Centrelink’s robo-debt fiasco faces huge clean-up bill

Cross-posted from Independent Australia:

By substituting manual checking of data for a computerised algorithm in a typical Coalition cost-cutting exercise, Centrelink now faces thousands of man hours dealing with the debacle including a frenzy of class action suits. John Haly reports.

CENTRELINK HAS been fraudulently issuing debt notices to people who owe no money. Persons so identified are then harassed and threatened to the point that they pay this un-owed debt rather than being penalised by a system, which they already know actively disparages them.

Some 20,000 people a week receive notices of debts — allegedly to recoup incorrect welfare payments. Said notices are triggered by a controversial automated debt recovery system, now under intense criticism because of what is essentially (or intentionally?) the flawed logic of its computer algorithm.

An inherent incompatibility exists between Centrelink’s financial information and the Australian Tax Office (ATO) records. It’s a matter of timing. Centrelink has information about its payments made fortnightly, and possibly data relevant to jobs that clients were offered and accepted. Centrelink is unlikely to be aware of the continuing circumstances of that job or subsequent ones found independently in the course of any given financial year. The ATO has only an annual summary of income. There is no breakdown into weeks, fortnights or months. There is also no breakdown of pay rates, when it was specifically known they earned it, or what changes to income streams occurred in the course of the year.

The ATO data is, therefore, incompatible with Centrelink’s data. The Government is comparing apples with oranges.

Despite this, Centrelink’s algorithm takes your yearly income as reported to the ATO and averages it over each fortnight of the year. To assume absolute consistency for all fortnights is absurd on a number of levels. The only group that may get close to this pattern are the fully employed and, even then, there are allowances, overtime, uneven hours, holidays, sick leave, RDOs, wage rises, wage falls, changes of roles and any manner of occurrences that will alter the payroll for any individual over any given week/fortnight.

Certainly, the most unstable employment group – and the most likely to have variants – are the unemployed. This is common sense that if you are dealing with people who move in and out of employment in any given year, where they may move from poverty one fortnight to sufficiency (or, if lucky, excess) the next. It is also common sense that averaging clients’ yearly income will most likely produce inaccurate results by which to measure any given actual fortnight.

So what does Centrelink do? They take the actual fortnightly records held by Centrelink along with any limited volunteered data and try to cross-reference it against a fortnightly averaging of annual taxation income data. The normal presumption of statistical probability would tell you the likelihood of such figures matching for this demographic is extremely unlikely. You would have to presume the mismatches will be the most common occurrence. In the absence of specific information in Centrelink’s internal records for discrepancies, inquiries should be made tentatively as to why there might be aprima facie case for a mismatch in numbers.

The onus of proof should also be on Centrelink (and not the client), as the process is so obviously flawed. This is something fully recognised internally within Centrelink, if not by the political policy makers. In the face of the inherently flawed logic of this approach, innocence until proven guilty would be the legally and ethically prudent course of action.

Instead, the Turnbull Government implements a process that presumes people to be guilty (of debt) until proven innocent. As a result, some 20,000 welfare recipients a week have been receiving notices that they have 21 days to prove their “innocence”, or be hit with penalties. These include a 10 per cent debt recovery fee, gaol time, a restriction on travel. The event for which they are being investigated may be anywhere up to six years in the past. Some recipients are paying up, not because they accept that they actually owe the debt, but simply because they can’t locate evidence from past years, or because they fear the repercussions of a punishing government bureaucracy.

If you have ever had to deal with Centrelink or any of its private job network partners, you will be well aware of how punitive they are. Surprisingly to the Government – apparently – this is producing a backlash.

Minister for Human Services Alan Tudge insists the automated process is not flawed and, despite protests to discontinue the letters, he is forging ahead with gusto. For Tudge to claim to the ABC that he “wasn’t aware of anyone who was completely convinced they don’t owe money but have been given a debt notice”, is either a grotesque case of wilful ignorance or a lie in the face of a growing body of evidence otherwise.

The one aspect of this is the sheer workload this must be creating for Centrelink. Let’s assume Alan Tudge is correct that the error rate is only 20 per cent, which is contrary to what centrelink whistleblowers reveal is the case. Giving him the full benefit of the doubt, 20,000 letters a week represents 4,000 fraudulent claims a week. This amounts to 16,000 a month and 192,000 a year.

