Actioning broken regular/irregular cash arrangements 107-05040010

If the customer does not pay the amount by the agreed date plus 7 days:

• a Payment Not Received letter issues
• the letter asks the customer to pay the amount within 7 days

If the customer is subscribed to SMS and does not pay the amount by the agreed date plus 5 days (or next business day):

• an overdue payment SMS is sent
• the SMS asks the customer to pay the amount now or set up a new arrangement

If the customer does not pay the outstanding amount within 14 days from the due date:

• the arrangement status will change from current (CUR) to broken (BKN)
• a DMN/RCV Broken Arrangement activity will generate
• the activity will allocate via Workload Manager (WLM)

Review a customer's record when actioning a broken arrangement. Make a reasonable effort to contact the customer to find why they were not able to maintain the payments.

Consider other payment methods when there is evidence of a poor repayment history. If the customer cannot maintain a BPAY® arrangement, a voluntary deduction (direct debit) may be a better option.

When discussing the customer’s broken arrangement, consider if any special circumstances existed from the start of the arrangement. See Special circumstances debt waivers..

Finalise the broken arrangement:

• if there are no determined debts that need follow up action, or
• after reasonable effort to contact the customer has been made

Once a broken arrangement is ceased, a no arrangement activity may generate. See Outbound customer contact and gathering information when recovering debts.

Review a customer's record when a new arrangement is offered. Refuse the arrangement where customers:

• manipulate the system to avoid paying their debt
• make new arrangements to avoid other recovery action. For example, making a repayment arrangement to avoid a tax garnishee

Check repeated broken arrangements made at the same time each year. An arrangement may be appropriate once Australian Taxation Office (ATO) has processed the customer's tax return.

Interest charges apply when a customer misses a payment under an agreed payment arrangement. Interest is charged each day from the day after the last expected repayment was due and will cease when:

• total debt amount and any calculated interest is paid in full
• Services Australia agree to skip the missed payment and the customer continues to make agreed payments
• the customer:
  • makes up the missed payment and continues to make agreed payments
  • enters into a new acceptable recovery arrangement and makes their first agreed payment
  • has a reasonable excuse exemption applied, or
  • has at least one debt temporarily written off or has a pause on debt recovery in place

See Interest Charge (IC) for Centrelink debtors no longer receiving payments.

Withholdings are deductions taken from a customer’s payment used to repay a debt.

If there are withholdings in place, do not cease withholdings to code a cash arrangement. Automatic withholdings apply to current customers regardless of other arrangements.