Joanita Wibowo

Money & Banking

Bill Shorten announces class action into Centrelink robo-debt system

Bill Shorten announces class action into Centrelink robo-debt system

Bill Shorten has unveiled a new “David and Goliath” class action against the federal government’s controversial robo-debt scheme.

The proposed action, which will be brought by Gordon Legal, would allege that the automated debt recovery system wrongfully collected money that belonged to welfare recipients.

“The Commonwealth has used a single, inadequate piece of data, the robo-debt algorithm, and used it to seize money and penalise hundreds of thousands of people,” Peter Gordon, senior partner at the law firm, told reporters in Canberra on Tuesday.

Shorten said his research into the robo-debt program “has led me to believe it is almost certainly illegal”.

“I just have to do research through the stories [the media has] covered to say there is a sickness at the heart of robo-debt which needs to be cured,” Shorten said.

“The scheme – including its reverse onus of proof – is at best legally dubious and should rightly have its legality determined by a court. It is right that this action be pursued by the lawyer who pursued justice in David and Goliath battles with Big Tobacco and Big Pharma.”

Gordon said he expected up to 160,000 people could fall under the class action, which would seek repayment for falsely claimed debts and compensation for those affected.

Minister for Government Services Stuart Robert said the class action announcement was a “political stunt”. In July, Robert confirmed that one in five debt notices issued by the system may be incorrect before apologising to a woman who had received a debt letter for her dead son.

The robo-debt scheme has been in place since mid-2016, when it was introduced by Malcolm Turnbull’s government.

In June, Victoria Legal Aid launched two federal court cases against the scheme. The firm’s executive director Rowan McRae said more than 500 people had asked for legal assistance after receiving robo-debt letters.

“We know it’s unfair. We know it’s having a terrible impact on our clients,” said McRae. “But we also think the scheme is unlawful and we’d like a court to test that.”