After 1.04 million data matching discrepancy letters in a year, they will not even cover the number of unemployed in this country (1.199 million), let alone all the other welfare recipients for other reasons. Alan Tudge expects the system to generate 1.7 million compliance notices, which by his own estimates means at least 340,000 letters in error. Of course, the Centrelink compliance officer whistleblower that spoke to The Guardian suggests the percentages of errors are vastly larger. Given that all of this was not only easily identifiable but unavoidably self-evident prior to the system being switched on, how is any of this not fraudulent?

At the current letter-writing rate (if they can maintain it) this will take over a year and a half to complete, although Mr Tudge thinks it will take three years. By then, the Australian legal fraternity will be in a feeding frenzy of class action suits with minimally, I calculate, 340,000 clients with legitimate grievances with the Government.

To keep on top of the “erroneous” case load – if Tudge is correct – requires the equivalent of 105 Centrelink officers processing each claim within an hour in a 38 hour week. This presumes an ability for each officer to address, research, confirm and redress an error on each letter in just one hour. But there appears to be mounting evidence it takes much more time. Plus it doesn’t factor in the equivalent of the 421 Centrelink officers devoting a single hour in a 38 hour week needed to process other claims.

But these figures are very conservative. The backlog of work is going to be extraordinary. No wonder it is so difficult to get through to Centrelink on the phone. It was nearly impossible to get Centrelink on the phone when there was only 20,000 debt recovery letters sent in a year, but now that they are doing it every week. It’s absurd. As for other means of communication, even compliance officers are complaining they cannot access the Centrelink online system efficiently, let alone customers.

In truth, even if Alan Tudge did call a halt, Centrelink will probably still be spending thousands of man-hours dealing with the consequences of this flawed and fraudulent system. The same would be true if the Commonwealth Ombudsman began investigating Centrelink’s debt recovery system and put a stop to it, disregarding the costs in legal redress, which are sure to follow.

Nothing about this course of action makes any logical sense, except to see this as class warfare against our vulnerable and easily disparaged citizens.

You can follow John Haly on Twitter @halyucinations or on his blog at auswakeup.info.

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  1. Ronin8317MEMBER

    By reversing the onus of proof, anyone who don’t have all their paperwork is screwed. Furthermore, Centerlink originally tells you to keep 2 years of record, it has now been retroactively changed to ‘forever’.

    The really really dumb thing about all of this? They can actually figure this out and avoid all of these mistakes by cross matching superannuation data >_<

    • “By reversing the onus of proof, anyone who don’t have all their paperwork is screwed. ”

      Which has been my worry. Many of the businesses I’ve worked for over the past 10 years haven’t given payslips and have long gone bust. I’m 99% sure I haven’t made any reporting mistakes, but if I have i have no way of checking or defending myself.

    • What I don’t get is that the ATO only knows my end of year salary. Seeing as the government thinks that storing two years worth of metadata to not be an imposition for my ISP, why aren’t the ATO able to afford a few extra database tables for weekly wages and tax payments? It’s utter incompetence times two.

    • Here’s a fine example of the integrity of the system – Australian of the year finalist gets Centrelink debt letter https://www.theguardian.com/australia-news/2017/jan/16/centrelink-robo-debt-system-wrongly-targets-australian-of-the-year-finalist

      Mrs Hammill is a leading foetal alcohol syndrome researcher who is retired but volunteers her time at the University of Queensland. Centrelink appears to have classed her research grant as income to which she is not entitled.

      There will be hundreds of thousands of these – welfare-bludging grannies who unconscionably suckle at the public teat while fraudulantly pretending to do medical research that will improve countless lives in the future.

      Yeah, go Centrelink! Go coalition – smash those welfare-bludging pensioners next!!

  2. run to the hillsMEMBER

    I’ve been discussing this matter with my brother who is a reasonably senior employee with 20 odd years tenure at Centrelink, he said this is a screw up of epic proportions. The front line staff, whose jobs are difficult at the best of times, are getting hammered. Apparently the gov minister was warned not to roll out the debt notices at the same time as the looming pension asset test changes but forged on against the advice given. Looks they are doubling down rather than admitting defeat.

    • Would be interested in your brother’s take on this…there’s no way they built this algorithm without knowing its limits. Sounds to me like it was meant to help with targeting fraud (pretty standard stuff). But what was the thinking that led them to wire the algorithm directly to the automated mail system, knowing full-well it will throw up thousands of false positives??

