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3h ago

Record $548.5 Million Robodebt Settlement Reached, Including $475 Million for Victims

Payments hinge on Federal Court approval after an appeal prompted by the royal commission’s findings.

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The "robodebt" scheme used income averaging -- comparing a person's reported income with their income as measured by the Australian Tax Office -- to automatically issue notices to welfare recipients saying they would have to repay some benefits
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Overview

  • The package sets aside up to $60 million for administration and up to $13.5 million for applicants’ legal costs, on top of $475 million in compensation.
  • Roughly 450,000 people are expected to benefit, and class members have been told to simply keep their Services Australia contact details up to date.
  • The agreement resolves the Knox v Commonwealth appeal, making it the largest class action settlement in Australian history if approved.
  • The deal follows a 2020 settlement that refunded unlawful debts and interest, lifting total financial redress linked to Robodebt to more than $2.4 billion.
  • Robodebt, ruled unlawful in 2019, used income averaging to wrongly raise debts, and a royal commission later condemned the scheme as ‘crude and cruel.’