By 3 News online staff
The Government is making moves to tweak a law that has been in place for decades to clarify when people start getting paid benefits after a seven-day stand-down period.
A recent court judgment said the current legislation could be interpreted as the payment beginning the day of the stand-down period, rather than on the seventh day.
Beneficiary advocate Kay Brereton says the mistake could affect hundreds of thousands of people.
She says anyone getting "practically every benefit" paid out since 1998 had their first benefit payment paid the day after their stand-down period ended, rather than on the day.
She is troubled by the Government's moves to fix the mistake, rather than dealing with the consequences of the oversight.
"It's very concerning because it's about changing a law to fit with a practice instead of making the practice lawful," she told RadioLIVE.
Social Development Minister Anne Tolley says it had been standard practice to start benefits the day after a stand-down period.
"They were never entitled to a benefit for seven days and that's been the practice."
She agreed the current law could be read as having the payment start on the seventh day, but she said this would make the stand-down period six days.
"We're just clarifying that so that anyone reading the law as the court pointed out, if you look at it, you could interpret it that that benefit restarted on the seventh day of the stand down which would make nonsense of a seven day stand down."
But Ms Brereton says the fact Ms Tolley is playing down the financial impact means she's out of touch.
"The minister thinks this isn't very much money, but that shows she doesn't understand how even $20, though I think it's a bit more than that a day, makes a difference in the budget.
"I think it is very much the wrong way to go about it because a lot of these people have children, so these children are missing out."
She wondered if the same thing would have happened if the botch-up had happened to another group of people aside from beneficiaries.
Ms Brereton said anyone applying for a benefit with Work and Income can ask for their benefit to be paid correctly and have the right to a review.
The select committee will report back on the possible change in January.