Shocking letter leaves Australian pensioner with $65,000 debt, royal commission hears testimonies
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We know all too well here at the SDC how hard it can be for Australian seniors to make ends meet.
So what would you do if you were suddenly hit with an impossible-to-miss letter which demanded the repayment of $65,000? And the letter wasn’t just from anyone, it was from Centrelink. It’s frightening to even consider.
Rosemary Gay, a 76-year-old pensioner from Ballarat in Victoria, faced that nightmare when a letter from Centrelink warned her that she had to pay back the staggering figure – and she only had two weeks to do so.
The letter claimed that if she didn’t make the payment within two weeks, the government would start taking it out of her pension. The sum she was requested to pay was more than three times her annual salary.
As a part-time receptionist who had worked 14 hours a week, she earned less than $20k in a single year.
'It turned my life upside down. It was just sheer terror that I owed a figure which was just such a huge amount, that I had never earned that much money…How could I owe that much money and I had to come up with it in three or four weeks?' Gay said.
Unfortunately, it’s a story that’s all too common in Australia right now. In 2020, it was determined that the government’s robodebt system had wrongfully recouped more than $750 million from approximately 381,000 people.
Rosemary Gay spoke about her experience as a part of the robodebt royal commission, which is currently taking place in Brisbane.
The commission is hearing from affected individuals from all over Australia, as they give horrific first-hand accounts of unjust debt collection. There have been multiple extremely distressing accounts from victims, including stories of spiralling depression, money taken from family businesses and the forced sale of homes.
Speaking to the royal commission about her experience, Gay said she made $17,436 as a part-time receptionist between July 1, 2010, and June 30, 2011. However, on October 12, 2016, she received a debt notice for $64,998.17, something she said left her with little hope.
'All I could see was that I may be faced with selling my home and losing everything that I had worked for in my 70 years and I just saw it all going away instantly,' she said.
Centrelink claimed that discrepancies between Gay’s reported income and the amount registered with the Australian Tax Office had resulted in Gay being overpaid.
'The data that I provided to them of my earnings would be exactly the same as what would be contained in my group certificate in my tax return at the end of that financial year,' she said.
Ms Gay thought the whole matter would be resolved quickly, but unfortunately, that wasn't the case.
'I presumed that once I'd confirmed that (amount) was in my group certificate, that would be the end,' she said.
'That they would correlate that to be the same as what I had reported to them, and expected that would be the end of it.'
Gay said she was shocked and angry that Centrelink had caused her 'such a traumatic experience’.
'It was a very dark period of time for me and one that is very difficult to relive,' she said.
It took two reviews, two months, and a lot of sleepless nights until she was told that the correct debt was only $120.33.
Members, if you or someone you know has been impacted by Robodebt, then please check out the websites of NotMyDebt and the Financial Rights Legal Centre.
NotMyDebt, a group founded by Lyndsey Jackson, was created to help victims of Robodebt. She said people she spoke to were 'facing homelessness' and 'worried they were going to get in trouble and lose their kids'.
We would be remiss not to acknowledge that the royal commission is still an ongoing investigation and we will do our best to keep you up to date with all the latest information.
Former Coalition ministers Alan Tudge and Christian Porter are expected to front the commission next week.
You may remember Tudge’s 2016 A Current Affair interview where he stated, ‘We’ll find you, we’ll track you down and you will have to repay those debts and you may end up in prison.’
You can watch the clip here:
We wish Rosemary and all those impacted by the robodebt system the best.
Members, what are your thoughts on this story?
So what would you do if you were suddenly hit with an impossible-to-miss letter which demanded the repayment of $65,000? And the letter wasn’t just from anyone, it was from Centrelink. It’s frightening to even consider.
Rosemary Gay, a 76-year-old pensioner from Ballarat in Victoria, faced that nightmare when a letter from Centrelink warned her that she had to pay back the staggering figure – and she only had two weeks to do so.
The letter claimed that if she didn’t make the payment within two weeks, the government would start taking it out of her pension. The sum she was requested to pay was more than three times her annual salary.
As a part-time receptionist who had worked 14 hours a week, she earned less than $20k in a single year.
'It turned my life upside down. It was just sheer terror that I owed a figure which was just such a huge amount, that I had never earned that much money…How could I owe that much money and I had to come up with it in three or four weeks?' Gay said.
Unfortunately, it’s a story that’s all too common in Australia right now. In 2020, it was determined that the government’s robodebt system had wrongfully recouped more than $750 million from approximately 381,000 people.
Rosemary Gay spoke about her experience as a part of the robodebt royal commission, which is currently taking place in Brisbane.
The commission is hearing from affected individuals from all over Australia, as they give horrific first-hand accounts of unjust debt collection. There have been multiple extremely distressing accounts from victims, including stories of spiralling depression, money taken from family businesses and the forced sale of homes.
Speaking to the royal commission about her experience, Gay said she made $17,436 as a part-time receptionist between July 1, 2010, and June 30, 2011. However, on October 12, 2016, she received a debt notice for $64,998.17, something she said left her with little hope.
'All I could see was that I may be faced with selling my home and losing everything that I had worked for in my 70 years and I just saw it all going away instantly,' she said.
Centrelink claimed that discrepancies between Gay’s reported income and the amount registered with the Australian Tax Office had resulted in Gay being overpaid.
'The data that I provided to them of my earnings would be exactly the same as what would be contained in my group certificate in my tax return at the end of that financial year,' she said.
Ms Gay thought the whole matter would be resolved quickly, but unfortunately, that wasn't the case.
'I presumed that once I'd confirmed that (amount) was in my group certificate, that would be the end,' she said.
'That they would correlate that to be the same as what I had reported to them, and expected that would be the end of it.'
Gay said she was shocked and angry that Centrelink had caused her 'such a traumatic experience’.
'It was a very dark period of time for me and one that is very difficult to relive,' she said.
Key Takeaways
- Rosemary Gay experienced ‘sheer terror’ after receiving a letter demanding she pay back the $65,000.
- After two reviews and two months, the correct debt Rosemary owed was determined to be just $120.33.
- Rosemary had been employed part-time and was paid around $22 an hour, so her annual salary would never have reached $65,000.
- The federal court ruled the practice of using Australians’ annual tax information to establish welfare debts unlawful, and it is believed to have wrongfully recovered more than $750 million from 381,000 people.
It took two reviews, two months, and a lot of sleepless nights until she was told that the correct debt was only $120.33.
Members, if you or someone you know has been impacted by Robodebt, then please check out the websites of NotMyDebt and the Financial Rights Legal Centre.
NotMyDebt, a group founded by Lyndsey Jackson, was created to help victims of Robodebt. She said people she spoke to were 'facing homelessness' and 'worried they were going to get in trouble and lose their kids'.
We would be remiss not to acknowledge that the royal commission is still an ongoing investigation and we will do our best to keep you up to date with all the latest information.
Former Coalition ministers Alan Tudge and Christian Porter are expected to front the commission next week.
You may remember Tudge’s 2016 A Current Affair interview where he stated, ‘We’ll find you, we’ll track you down and you will have to repay those debts and you may end up in prison.’
You can watch the clip here:
We wish Rosemary and all those impacted by the robodebt system the best.
Members, what are your thoughts on this story?