Centrelink Debt: Pensioner Chased Over 24-Year-Old Claims
Iain Milne, a 72-year-old pensioner in New Zealand, received a Centrelink notice in September demanding $400, then learned of a second $6200 claim from 2002. His case is tied to 147,000 debts built on a method later found unlawful.
Iain Milne, a 72-year-old pensioner in the New Zealand town of Kaitangata, says Centrelink is pursuing him for a $400 debt and a separate $6200 claim dating back to 2005 and 2002. He received the first notice by letter in September.
Milne is a former Queensland police officer. He had not expected mail from Australia.
The letter was a debt recovery notice. Centrelink, Australia's welfare payments agency, said he owed $400 for a debt that was being unpaused.
Milne said he was not too worried at first. It was a manageable sum. "Opening that letter was the beginning of my nightmare," he said.
He phoned Centrelink and learned the $400 related to alleged overpayments of the Newstart allowance. He briefly received it while living in Australia in 2005.
Then came the second claim. According to Services Australia, Milne also owes $6200 for disability support pension payments he received in 2002.
Milne said he received that pension for less than a year because of post-traumatic stress disorder (PTSD) from his 12 years as a Queensland police officer. In 2002 he split from his wife of 19 years and moved back to New Zealand.
Payments he says he never saw
"Centrelink continued to pay my Australian disability into my joint account, which I no longer had access to, but my ex-wife did," Milne said. "I was totally unaware of these payments."
He said he does not believe his ex-wife deliberately kept the money. He also acknowledged he should have told Centrelink he was leaving the country. He said he was too overwhelmed by events in his personal life.
His mother died four months after he returned to New Zealand. The following years brought a major struggle with depression, including periods in hospital.
A method later found unlawful
Milne moved back to Australia for two years between 2005 and 2007. He received Newstart briefly before finding work as a caretaker at a Queensland retirement home.
It is believed Centrelink raised both debts during that period. Milne had his wages garnished to make some repayments, but he said he was completely unaware of the pension debt.
His $400 Newstart debt is one of 147,000 current Centrelink debts calculated using income apportionment. The practice averaged a recipient's earnings across fortnightly periods instead of using exact pay dates. It was later found to be unlawful.
The government used it to raise millions of debts over decades. Those 147,000 debts have been on pause for six years, first because of the pandemic and then because of questions about their legality.
Milne said he has spent many hours on the phone to Centrelink in recent weeks. He can explain some of what happened but is not close to understanding the whole story. He said he had always tried to report his income correctly and was "flabbergasted" by the demand.
"Surely 24 years is just beyond the pale, it is ridiculous," he said. "Why me, now, as a pensioner? I could die tomorrow. Are you going to chase me to my grave?"
