CANBERRA — The Albanese government admitted it illegally cancelled approximately 300,000 Centrelink welfare payments due to a glitch in the automated mutual obligations system, violating Australia’s legal requirement that payments cannot be stopped until 28 days after a missed obligation. The cancellations occurred between 2020 and 2024 and affected recipients of JobSeeker, Youth Allowance, Parenting Payment, and Disability Support Pension.
Department of Employment and Workplace Relations representatives stated the number of illegal cancellations was in “the vicinity of 300,000.” The department had previously acknowledged only 9,510 unlawful cancellations. Centrelink payment cancellations under the mutual obligations scheme have been paused since July 2024.
Bronwyn Field, a department representative, said Economic Justice Australia used publicly available data to estimate unlawful cancellations and that the department’s internal analysis was “in the vicinity of that.” Field noted that one complexity in calculating unlawful cancellations is that some individuals found paid work and therefore no longer needed to reconnect to a job provider. She added that the number of people who had their payments illegally cancelled while still eligible for welfare would be “a much smaller cohort.”
Kate Allingham, chief executive of Economic Justice Australia, said her organization raised concerns about unlawful cancellations with the government over 12 months ago. “Two additional reports since our analysis have identified further issues of unlawfulness in the Centrelink system,” Allingham said. She stated that while the department and minister claim they are working to fix the issues, Economic Justice Australia has not seen evidence that fixes are occurring.
Allingham expressed concern about the use of automated systems in welfare suspensions, citing a lack of applied discretion. She described a process where missing an appointment triggers an automatic notification threatening suspension without human review. Economic Justice Australia estimates that about 20% of affected individuals could be eligible for some form of remediation.
Between January and March 2024, there were 299,305 notices of suspension of welfare payments, averaging just over 3,325 per day. Australian law requires that welfare payments cannot be cancelled until 28 days after a person misses a mutual obligation activity. Job providers are not legally required to check why a person has not engaged in a mutual obligation activity.