ALA spokesperson Greg Barns said: “The use of averaging reported incomes over the period of time someone has received income support payment is leading to incorrect calculations of alleged overpayments and the individual is then responsible for proving that the alleged debt is incorrect.

“The person affected is required to prove their innocence on the basis of very limited information and this is causing many people serious stress and anxiety.”

Mr Barns said it is “extraordinary” that Centrelink cannot improve its debt information systems to ensure it is a last resort and in very rare cases, send out letters to clients asking the clients to “effectively do Centrelink’s work for it”.

He said these practices are at the heart of what is wrong with Centrelink’s Automated Debt Raising and Recovery System and it continues to cause harm.

“This continues despite the fact that there have been changes made to the tenor of communications with clients. The reality is that many recipients of these letters seeking clarification or information have financial literacy or broader literacy issues, homeless or suffer from a serious illness,” Mr Barns said.

The ALA said the government’s own debt recovery guidelines warn that on average the income will result in mistakes because unless income earned was consistent in each fortnight throughout the year, averaging will produce an incorrect assessment.

“Government has insufficient evidence to claim that overpayments exist from carrying out a crude data-matching process,” said Mr Barns. “The government is abusing its power by claiming that thousands of debts exist on the basis of inaccurate debt calculations based on average income.”

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