Robo-debt class action lawyers unhappy with government’s instalment payment plan


The government is facing a class action over the scheme from law firm Gordon Legal – despite the refunds – that is due to go to trial in September. The Federal Court in November last year found the income-averaging method was inaccurate and unlawful. Andrew Grech, a partner at the firm, said government’s approach would “muck people about” and the court had the power to stop parties to class actions confusing plaintiffs.

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“We will be writing to the government’s legal representatives, the Australian Government Solicitor, and asking them to clarify the [refund] process that’s being undertaken,” Mr Grech said. If that failed, he said Gordon Legal could ask the court to force the government to clarify its position.

The government estimates it will refund about $720 million it clawed back from welfare recipients through the robo-debt process, which used averaged income data rather than real earnings to assess whether people had been paid too much welfare. The Gordon Legal claim wants court-ordered interest and damages for its clients, on top of refunds.

A Services Australia spokeswoman said the department had already made a small number of repayments to test the system, with more from the middle of the month and most refunds expected to be completed by November.

Prime Minister Scott Morrison has apologised for any “hurt or harm” caused by robo-debt but also said last month the government would pursue legitimate welfare debts.

“I think all Australians would agree that it’s important that if there are overpayments of welfare or other things like that, then the government has to be diligent about taxpayers funds and make sure that we recover moneys where it’s right to do so,” Mr Morrison said.

Labor’s government services spokesman Bill Shorten, who has called for a royal commission into robo-debt, said the instalment plan was “simply not good enough”.

“Stuart Robert needs to come clean: What is the latest digi-bungle that prevents the robo-debt victims being repaid in full? What is the digital repayment cap? And why can’t the victims simply be cut a bank cheque?” Mr Shorten said.