Recovery Fee applied to debts resulting from incorrect declaration of income 107-05100040

Process undetermined debts using the Debt Action script.

If the debt is to be raised and:

• recovered, go to Step 3
• waived, this procedure does not apply. Go to Debt investigation

See the Resources page for list of affected payments.

Is the debt for a working age payment?

• Yes, go to Step 4
• No, procedure ends here

Income from personal exertion includes income received as an employee or for services rendered. For the definition of 'personal exertion', see the References page.

The reason codes are:

• 'IES' - , income: earnings not declared/coded (self)
• 'ISI' - income: earnings wrongly declared/coded (self)
• 'ISA' - income: Incorrect earnings auto (self) or
• 'UCE'. - income: undeclared cash earnings

Apply the Recovery fee to the part of the debt directly related to a customer's income from personal exertion.

See the Resources page for examples.

Is all or part of the debt due to income from personal exertion?

• Yes, go to Step 5
• No, see Step 2 in Table 2

Has the customer already provided information about why they did not correctly declare their earnings?

• Yes, issue the Q175 warning letter and go to Step 2 in Table 2
• No, go to Step 6

Contact the customer to discuss why they did not declare their income.

For the definition of reasonable excuse, see Policy on the References page.

Does the customer have a reasonable excuse for failing or refusing to declare their income?

• Yes, see Step 2 in Table 2
• No, go to Step 7

Before a Recovery Fee is applied, contact the customer:

• go to the Recovery Fee (OPRF) screen:
• issue an 'Invite to Contact' letter (this requests a response within 21 days)
• record date letter issued
• add the keyword 'FEEDEC' (awaiting Recovery Fee decision) to the activity
• resubmit the activity for 21 days. For remote customers resubmit for 28 days. See Allow extra time for mail delivery.
• create a manual follow up (MFU) to suspend the record after 21 days (28 days for a remote customer) if there is no reply.
• activate a review 14 days from the date of suspension to cancel the record if there has been no contact from the customer.

Note: use the keyword 'RSDBTFEE' (raise debt - 10% Recovery Fee to apply) to hold debts awaiting future calculation.

Suspended records are considered current until they are cancelled.

Is the customer current?

• Yes, go to Step 8
• No, go to Step 9

If the customer:

• responds, see Step 1 in Table 2
• does not respond. Suspend payment until they respond, using code 'RFR' (failed to reply to Recovery Fee letter)

Where customer contact:

• is made after the payment has been suspended, assess for restoration of payments. See Step 1 in Table 2
• does not occur within the next 14 days, payments will cancel. Go to Step 9

Payments that have been cancelled and a debt raised, must have the warning letter (Q175) issued.

If a non-current customer:

• does respond:
• within the stated time, see Step 2 in Table 2
• after 21 days (28 days for a remote customer), before raising the debt, apply the fee (if applicable). See Step 2 in Table 2
• does not respond to the 'Invite to Contact' letter, raise the debt. Do not apply the Recovery Fee. Issue a warning letter

When the customer contacts:

• advise them of a possible debt
• discuss their understanding of their obligations to advise the agency of their income
• discuss the reasons the customer failed to declare or under-declared their earnings
• explain how the customer should declare income correctly in future
• discuss your decision with the customer

If the customer says there are personal issues, consider contacting the social worker.

Determine if the customer failed or refused to declare their income from personal exertion without a reasonable excuse, or if they 'knowingly' or 'recklessly' provided incorrect information. See Policy in the References page for the definitions of 'knowingly' and 'recklessly'.

Go to Step 2.

Record details of the debt on the Modify/Assess Debt (OPMA) screen.

The screen flow will navigate to the Component Amounts (OPCA) screen. Code the component amounts. All the components must equal the debt total.

Is the fee to be applied?

• Yes, go to Step 4
• No, go to Step 3

Record the decision in the Reason field on the OPRF screen, see the Resources page for codes:

• if the customer did not provide correct information about their income, send a Q175 warning letter
• record details on the OPRF screen
• document reasons for the decision in a DOC. Include details of verbal warnings
• press [Enter] to confirm the details

Go to Step 5.

The Recovery Fee is automatically calculated.

Note: the Recovery Fee amount may require a manual recalculation in certain circumstances.

If the Recovery Fee details are:

• applied and confirmed, code the Reason field as 'RFA' (Recovery Fee applied) and press [Enter]
• not confirmed, key the manually calculated Recovery Fee amount and code the Reason field as appropriate, see the Resources page for valid codes
• press [Enter]

The OPRF screen shows:

• whether or not the first request letter was sent and the date it was sent (if applicable)
• employer details
• the Customer Contact Date (this is a compulsory coding field if the fee is applied)
• if a warning letter was sent
• the Reason field for applying or not applying the Recovery Fee
• the amount of eligible debt the Recovery Fee applies to - in the Elig AMT field
• the amount of debt which did not result from income from personal exertion - in the Other Circumstances Debt Amount field
• the Recovery Fee amount that has been applied - in the Rec Fee field
• the Recovery Fee amount as automatically calculated - in the System Estimate field

The Recovery Fee also displays on the General Information (OPGI), Modify Amount (OPMA) and Account Payable (OPAOD) screens.

If there are variations made to the debt amount via the Debt Amount (OPDA) screen:

• recalculate the Recovery Fee
• manually calculate the eligible debt amount using a debt calculation tool
• the eligible debt amount on the OPRF screen with the reason code 'RDA'

Apply this process even if a portion of the debt has been waived. Change the Recovery Fee amount on the OPRF screen in the same activity. Use the Debt Action script.

The screen flow navigates to the Account Payable (OPAOD) screen:

• send an automatic Account payable letter, or
• if required, supress the automatic advice and issue manual advice

See Sending Account Payable letters.

The screen flow navigates to the Activity Finalisation (OPAF) screen:

• key 'Y' in the Finished? field
• record details on a DOC