New figures show nearly 1,000 robodebt victims were sent to debt collectors after the government admitted that the program was unlawful.

Last month, the Commonwealth Ombudsman slammed Services Australia for not halting all debt recovery activities after November 2019, when the Morrison government accepted that the automated debt-raising was “legally insufficient”.

Services Australia continued accepting repayments from over 123,500 people after that date.

In a response to questions on notice this week, the agency also revealed that there were 961 people who “had debts of this type that were referred to an External Collection Agent” that later required “remediation”.

The conduct of heavy-handed debt collectors is a major cause of trauma for those embroiled in the robodebt mess. 

Services Australia has been issuing refunds since July 2020.

The agency had previously argued stopping all debt recovery at once would have confused customers, as some people’s debts were legitimate.

It also said that the unlawful “income averaging” method was not the only method used, pointing out that each debt raised by the faulty system needed to be manually identified by staff.

The ombudsman called for a blanket pause on debt recovery, arguing it is unacceptable for the agency to continue receiving payments on debts it “knew had a high likelihood of being raised on ‘legally insufficient’ grounds”.

Meanwhile, the federal court is considering a $1.2 billion settlement with a class action by Gordon Legal on behalf of more than 400,000 robodebt victims.

Hearings to consider the settlement or occurring today.