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Robodebt class action to settle for $1.2bn
The federal government has agreed to a “landmark” class action settlement, worth $1.2 billion, over its controversial Robodebt recovery program, which raised automated debts against welfare recipients.
Tony Zhang
Gordon Legal, which represented the Centrelink recipients who had been forced to pay back money under the “unlawful” scheme said the parties had reached an agreement which, if approved by the Federal Court, will see $1.2 billion in total delivered to participants in the legal challenge since it started, including $112 million in compensation.
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The federal government has further agreed to pay back $721 million to more than 370,000 people who were wrongly pursued, and it will also drop claims for another $398 million in debts it had asserted against some of the class action group members, Gordon Legal said in a statement.
The firm noted that, in settling the class action, “the Commonwealth has not admitted that it was legally liable to group members”.
“We want to acknowledge the courage of the lead applicants; Katherine, Elyane, Steven, Felicity, Shannon and Devon, who led these proceedings on behalf of all Robodebt victims in pursuit of this class action, which has allowed this outcome to be achieved today,” Gordon Legal partner Andrew Grech said.
“Our clients have asked us to especially thank Bill Shorten for his relentless pursuit of this issue, for his compassion over the last four years for vulnerable Australians hurt by Robodebt and for bringing the case to Gordon Legal’s attention when it seemed that all other options had been exhausted and only resorting to the legal system would help.”
Mr Grech further acknowledged the work of the legal team at Victoria Legal Aid, whom he said worked tirelessly to bring a number of individual claims before the Federal Court before the class action was commenced, as well as the efforts of many community legal services in the Welfare Rights Network, such as Social Security Rights Victoria, who have been advocating for victims of Robodebt for the last few years.
The Robodebt scheme has been widely criticised for using computer algorithms to raise debts against hundreds of thousands of welfare recipients, with little to no human oversight.
Earlier this year, Prime Minister Scott Morrison apologised in Parliament for “hurt or harm” caused by the process.
Shadow minister for government services Bill Shorten said in a statement Labor would continue to push for a royal commission into Robodebt.
The class action, launched on behalf of people who received notices through the automated debt recovery process, was launched last year with senior partner Peter Gordon making the announcement along with Mr Shorten. It comes after pressure over the federal government’s “15,000 mistakes” borne out of the automated system.
This comes as the class actions landscape continues to evolve in Australia with Lawyers Weekly presenting a special two-part episode exploring all things class actions in 2020 and beyond with Maurice Blackburn national head of class actions Andrew Watson.
The first part discusses where the parliamentary inquiry into litigation funding and industry regulation is at, the position of plaintiff firms with regards to that inquiry, with the second part diving deeper into the challenges surrounding contingency fees and common fund orders and the duties of leaders in class actions teams at this critical juncture.
