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Centrelink debts have been collected based on income-averaging for '20 to 30 years', minister reveals

<span>Photograph: Mick Tsikas/AAP</span>
Photograph: Mick Tsikas/AAP

Stuart Robert has revealed the federal government has collected debts based on income-averaging for “20 to 30 years” but suggested it is unable to refund them because it doesn’t know who they were all paid by.

The government services minister made the comments at the National Press Club on Tuesday, also revealing 393,000 recipients of unlawful robodebts since 2015 can expect an average refund of $1,900 but 7,000 will have to wait for repayment in instalments because they are owed more than $6,999.

Robert delivered a speech attempting to draw a line under the robodebt saga – set to cost the commonwealth more than $1bn – by promising more helpful, respectful and transparent service delivery and suggesting that a new “entitlement calculation engine” will improve processes.

Related: Centrelink staff forced to administer botched robodebt scheme deserve apology, union says

Robert defended Services Australia for its plan to refund a portion of the 470,000 illegal robodebts in instalments, explaining that 7,000 will be repaid in instalments “because there is a check in the system” that prevents repayments of more than $6,999.

The check was put in place by the previous Labor government after a human services staff member accidentally entered a date instead of a dollar figure, resulting in a $4m payment to an individual, he said.

Although Services Australia has contact details for 190,000 robodebt recipients, it estimates refunds will take until November because 203,000 others will need months to update their bank details in MyGov.

Robert also said that governments have calculated debts “partially or solely” based on income averaging for 20 to 30 years and done so “on some mass” since 2007, including an estimated 16.6% of debts in 2009 and 24.4% in 2011.

Asked why the government isn’t refunding these debts, Robert replied that the sample tests it has run in those two years are “the only data sets we have in terms of where we sit”.

Robert claimed that computing systems introduced from 2015 to automate income-averaging meant the government “knows who every single one of those individuals are” but “prior to that there was no computing system that existed”.

The comments confirm Guardian Australia’s reporting that the commonwealth has potential liability for debts before 2015.

At a later doorstop, Robert told Guardian Australia at least 4,000 debts a year were calculated with averaged income data from 2007 onwards.

Both at the press club and the doorstop, Robert refused to give a commitment to repay people who received unlawful robodebts before 2015.

“Going backwards it becomes very, very difficult to identify [recipients],” he said. “To certain degrees we’ve done that in the tests of 500 people – that’s informing us as to what’s possible.

“We’re still working out what indeed [is] possible, what data sets exist, which is why the sampling was done … That analysis is ongoing.”

Earlier, at the press club, Robert boasted that Services Australia has improved processes, reducing call wait times for Centrelink customers from “well over 30 minutes” per call to less than five minutes.

For the last decade the department had “call blocked” or hung up on 30m social services and welfare calls each year, or 150,000 per day, a number he said was “now down to zero”.

Despite the boast, answers to the Covid-19 inquiry’s questions on notice from the social services department reveal that 4m Centrelink calls were abandoned when callers hung up before speaking to a service officer from July 2019 to the end of May 2020, including 187,373 in May.

Although average time to answer Centrelink calls was down to 7 minutes 41 seconds in May, the financial year to date average was 15:28.

Robert said Services Australia had faced a “baptism of fire”, with a surge of welfare claims overloading Centrelink and MyGov after the Covid-19 lockdown was introduced on 22 March.

Related: Unions say Coalition's 'demonising' of unemployed is groundwork for Covid-19 welfare cuts

But Services Australia rebounded to process 1.3m jobseeker claims in 55 days, a volume normally processed in two and a half years.

Asked if Services Australia is preparing for increased load of unemployment claims when jobkeeper wage subsidies (administered by the tax office) are phased out in September, Robert said: “Absolutely preparing for it.”

He said 1.6 million Australians are on jobseeker and “as jobkeeper starts to slowly come off … we need to be prepared for more Australians to come onto the payment”.

“Now, if they don’t, superb – but the nation can be assured, Services Australia will not be flat-footed on this.

“It’ll have the capability, people and resources to deal with any increase, should it arise.”

The federal government is not due to announce the future of jobkeeper wage subsidies for another two weeks, but on Tuesday the shadow treasurer, Jim Chalmers, cited the renewed six-week lockdown in Victoria as reason to end the “uncertainty for businesses and their workers”.

“These new restrictions are necessary but they create a lot of difficulty for business and Scott Morrison shouldn’t add to that pain.

“He can better target jobkeeper, he can taper it, but he shouldn’t just be turning off the tap for all of those businesses who are affected by these necessary new restrictions.”