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NDIA chased more than 100 disabled participants for debts they did not owe
More than 100 people with disabilities were chased for debts they did not owe by the National Disability Insurance Agency, which has blamed “poor process and human error” for the bungle.
The agency has repaid $145,000 to 26 participants after a review of its debt policies revealed it had incorrectly tried to claw back payments from 115 National Disability Insurance Scheme participants.
National Disability Insurance Scheme participants have received an apology and refunds after being incorrectly pursued for debts.
About 60 NDIS service providers have also been incorrectly hit with debts by the agency. Refunds to the businesses are expected to reach $3 million.
While the botched debt collections follow the robodebt scandal, in which 470,000 welfare recipients were incorrectly charged debts by an automated data-matching system, the National Disability Insurance Agency (NDIA) has blamed human error for its own bungle.
“The agency has apologised for any distress caused,” the NDIA said in a statement on Friday.
“These debts were not generated by any automated systems. The errors were the result of poor processes and human error.”
The agency undertook a review of its debt policies and practices and discovered errors in almost a quarter of the 475 debts issued to participants between 2017 and early 2024.
Debts sought from 387 NDIS service providers were also reviewed. The agency said it expected to offer refunds to under 60 providers.
The agency had demanded money back from NDIS participants and providers over claims they or a nominee had made mistakes while making claims, for gaining money for items that are not covered by the scheme, or over allegations of making misleading claims, including the use of fake invoices, amounts or providers.
But on closer inspection the agency found errors in many of its debt demands, including cases in which it had inadequate evidence or records to substantiate its claims.
The review also found instances in which the NDIA had issued bills without sufficient attempts to contact the participant or provider to understand their circumstances, and cases in which the agency had issued debt notices citing incorrect parts of the NDIS Act.
Twenty-six participants have already received a refund and another two clients or their families are expected to receive refunds soon. In the remaining 87 participant debt error cases, participants had not yet paid the NDIA, but the demands have now been wiped.
Last year, former NDIS minister Bill Shorten rejected claims that changes to the scheme would cause robodebt 2.0, after concerns were raised in a Senate committee in May 2024 over the NDIA’s debt recovery rules.
The NDIA said on Friday that debts accounted for a just 0.06 per cent of the scheme’s costs, but conceded the financial and emotional impact on participants could be substantial.
“The NDIA considered all factors relevant to the issuing of debts, and where there were problems including poor process, lack of evidence and natural justice, legal deficiencies and poor communications, debts have been revoked,” the agency said.
“Where debts are proceeding and are not subject to criminal proceedings, the agency will contact participants to check on their circumstances and wellbeing and explain available options to commence repayment.”
The NDIA said it had revised its approach to debt recovery and laws had been introduced last year allowing greater flexibility to account for a person’s disability when considering waiving a debt.
It said all agency-initiated debts were now reviewed and approved by two panels, which include legal specialists and senior executives, to minimise the risk of an NDIS participant owing money.
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