Former Department of Human Services secretary Kathryn Campbell has told a royal commission she accepts federal cabinet was misled when the robodebt scheme was approved, admitting to a “significant oversight”.
However, she rejected suggestions it was deliberate.
The inquiry is investigating why the Centrelink debt scheme ran between July 2015 and November 2019, ending in a $1.8bn settlement with hundreds of thousands of victims, despite Department of Social Services (DSS) lawyers warning when it was developed that it would be unlawful.
Appearing at the royal commission for a third and final time on Tuesday, Campbell rejected one theory being considered by the inquiry, which is that her department removed suggestions legal change was needed from the March 2015 cabinet submission due to direct or implied pressure from ministers.
Under questioning by the senior counsel assisting, Justin Greggery KC, Campbell accepted that the document – which falsely said there was “no change” to how debts would be assessed under robodebt – misled the expenditure review committee about the fledgling proposal.
Greggery said: “Is it your evidence a document which was capable of misleading a submission of cabinet went unnoticed by you despite your earlier involvement in those briefings?”
Campbell replied: “Yes.”
Campbell said she could not recall why she didn’t notice the change, which was inserted by officials of the Department of Human Services (DHS) in early March. The commissioner, Catherine Holmes AC SC, has suggested the misleading change was made by DHS officials either to deceive DSS, which had warned against the plan, or with their consent in what she has called “collusion”.
Asked if ministers had pressured her to put forward the proposal without legislation, Campbell said: “There was no pressure.”
Campbell said she took responsibility for “what happened in the department”, but emphasised she “did not notice the change in the draft”.
She accepted Greggery’s suggestion it was a “significant oversight”.
Greggery said another possibility was that the misleading language was consciously inserted to “avoid the need to identify legislative change” to ministers.
“I do not agree with that,” Campbell said.
“I have never been in a department that sought to mislead,” Campbell added. “And I have never been involved in an operation that has sought to mislead the government.”
Greggery suggested that after the then-social services minister, Scott Morrison, had indicated his desire for the proposal to go ahead in February 2015, there was no realistic possibility it could be legislated to start in July 2015.
“You were put in an impossible position by that point?” Greggery said.
Campbell maintained she did not know why the misleading change had been made.
“I don’t know why it occurred,” she said.
Later, Campbell was shown a staff-wide email she had sent while the scheme was facing significant controversy in January 2017.
In the email, Campbell repeated the line that there was no change to the way debts were being raised through the robodebt program.
This prompted another compliance officer, Colleen Taylor, to write to Campbell, telling her she was being “misled”.
Campbell said she referred Taylor’s concerns to her staff. Asked why she had not corrected her statement there was “no change” to debt processes when she knew this wasn’t true, Campbell replied that she was focused on ensuring welfare recipients were able to “engage” with the system.
Campbell denied that her strong defences of the program and her insistence that there was no change to the way Centrelink calculated debts had a chilling effect on people within her department.
She was shown several key documents she said were never shown to her, including a brief intended for her outlining key flaws in 2015, and damning external legal advice obtained by the Department of Social Services in August 2018. By this time, Campbell had been promoted to DSS secretary.
Holmes said: “You do seem to have been shielded from a lot of bad news, would you agree?”
Campbell said: “A lot of bad news got to me on other topics. It was bad news most hours of most days in those departments.”
Campbell also faced questions about the ethics of the proposal, admitting she didn’t consider whether it was fair on people who didn’t respond to the debt letters.
She accepted the proposal included a retrospective change to the way a person’s entitlement to income support was reviewed: even though they declared on a fortnightly basis, it used annual tax office data to check their eligibility to payments.
She was asked by Greggery: “Did you consider the question of fairness involved in changing the question of entitlement retrospectively?”
Campbell replied: “No.”
Campbell said she did not consider this issue until the scheme exploded into controversy in January 2017. It was established in July 2015.
She said the government announced changes in 2017 that meant the “income averaging” method central to the scheme was only used after two attempts to contact the welfare recipient.
The commission continues.
