In the first two weeks of hearings on the illegal welfare scheme, a central question was asked: How could it happen?
Serena Wilson stopped for a while before finally answering with a quiet voice: Yes, I believe you are right.
Wilson made a dramatic confession to Justin Greggery (senior counsel to the royal commission into the Robodebt Scheme), that she knew that the Coalition government’s welfare debt collection program was illegally operating and that “I did not take any steps to stop it.”
Wilson, now long retired, was a senior official at the Department of Social Services. She was one of six deputy secretaries. In 2014, she saw a summary of critical legal advice which indicated that the robot debt program was illegal.
This scheme resulted in a $1.8bn settlement for the commonwealth with hundreds of thousands of victims who were sent illegal welfare debts. The royal commission is currently investigating the matter.
Wilson stated, “Now I’m ashamed and in hindsight, I could have spoken out.”
Wilson’s honesty in the witness box – where she admitted she lacked courage and had violated the APS code – explained a question that Catherine Holmes and Greggery repeatedly asked over the past two weeks: How could this have happened?
The commission is investigating how a proposal from one department of government that was thought to be illegal could have been included in the budget for 2015 and then executed. The scheme was continued until November 2019 even though officials were forced to confront the reality of their legal situation at crucial times in 2017-2018.
The robot debt scandal, especially before its closure, was presented as a sign of the dangers of automation and an ideological desire to demonize welfare recipients. It did.
One of the secret briefs that were shared with ministers at the moment and broadcast this week was a “taskforce”, which was meant to warn allegedly fraudulent welfare recipients: “You’re Next.” Scott Morrison, then minister, and his top officials had held a crucial meeting. He’d expressed his desire to become a “welfare officer”.
The integrity of the commission’s hearings in these two weeks has been a matter of direct concern. It remains to be determined if there is a “stuff up”, “conspiracy”, or, as Holmes asked Holmes, “a conspiracy concealing a stuff up”.
Public servants were aware of the problems
The public service’s policy and legal professionals were well aware of the significance of the robot debt program, which was “unethical” as well as its potential illegality. They were aware of the dangers from late 2014 and had begun to put pen to paper. The commission tracks how far the paper has been passed up the chain.
Finn Pratt (the former secretary of the Department of Social Services), was Wilson’s boss. He insisted that those warnings had never reached him. Pratt insisted that he wasn’t avoiding responsibility, as his department was responsible for the social security law. However, he stressed the importance of his role which covered multiple policy areas and included new initiatives in disability and childcare policy. Pratt pointed out that his department was responsible for about a third of government spending at its peak. Wilson was defended by him as a great public servant. He said that he relied upon her for advice.
He referred to the fact that the robodebt program was managed by the Department of Human Services (now known as Services Australia) and said memorably, “This was one headache, which wasn’t mine.”
Pratt implicitly gave the ball to Kathryn Campbell. Many associate Campbell with the robodebt program as the most prominent bureaucrat.
She defended robodebt as secretary of the Department of Human Services in 2017, the year that the scandal was at its height. She made a few snide remarks about the media. Pratt was replaced by Campbell as secretary of DSS later that year.
Campbell fought senators over language to describe the scheme’s illegality even after it was shut down. She favored “legally insufficient.”
Campbell was less vocal in the witness box. Campbell was more reserved in the witness box, but she was careful about her choice of language. As federal court justice Bernard Murphy and Greggery had told her twice, she would not agree that the scheme was a “massive failure of public administration”. Campbell insists on “significant”, and not massive.
Morrison was given legal warnings
The inquiry found that Campbell’s department was responsible for administering social security policy. This meant that the department had to ensure that all actions, including how it raised welfare debts were legal.
Campbell met with Morrison in late 2014. Campbell then worked with Malisa Golightly, Morrison’s deputy, to create an executive minute. Robodebt watchers have long sought the executive minute and it was finally revealed this week.
Morrison had requested proposals on welfare compliance. Morrison signed the minute on 12 February 2015. It specifically mentions the use of ATO data to comply with debt compliance measures that led to the robodebt program. Also, it acknowledges that DSS stated that such a plan needed legislative changes. The document authorized the departments to submit policy proposals for consideration and implementation in the budget.
Campbell acknowledged that she knew, given the minute, that DSS had a position. The proposal that became Robodebt would require a law change to be legal.
Campbell stated that the process of creating the policies and finalizing them was ongoing without her involvement. The process was being managed by her department and the DSS.
She claimed she didn’t see the new policy proposals documents, either the drafts or the final versions. This meant she was unable to know how they “landed”.
Greggery wanted to know how she believed the scheme was legally operating after it was officially launched in scale by her department in 2016. She stated that she hadn’t given up on the matter, but that DSS had been handling it.
Greggery asked, “In the absence of positive knowledge [the scheme] was legal, you assumed it was despite earlier advice?”
Campbell responded, “I did.”
She said that it was a mistake to assume that other agencies would give policy advice. I relied on policy advice from other agencies… It would have been better to seek external legal advice.
There are still questions about the 2015 proposal
The royal commission appears to have focused its investigation on March 2015. A draft of the policy proposal had been sent to DSS lawyers by 2 March 2015. Officials were alarmed when they stated that there wasn’t a need to make legislative changes.
It is not clear how the acknowledgment of legislative change was dropped from the proposal.
The royal commission heard that the DSS lawyers who had warned against it in 2014, were raising legal concerns again and reiterating them over two days in march. They raced against the clock to submit the proposal to the Department of Finance to cost it. Because Morrison was interested, the welfare compliance measures were included in the budget process.
It remains to be seen what DHS officials did with the legal warnings.
Pratt claims he didn’t see the robo debt proposal. He was not generally made aware of it until 2017 when it became a media topic, and Christian Porter, the minister at the time, called to inquire: “What the heck is all this?”
Wilson claimed that she was unaware of the illegal “income averaging”, which is used in robo debt, until 2017. She believed the idea was dead before that. She claimed that DHS deputy secretary Golightly had told her that income averaging was not being used. Golightly was her direct rival. Since then, she has passed away.
Greggery began to ask Campbell more questions about her understanding of the legal implications of robodebt, and she responded by saying that Campbell had accepted the advice and given it to Minister Morrison.
Greggery responded: “It seems as though you are passing responsibility to ministers, rather than carrying it yourself.”
Campbell refuted this. Campbell will be back on the witness stand on December 5.
The royal commission continues.