Federal Government Forced to Cough Up Staggering $475 Million in Damages to Victims of ‘Cruel’ Robodebt Scandal: Hundreds of Thousands to Receive Compensation
- Record-breaking class action settlement sees government agree to pay out $548.5 million to over 450,000 Centrelink recipients
- Vindication for victims of Robodebt scheme, which was slammed as ‘crude and cruel’ by Royal Commission
- Settlement marks the largest class action payout in Australian history, with Attorney-General Michelle Rowland hailing it as ‘just and fair’
In a landmark victory for the victims of the notorious Robodebt scandal, the federal government has agreed to pay out a staggering $475 million in damages to over 450,000 Centrelink recipients who were wrongly pursued for debts they didn’t owe.
The settlement, which has been hailed as a major vindication for those affected, marks the largest class action payout in Australian history. According to law firm Gordon Legal, which represented the claimants, the total settlement amount stands at $548.5 million, including reasonable legal costs and administration fees.
Peter Gordon, founder of Gordon Legal, described the outcome as “vindication and validation for hundreds of thousands of Australians afflicted by the Robodebt scandal”.
“Today is also one more vindication of the principle that Australia remains a nation ruled by laws and not by kings. Laws which even hold the government accountable. Long may that be the Australian way,” Gordon said.
Former nursing student Felicity Button, who was part of the class action and incurred a debt of $11,500 when claiming Youth Allowance, testified at the Royal Commission and welcomed the settlement. “Even though what happened to us was unfair, unjust, cruel, torturous and inhumane, we didn’t retaliate in kind. We used the legal system for what it’s there for and justice prevailed,” she said.
Button revealed that the Robodebt scheme had caused irreparable harm to many people, including those who had lost family members, gone through divorce, become bankrupt, and suffered severe mental health issues.
“We can never compensate for that, but this is as just and as fair as it could have been and ever would be,” she said.
Attorney-General Michelle Rowland acknowledged the government’s role in the scandal, saying: “Settling this claim is the just and fair thing to do. We are committed to addressing the harms caused to hundreds of thousands of vulnerable Australians under the former Liberal government’s disastrous Robodebt scheme.”
The Robodebt scheme, which was launched in 2015 and ran until 2019, was widely criticised for its “crude and cruel” mechanism, which saw welfare recipients pursued for debts they didn’t owe. The scheme was linked to at least two suicides and was ultimately shut down in 2019.