The Morrison government owes Australians hundreds of millions of dollars in compensation after the Federal Court ruled robo-debt was unlawful, Labor says.
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The government should say how long they knew the scheme was unlawful, Labor's shadow government services minister Bill Shorten demanded.
The controversial robo-debt was ruled unlawful on Wednesday, with the court saying Centrelink could not have been satisfied the debt was correct.
The decision comes after the federal government made significant changes to the debt recovery system, which has used data-matching to land people with debts they do not owe.
While not commenting on the court decision, Government Services Minister Stuart Robert has defended the process of ensuring Australians receive the correct amount of welfare.
"We will continue to use data matching to line up a tax return with an individual Australian's welfare they've received as the basis to ascertain whether a debt may exist," he told parliament during a debate on robo-debt.
The previous Labor government introduced a similar process to robo-debt in 2011, where each case was reviewed by a Department of Human Services staff member.
The coalition moved to a fully-automated system in 2016.
The Federal Court's ruling is an earthquake decision, Mr Shorten says.
"This is not the end of the robo-debt matter because there will be hundreds of thousands of Australians who went through stress, trauma, administrative headache," he said.
"And if you believe some grieving families, it's been the cause of suicide."
The Greens have accused the government of defying the Senate after it refused to produce its legal advice on why it had decided to wind back robo-debt.
Senator Rachel Siewert said the government was evading responsibility.
"Clearly this government has something to hide," Senator Siewert said.
Wednesday's decision centred around Victorian woman Deanna Amato, who was ordered to pay $2754 to the Department of Health and Human Services, which runs Centrelink.
Victorian Legal Aid took her case to the Federal Court and she was paid the $1709 taken from her tax return to cover the debt.
It "could not have been satisfied that a debt was owed in the amount of the alleged debt", Justice Jennifer Davies decided in the Federal Court.
The justice decided Ms Amato was also entitled to the interest earned on the money and the government was ordered to pay her legal costs.
The robo-debt scheme is also facing a potential class action lawsuit.
Earlier this month Department of Human Services staff were told not to rely entirely on the robo-debt system and instead undertake further investigations to determine whether people owe money.
Australian Associated Press
