So, you’ve got a Centrelink debt – or do you?

 So, you’ve got a Centrelink debt – or do you?

Questions raised over Centrelink’s sums

A number of students have recently been accused by Centrelink of welfare fraud, and hit with debts for repayment. However questions are being raised around Centrelink’s calculations, with many suggesting they in fact don’t have a debt at all. But getting Centrelink to agree is proving tricky!

Welfare fraud – or Centrelink error?

  • In one example, a full time student who earns money from her part time job was recently told she has a $3,500 Centrelink debt for payments she received between 2011 and 2013.
  • Centrelink claim she has committed welfare fraud, and allege that she earned money in fortnights where she had reported no income.
  • However in making these calculations, Centrelink were simply dividing her total annual earnings by the number of fortnights in a year, regardless of periods where she didn’t work.
  • There were in fact many fortnights where she had earned no income, and correctly reported this – so she contests she has done nothing wrong and is trying to challenge the debt.

But challenging Centrelink is no easy task!

  • Cases like this one have arisen for many students due to a new system Centrelink are using. It matches your annual income tax return data from the Australian Tax Office with the fortnightly income you’ve reported to Centrelink.
  • The system can investigate as far back as 2010, so in many cases people are having to come up with pay slips from 5 years ago to prove Centrelink wrong and challenge their debt notices.

Why might Centrelink think you owe them money?

  • If this new system detects a discrepancy with your income amounts, Centrelink will send you a letter and SMS to say you have a potential welfare debt.
  • You then have 21 days to login online to review and update your information.
  • If you don’t do this, Centrelink will assume their information is correct. They’ll declare that you DO have a debt and will send you a debt notice.
  • You may need to locate and supply documents to support your position, including bank statements, pay slips and letters from your employers.

Are you affected?

  • If you are, you’ll receive a letter and perhaps an SMS from Centrelink.
  • It’s important you respond as quickly as possible – if you don’t, Centrelink will assume you do have a debt, and will start trying to recover it from you.
  • So make sure Centrelink have your correct mailing and email address, and mobile phone number.
  • Login to your MyGov account to check the contact details on your file are correct.

How to resolve any issues with Centrelink

  • Unfortunately compliance issues like potential debts have to be dealt with using Centrelink’s online system or by phone – you can’t go into a branch regarding these.
  • And as we recently reported, more than 29 million phone calls to Centrelink went unanswered last year – so getting through to them is no easy task.
  • But be sure to persevere, or for your best bet go online – as the consequences of not challenging an alleged debt could be costly!

Have you been incorrectly hit with a Centrelink debt? How did you go about resolving your problem?