      • It’s simple. They don’t give a fuck. The utter disdain this government is showing for it’s constituency is breathtaking.

    • Did he say if the algorithm was internally developed, or did they outsource this to a large IT consulting firm, like IBM?

  3. “Nothing about this course of action makes any logical sense, except to see this as class warfare against our vulnerable and easily disparaged citizens.”

    The conclusion is so wrong it’s not even funny.

    Of course it makes sense to use software to perform these calculations. The problem, as always, is the poor implementation of it (bad algorithm) – but the initial idea to automate this process is good.

    • The issue is the effort, expense and political capital being burned through for ~$300m, while we get >$2bn of unauthorized expenses for the refugee camps, which cost over $500k per refugee per year to run. Not to mention many other billions wasted elsewhere on stupid contracts and policies. If among all these blunders they are focusing on collecting some centrelink pocket change, (after costs of getting this money), then it is definitely a war on the poor.

      • “——then it is definitely a war on the poor”
        Absolutely – normal as usual behaviour from the Liberal ( haha )Party .

    • Just to be clear, you know the automation was already in place? The algorithm hasnt changed, they just removed the human filter. They would have known this would happen. You can’t blame an algorithm for doing its job badly and apparently the same applies to Aus politicians.

      • The algorithm can’t work because the format of the data is incompatible. The proper solution is to make the databases compatible between ATO and Centrelink and perform a massive manual data cleaning exercise to get rid of anomalies and ensure that data is entered at the correct frequency (weekly). That should take a few years and few million man hours but after all that you should be able to run the algorithm and get a very low error rate.

        Of course then you might discover that there wan’t as many fraudulent claims as you had counted on and you just spent far more than you can hope to recover.

        Realistically you wouldn’t bother, any more than you would conduct inquiries into people claiming tax deductions for stationery items that they weren’t being used for personal use. However computerized spam invoicing is very cheap and even if most of your victims are innocent you can rely on making a decent profit from those who are forced to pay up, don’t check, can’t be bothered fighting etc

      • The algorithm was designed to flag anomalies which can then be double-checked by humans. It wasn’t meant to do anything else as far as I know. Removing the humans meant removing the next stage of the filter. Their own stats would have shown exactly what the outcome would be.

        You are correct – this is essentially a government phishing scam

      • However computerized spam invoicing is very cheap and even if most of your victims are innocent you can rely on making a decent profit from those who are forced to pay up, don’t check, can’t be bothered fighting etc

        The trick with that one is to not get greedy, and ensure that the extra amounts are sums that your targets won’t be bothered fighting, not sums that are likely to put them on the streets if they attempt to pay.

    • Part of the process of good management, or good anything actually, is to know what you don’t know and therefore make a reasonable assessment of risk, before proceeding with a large-scale activity like this.

      This is a textbook example of a fuck-up based on overconfidence, poor risk management and zeal. Those involved should no longer have jobs.

      • You are being too generous. I’m cynical enough about this to think that they knew exactly what would happen (everyone involved at C-link told them!!!) but they underestimated the backlash.

      • Now that we have Centerlink Fail to add to Cenus Fail I wouldn’t trust our government agencies and the politicians pulling the strings to play a game of Pokemon, Go!

      • Ranald, you may be right. That being the case they should be sacked anyway because any backlash was always going to lead to higher clean up costs than what they could recover. Never mind the loss of public trust in seeing their govt do something so stupid and vindictive.

        its extraordinarily poor even for this shambles of a government.

      • You know, I’m not sure how unintentional this all is. Sending debt notices to dirty dirty dole cheats is very popular with your average coalition voter. Regardless of whether they actually owe any money or not.

  4. The predictable outcome of many initial attempts to automate. The error (or carefully planned decision) is not to assume that their would be teething problems at the start, and allow for additional work hours accordingly.

    • This is purely and simply the LNP’s War on Welfare.
      Absolutly idealogical.
      Well if you can install robots to replace public servants , you can go to the next logical step and replace politicians with robots.
      Properly programmed they will perform far better than party centric pollies and work in the interests of the community.

  5. This is where classic small gov, neo lib ideology leads. While other countries are considering spending money on universal basic income, Australia is spending more just to keep it out of the hands of the poor (who would just blow it all on goods and services). For their next trick they might privatise/outsource the running of centrelink to a super fund or an overseas corporation. Genius.

