An external audit into robodebt in 2017 was stopped before it was completed, latest royal commission hearing reveals

The minister in charge of the botched robodebt scheme had ordered an external audit, but it was stopped before completion, it’s been revealed.

A comprehensive audit ordered into the robodebt scheme ordered by the minister in charge was mysteriously abandoned before it was completed, startling royal commission evidence has revealed.

Then human services minister Alan Tudge brought on board consultants Pricewaterhousecoopers (PwC) under a million-dollar contract to investigate the saga’s shortcomings in 2017.

However, the report was abandoned after a visual presentation halfway through the audit period.

PwC partner Shane White fronted the inquiry in Brisbane on Friday and detailed how the investigation was scrapped, apparently at the Human Services department’s wishes.

This led to commissioner Catherine Holmes asking if a “nod and a wink” was offered by the department to ensure the results of the report were buried.

Shane West, Partner PwC, appeared before the Royal Commission into the Robodebt Scheme on Friday. Picture: NewsWire / Sarah Marshall

“What was made clear to you? ‘Gosh we’re happy with the presentation you made and we don’t need any more?’” she asked.

“You’ve almost got it finalised and then it’s clear a presentation you’ve given a couple of weeks earlier will fit the bill?”

Ms Holmes went on to question how the report’s final form could have just been abandoned.

“Look, I have to tell you, this really challenges credulity that nobody in DHS, on your version of events, gets wind of the report and that PwC just abandons report at this stage of preparation without any documentation of how that happens,” she said.

Mr West replied by saying: “That’s my recollection.”

The audit took place around the same time the Commonwealth ombudsman was investigating the Centrelink debt recovery scheme amid reports of its shortcomings.

Mr West said he doesn’t remember how PwC was informed the final version of the report was no longer needed.

“We weren’t able to find any [texts] or email correspondence to that effect,” he said.

Mr West also said PwC in its audit did not rely on information from the department, which Ms Holmes characterised as a “mistrust in the work they’d done”.

“There was a view what the department had documented … might not have been 100 per cent accurate,” Mr West said.

Counsel assisting Justin Greggery KC said the consulting firm’s report resulted in a “a very poor report card” for robodebt.

“It was woeful, wasn’t it?” he asked Mr West.

“I think our view was that there were things [in the scheme] that should have been considered but weren’t,” Mr West replied.

“[We found] room for improvement … a lot of flaws”

Earlier this week former social services minister Christian Porter and Mr Tudge gave lengthy blocks of evidence.

The robodebt saga took place between 2015 and 2019. Picture: NCA NewsWire / Brenton Edwards

Mr Porter said he took responsibility for the robodebt scheme’s failures when he was the minister in charge between 2015 and 2017 but was frustrated by the relevant departments’ actions.

Ms Holmes asked Mr Porter if he “took any responsibility for this?”

“I do. And I look back on this and I see myself through the correspondence getting quite close at points to taking the next step of inquiry,” he replied.

“I didn’t do that. I wish now that I had, but I also see the reasons why I didn’t do that.”

Mr Porter said he stopped being the social services minister before he could act further on his concerns. But he also took aim at the departments of social services and human services.

He said he was “frustrated with all of them”, blaming them for inaccurate talking points prepared for him before he fronted national media on the scheme.

Ms Greggery asked about whether concerns flagging the scheme’s legality – which had been canvassed at a conference attended by departmental staff – should have been brought to his attention.

“I think that’s a fair proposition,” Mr Porter said.

Former social services minister Christian Porter was frustrated with his departments. NewsWire / Sarah Marshall

Mr Tudge also gave evidence on Wednesday and Thursday.

In response to earlier claims that he acted indifferently about the legality of robodebt, Mr Tudge said that prospect didn’t occur to him.

“My mind was not acting as a lawyer; it was acting as an implementer of the policy,” he said.

“I’d understood that (income averaging) had always been used for decades and so it had not crossed my mind that it could possibly be unlawful.”

Robodebt was an automated welfare recovery scheme that used income averages and unlawfully took $720m from 381,000 Australians.

The practice was ruled unlawful by the Federal Court in 2019.

The royal commission is investigating how Australians’ annual tax information was used to determine average fortnightly earnings and automatically establish welfare debts.