Oz senate committee says 'robo-debt' program was 'set up to fail'

Government senators play the 'this is fine' card

Federal Government senators have rejected a Senate report that describes its “robo-debt” program as “set up to fail”.

The inquiry was set up by the Labor opposition with the support of The Greens, and its report was tabled in the Senate last night.

The government began to automate the process of determining overpayments last year, and with reduced human oversight, errors accumulated in a process that compared fortnightly payments from Centrelink with yearly income reported to the Australian Tax Office.

Incorrect debt notices plagued the system, and in April the Commonwealth Ombudsman issued a sharply critical report into the operation of the “Online Compliance Intervention” (OCI) system worked.

The Senate report lays out the scale of the train-wreck, saying OCI notices were issued to 200,000 people at the rate of 20,000 per week. In spite of this, the error rate was so high and the recovery rate so low that of its AU$300 million target for 2016-2017, the first six months of the program only yielded $24 million in recovered payments.

Even the Senate committee conducting the inquiry was unable to get a good estimate of the error rates in the program, because the Department of Human Services denies there are any errors: it contends that asking benefit recipients to respond to its assessments is not an error: “This is how the system is designed to work”, the department told the committee.

The report says the process designed in the OCI program outsourced record-keeping to Centrelink recipients, a process that “lacked procedural fairness” at every stage of the program: the drafting of legislation, communication with the public, and call centre operations.

The most glaring example cited in the report is how the Department of Human Services advised benefit recipients to retain records for six months, but the OCI system could raise debts for payments going back years.

The report also criticises the lack of a risk assessment process in the OCI's design, call centres that couldn't cope with their workload (as The Register reported earlier this year, the automation ended up needing hundreds of extra staff), and concludes that “the system was so flawed it was set up to fail”.

Other recommendations are that the government:

  • Put the OCI on hold while the government addresses its flaws, and not restart the program until a new integration between DHS and the ATO is implemented in 2018;
  • In redesigning the process, the government should conduct a “robust risk assessment”;
  • All debts created by automatic income averaging be re-assessed by humans; and
  • The OCI should be restructured to comply with data matching protocols, guidelines, and legislation.

In response to Human Services Minister Alan Tudge and the DHS's “doxing” of a complainant, the committee wants the department's privacy policy updated to prevent a repeat.

The basis of the majority report has been dismissed by the government senators' dissenting report, who deny a lack of procedural unfairness in OCI, and attribute issues to customer “confusion” about how the program worked. ®

Bootnote: Vulture South is indebted to consultant Justin Warren, whose close reading of the most boring bits of government reports always uncovers gems like this:

Apparently Centrelink's ancient due-for-replacement IT systems couldn't manage multiplication and division. ®

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