Morrison rejects robo-debt findings as commission refers individuals for further action

Former prime minister Scott Morrison has vehemently rejected adverse findings made against him by the robo-debt royal commission, which recommended unidentified individuals be referred for potential criminal or civil action over the illegal welfare crackdown.

Top bureaucrats met for crisis talks on Friday afternoon to discuss the implications for the public service after royal commissioner Catherine Holmes, SC, delivered her 990-page report into a scheme she said was plagued by collusion and dishonesty in concealing its unlawfulness.

Prime Minister Anthony Albanese, with Government Services Minister Bill Shorten on Friday, described robo-debt as a “gross betrayal and a human tragedy”.Credit: AAP

Prime Minister Anthony Albanese described robo-debt as a “gross betrayal and a human tragedy”. He singled out Morrison, his predecessor, as having been mentioned “countless times” in the report, and said his defence of the scheme was “based upon a falsehood”.

But Morrison, who took the initial proposal to cabinet as social services minister in 2015, issued a lengthy defence of his actions after Holmes found he had allowed cabinet to be misled over the legality of the scheme and gave untrue evidence to the commission.

“I reject completely each of the findings which are critical of my involvement in authorising the scheme and are adverse to me. They are wrong, unsubstantiated and contradicted by clear documentary evidence presented to the commission,” Morrison said, adding that they were based on a fundamental misunderstanding of how government operates. He is seeking legal advice over parts of the findings.

Holmes recommended that a sealed chapter of the report relating to the referral of individuals not be tabled in parliament “so as not to prejudice the conduct of any future civil action or criminal prosecution”. She did not reveal who had been referred for further investigation to various agencies including the National Anti-Corruption Commission, the Australian Federal Police and the Law Society of the ACT.

The government is pledging accountability, with Government Services Minister Bill Shorten saying he felt conflicted over the secrecy of the referrals and Albanese saying he ultimately wanted the sealed chapter made public.

Morrison said the weight of a 2015 executive minute in which bureaucrats initially advised of the need for legislative change to establish robo-debt was mischaracterised by the commission’s findings, while also denying an assertion he pressured officials to force the policy through.

But Holmes said Morrison had failed to make an “obvious inquiry” about why that advice had changed by the time the proposal was taken to the expenditure review committee.

Holmes said Morrison’s evidence that he was told the use of income averaging – the core feature of the automated debt recovery scheme – was an established practice was “untrue” and inconsistent with other evidence he had given in December.

She also accused former human services minister Alan Tudge of an “abuse of power” for pursuing welfare recipients in the media to deflect from mounting criticism of robo-debt, and said former social services minister Christian Porter “could not rationally have been satisfied of the legality of the scheme”.

Former government services minister Stuart Robert went “well beyond supporting government policy” as a cabinet minister in defending the scheme despite knowing its flaws, she said.

Tudge, Porter and Robert defended their actions as ministers on Friday. Robert welcomed the findings and said he “worked hard” to shut down the program, while Tudge said the final report made no finding he knew of the scheme’s unlawfulness and Porter said he acted in good faith.

Holmes called for a more “ethical” and transparent attitude to debt recovery.

“It is remarkable how little interest there seems to have been in ensuring the scheme’s legality, how rushed its implementation was, how little thought was given to how it would affect welfare recipients and the lengths to which public servants were prepared to go to oblige ministers on a quest for savings,” Holmes said of the program that ran between July 2015 and November 2019.

“Truly dismaying was the revelation of dishonesty and collusion to prevent the scheme’s lack of legal foundation coming to light.”

Robo-debt was aimed at identifying people who had been overpaid Centrelink benefits by using an automated system of income averaging to help identify alleged discrepancies between their reported income and income data held by the Tax Office. But the scheme, which recovered about $750 million from about 380,000 people, was flawed and resulted in debts being calculated based on incorrect data.

The Commonwealth settled a test case in 2019 and conceded that raising a debt using income averaging was unlawful.

Originally billed as a $1.7 billion savings measure, the scheme ended up costing the public more than it was designed to reap after the Commonwealth settled a class action for $1.8 billion in the Federal Court in June 2021, in what a judge described as a “shameful chapter in public administration”.

Vulnerable Australians were wrongfully pursued as welfare cheats, and subjected to financial distress over claims they owed the government tens of thousands of dollars. Jennifer Miller’s son, Rhys Cauzzo, took his life in January 2017 after being chased over almost $18,000, and Kath Madgwick’s son Jarrad died by suicide in May 2019.

“What is certain is that the scheme was responsible for heartbreak and harm to family members of those who took their own lives because of the despair the Scheme caused them,” Holmes said.

“It extends from those recipients who felt that their only option was to take their own life, to their family members who must live without them.”

Tudge said he strongly rejected “the observation that I was indifferent to suicides that were brought to my attention”.

Colleen Taylor, the former Centrelink worker who raised the alarm over robo-debt, said those who ran the scheme were missing an “empathy gene”.

“The only thing that stopped this in the end was that it was illegal,” Taylor said. “Why wasn’t it stopped long before because of all the other reasons: immoral, unjust, unfair, cruel?”

Crisis support is available from Lifeline on 13 11 14.

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