The robodebt welfare scheme ruined lives. Now, the Government will have to pay more than $1 billion to 400,000 Australians.
Robodebt: A welfare scheme that automatically sent out debt notices to hundreds of thousands of Centrelink recipients. Earlier in the year, after courts found it unlawful, the Federal Government scrapped the scheme and promised to repay the unlawful debts.
Understanding robodebt
1 - How was the Government able to set up an unlawful welfare policy?
2 - How did robodebt hurt people?
3 - So what compensation must the Government now pay?
How was the Government able to set up an unlawful welfare policy?
On paper, robodebt looked like a minor change. Instead of Centrelink staff reviewing client files, an algorithm would automatically send out notices to welfare recipients it believed owed the Government money. But the algorithm got it wrong.
Hundreds of thousands of unlawful robodebt notices were sent out to some of the most vulnerable Australians from 2016, when the scheme was announced during the federal election, to earlier this year.
How did robodebt hurt people?
A 2017 inquiry into the scheme heard from people who said members of their family had suicided after Centrelink pursued them for unlawful debts. Other witnesses said they had lost jobs, suffered serious mental health issues or struggled to put food on the table after repaying the money.
So what compensation must the Government now pay?
Back in May, the Government announced it would repay $721 million in unlawful debts recouped under the robodebt scheme.
But that wasn’t the end of it - a class action lawsuit was announced soon after that urged the Government to not only repay the debts, but supply compensation to those who were affected by the scheme.
Today, on what would have been the first day of the class action trial, lawyers for robodebt recipients announced that a settlement had been reached with the Government.
In the end, $1.2 billion will be repaid to 400,000 robodebt victims, bringing an end to an unlawful welfare scheme that started out with an election-time announcement and a flawed algorithm.