The ATO has changed how it treats previously suspended tax debts, raising serious questions about older and vulnerable Australians, retirement savings and whether government has absorbed the human lessons of Robodebt.
Australia spent millions on a royal commission into Robodebt. We heard about the distress caused when government pursued vulnerable people for debts, including mental illness, suicide and families devastated by what happened.
You might have thought one lesson would be that government needs to take particular care when debt recovery reaches people who are already vulnerable.
So it is surprising to discover what has been happening at the Australian Taxation Office.
In June 2026, the Australian National Audit Office reported on the ATO’s management of taxpayer debt. Buried in that report is a significant change in the treatment of debts placed on hold.
When the ATO resumed offsetting debts on hold in June 2022 after the Covid pause, it reinstated exclusionary criteria. For individuals, two stood out: income and age.
To be included in the offsetting process, an individual had to be under 70 and have taxable income or a tax loss of $50,000 or more. In December 2022, the ATO removed both criteria.
Why did the ATO once consider age and low income relevant, why did it change its mind six months later, and what assessment was made of the consequences for older and vulnerable Australians?
Guardian Australia reported in December 2025 that a renewed ATO program was targeting $5.3 billion in post-2017 debts on hold involving 325,788 taxpayers. Many had previously been regarded as uneconomical to pursue. Documents obtained under freedom of information indicated that after June 2026 some could be taken off hold, opening the way for direct repayment to be sought.
This raises another question about superannuation.
Australians have been told for decades to save for retirement. Superannuation is supposed to help us support ourselves as we age, but someone reaching their seventies with $200,000 or $250,000 in superannuation is not rich.
That money may have to last another 15 or 20 years and pay for housing, health care, dental care, home maintenance and later perhaps assistance at home or aged care.
If a younger person loses $50,000 from savings, there may be decades in which to rebuild them. Take $50,000 from someone who is 71 and no longer working and it is gone. You can’t earn your super twice.
How many older Australians with reactivated or previously on-hold tax debts have been asked, encouraged or advised to use superannuation or retirement savings to pay them?
That figure does not appear to be publicly available. If the ATO does not collect it, why not?
If government policy can result in older people using finite retirement savings to pay historical debts, government should know how often that happens and what follows. Has anyone calculated whether recovering $50,000 today may result in greater public expenditure tomorrow because that person later needs more help with housing, health care, home support or aged care?
There is a wider question here about how government administers older Australians.
Under Support at Home, older people seeking help to remain at home are assessed through the Single Assessment System using an Integrated Assessment Tool. The government says the tool is designed to improve consistency and is used to classify and prioritise care needs. In February 2026, both the National Aged Care Advisory Council and the Council of Elders raised concerns about assessment and automated decision-making.
The issue is not whether government should use technology. The issue is what happens when increasingly standardised and technology-supported systems make decisions that can fundamentally change an older person’s life while health, welfare and individual vulnerability struggle to find their place.
Under Support at Home, a decision can affect how much assistance someone receives to remain safely at home. Under the ATO’s debt-recovery system, decisions about historical debt may affect how much of that person’s retirement savings remain available for housing, health and future care.
We seem to be getting very good at building systems to administer old people. I am less certain that we are getting better at looking after them.
This is where Robodebt should still be haunting government.
The comparison needs care. Robodebt involved an unlawful method of calculating welfare debts. The ATO tax debts being discussed here may be legally owing.
But legality was not the only lesson from Robodebt. It showed what can happen when government debt recovery loses sight of the person at the other end and when vulnerability is dealt with only after harm occurs.
For someone living with serious mental illness or suicidal thinking, the sudden prospect of losing retirement savings, a home or financial security may precipitate a serious mental-health crisis. After Robodebt, government cannot reasonably say that risk is unforeseeable.
There is also the question of how often someone should have to prove vulnerability. If the ATO has already accepted that a person’s circumstances justify putting a debt on hold, why should that person have to demonstrate the same exceptional circumstances again if the debt is reactivated?
A government administration system should be capable of remembering what government already knows.
There is an obvious middle ground. Where serious and enduring vulnerability has been established, leave the debt on hold from active recovery. The debt does not need to disappear, and future tax refunds and credits can continue to be applied against it where the law allows.
The ATO and the government should explain why the age and income exclusion criteria were removed, how many people over 70 have been affected, how much has been recovered from them and how many have been asked or advised to use superannuation or retirement savings.
They should also explain what safeguards ensure that serious illness, mental illness, caring responsibilities and other vulnerabilities are considered before recovery escalates.
These are not arguments for avoiding legitimate tax debts or against technology. They are questions about proportionality, vulnerability and good government.
Robodebt should have taught government more than how not to calculate a debt. It should have taught government what can happen when administration at scale loses sight of human vulnerability.
We should not need another royal commission to learn that lesson again.
Char Weeks
Char Weeks is the founder of the award-winning secure digital information safe, Secure My Treasures. Way back, she championed innovation and improvement in healthcare delivery. She campaigns against job ageism, elder abuse, and domestic violence. Char has owned three strata title units, two in Melbourne and in Sydney, and has been a member of a strata committee of management.