In­ter­est charge gets wel­fare debts re­paid

Ovens & Murray Advertiser - - NEWS -

THE prospect of be­ing charged in­ter­est on out­stand­ing wel­fare debts has en­cour­aged more than 28,000 for­mer Cen­tre­link clients to be­gin pay­ing back the money they owe.

About half of that group – or ap­prox­i­mately 14,000 peo­ple – re­paid their en­tire debt in one lump sum, in­clud­ing sev­eral in­di­vid­u­als who owed more than $20,000 each.

The De­part­ment of Hu­man Ser­vices an­nounced in April that it was send­ing let­ters to about 170,000 for­mer clients who col­lec­tively owe tax­pay­ers a stag­ger­ing $905 mil­lion.

The let­ters in­form them they have 28 days to con­tact the de­part­ment and en­ter into a re­pay­ment plan, oth­er­wise in­ter­est would be charged un­til they did.

Of the 45,000 peo­ple who are now be­yond the 28 day cut-off, al­most two thirds (28,000) have be­gun re­pay­ing what they owe.

The re­main­ing third are now be­ing charged in­ter­est at the rate of 8.77 per cent.

As Min­is­ter for Hu­man Ser­vices, I am pleased that so many peo­ple have agreed to start meet­ing their obli­ga­tions.

But I strongly en­cour­age those who have re­fused to en­gage with us to move swiftly in or­der to avoid see­ing their debt grow even fur­ther.

Given that th­ese peo­ple are no longer re­ceiv­ing wel­fare ben­e­fits and are pre­dom­i­nantly back in the work­force, the govern­ment be­lieves they have the ca­pac­ity to pay up.

The early re­sults we are see­ing sup­port this view and show that the strong ac­tion we are tak­ing is jus­ti­fied.

Aus­tralia has a gen­er­ous so­cial safety net that helps peo­ple who gen­uinely need it.

But if some­one re­ceives a ben­e­fit they are not en­ti­tled to, the govern­ment has a re­spon­si­bil­ity to re­cover th­ese amounts to en­sure the sys­tem re­mains vi­able.

The amount peo­ple are re­quired to pay back un­der a re­pay­ment plan will de­pend on their in­di­vid­ual cir­cum­stances and ex­emp­tions can be pro­vided for those who can demon­strate gen­uine hard­ship.

Charg­ing in­ter­est on govern­ment debts is also not new. Michael Keenan, Fed­eral Min­is­ter for Hu­man Ser­vices

Newspapers in English

Newspapers from Australia

© PressReader. All rights reserved.