    The same thinking has lead to the closure of the car factories: cut the subsidies (called high-tech manufacturing investment in other countries), lose the economic gain and tax windfall. “Hey, we’re saving money by not spending.”

    This is tectonic level idiocy stemming from corrupt ideology and should be enough to roll any government.

  6. “now under intense criticism because of what is essentially (or intentionally?) ”
    I doubt this is intentional.
    But obviously the Turdbot and his ministers cant admit any fault as it just looks bad for them.
    Would like to know who designed the software and how it would work for this though.
    Ive seen some shockingly stupid software put together over the years so whoever was the project lead on this one should be fired.

    • If I understand correctly, its not the software though, its the strategy. The strategy seems to be to take an extremely macro set of data and use it to conduct a mass campaign. The data and analytics is not available to support the campaign they are seeking to conduct. The thought process is flawed, not the execution.

      Kinda like saying – I want to target all over 65s in an area for pension audits. But my available data only tells me who is over 55. But I’ll go ahead anyway.

    • The only unintentional part of the this fiasco is the backlash.

      As I’ve said before, the neocons clearly think they’ve reached the endgame. They’re not even bothering with facades of propriety anymore.

  7. Tudge is absolutely correct – The system is working exactly as designed. This is obvious from the content of the latest whistleblower’s statement which outlines orders from management (and presumably the Minister) to staff instructing them not to resolve identified issues with the data matching unless there has been a formal customer complaint.

    It’s an absolute disgrace and Tudge, Porter and Turnbull (in particular Mr Invisible) should be hung from a tree for their response.

  8. Centrelink general manager Hank Jongen, in his response to the latest whistleblower letter, did NOT deny that the onus is on customers to find errors that cause them to be billed for false debts, and did NOT deny that staff are under instructions to keep it that way. In short, he did NOT deny that Centrelink is engaged in the biggest speculative-invoicing scam in the history of the world.

    • Why would he?
      He’s proud of doing a fine job of implementing his masters’ policies – just one of many horses pulling the wagon, unable to pull left or right to escape the will of the driver.

  9. deanis123MEMBER

    The average cost for them in defending decisions reviewed in the SSAT (AAT) is around $4,200 (PC Report – Access to Justice Arrangements 2014), I wonder if they have factored this kind of thing in to the estimated amounts they are expecting to recover?

  10. Ahhhh…. the smell of private sector contractors with a thin veneer of public management [hand picked for ideological purity or ethical flexibility] where the code is a law unto itself – no human[s agency involved of course [altruism]. Because that would make Hayek [and free market friends] sad, price discovery dictates all human events.

    Disheveled….. mean while on a higher strata of human society lawlessness and looting proceed unabated……

    • Did I hear this morning that Eric Abetz has said that all problems with this automated system have now been corrected? What a towering example he is of upright humanity to which we should all aspire to.
      Meanwhile, still not a whimper from the powers that be over the North West Shelf gas debacle that ripped $5 Billion of royalties from the Fed Gov’t in 18 months and a probable 5 year misalignment in royalties that should have been paid.

      • Dear dawg Nhibbo….. think of the shrine of GDP not receiving its allocation of productivity by divine right… the very fabric of time and space is in peril….

        disheveled…. deviants like you must be rendition to Restage compound for immediate re-coding… you don’t even want to know…

      • What he means is that his own personal issue with it (a member of his family received one of the false Centrelink letters) has been sorted and so everybody else can go to hell.

        He’s telling us that if you are a member of the coalition or have a close relative or friend who is, any false debt sent to you by Centrelink will be swiftly repealed. If you’re anyone else, too bad you’ll just have to bend over and take it.

  11. What percentage of these debt letters are incorrect? Anyway, talk of class action is a nonsense. Don’t turn this into an ambulance chaser’s picnic.

    • Putting the debt collectors onto someone as a “mistake” is an extremely serious offence. It could destroy their credit rating, ruin their life. There is no telling how much effort would be needed to repair the damage done. I would say that in some cases, this would be similar to coming home and finding you have been burgled.

      The mongrels who did this should be sacked, bankrupted and serve some time in Long Bay. Remember, they threw Pauline Hanson in jail for alleged bad form filling, and for an amount that pales in comparison to the Politicians rort list. Try a bit of bad form filling with the ATO and watch the letters come threatening imprisonment.

