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What new Centrelink ‘opt-out’ message means

Centrelink is in the spotlight. Image: Getty

Australians logging onto their MyGov accounts as of Monday 18 May may notice a new feature: an opt-out notice for a robodebt class action

Class action law firm Gordon Legal and Shadow Minister for Government Services Bill Shorten in 2019 announced they would launch a class action against the debt recovery scheme.

Centrelink’s controversial robodebt system saw 686,901 debts raised, worth $1.4 billion. The scheme raised the debts by using a process called income averaging, which saw Centrelink tally up a recipient’s assumed income by averaging out their income reported to the ATO. 

Critics claimed the income averaging calculations were flawed and led to incorrect debt notices issued to thousands of recipients. 

The scheme, dubbed “unlawful” by the Federal Court, has since been wound back and hundreds of millions refunded.

But the class action remains on track for mediation in June, Gordon Legal principal lawyer James Naughton said. 

The class action will be heard between July and September this year, and is one of the largest in Australia’s history. It alleges that Centrelink’s robodebt program has caused “significant and unnecessary detrimental financial impact on thousands of lives” since July 2015. It seeks repayments of the “unlawfully claimed debts”. 

“We hope [the mediation] will resolve the class action. If it does not, the case will go to trial between July and September. Centrelink will be notifying people who it believes are Group Members in the coming days,” Naughton said.   

The Commonwealth has been required to notify potentially affected Australians of the class action, and their right to opt out. 

“If you have received a notice, then Centrelink believes you have been affected by robodebt and are a Group Member in the Class Action. You have the choice to opt out, but we recommend that you do not.”

The legal firm said they are now preparing to be contacted by hundreds of thousands of affected Australians. 

Gordon Legal has already received over 13,000 registrations of interest. However, it believes the actual number of affected Australians is far higher.

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