Plans for what became the robodebt scheme “almost immediately” concerned policy advisers at the Department of Social Services and were viewed by one official as “unethical”, a royal commission has been told.
Cameron Brown, a former director of payment integrity and debt management at the Department of Social Services (DSS), said he was responsible for seeking advice on the policy idea from its internal legal team in late 2014.
That was in response to a proposal from the Department of Human Services to use “income averaging” to raise welfare debts – the central plank of what became the ill-fated robodebt scheme.
At the time the DSS led the development of social policy while the Department of Human Services was responsible for administering services such as Centrelink, including welfare debt recovery.
It remains unclear whether this damning legal advice was shared with the Department of Human Services, which was responsible for the plan.
Brown said he and his team were “almost immediately” concerned about the “unethical” debt recovery proposal.
Brown compared the proposal to the so-called Dallas Buyers Club “speculative invoicing” saga in which copyright holders sent legal demands to alleged downloaders of the 2013 film for large amounts of money in the hope they would settle.
He noted many of the people targeted by robodebt were vulnerable and the “onus of proof” was unreasonable given much of the pay information they would need to source went back years.
Brown said the subsequent internal DSS legal advice was “black and white” and should have been the end of the proposal.
The inquiry heard there were discussions within DSS about seeking more formal legal advice from the Australian Government Solicitor (AGS).
However, it heard this was complicated by the fact that at this time there was no formal plan – known as a “new policy proposal” – to be referred for AGS consideration.
The inquiry previously heard the legal team within DSS was subsequently approached to review a more concrete proposal a few months later in early 2015. It heard this left them with only two days to review it, because the plan had been taken into the budget process after winning support from the then minister, Scott Morrison. There is no suggestion Morrison was aware of the legal doubts.
The former government went on to implement the scheme in July 2015, which ran until November 2019, when the government accepted in federal court the scheme was unlawful.
The royal commission heard Lisa Keeling, former general counsel at the Department of Social Services, was tasked in November 2019 with investigating whether the Department of Human Services had sought legal advice when robodebt commenced.
Keeling’s report found three pieces of advice had been sought by DHS’s internal legal team in early 2015. But all three did not explicitly address the central legal question of the legality of using income averaging to raise welfare debts.
According to Keeling’s review, the only legal advice held by the government departments was the unfavourable advice created by DSS in late 2014, which suggested the robodebt scheme would unlawful.
But Keeling did not find evidence that it had been shared with the Department of Human Services. DHS was responsible drafting the policy proposal for consideration by ministers.
The inquiry heard Keeling’s report was based on a review of documents and discussions with some mid-level staff and did not include interviews with other longstanding senior officials.
Keeling found that over time a view had formed within DHS that the robodebt program was based on legal advice that backed its legality. The department’s view was also that “income averaging” had been a “longstanding” practice for raising debts, an argument the department and former Coalition government have repeatedly employed.
The commission heard Keeling’s report was never “finalised” because the secretary of the DSS had said this would be not necessary. The secretary at the time was Kathryn Campbell, who was previously secretary of DHS. Campbell, along with other key DHS officials, will give evidence next week.
Under questioning from counsel assisting, Angus Scott, Keeling was also asked about a practice within government departments where draft legal advice from an external firm would not be “finalised”.
Keeling said this did occur if circumstances changed or it was “unhelpful”.
The inquiry heard on Wednesday the Department of Social Services received “catastrophic” draft advice from Clayton Utz in August 2018 saying robodebt was unlawful. It is unclear what happened to the advice, though the law firm was paid.
Speaking generally, Keeling said if draft advice was finalised, it would needed to be acted on, which could include sharing it with more senior officials including the department secretary or even a minister.
The royal commissioner, Catherine Holmes, said: “But if you’ve gotten advice, even if it’s in draft form, it’s legal advice. It’s come from lawyers. It’s paid for. It exists. It’s like a child putting its hands over its eyes and thinking you can’t see it.”
Keeling replied: “I agree with you that once you’ve received the advice there should be action on it regardless of whether it’s draft or not.”
The commission continues.
