Ministers and civil servants named in the update of the class action against robo-debts


Gordon Legal’s class action lawsuit against the Commonwealth of Australia over the Centrelink Online Compliance Intervention (OCI) program, colloquially known as robo-debt, was scheduled to begin on September 21, 2020, but the lawsuit was postponed to allow applicants to file an amended return.

In the amended statement, Gordon Legal alleged that two Australian ministers and a handful of government officials knew robotic debt was causing damage to vulnerable Centrelink clients.

The Department of Human Services, now Services Australia, launched the Data Matching Work Program in 2016, which saw the automatic issuance of debt notices to those who receive social benefits through the Centrelink program.

From July 1, 2016 to August 31, 2019, Centrelink’s OCI program saw 1,159,662 evaluations have been launched using automated data matching technique.

The amended statement alleges that former Social Services Minister Alan Tudge was aware that the robo-debt notifications contained errors on the part of the department.

The amendment also alleges that the Commonwealth was aware of the vulnerability status of its clients, as this knowledge could be inferred from the eligibility criteria for receiving financial assistance. He added that any recovery by the Commonwealth of an alleged overpayment could lead to significant financial hardship.

Further, the claim alleges that the department knew its bi-monthly averaging practices were flawed in February 2015, and that in March 2017, Tudge learned that 33% of robotic debt “had fallen to AU $ 0 upon review.” .

According to the applicants, two ministry officials – Director of Social Services Operations Annette Musolino and Malisa Golightly, who is currently Deputy Secretary for Immigration and Settlement Services at the Home Office – were informed in March 2017 of ‘a draft ombudsman recommendation with respect to the OIC system that the Commonwealth “should … further consider how to mitigate the risk of possible excessive debt collection”.

The allegation said the two officials never sought to challenge or qualify the recommendation, and neither did Tudge, when told about it in April.

The complaint further accuses the department of having been informed 76 times by the Administrative Appeals Tribunal (AAT) that Centrelink robo-debts had been rejected on the grounds that the presumption of fortnightly income could not legitimately justify the existence of a debt. The petitioners allege that the Commonwealth acted unlawfully in determining and enforcing any overpayment of debt, demanding or demanding repayment and collecting the alleged debt.

“The Commonwealth had and has no statutory or other authority to levy and collect or seek to collect any overpayment debt, or to impose a penalty therefor, in respect of any claimant or member of the group “, indicates the request.

“The Commonwealth was aware of these cases (including their illegality) because: it participated in the Administrative Appeals Tribunal reviews in which it asserted an overpayment and chose not to appeal or not to revise (AAT decisions concerning illegal debts), including the 76 decisions, ”he adds.

The amended claim lists dozens of situations in which clients threatened to self-harm or even kill themselves in response to receiving a debt letter. He also alleges that Tudge learned in July 2017 that a “DHS beneficiary committed suicide” after receiving a robo-debt notification.

Tudge ended his term as Minister of Social Services in December 2017 and is currently Minister of Population, Cities and Urban Infrastructure.

The claim also accuses former Minister of Families and Social Services Paul Fletcher of knowing that a certain ATO payment differential was not an overpayment.

Gordon Legal launched the robo-debt class action lawsuit in November last year on behalf of five representative candidates and hundreds of thousands of people included in the case as panel members.

The essence of the plaintiffs’ thesis is that the debts raised by robo-debts are illegal and that all beneficiaries should be compensated by the federal government. Gordon Legal previously sought interest payments and damages, but is now seeking exemplary damages due to the government’s continued management of the program in light of its new claims.

Instead of the class action kicking off on Monday, another case management hearing was heard instead to discuss the amended claim. The Commonwealth, represented by Michael Hodge QC, said the plaintiffs “were trying to conduct a case outside of the case at hand.”

“They did not plead knowledge or reckless indifference to actual illegality. They pleaded knowledge of other things concerning Minister Tudge,” Hodge said.

During the hearing, Judge Bernard Murphy said that given Hodge’s emphasis on the allegations against Tudge, compared to the other new allegations, the judge noted that “there was probably some substance in the complaint, otherwise [Hodge] wouldn’t have pushed him as hard as [he did]”.

“I am getting frustrated with the pleadings battle in this case. I am frustrated by both sides… on the plaintiffs’ side, the pleading has shifted; it was not detailed enough… I suspect that when you are confronted with Mr. Hodge complaints about your submissions that you will find that some of them are outside of the case pleaded, ”Murphy said.

“On Mr. Hodge’s side, there is quite a bit of strategy in all of this … my goal is to give both parties a fair opportunity to present their case and to make sure the Respondent understands the matter that is being brought. against her.

“It affects hundreds and thousands of people.”

Commonwealth officials will have until Friday to provide a list of their issues with the amended return, while applicants will have until October 2 to respond. In the meantime, another case management hearing has been set for Thursday.


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