The federal government has spent more than $34 million to fight ongoing legal challenges to its unlawful robodebt scheme according to Labor, with $545 million now paid back to Australians who were subject to an incorrect debt.
According to tender documents, the Department of Social Services and Services Australia have spent more than $34 million on legal services in the year since a robodebt legal action was launched by Victorian Legal Aid.
Of this, Social Services, which is the respondent on the class action being conducted by Gordon Legal, spent $5.1 million, while Services Australia spent $29 million.
A Services Australia spokesperson said the contracts relate to “general corporate legal responsibilities” rather than legal services relating to robodebt.
Shadow government services minister Bill Shorten said the government should have sought this legal advice before it launched the controversial program, which it has since admitted was unlawful.
“The Morrison government has got it backwards. They are paying lawyers now to help them resist paying victims of an illegal scam that never would have happened had they consulted lawyers in the first place,” Mr Shorten said.
“Australians know they stuffed up. It’s not time for a Royal Commission to restore proper justice to victims instead of blowing more money to litigation to cover the whole thing up.”
The government is “dragging its heels” over the class action, Mr Shorten said.
“This is great news for lawyers who want swimming pools but terrible news for the Australian taxpayer. We are being stonewalled over the origins of this disaster and it’s not entirely clear whether legal advice was sought at all before this extortion was let loose on innocent Australians,” he said.
Late last year the federal government announced it would refund nearly 500,000 robodebts worth more than $700 million after admitting significant elements of the debt recovery program were unlawful.
All debts raised wholly or partially using the averaging of income data from the ATO will be refunded by the government, with that process kicking off at the start of this financial year.
The government scheme is still facing a number of legal challenges and a class action lawsuit, led by Gordon Legal.
The Senate Community Affairs References Committee held another public hearing on Monday afternoon as part of its inquiry into Centrelink’s compliance program. Representatives from Services Australia and the Australian Taxation Office faced a series of questions from Senators focusing on the unlawfulness of the scheme, the impact on those who received a debt and the process of refunding individuals.
The ATO confirmed that as of Friday last week, $545 million had been paid back to individuals who were subject to a robodebt based on income averaging.
Department of Social Services secretary Kathyrn Campbell again apologised for the scheme being “legally insufficient” and for “any hurt or harm” caused by it.