A former senior Department of Social Services official, who was given damning legal advice the robodebt scheme was unlawful, has told a royal commission she lacked the “courage” to speak up and was now “ashamed”.
In dramatic hearings on Wednesday, the royal commission was told Serena Wilson, a former deputy secretary at DSS, was made aware of the legal advice in early 2015 when the scheme was being designed.
But she said she failed to personally tell former prime minister Scott Morrison the plan could be unlawful as she was under the belief it had already been “killed”.
Wilson then claimed she was unaware for about two years that the unlawful “income averaging” method was being used in the robodebt scheme, saying she had been given assurances by another official, Malisa Golightly, who has since died.
Wilson said she finally realised the unlawful method was being used in the “latter part” of 2017, but she did not have the “courage” to tell anyone.
“And now I’m ashamed. And in hindsight I could have spoken up,” she told the hearing.
The robodebt program – which began in July 2015 and ran until it was stopped by the courts in November 2019 – saw hundreds of thousands of Australians sent unlawful demands to repay welfare payments and ended in a $1.8bn settlement.
Wilson was sent an email from DSS official in November 2014 saying legal advice was expected to confirm the “income averaging” method used in the robodebt scheme was unlawful.
A January 2015 email also sent to Wilson began “you requested information/advice about the DHS proposal to change the approach to … raising social security debts”.
Wilson, who was among the most senior people in the department, denied she had requested the legal advice, though she could not rule it out.
The hearing was told Wilson also could find no record that she had passed on the legal advice to her boss, the DSS secretary, Finn Pratt. She said it would have been her practice to do so. Such evidence might have been contained in her personal notebooks, which the inquiry heard she “destroyed” when she retired in mid-2017.
Wilson said DHS had started to encroach on her department’s responsibilities, which had caused confusion around the time the scheme was being developed in early 2015.
But she said that she “thought we’d killed it”, referring to the plan.
The inquiry heard that Wilson and Pratt had a meeting with Morrison on 22 January.
Senior counsel assisting Justin Greggery asked: “Did you say that to minister Morrison on the 22nd of January?”
Wilson replied: “No.”
Greggery said: “Surely the clearest way to kill it was to commit the advice, both legal and policy to writing and send it to your own minister?”
Wilson replied that “in hindsight I wish we had”, prompting Greggery to note there was nothing stopping her from doing so.
Greggery said it had been her responsibility to stop the proposal but instead her department had “either with your direct involvement or knowing involvement” actually engaged with DHS about the “language used in the proposal”.
Responding to Wilson’s suggesting that her department had provided “feedback” that it was “problematic”, Greggery said there was a difference between making comments and “saying you can’t advance a draft [for the minister] … because it’s against all social security policy”. “So don’t put it in a draft, the train’s leaving the station, isn’t it?”
The inquiry has previously heard a minute sent to Morrison in January had suggested that legislative change might be needed to implement those welfare compliance measures.
But, according to Wilson’s evidence, the “significance of the risks of the issues of both policy and law were communicated to the Department of Human Services but were not communicated to the minister for social services”.
The use of income averaging – or what became the robodebt – was not specifically flagged in the budget, which noted a range of welfare compliance budget measures including increased data-matching. It only emerged in late 2016 after the scheme was ramped up and caused public outrage.
Despite her insistence she had only realised income averaging was being used in the latter part of 2017, the inquiry heard Wilson had chaired a meeting in January 2017 in which DHS confirmed it was using “income averaging” as a “last resort”.
She then led a 15 January 2017 meeting with the Commonwealth Ombudsman where she failed to tell the watchdog about the legal concerns from 2014.
Greggery said as the deputy secretary of the department she was in a position to do something but “took no steps to stop it”.
He said Wilson had failed to act with “actual knowledge of the consequences of the raising of unlawful debts on a large scale”.
After a long pause, Wilson replied: “Yes, I think you’re right.”
Greggery said she was “duty bound” to provide “full and frank advice” but instead took steps to ensure the “continuation of what you then believed to be unlawful”.
He said she had “breached the [Australian Public Service] code of conduct” by her “deliberate choice”. Wilson accepted this was the case.
Asked if there was something she was “fearful” of, Wilson said the work environment under her new boss, DSS secretary, Kathryn Campbell, was “more authoritarian”. She had a “less mutually respectful” relationship with Campbell, Wilson said. Campbell will give evidence on Thursday.
The inquiry later heard Wilson also did not share the damning legal advice with Christian Porter, who social services minister in 2017.
The royal commission before Catherine Holmes continues.
