An Adelaide woman has told how she was given a Centrelink debt related to parenting payments despite having no children and never having received welfare benefits.
When Kate Tregenza, 23, went into a Centrelink office to try to sort out the bungle out, she brought with her 22 years' worth of banks statements showing she had never received any payments from the government department, thinking that would put the matter to rest.
However, Ms Tregenza said she left the Centrelink office in tears, having been told that was 'not enough evidence' to wipe the debt.
The first Ms Tregenza heard of the extraordinary Centrelink fail was when she got a call from a debt collector while she was at work in around April last year.
The debt collection company, Probe Group, told her she owed $500 to Centrelink and immediately started pressuring her to pay the amount back in full, she said.
"They said that they had tracked me down," Ms Tregenza said.
"They said that I owed Centrelink money and that I had let it go and if I kept letting it go they would be adding more money onto it.
"I told them I had never been on Centrelink payments in my life but they were so adamant that I owed Centrelink money.
"They abused me to the point where I was in tears. One of my colleagues stole the phone out of my hand and hung up on them."
Ms Tregenza said she initially put the phone call down to a scam.
But, when she got a second and third call, it prompted her to log in to her MyGov account to see if she could find any messages from Centrelink about the alleged debt.
Ms Tregenza said there were a couple of messages from Centrelink on her MyGov account saying she owed $500, but the bank account number listed on the debt notice was not hers.
Thinking it must be a case of mistaken identity, but still in the dark over what the alleged overpayments were for, Ms Tregenza gathered together all of her bank statements.
"My mum likes to keep everything, I have them all at home in a filing cabinet … all 22 years' worth since my bank account was opened when I was born in 1996," she said.
Ms Tregenza said she then went into the Centrelink office and handed over the bank statements to show it was impossible for her to have a debt because she had never received welfare payments.
"I told the woman these are all my bank statements and she said, 'sorry that is not enough evidence'," Ms Tregenza said.
Ms Tregenza said she asked what type of payments the alleged debt related to, but the Centrelink staff member would not tell her.
"They said that they couldn't disclose it, because if it was a mistake on their system then they couldn't give out details as to what it was.
"I said, 'that's kind of ridiculous. You are accusing me of owing you guys money, I want to know what it is for'.
"But it was like they didn't care, all they wanted was their money, pretty much, that's how it felt."
"I broke down, I had a panic attack and I had to walk outside, I was in tears."
Ms Tregenza said her case was put up for review by Centrelink, but it wasn't until about six weeks later that she was finally told the debt related to parenting payments.
"I was speaking to a gentleman on the phone, I think he was referred to as my case manager, and I was saying, 'look I am genuinely really concerned. I have just got a car loan, now I'm worried that it might get repossessed because of this'."
"I said, 'I know you can't give me too much information but can you tell me what it was for?'"
"He ended up turning around and saying look, 'I'm not meant to give you this much detail, but I can tell you that it was for parenting payments'."
"As soon as he said parenting payment I just burst into laughter and said that is a joke.
"He was a bit taken aback. He said, 'what do you mean?' I said, 'I have never been pregnant, never had a child and if I had I definitely would know'."
Centrelink eventually wiped the debt, and sent Ms Tregenza a letter apologising for the inconvenience.
In response to nine.com.au's questions about Ms Tregenza's case, Department of Human Services General Manager Hank Jongen said: "We encourage anyone who disagrees with, or doesn't understand, a decision we've made to contact us.
"We can check the decision, and explain why we made it. This also gives people an opportunity to correct any misunderstandings, or present new information."
However, Ms Tregenza said she was still puzzled as to why a simple mix-up turned into such an ordeal.
"I think there should have at least been some sort of communication from Centrelink before it got the point of involving the debt collectors, Ms Tregenza said.
"If they had of called me earlier on and said, 'hey look, just calling to say you owe us this much money', I could have cleared it up before it even got to the debt collector."
"It would have been a lot less stress, a lot less anxiety for me. I have never dealt with debt collectors before and they are so nasty."
Ms Tregenza's story comes after a key part of Centrelink's bungled debt recovery program - known as robodebt - was found to be illegal earlier this week.
In a landmark ruling on Wednesday, the government was forced to settle a Federal Court case and admit a debt raised against government employee Deanna Amato was unlawful because it relied solely on an inaccurate system of income averaging.
In Ms Amato's case, she only found out about her – now found to be false - debt when her tax return was taken.
In the case of Ms Amato, the government conceded to the court that she had actually been underpaid by $480, rather than owing the $2500 debt the department had calculated using ATO income data.
Due to Centrelink relying only on the income averaging system in hundreds of thousands of cases, many former welfare recipients have only found out about their debts when their tax returns were taken, or when they were contacted by debt collectors.
Government Services minister Stuart Robert announced last week Centrelink would no longer raise debts using only averaged ATO income information and would require other proof points, such as payslips, before raising a debt.
Contact reporter Emily McPherson at emcpherson@nine.com.au.
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