others were told their salary did not match that recorded by the ATO. Upon confirming the ATO salary, the system averaged it out for the year without realising they werent earning anything for many of those months. Others found the system recorded them as having two jobs because their employer was recorded under slightly different names by the ATO and Centrelink (e.g. Uni Melbourne and University of Melbourne).

If there is a concern, you can call Centrelink or visit a branch to speak to someone.

ISSUE: Huge queues at branches, staff telling people to go back online, hours wait on telephone. Some also told their jobs prevented them from contacting Centrelink during normal working hours.

Once you update the information, Centrelink may ask you to provide supporting documentation, including bank statements, letters from an employer or payslips.

ISSUE: Some people no longer have the payslips from in some cases six years ago and/or their former employer no longer exists.

You will then receive a letter stating the amount you owe, plus a recovery fee of 10 per cent. If you do not begin payments within two weeks, you may receive a letter from the debt recovery agency.

ISSUE: You may still believe the decision is wrong but once the debt is raised, you have to begin paying it.

If you think the decision is wrong you can ask for a review.

ISSUE: The reviews take months, and in the meantime, you may still be pursued for the debt. Some were told to start paying it back and be reimbursed later but many say they do not have the hundreds of dollars to spare.

Readers seeking support and information about suicide prevention can contact Lifeline on 13 11 14