Types of Centrelink debts and how they are generated 107-02020000

These debts may occur when:

• the payment is granted to a customer who does not meet all the payment qualifications
• a customer's circumstances change after a payment is granted
• the recipient of the payment is not the customer
• the customer is deceased and continues to get a payment
• the customer does not comply with the relevant notification period
• the customer knowingly or unknowingly misrepresents their circumstances

Customers in receipt of an income support payment, ABSTUDY and some Family Tax Benefit customers can be paid rent assistance (RA) for 28 days after the system date of an update that is recorded with the following rent verification codes:

• Change of address (COA)
• New claim (NCL)
• Hardship (HAR), or
• Rent Verification to be uploaded (UPL)

Note: the system date is when the update is finalised on the system. For example, if coding of the updates started on 1 May 2022 and the activity was finalised on the system on 15 May 2022, the system date is 15 May 2022.

If a customer fails to provide rent verification within 28 days, automatic review processing will cease their RA by applying the rent verification code of Not Verified (NVE). The customer retains entitlement to the rent assistance received during the COA, NCL, HAR or UPL period.

Do not raise a debt for a COA, NCL, HAR or UPL period if the customer fails to provide rent verification.

Raise a debt where the customer subsequently indicates a change has occurred that retrospectively reduces the RA rate payable. This could be:

• a reduction in the amount of rent paid
• a change to their sharer status, or
• their primary payment is retrospectively cancelled, for any reason (before or during the 28 day review period)

Raise an advance debt when:

• the advance has not been fully repaid, and
• the customer no longer gets a payment

In most cases, if the customer transfers from one income support payment to another. The outstanding balance of the advance payment does not become a debt.

ABSTUDY

Raise an advance debt manually if there is an advance balance outstanding and:

• the customer transfers to another payment, or
• a social security customer transfers to ABSTUDY, or
• their payment is cancelled

Multiple advance payments

From 1 July 2010, multiple advance payments became available to pensioners. This may result in separate debts if the customer stops getting a payment.

For more details, see Raising debts of advance payments.

Prepayments:

• are made on an earlier date
• occur where the customer's normal payday falls on a day when the payment cannot be made (for example, Christmas or Easter)

If the customer's circumstances change during that payment period, they may get paid more than they are entitlement to.

Assurer Debt

If an assuree is paid an AoS recoverable payment during the AoS period, they will need to repay the full amount.

Assuree Debt

A debt can be accrued by the assuree during the AoS period (arising from a contravention of the Act).

These debts are recoverable from the assuree only and normal debt processing occurs.

These debts occur, when:

• a notifiable event has occurred, and
• this results in a recalculation of entitlement

These debts occur when a customer transfers from:

• one payment to another, or
• a Centrelink payment (for example, Disability Support Pension) to one made by another department (for example, Department of Veterans' Affairs Service Pension)

Student Assistance Act 1973 debts include:

• ABSTUDY
• Assistance for Isolated Children (AIC) Scheme
• Financial Supplement loan (FSL)

Compliance reviews happen when there is a justified or documented risk of an incorrect payment resulting from:

• fraud
• misrepresentation
• error or omission on the part of the customer

They are not conducted for system, coding, assessment or reassessment errors.

The review activity is started by compliance staff or triggered from an external source (for example a third party).

To progress:

• record compliance debts on the Integrated Review System (IRS) if it is part of a compliance review
• locate the 'undetermined debt activity' (UND) on the Debt Management Information System (DMIS)
• action the undetermined debt on DMIS

Service updates are:

• payment program specific
• based on the duration of the payment to the customer
• cyclic in nature, for example, 12 weekly Parenting Payment Single (PPS) reviews and Pensioner Entitlement Reviews (PPR)

To progress:

• select 'action and finalise' within the host payment system
• check the review results once they appear in Integrated Review System (IRS)
• locate the 'undetermined debt activity' (UND) on the Debt Management Information System (DMIS)
• action the undetermined debt on DMIS