Statement on calculating social security debts: Chaplin v Department of Social Services
22 June, 2026
Legal Aid NSW acknowledges the important decision of the High Court in Chaplin v Secretary, Department of Social Services. The decision provides important clarity on the lawful calculation and recovery of social security debts.
Background
From at least 2003 to 2020, the Department of Social Services used a method known as income apportionment to assess whether someone had been overpaid a social security payment. This approach was not authorised under the legislation and involved averaging a person’s employment income across more than one fortnight. This practice resulted in a large number of unlawful debts.
Mr Chaplin’s case
Mr Chaplin’s Centrelink debt was calculated using income apportionment.
His case in the High Court focused on how to apply the income test where his payslips showed how much he was paid, but not exactly when he had worked. This meant it was not possible to identify the fortnight in which the income should be counted in.
The High Court was asked to decide how his debt should be recalculated, given that income apportionment is unlawful. The High Court said that, in circumstances like Mr Chaplin’s, where it is not known when income was earned, the Department can assess the income in the fortnight it was received to determine whether there was an overpayment.
Effect of the decision
The decision makes clear that there are other lawful ways for the Department to calculate debts impacted by income apportionment.
The Robodebt and income apportionment failures show why stronger safeguards are needed in the social security system. Currently there is no time limit on recovering social security debts. This means people can be asked to repay debts many years later, when they may no longer have the records or information they need to respond.
Legal Aid NSW continues to support the implementation of the Robodebt Royal Commission’s recommendations, including the introduction of a six‑year limitation period on debt recovery. Introducing clear and enforceable time limits is a critical safeguard to prevent errors from going unchecked, reduce the risk of unfair outcomes, and ensure greater accountability in the system.
This decision is an important opportunity for Government to make sure people affected by income apportionment are treated fairly, and to contact Centrelink to check whether they may be eligible for compensation. The deadline to apply is 29 January 2027.
More information
Listen to the Law for Community Workers podcast episode: Old debts, new rights – why Centrelink might owe your clients money (41m 22s).
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