      The government can’t have two sets of rules – jail for us, travel rorts for them.

    • Wow Mike, you really are just a cheerleader for everything LNP. I suggest you would get more satisfaction posting on murdoch sites and calling 2BG to get that smug satisfaction of being righteous.

    • “Anyway, talk of class action is a nonsense.”

      Whenever someone uses this odd, singular version of the word nonsense, I always think of some pompous, gout ridden old fossil puffing himself up with a bit of legalistic plumage. I have no idea whether or nor not you have gout.

      If you say “this is nonsense” then it is a reasonable abbreviation for “this is not sensible”. Otherwise you could say “this is a nonsensical idea”, which is clearer. There may be ideas, plans, gestures that may be nonsense, however I don’t think that something can be a “nonsense” as a stand alone noun.

      People like to use words in a dishonest way. In this case you have used a legal flavoured phrase to dismiss and trivialise a great wrong inflicted on the weakest members of our society. That is what what everybody is getting tired of – the deplorables getting a kick in the guts and the elites “elite-splaining” why they deserve it and should just shut up.

    • Pareto! If around 20% of debt letters are incorrect due to minor and not so minor data errors and around 80% of debt letters are legitimate, what is the problem.

      Fix and explain where wrong, request payment refund where assessment is correct. This seems simple enough. Centrelink heads should have tested data matching more conclusively to avoid unnecessary mistakes, but mistakes do happen.

      It is a nonsense to fill lawyers pockets over this. Taxpayers have obviously already paid out too much.

      • Read again Mike – no one knows exactly how many are wrong, not even Centrelink. Because the process previously in place for determining data matching errors from actual debts – having experienced human scrutineers check discrepencies flagged by the computer – has now been removed. This process was obviously very slow and labour-intensive – it also resulted in a high portion of the investigated discrepencies subsequently being found to be not an actual debt owed at all but merely one of a number of human/data matching errors. “The Centrelink compliance officer, who asked for anonymity, told Guardian Australia the system was error-prone but that most customers were paying debts without checking them first. The source said of the hundreds of cases they had reviewed, only about 20 (at a “generous estimate”) turned out to be genuine debts.” https://www.theguardian.com/australia-news/2016/dec/23/centrelink-officer-says-only-a-fraction-of-debts-in-welfare-crackdown-are-genuine

        The rate of discrepencies flagged by the computer that transpire to not be actual debts at all appears staggeringly high. There’s nothing wrong with the computer – it’s just that it can only highlight data discrepencies, it lacks the capacity to determine guilt or innocence. This can only be done by humans.

        AS has been pointed out, this human filter has now been removed – and the computer is free to simply spray out tens of thousands of notices WHICH ARE NO LONGER CHECKED FOR ACCURACY BEFORE BEING SENT. The onus is now on the letter recipient to cobble together the relevent information – which is often difficult and sometimes impossible since it does not necessarily still exist – and prove their innocence.

        This is an example of taking outsourcing as far as it can possibly go – Centrelink has cut costs by removing proper data reveiw procedures previously performed by trained, data-literate, system-literate IT professionals employed by/contracted to Centrelink and are now having this crucial scrutineering work done for free – by the people they are accusing of owing money.

        A high percentage of whom simply do not have the knowledge or capacity to defend themselves against such allegations, even when they are false. If an employer has gone out of business some years ago, the “proof” may be impossible for even a savvy individual to obtain since the required documentation may simply no longer exist. In this case, Centrelink’s default position is that the person is automatically guilty and even if they are still disputing it, they must begin paying. Which seems to me like a breach of the law.

        By the time 1.6 million notices have been sent out – and we aren’t counting the aged and disability pensioners yet, they will apparently account for twice that figure – the number of false debts and demands for repayment, often accompanied by threats, may well be in the hundreds of thousands.

        It takes an extrordinary set of blinkers to not be able to see the unfolding disaster here. Many of the “debts” are in the hundreds of dollars but there appear to be a lot in the thousands or tens of thousands of dollars – enough to inflict not merely financial ruin but actually drive some people into poverty.

        A man had to be capsicum sprayed at a Centrelink office yesterday – how long before some tormented fool goes Port Arthur at a C,link office somewhere?

