Actioning broken voluntary deduction (direct debit) arrangements 107-05040020

Use the Debt Recovery script to action a broken direct debit. For:

• active (outbound) recovery, locate the broken recovery arrangement allocated by Workload Management. Select:
  • Ready
  • Quick Ready. Note: only when directed by Branch or Divisional Workload Management teams
  • Ready for work if there are no activities in the inbox that need actioning
• assisted (inbound) recovery, go to Step 2

Check the customer's record for a history of broken arrangements. Review these screens:

• Payment Arrangement List (OPAL) for previous arrangements made to avoid other recovery action
• Repayment History (OPRH) for customer payments as per their agreed arrangement. A direct debit payment shows as received on the day it was due from the customer's financial institution account. If the Reserve Bank is unable to deduct the payment from the customer's financial institution account:
  • the payment will reverse
  • will show as a negative payment approximately 3 days later
• Repayment schedule (OPRS) for repayments already missed
• Document List (DL) for broken arrangements without unforeseen events or financial hardship
• Key Dates (OPKD) for letters issued
• Income and Assets (ITS) for capacity to pay the debt in full
• Process Direct Repayment Status (OPPR) or (OPPRD) for pending cash payments and receipted payments towards Child Care Subsidy (CCS) debts

For:

• active recovery, some phone contact may be required, follow BAU process. For a:
  • a non-current customer, go to Step 3
  • a current customer, go to Step 4
• assisted recovery, go to Step 4

For non-current customers with a broken voluntary deduction (direct debit) arrangement in place, consider:

• contacting them if there:
  • is recent contact or a known change in the customer’s circumstances
  • is a history of compliance, and this is the first or one-off missed payment
  • are multiple broken arrangements with no successful engagement
• if the customer has contacted after receiving the reminder SMS

Is contact with the customer required?

• Yes, go to Step 5
• No, go to Step 10

If the customer is current and has a broken voluntary deduction arrangement in place, consider if the customer:

• is receiving a Centrelink payment with withholdings in place and the customer is meeting their current obligations:
  • do not cease a withholdings arrangement to enter into a voluntary deduction arrangement. The withholdings arrangement will automatically restart the next day
• has since become current and the voluntary deduction arrangement has broken, contact may not be appropriate, investigate the record to determine if contact is needed

See Withholdings to make a withholdings arrangement.

Is contact with the customer needed?

• Yes, go to Step 5
• No, go to Step 10

Make a reasonable effort to contact the customer.

If leaving messages, follow Safeguarding customer privacy when raising and recovering debts.

Be aware of customers experiencing vulnerability. See Identifying customer vulnerability and risk issues.

Was customer contact successful?

• Yes, go to Step 6
• No:
  • DOC the attempt using the Unsuccessful Engagement Fast Note 
  • go to Step 10

Safeguard the customer's privacy before discussing the reason for the call.

Check the Direct Deduction (OPVD) screen to ensure the customer’s financial institution details are entered correctly.

Discuss the:

• reason the arrangement broke
• suitability of the payment method
• customer’s:
  • capacity to pay
  • willingness to pay the outstanding amount
  • payment history

Has the customer missed paying, or paid less because of an unforeseen event or financial hardship?

• Yes, go to Step 7
• No, go to Step 8

Consider whether the customer is experiencing vulnerability based on the reasons provided.

Offer additional support services if appropriate, such as;

• Payment and Service Finder
• Referral to external support services

If the customer advises they are experiencing vulnerability, consider a Short-Term Hardship (STH) temporary write off. Determine how else to best assist the customer. See Identifying customer vulnerability and risk issues and/or Family and domestic violence.

Note: consider if special circumstances exist that support a waiver. See Special circumstances debt waivers.

Is the customer experiencing vulnerability?

• Yes, offer to apply a STH temporary write off. If the customer:
  • accepts, see Temporary write off of Centrelink debts. Document the initial amount offered and reason for the decision
  • declines, go to Step 8
• No, go to Step 9

Tell the customer that to negotiate their repayment to the amount offered, more details are required about their circumstances.

The aim is to negotiate an amount that recovers the debt in the shortest time possible, without placing the customer in hardship.

Note: non-current customers may have unknown sources of income and the income and asset information held on record may not be correct.

Capture as much detail as possible about the customer’s financial circumstances to ensure the amount accepted reflects their capacity to pay. Household income and expenses should be considered when a customer and partner are living together,

The customer may have already provided this information earlier in the call. If further details are needed, some suggested questions to ask are:

• ‘To help us decide the most appropriate arrangement, I need to understand a little more about your current circumstances. Can you tell me more about what’s happening at the moment?’
• ‘Is there anything else impacting your ability to make repayments?’
• ‘Has anything happened recently to make it harder for you to make repayments?’
• ‘Can you give me an idea of what kind of income and expenses you have?’
• ‘How long might you need this assistance for?’

Actively listen to the customer and acknowledge the customer’s circumstances and responses provided.

Strategic Debt Recovery staff only

A further assessment of the customer’s financial circumstances may be required to verify the customer’s true capacity to repay the debt if there is:

• reason to believe the customer has a higher capacity to repay, or
• doubt about their circumstances

See Financial circumstance assessment for debt recovery.

Does the customer have the capacity to maintain a suitable arrangement?

• Yes, go to Step 10
• No, defer payment. See Temporary write off of Centrelink debts. Document the initial amount offered and reason for the decision

When speaking with the customer, tell them to continue making payments according to their arrangement and explain:

• their payment can be missed
• it is important to contact if they cannot pay by the due date
• the recovery actions that may take place under the cost effectiveness guidelines

If there is no contact with the customer, coding a missed payment can reset the arrangement status from BKN to CUR allowing the customer to continue the existing arrangement.

See Updating payment arrangement schedule and code the missed payment, go to Step 11.

Procedure ends here.

Use the Debt Recovery script to action a broken direct debit arrangement.

If the script is unavailable, manually end the arrangement:

• on the Activity List (AL) screen, 'S'elect the DMN/RCV broken activity > [Enter]
• on the Payment Arrangement List (OPAL), 'S'elect the VOL/BKN arrangement > [Enter]
• on the Direct Deduction (OPVD) screen, in the Cease Date field, key T (today)
• the direct debit arrangement will show on OPAL as VOL CAN

If another arrangement is needed and attempts to contact the customer have been:

• successful, see Arranging cash repayments to recover debts
• unsuccessful, and the debt value is:
  • over $1,500, a no arrangement (NOARR) activity will generate after one day
  • under $1,500, go to Step 12

If another arrangement is not needed, go to Step 13.

When a broken arrangement is ceased for debts under $1,500, a no arrangement (NOARR) activity will not generate.

Staff must make a reasonable effort to contact the customer.

Was customer contact successful?

• Yes, see Arranging cash repayments to recover debts
• No, staff must:
  • DOC the attempt using the Unsuccessful Engagement Fast Note
  • send a ‘Request client to contact office by phone’ (Q164) letter
  • DOC the record and include the address to which the letter was sent to

Procedure ends here.

The Debt Recovery script automatically creates a DOC when ceasing an arrangement. If the script is unavailable, manually DOC the record with these details:

• in Ext Detail: Recovery: VOL Arr Ceased
• in the Txt field, record:
  • CRN balance
  • Date of dishonoured payment
  • Debt Id's
  • Reason for ceasing arrangement
  • all relevant details of the discussion if the customer was contacted
• close the DOC