ROBODEBT AUSTRALIA

2016

The Australian Government launched this automated system designed to recover welfare overpayments and save billions of dollars. It worked by digitally comparing a person's annual tax income with the earnings they had reported to the social security agency.

Robodebt's failure was due to it’s algorithm. The “robot” inaccurately calculated average income and created false debts. The algorithm made up debts where none existed. The worst thing about the system was that the burden of proof was on the welfare recipient. Struggling individuals were forced to prove their innocence against the flawed calculation.

The consequences were devastating. Over 470,000 inaccurate debt notices were issued. The immense stress led to financial ruin, severe mental health crises, and was linked to multiple suicides. In 2019 the scheme was ruled unlawful by Australia's Federal Court .

The government was forced to scrap the program and repay AUD $1.8 billion (USD 1.2 billion) to victims. A Royal Commission condemned Robodebt as a "crude and cruel" failure of public administration, a catastrophic warning against inhumane automation.

In 2025 a documentary was released about the disaster.

Additional info:

The Guardian - The original article that exposed Robodebt

BBC News - Record payout for victims of 'illegal and immoral' Australian welfare scheme