Energy companies have been accused of misusing welfare payments.

AGL and Ergon Energy have been caught up in a broader issue with the use of Centrepay - a bill-paying service for people receiving welfare payments.

AGL and Ergon Energy Retail reportedly received money through the government-operated Centrepay debit system long after customers had terminated their services with the companies. 

Services Australia, which oversees Centrepay, has confirmed it is working with the energy companies to refund the overpayments. 

“The agency has supported the return of all overpayments to AGL customers,” says Services Australia spokesperson Hank Jongen. 

“We have also commenced processes to support Ergon to return all funds to impacted customers.

“The agency supports the return of overpayments where businesses are unable to facilitate refunds themselves”.

Ergon Energy Retail says it is committed to refund any credit balances post-account closure. A lawsuit from the Australian Energy Regulator against AGL has cast a spotlight on the system's vulnerabilities, with documents alleging AGL was aware it was receiving funds from non-customers for years. 

AGL refutes claims of mismanagement, stating it lacked control over the deductions.

The systemic issue raises questions about the safeguards within Centrepay, designed to ensure welfare recipients can meet basic needs without undue financial strain.

The extent of the problem has prompted calls for a comprehensive review and reform to prevent future misappropriations. 

More details are accessible here.