The federal government has agreed to settle a class action lawsuit over its unlawful Centrelink debt collection scheme, on the same day the trial was set to begin in the Federal Court.
In a statement, Gordon Legal – which represented approximately 400,000 class action members – said that the government agreed to pay $112 million in compensation to members, which includes legal costs.
In May, the government announced it would refund $720 million which had been clawed from dole recipients as part of the debt collection scheme.
The program, which relied on automatically calculated debts which often fell apart under scrutiny from courts such as the Administrative Appeals Tribunal, had faced a groundswell of opposition since its launch in 2016.
Such was the fragility of the scheme that the government was privately conceding as early as March that it would be forced to make refunds, The Guardian reported.
The statement from Gordon Legal said the government continued to service those refunds to class action members, and had agreed to drop $398 million worth of debt collection claims.
The $112 million represents an extra payment on top of the existing refunds.
Subject to court approval, the entitlements to individual members of the class action will be assessed and paid in 2021.
“We want to acknowledge the courage of the lead applicants; Katherine, Elyane, Steven, Felicity, Shannon and Devon, who led these proceedings on behalf of all Robodebt victims in pursuit of this class action, which has allowed this outcome to be achieved today,” said Gordon Legal Partner Andrew Grech in a statement.
“Our clients have asked us to especially thank Bill Shorten for his relentless pursuit of this issue, for his compassion over the last four years for vulnerable Australians hurt by Robodebt and for bringing the case to Gordon Legal’s attention when it seemed that all other options had been exhausted and only resorting to the legal system would help.
“Our clients would also like us to acknowledge the Federal Court of Australia for its preparedness to schedule frequent case management hearings and to facilitate a trial of the proceedings so quickly, notwithstanding the difficult circumstances of the Melbourne COVID-19 lockdown,” he added.
This article originally appeared on Business Insider Australia.