Class action settlement

Information for people who are part of the robodebt class action.

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Robodebt class action and settlement payments

Settlement payment information - Income Compliance class action audio

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We’ve finished calculating settlement payments for eligible registered group members of the robodebt class action. This is also known as the Income Compliance class action.

These payments are similar to interest they could have earned on the debt repayments they made.

Eligible registered group members will get a letter from 5 September 2022 with the amount of their settlement payment. Everyone should receive their payment by 30 September 2022.

Most people won’t get large amounts of money as a settlement payment. Around half of settlement payments are between $50 and $300.

Some eligible group members who only repaid small amounts, may get less than $10 as a settlement payment. People who paid back more, or were without their money for longer, will get larger payments.

What the robodebt class action is

Gordon Legal filed a class action lawsuit for 6 applicants and other group members against the Commonwealth of Australia. It is about Centrelink debts raised under the Income Compliance Program between July 2015 and November 2019.

The Commonwealth and the applicants represented by Gordon Legal agreed on a $112 million settlement. It was approved by the Federal Court in June 2021.

What the settlement means

Eligible group members will get settlement payments from the agreed $112 million settlement sum.

Gordon Legal’s court-approved costs of $10.3 million have been deducted from the settlement sum of $112 million. This left $101.7 million to distribute to eligible registered group members, known as the distribution sum.

Eligible registered group members are getting settlement payments from the distribution sum, similar to interest they could’ve earned on the debt repayments they made.

Settlement payments were calculated for all eligible registered group members according to the settlement terms and orders made by the Federal Court.

The amount each group member receives will be different. People who made larger repayments, or went without their money for longer, will get larger amounts.

Settlement payments aren’t the same as a refund. Most refunds referred to in the settlement have already been paid.

More information on the settlement is in the Implementation Plan.

How we notified you if you’re eligible

We sent you a letter about your debt category and whether you’ll get a settlement payment in November 2021.

You were able to ask for a review of your debt category by the agency. If you weren’t satisfied with the outcome of that review, you could ask for an independent review.

All category reviews are complete. There are no further opportunities to get a review of your debt category or eligibility for a settlement payment.

If you needed to register a bank account or payment destination, you had until 11 February 2022 to provide it. Most people were already registered as they gave us their bank account details for a refund, or they get a regular payment. This process is now complete.

How your settlement payment was calculated

Your settlement payment is calculated in two parts, simple interest and an added settlement amount.

Simple interest

Simple interest is calculated for every day you were without the money you repaid. The daily amounts are then added together to give a total interest amount.

Simple interest was calculated using interest rates set by the Federal Court.

Added settlement amount

After calculating simple interest for each eligible registered group member, there was money left over. Each group member got a portion of that left over money.

Your added settlement amount is proportional to the amount of your simple interest. People who got larger interest amounts got a larger added settlement amount.

The simple interest and added settlement amount were added together to give your total settlement payment.

Download the settlement payment factsheet:

Where to get your settlement statement

You can see what information we used to calculate your individual settlement payment in your settlement statement.

You can get your settlement statement, after we’ve sent you a letter with the amount. To view you settlement statement:

  • go to myGov and sign into your Centrelink online account
  • select MENU from your homepage, and then Payments and claims
  • select Income Compliance then Class action settlement statement.

You can also ask us to send you a statement in the mail by calling the Income Compliance line.

How we’ll pay your settlement

We’ll pay your settlement after we send you a letter to tell you how much you’ll get. All eligible, registered group members should receive their payment by 30 September 2022.

We’ll pay your settlement into one of these:

  • the bank account we pay your regular Centrelink payment if you get one
  • the bank account you gave us for a refund of your Income Compliance debt
  • the bank account or payment destination you gave us when you registered for a settlement payment.

If you asked for a cheque when you registered, we’ll send it by post to the address you gave us.

If you need to change the bank account or payment destination for your settlement payment, please call our Income Compliance line.

How to get a review of your settlement payment amount

The terms of the settlement allow time for reviews and quality assurance at each step.

If you think your settlement payment amount isn’t correct, you have up to 30 days after receiving your settlement payment to ask for a review. A review will check:

  • that all your eligible debts were included
  • the total amount of repayments you made
  • when you made repayments
  • when you got a refund
  • the Federal Court interest rates used.

We can’t review your settlement payment if 30 days have passed since you received it. We have strict processes we must follow. These processes were set by the Court and agreed to by Gordon Legal.

To get a review:

  • go to myGov and sign into your Centrelink online account
  • select MENU from your homepage, and then Payments and claims
  • select Income Compliance then Class action settlement query
  • follow the prompts and submit your query.

You can also call the Income Compliance line and ask a staff member for a review.

What else you need to know

You don’t need to report your settlement payment as income if you get a Centrelink payment.

Your settlement payment is not taxable. It’s paid in settlement of claims under the class action. You don’t need to do anything. Read more about settlement payments and your tax return on the Australian Taxation Office website.

Page last updated: 21 September 2022