You are here

7.18 Waiver

Last amended: 21 March 2014

7.18.1A debt may be waived where it is considered inappropriate to pursue recovery, even though recovery may be possible, e.g. by limitations to current payments or where a person has the funds available to make a repayment. Waiver action is also taken where a debt is irrecoverable in law, for example where proceedings to commence recovery of the debt are delayed beyond the statutory six year period after the debt is identified (the Statute of Limitations provision).  Action is necessary to permanently extinguish the irrecoverable debt, and this is achieved by waiver.

7.18.2The effect of waiving a debt is to forego recovery action permanently. Waiver is a permanent bar to the recovery of a debt and means that the debt effectively ceases to exist. Once a debt has been waived, recovery can no longer be pursued.

7.18.3Under paragraph 206(1) (b) VEA, the Commission may waive the right of the Commonwealth to recover:

  • all or part of a debt that becomes payable under, or as a result of, the Act; or
  • those categories of debts under, or as a result of the Act which are included in a class of debts specified by the Minister in the Gazette.

The following two class of debts have been specified at this time:

  • debts calculated to be an amount less than $200, or where the delegate is satisfied on the basis of available evidence that the amount of the overpayment is, or is likely to be, less than $200, and
  • debts incurred by persons who were adversely affected by the 2009 Victorian bushfires.

7.18.4As PIPS automatically calculates overpayments, and DMRS allows for the automatic generation of advice letters and recovery action, all overpayments raised on the system are recovered. Automatic overpayments may be waived where the debt is less than $50 and the debtor is no longer in payment with DVA. The $200 Ministerial waiver applies in situations where debts require manual calculation, data entry and generation of advice letters (consideration must be given to the cost effectiveness of the recovery).

7.18.5Where a person has incurred an overpayment of less than $50 and the debtor is no longer in payment, the delegate may consider writing off the debt if there is a high probability that the debtor will resume receiving income support payments.

7.18.6Unless the debt falls within a class specified by the Minister, a delegate may exercise the discretion to waive recovery of a debt, or part of a debt only where he/she is satisfied that:

  • the debt arose as a result of an administrative error, and the payment was received in good faith, and the debt was not discovered or a request for repayment was not made within 6 weeks of it occurring; or
  • there are extreme or unusual circumstances surrounding the debt; or
  • the debt was increased by administrative delay; or
  • the debtor does not have the capacity to repay the full amount of the overpayment; and both the debtor and the Department agree that repayment of not less than 80% of the original amount in a lump sum is in full satisfaction of the whole debt; and the agreed amount is paid within the specified period (see 'discounting' below for details); or
  • the debtor has a notional entitlement to another income support payment; or
  • the Department has recovered all of the original value of the debt from the debtor, except for an amount which the Australian Taxation Office has advised constitutes overpaid tax which cannot be refunded to the debtor; or
  • the debt should be waived for other reasons, as in the categories below.

7.18.7The debtor must never be given the impression that recovery may be waived before a decision is made by the delegate.