In a revelation that shocked many Aussies, Services Australia has been chasing $4.9 billion in unpaid debts.

Some of these debts date back decades and may have been miscalculated.

This news raised concerns among Australians, particularly those who have received or are currently receiving welfare payments.


As of October last year, Services Australia pursued debts from 829,266 customers.

The oldest debt on Services Australia's record dated back to 1979.

However, a number of these debts stemmed from the 1990s—a period when many of our readers may have been in the workforce or receiving assistance.


At the time, Services Australia used income apportionments.

It was a complex system heavily used due to the uncertainty about how payslips aligned with the fortnightly income reporting periods required for welfare payments.

This method involved creating a 'daily' average of income, which often led to customers being overpaid and subsequently served with a debt notice despite reporting their income honestly.

This practice, prevalent from the 1990s until 2020, has been under scrutiny following two investigations over the past two years.


These investigations revealed 147,773 debts that may have been unlawfully calculated, affecting 100,360 customers in the process.

This was an increase from the approximately 100,000 debts previously identified by the Commonwealth Ombudsman, who called for these debts to be waived.

The federal court is waiting for the outcome of an appeal after an administrative appeal tribunal found that income apportionment could result in individuals being pursued for debts.

In response to these findings, Services Australia assigned 150 staff members to work on income-apportionment matters since October last year.

'Since December 2020, income apportionment no longer occurs. The $4.9 billion owed includes outstanding debts that may be impacted by income apportionment,' Services Australia spokesperson Hank Jongen stated.

'A decision to waive or refund debts on the basis that income apportionment was used would need to be made by the government.'


Greens Social Services Spokesperson Penny Allman-Payne expressed concern over the possibility of Australians unlawfully pursued for Centrelink debts.

She emphasised the need for a fairer social security system that does not criminalise individuals for seeking support.

The Australian government agreed in principle to a Royal Commission's recommendation to reinstate a six-year limitation on debt recovery.

However, details about its implementation and its application to current debts remain unclear.

Allman-Payne continued to urge the government to act on this recommendation.

Meanwhile, the Antipoverty Centre's Spokesperson, Kristin O'Connell, called for a halt on all debt recovery activities.

O'Connell highlighted the need to protect welfare recipients from harmful debt collection practices until a safe system comes.


The Department of Social Services stated that the government is committed to improving social security debt arrangements.

They also ensured that debt raising and recovery were conducted in a timely, fair, and respectful manner.

For seniors, this news could mean that you may have been affected by these potentially incorrect debt calculations.

If you suspect that you have been wrongfully pursued for a debt, or if you have an old debt calculated using income apportionment, take action immediately.

Services Australia has been reviewing and appealing debts, and it is crucial to reach out to them for a reassessment.

You may be entitled to a refund or waiver, especially if your debt was calculated using the now-discontinued income apportionment method.
Have you or someone you know been affected by these debt recovery efforts? Are you already in talks with Services Australia about a reassessment? Share your experiences and thoughts about this change in the comments below!