      • Pareto! If around 20% of debt letters are incorrect due to minor and not so minor data errors and around 80% of debt letters are legitimate, what is the problem.

        Vast amounts of money will be spent with little net recovered, for no real purpose other than to put the “leaners” in their place and remind them how important the “lefters” are.

        This is before even getting into the human cost on those accused – rightfully and wrongfully.

        The amounts being talked about, even if they all end up being true, are a rounding error in the overall welfare budget. They could probably save the same amount of money in real terms by imposing an “efficiency dividend” on travel entitlements.

        This has nothing to do with saving money and everything to do with hurting the weak and enforcing the status quo. Conservative Politics 101.

      • If I were currently on unemployment benefits and some work came on offer – I would probably be very disinclined to accept it given that doing so would likely result in a computer somewhere accusing me of owing money and demanding proof that I didn’t.

        Perhaps they believe that they can discourage new jobseekers from applying for benefits at all – leaving those who cannot garner family support to beg, borrow or steal to survive. This thing has a real industrial revolution type ring to it.

      • drsmithy, I agree with your synopsis but what I’d be interested to know is just how many of those targetted are not currently receiving any welfare but are people who are today fully employed and have received debt demands relating to periods of unemployment years earlier. Not suggesting at all that the currently unemployed deserve it and those who were but are now employed don’t – no one deserves treatment like this – but the system does seem to be capturing such people. I have read a number of such stories finishing with qoutes to the effect of “I will never vote Liberal again”.

      • I have read a number of such stories finishing with qoutes to the effect of “I will never vote Liberal again”.

        Whilst a heartening conclusion, it does go to show the mentality and disconnect of such people – ‘until it happens to me it’s righteous, but when it does it’s a travesty’.

        If this is what it’s taken someone to stop voting Liberal, then they haven’t been paying attention for decades. This is core (contemporary) Liberal Party politics.

      • Yes, the classic mindset of the neo-liberal era, reinforced by the typical Australian “it doesn’t matter to me” outlook.

        I think this is probably part of a broader agenda – to see how far they can get away with dismantling the welfare state. They are hoping to prevent people from applying for any kind of government assistance through instilling fear – let everyone see that if you receive welfare, sooner or later you will be hit with very unpleasant consequences.

        Since merely punishing the disadvantaged for the crime of being disadvantaged will not of itself actually create jobs that do not exist for the unemployed to go to and will not magically return the infirm, the disturbed and the elderly to physical and mental health and vigour, it’s difficult to foresee exactly how much effect this is likely to have at deterring people from seeking assistance from government. Many new young jobseekers may be able to “live off the taxpayer” (I hesitate to use that term for a number of reasons including that it creates a false impression of people being “leaners” and further that it is not applicable in our sovereign monetary system) without applying for newstart – they’ll just keep being supported by parents. But there are lots of others who will not readily have such options.

        Overall, the great majority of joblessness is not voluntary idleness – human beings are social animals and a natural urge to contribute to society is found within the phyche of most. Most unemployment is the creation of the system and the reason we don’t fix it and return to a policy of full employment and the 2% or so unemployment rates (2% = “frictional unemployment” which in real terms is only a little above zero) of the decades from WW2 to the late 1970’s is because not everybody agrees that an economy in which everybody who needs a job can get one is a good thing.

        As Robert Menzies alluded to, the threat of unemployment is the most effective weapon the capitalist has to discipline the workforce with – “the situation is radically reversed when the worker can say, if you will not employ me then there is always somebody else who will”. Menzies wanted full employment gone but feared a devastating political backlash.

        So we allow involuntary unemployment to exist in order to prevent workers from having too much power and to suppress wage demands, thus disciplining inflation.

        Using human beings as sacrificial lambs to maintain the smooth functioning of the system is offensive to many voter’s sense of right and wrong so it has been necessary for decades to continually reinforce the idea among the population that all unemployment is always a voluntary choice, that such people are bludgers living off the fruits of everyone else’s labour and as such are to be despised.

        This brainwashing has been been quite successful – but I think (hope) they have overestimated just how successful and have overreached on this one.

  12. proofreadersMEMBER

    A fine example of Do-nothing’s signature vision for Straya – leading-edge innovation?

    In “fairness”, the subject computer algorithm should be adapted to vet pollies’ expenses and debt notices issued?

