In a landmark decision, hundreds of thousands of Australians who were wrongly accused of owing welfare debts due to an illicit automated system have achieved the nation’s largest payout in history. Dubbed “Robodebt,” this system incorrectly informed welfare recipients that they had been overpaid and demanded that they repay these debts, many of which never existed. Tragically, some victims even took their own lives.
In 2020, a successful class action lawsuit led to a monumental A$1.8bn (£876m; $1.2bn) settlement for those affected by the Robodebt scheme. The campaign for increased compensation continued, as lawyers argued that government officials under the then-Liberal National coalition government were aware of the scheme’s unlawful nature but allowed it to proceed.
On Thursday, the current Labor government confirmed that it would settle the additional claim and provide an extra $475m as compensation for the damage inflicted by the “illegal and immoral Robodebt scheme.” Another $13.5m is set aside for legal fees, and up to $60m is designated to manage the compensation scheme. Attorney-General Michelle Rowland declared this move as “the just and fair thing to do,” reflecting the severe harm caused to thousands of vulnerable individuals under the “disastrous” scheme.
Lawyers for the class action asserted that the additional compensation served as “vindication and validation” for the victims. Peter Gordon, representing the class action, stated, “Today also marks one more affirmation of the principle that Australia remains a nation governed by laws, not rulers — laws that even hold the government accountable,” according to the Australian Broadcasting Corporation (ABC).
Felicity Button, a victim of the Robodebt scheme, shared her mixed emotions, noting the tragic loss of family members, divorces, and bankruptcies among the affected individuals. She emphasized that “irreparable mental health issues” stemming from this ordeal “can never be fully compensated.”
The Robodebt system, operational from 2016 to 2019 under former Prime Minister Scott Morrison’s conservative government, was intended to save about $1.7bn. Preliminary estimates indicate over 440,000 people, many of whom are among the nation’s poorest, were impacted. A high-profile inquiry suggested the scheme contributed to at least three suicides.
A royal commission, the most authoritative form of public inquiry in Australia, concluded in mid-2023 following an exhaustive examination, including hundreds of public testimonies. The inquiry revealed that the algorithm used to assess overpayment was based on flawed calculations, averaging a person’s fortnightly income without accounting for irregular work hours, which resulted in wrongful assumptions. The commission also discovered that senior officials responsible for designing and implementing the scheme were aware of its illegality. This revelation prompted lawyers to pursue additional compensation under claims of “misfeasance in public office.”
Source: https://www.bbc.com/news/articles/clyx3jvk4zeo?at_medium=RSS&at_campaign=rss
