Knox Class Action (Facilitation) Bill 2026

Ms COFFEY (Griffith) (17:37): I first start by acknowledging the contribution that the member for Forde shared—the testimony from Rhys's mother. I don't think anyone could listen to that and not be moved. I'm very appreciative of the member for Forde for sharing that with us.

The robodebt scheme created by those opposite caused pain and trauma for more than 400,000 people across Australia. It was a shocking and deliberate case of maladministration perpetrated knowingly by ministers. The royal commission heard countless tragic stories, like the one we've just heard now, of people being hounded by their own government to repay debts they did not even owe.

A demand for money carried the authority of the Commonwealth. People questioned themselves. They, at the same time, worried about paying their rent.

They faced accusations that cut deeply into their sense of worth. As we have heard, some lost their lives. We must keep their families—the families of Rhys and others—in our thoughts today.

Clearly, I and many people in this House here this afternoon, from both sides, find it deeply upsetting that Australians who were seeking help were made to feel frightened of the very system established to support them. There is no shame in needing income support—none. In fact, reaching out for support must be encouraged.

Any one of us can lose a job, become unwell or need help through a difficult period. People must be able to turn to their government at those moments. Robodebt shamefully instilled fear in people for doing so.

This bill, the Knox Class Action (Facilitation) Bill, deals with the treatment of settlement payments, but its purpose reaches into people's daily lives. It protects compensation from rules that otherwise risk reducing income support or recovering money from the people the Commonwealth has harmed. I support this bill, and I want to begin with the people whose experiences explain why it's needed.

Tory Burdett was 29 when he took his life in 2018. He had received a Centrelink demand for $7,000. His mother, Cherie, said it seemed like just a normal everyday day: 'He was ready to go to work in his work clothes.

He'd gone to McDonald's that day.' Cherie remembers a loving son and a caring big brother. She estimated that more than 400 people attended his funeral. 'Everyone adored him,' said his mum. She said several pressures contributed to her son's death, and the debt was a large part of what he carried.

Jarrad Madgwick died by suicide in 2019, three weeks before his 23rd birthday. His mother, Kath, said that he had spoken about his future shortly before his death and about a $2,000 Centrelink debt. She welcomed compensation for victims and called for change to prevent that cruelty from ever happening again.

These mothers—and the mother of Rhys, who we have just heard from—have shared experiences no parent should ever have to describe to a royal commission or to a journalist. They have asked the country to listen to their children's stories. We owe them the care to listen properly.

I cannot know the grief of Kath or Cherie or Rhys's mother—the grief that they live with every single day—but I hear their determination that their sons be remembered as people who were loved, with lives that reached far beyond a debt notice. They should never have had to fight to make their children's humanity part of this debate. A settlement cannot return a son to his mother and cannot give a family the years together that they expected to share, but we can, as elected members of this place, accept our responsibility to act.

We can recognise the harm and change the systems that inflicted this distress. That responsibility remains with us long after today's debate. The damage from robodebt entered people's homes and affected their sense of safety.

For someone already counting every dollar, a demand for thousands of dollars can make an ordinary week feel impossible. Rent is still due. There is still food to buy.

The debt demand sits alongside expenses that cannot wait and the fear can follow a person through the day, making it harder to concentrate at work or be present with family. An accusation from government can make someone doubt their own integrity. It can leave them embarrassed to ask for help, worried that others will believe they have done something wrong.

No-one should have to be made to carry the shame for an unlawful debt. We must recognise the damage to trust, too. Telling someone that a scheme has ended does not automatically make the next government letter feel safe.

The person receiving it still remembers what happened last time. They still have to decide whether to trust the information in front of them. Repairing that relationship takes time and consistent, respectful treatment.

I want people harmed by robodebt to hear this clearly: there is no shame in needing support. You deserved lawful decisions and decent treatment. Your government failed in its responsibility to you.

Robodebt caused pain and trauma for more than 400,000 Australians. The former coalition government used the power of the Commonwealth against people who needed support, including people already facing severe financial and personal pressures. The scheme was illegal and immoral.

The royal commission found that harm had been knowingly inflicted on economically and socially disadvantaged people. These were people entitled to fair treatment and lawful decisions. Their income did not diminish those rights.

Their need for support did not make them less deserving of respect. A person seeking help after losing work should receive a fair assessment. A student relying on income support should be able to focus on their studies.

Someone living with illness should be able to ask for assistance without feeling accused of wrongdoing. Robodebt violated the basic understanding between government and the people it serves, and the language from the former government made that threat unmistakeable. After hearing what the member for Forde shared, this is even harder to read.

Former minister Alan Tudge said, 'We will find you, we'll track you down, and you will have to repay those debts and you may end up in prison.' Consider the fear those words created for someone already struggling to understand a debt demand. Consider the imbalance of power between a minister delivering that threat and a person wondering how to challenge the Commonwealth.

That person deserved an explanation grounded in law. They deserved a government willing to hear that it had made a mistake. Instead, they faced a scheme that caused illegal harm and left them carrying the consequences.

