Centrelink resumes collecting 147,000 debts after six-year freeze
Centrelink has restarted collecting 147,000 debts that were frozen for six years following December 2025 legislation validating income apportionment.
Centrelink has restarted pursuing 147,000 debts that were frozen for six years. The debts used income apportionment, a method that averaged a person's earnings across fortnights instead of using exact pay dates.
The method was later found unlawful but was made valid by legislation passed in December 2025. A 72-year-old pensioner in New Zealand got debt notices for welfare payments made in 2002 and 2005.
He had never been told about these debts and thought they were settled decades ago. Centrelink is now pursuing 1.34 million debts still owed, totalling $5.02 billion.
Some debts go back 40 years. Legal advocates and the Commonwealth Ombudsman have called for a six-year time limit on old debts.
They argue it is nearly impossible to find evidence from decades earlier.
- 147,000
- Debts resumed collection
- 6 years
- Freeze period
- 1.34 million debts worth $5.02 billion
- Total outstanding debts
- Up to 40 years old
- Oldest debts
Why it mattersPeople who got welfare payments years or decades ago could face unexpected debt notices. These notices are for overpayments they did not know existed.
AustraliaAustralians who once received Centrelink payments, even decades ago, could be pursued for old debts that were previously frozen by government pause.
✓ Claims checked against the source. checked 3 h ago
