Finance Welfare ‘Good’ debt, ‘bad’ debt, robo-debt and the decision that erased Bob Day’s debt
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‘Good’ debt, ‘bad’ debt, robo-debt and the decision that erased Bob Day’s debt

Bob Day Senate
The embattled Family First senator resigned following the collapse of his home building company group. Photo: AAP
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Treasurer Scott Morrison amused many when he introduced ‘good debt’ and ‘bad debt’ into our political lexicon. It seemed to be completely incongruous with the once-heralded ‘debt and deficit disaster’. (Remember that?)

They are fairly stark terms: ‘good’ and ‘bad’. Infrastructure spending is ‘good’. Health, education and welfare is ‘bad’. Yet it makes sense, even if it doesn’t sound right.

This week the government decided another debt was ‘good’ – but you can bet the public will be less convinced by this one.

It has revealed it won’t ask former senator Bob Day (remember him?) to pay back the money he earned as a parliamentarian. Mr Day’s election was recently struck out by the High Court, which ruled he was ineligible to stand for office.

It’s not clear exactly how much the South Australian might owe. But The Guardian has reported he was paid close to $130,000 between February 2016 (when he became ineligible) and his November resignation.

In an exquisite coincidence, this comes at the same time the government has been clawing back overpaid welfare dollars through its controversial data matching program. Private debt collectors have been contracted to chase down the recipients and their money. The amounts can be as little as $20. In July, the program will be expanded to include pensioners.

The reason the government gives for going after these welfare recipients is as much about morality as it is the money. It’s about ‘entitlement’.

As Human Service Minister Alan Tudge told The Australian late last year: “Our aim is to ensure that ­people get what they are entitled to — no more and no less.”

Alan Tudge
Alan Tudge says the government wants people to get what they are entitled to. Photo: ABC

It’s a fair aim. Most Australians wouldn’t argue with the idea that people should get no more or less than they’re supposed to.

That’s why Mr Day’s case poses a problem. Is the government’s moral argument fuelled by conviction or convenience?

Thousands of dollars owed by a politician? File under: ‘good debt’. Or at the very least, ‘forgivable debt’. Overpaid ‘dole bludgers’? Bad, bad, bad.

Earlier this month, populist Tasmanian Senator Jacqui Lambie cut straight to the heart of this kind of contradiction. The government has decided welfare recipients should be drug-tested. Fine, Senator Lambie said, but only if politicians are, too.

Whether Mr Day should have to pay back the money – or at least all of it – is not an easy question to answer. He has declared bankruptcy due to financial problems with his business. As Special Minister of State Scott Ryan said, he acted “in good faith”.

But the situation reminds me of a conversation I had with a welfare expert. I had wondered what she thought of the government’s ‘robo-debt’ program.

“Personally, I think we should waive all welfare debt,” she told me.

All of it?” I asked, incredulously.

“Yeah, why not?”

It seems like a crazy idea, doesn’t it? Just ask Bob Day.

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