  13. I am amazed this went ahead, it is numerically proven that many invoices will be incorrect and false, this would have been known and approved. Whoever approved this on the basis of ‘acceptable risk’ could arguably be found guilty of using a false instrument. I would reckon that this person is likely the minister, as yes men are usually very keen to ensure the responability ultimately lies with the boss!

  14. Centerlink employee to minister: “the algoritm’s wrong”
    Centerlink minister to employee: “algo what?”

  15. Hill Billy 55MEMBER

    Its not just unemployment benefit recipients. I have had a case of someone receiving disability benefit being targetted erroneously. They actually have the data to prove the error from the 2011 year.

  16. After decades of demonizing the unemployed following the abandonment of full employment in the late 70’s, the government believed that the public had been well conditioned enough to despise the few million people at the bottom of the social heap to the extent where it would be able to get away with mass fraud, extortion and outright thuggery. It appears they may have miscalculated.

    At first this appeared to be the most monumental case of incompetence by government I have seen in my lifetime – however, it has become abundantly clear that there is no mistake here…..this is the intended outcome. The government KNEW that huge numbers of false positives would be generated by removing human scrutineers from the process and cranking the dial up to 11 – as other posters here have pointed out, Centrelink staff who had been using this exact same system for years told the government that this would happen. They were ignored. The computer programme was never designed to be able to distinguish real overpayments out of a myriad of complex circumstances since as a machine, it does not posses the capacity for intelligent reasoning and judgement – a human being is required for that. It’s function is merely to scan bulk data and flag indescrepencies which would previously have been checked by a human. And it appears that in a very high percentage of cases, the person would then find there had been no attempt to defraud and it was merely one of a broad range of legitimate circumstances which a machine is unable to recognise – data incompatability errors between Cetrelink and the ATO, human errors etc.

    One of the most glaringly obvious examples of the process having had human intelligence removed is the cases where the Centrelinks files spelled an employers name one way and the tax office spelled it another – sometimes the difference may have been nothing but a single apostrophe in the name but the dumb machine spots the difference and regards it as being two different employers, one of whom the person did not tell Centrelink about. Although Centrelink has further relevent data, the computer did not look any further to see that by amazing coincidence, the “different” employers both have the same ABN and that the amounts the person stated they earned were identical to the last dollar – a human would have picked up on that immediately. But the computer simply flags the difference and sends a letter/email asking the person to confirm the above amount – when they do, the debt process is automatically kickstarted.

    Another is where the computer takes the earnings of a person engaged in casual/seasonal work – they may do ok in some weeks or fortnights but have literally nothing to eat and pay rent with in others – and simply averages them out over 26 fortnights and assumes the person actually earned that amount each fortnight, making them inelligable for any any Centrelink assistance and duly sends the confirmation letter followed by the demand for money. Very large numbers of legitimate assistance payments have been deemed illegitimate (and repayable with a collection fee on top!) by an error (or deliberate process) that a primary school child could spot.

    I’m not a lawyer but I’m fairly certain that if I demanded money form someone with no actual proof of a debt owed and often only flimsy evidence easily refuted, threatened them with debt collectors, garnishment and in some cases actually used my powers to begin making deductions from their account – that would called blackmail, extortion and theft. Further, in many cases I have demanded sums that I KNOW cannot possibly be correct because I simply averaged out their lumpy, casualized income – that is fraud plain and simple.

    It seems clear that Centrelink and the government are of the opinion that the laws that apply to all other Australian citizens do not apply to them.

    With 1.6 million people to be hit with debt letters in the current tranche and a further 3 million age and disability pensioners to be targetted – the government is declaring that 1 in every 6 or 7 of the adult population have committed welfare fraud at some stage in the past 6 (or longer) years and now must pay up.

    This is the most extrordinary allegation I have ever seen an Australian government level at it’s own citizens.

  17. “We don’t seem to know how many of these “income discrepancies” are there because of the flaws in the the data matching process itself.

    Some of the information Centrelink has is likely to be incorrect. When you have humans entering data, this is bound to occur, and trying to fix up those errors is a worthy goal. Indeed, it’s required by Australian Privacy Principle number 10 as part of the Privacy Act 1988. Most of these errors are going to be innocent misunderstandings, forgetfulness, or just typos. Some smaller amount will be deliberate fraud.

    But what we have here is the data matching process creating brand new errors! It’s actively making the data Centrelink has worse not better”