Those opposite claimed robodebt would save taxpayers $4.7 billion. It has cost the Commonwealth more than $2 billion. That financial cost is substantial, but it is the social cost that is unforgivable.

I'm angry that people with so little financial security faced such an abuse of power. I am angry that families had to spend years asking their government to recognise the suffering it caused. Holding public office brings a duty of care in the exercise of power.

Labor committed to a royal commission into robodebt, and we established it after coming into government. Victims deserved answers about how this happened. Australians deserve to know how their government had allowed such harm to continue.

The royal commission gave people an opportunity to describe experiences that had too often been dismissed. It examined the decisions behind the scheme and the failures that allowed it to operate. I thank the people who gave evidence, including those who spoke about some of the most painful periods of their lives, including the mother of Rhys, as the member for Forde shared, and the other mothers that I have mentioned.

Giving that evidence required courage. It required people to return to events that they had every reason to want to put behind them. Their willingness to speak helped establish the truth.

The Albanese Labor government agreed or agreed in principle to all 56 recommendations. Fifty-two have now been fully implemented, and work is continuing on the other four. We have introduced a new debt-management program at Services Australia and ended its use of external debt-collection agencies.

We have introduced processes that put the people affected by new programs at the centre of their development. We have strengthened consultation with recipients, advocates and frontline staff and improved processes for recognising and responding to vulnerability. We have strengthened ombudsman powers and improved administrative review, legal practice and Public Service accountability.

The practical test is straightforward. Government must understand how a decision will affect the person receiving it, including someone experiencing financial hardship or distress. A process can look orderly inside a department and feel impossible to the person trying to use it.

Listening to that person must be part of the work from the beginning. Our government has taken further steps to make social security debt arrangements fairer. Last year, we raised the small-debt waiver to $250, its first increase in 30 years.

Annual indexation lifted that threshold to $260 on 1 July, and that amount will continue to rise. Around 1.2 million debts will be waived or no longer need to be raised in the last financial year. We've expanded the special circumstances debt waiver to better protect victim-survivors of family and domestic violence from coercive social security debt.

A perpetrator's lies or statements made under coercion or duress should not prevent a victim-survivor from accessing that waiver. These changes recognise that debt recovery decisions have consequences inside people's homes. They can affect a person's financial independence and their ability to regain stability.

Governments must take those consequences seriously. The royal commission's work helped bring new evidence to light. The Knox class action appealed the earlier robodebt settlement, with the applicants bringing a further claim for misfeasance in public office.

The Commonwealth reached agreement with the Knox class action in September 2025, which was approved by the Federal Court in June this year. Approximately 168,000 robodebt victims are expected to be eligible for payments, with $475 million available to compensate eligible group members. Payments can take the form of fixed amounts or individual assessments.

They recognise economic and non-economic losses arising from robodebt. For someone harmed by this scheme, compensation is an acknowledgement that the wrong was done to them. They should be able to receive their payment without Commonwealth recovering part of it under compensation recovery rules.

For a survivor, that money can offer some room to recover financially and make decisions about their own needs. That choice belongs to them. They should not have to defend their entitlement to redress against the institution responsible for that harm.

Under the usual rules, a lump sum compensation payment can affect income support, recovery arrangements can require money to be returned to the Commonwealth, and tax can create a further problem. The usual tax treatment depends on what the payment compensates for. Compensation for lost income can be taxable.

Compensation for personal injury is usually not taxable. Without a specific exemption, some recipients risk an unexpected tax bill. Without these protections, receiving compensation from robodebt can itself create a fresh financial pressure.

That is unacceptable. Consider a person who relies on a pension to meet regular expenses. Their settlement payment recognises harm they suffered.

Receiving that payment should not in itself count as income and reduce the pension they rely on for their everyday needs. Consider an NDIS participant. Compensation for robodebt should not reduce the funding for the reasonable and necessary supports in their plan.

People have waited years for redress. They deserve clear information about how these protections work and the ordinary rules that still apply. Passing this bill quickly will help put these protections in place and avoid unnecessary delays for compensation.

For someone waiting for compensation, another delay means more uncertainty about the money that they are owed. We have an opportunity to give people greater certainty about the treatment of their compensation. The Albanese Labor government promised to investigate robodebt.

We delivered the royal commission. We are acting on its recommendations and protecting compensation for the people harmed. There is more work to finish, and we will keep doing it.

But no member of this House should lose sight of why we are here. People trusted their government to administer the law fairly. That trust was violated.

Families have lived with the grief of an empty chair at family gatherings. Survivors have carried distress long after the scheme ended. They deserve justice expressed through the decisions we make and the decisions we put into law.

For Troy, for Jarrad, for Rhys and for every person harmed by robodebt, our responsibility is to act with the care they should have received from the beginning. The government that caused this harm cannot undo it. This parliament can ensure people receive the compensation they are owed and demand a system that treats every person with dignity.

That is our duty, and this bill is part of fulfilling it.