In April 2015, measures to create budgetary savings by increasing the pursuit of outstanding debts and investigation of cases of fraud in the Australian welfare system were first flagged by the Minister for Social Services Scott Morrison and the Minister for Human Services Marise Payne, and formally announced by the Abbott government in the 2015 Australian federal budget. Initial estimates in the 2015 budget projected that the scheme would recoup A$1.5 billion for the government.
In July 2016, the manual system began to be replaced with the Online Compliance Intervention, an automated data-matching technique with less human oversight, capable of identifying and issuing computer-generated debt notices to welfare recipients who had potentially been overpaid. The new system was fully online by September 2016. In December 2016, Minister for Social Services Christian Porter publicly announced the implementation of this new automated debt recovery scheme – which was given the colloquial name "Robodebt" by the media – was estimated to be capable of issuing debt notices at a rate of 20,000 a week.
In early January 2017, six months after the commencement of automated debt recovery, it was announced that the scheme had issued 169,000 debt notices and recovered A$300 million. Based on these figures, it was suggested that a similar automated debt recovery system would be applied to the Aged Pension and Disability Pension, in order to potentially recover a further A$1 billion.
Services Australia announced in September 2019 that expenditure on the Robodebt program was A$606 million while recouping A$785 million.
Opponents of the Robodebt scheme said that errors in the system were leading to welfare recipients paying non-existent debts or debts that were larger than what they actually owed, whilst some welfare recipients had been required to make payments while contesting their debts. In some cases, the debts being pursued dated back further than the ATO requests that Australians retain their documentation. Particular criticism focused on the burden of proof being moved from Centrelink needing to verify the information, to being on the individual to prove they did not owe the funds, with human interaction being very limited in the dispatch of the debt letters.
Allegations levelled against the scheme by the media, former and current welfare recipients, advocacy groups, politicians and relatives of welfare recipients include:
After the Turnbull government implemented the Robodebt scheme, many recipients of debt notices filed complaints with the Commonwealth Ombudsman. This led to the agency investigating the scheme, with the final report and recommendations delivered in April 2017. The ombudsman recommended that the Department of Human Services (DHS) should:
The ombudsman also recommended that before expanding the scheme, the DHS should undertake a comprehensive evaluation of the scheme in its current form, and consider how to mitigate the risk of possible over-recovery of debts.
The Robodebt scheme was the subject of a Senate committee inquiry beginning in 2017. The inquiry had a number of findings and made a number of recommendations, including:
Initially, the total sum of the repayments was estimated to be A$721 million. However, in November 2020 this figure expanded to A$1.2 billion after the Australian government settled a class-action lawsuit before it could go to trial.
After weeks of criticism from the Opposition, in June 2020, Prime Minister Scott Morrison, in response to a question from the opposition concerning a particular victim of the scheme, stated in parliament that "I would apologise for any hurt or harm in the way that the Government has dealt with that issue and to anyone else who has found themselves in those situations". As of 31 July 2020, it was announced that A$224 million had been repaid to more than 145,000 welfare recipients.
On 11 June 2021, the Federal Court approved a A$1.872 billion settlement incorporating repayment of A$751 million, wiping of all remaining debts, and the legal costs running to A$8.4 million. In ruling against the scheme, Justice Bernard Murphy described it as a "shameful chapter in the administration of the commonwealth" and "a massive failure of public administration”. The Federal Treasurer Josh Frydenberg said the government accepted the settlement, but distanced himself from the suicides and mental health issues surrounding the administration of the scheme. Services Australia has stated they will commence repayments in 2022 to people who have overpaid according to debt recalculations.
The scheme was again the subject of a Senate committee inquiry, which began in 2019.
Initially meant to report its findings in December 2019, the inquiry's deadline was extended six times, with the Senate committee delivering its final report in May 2022. The five interim reports made several findings, including:
In June 2020, the Greens and Labor called for a Royal Commission into Robodebt, to "determine those responsible for the scheme, and its impact on Australians". These calls have been reiterated by university academics, and by ACOSS, which stated that "although some restitution has been delivered to victims of Robodebt, they have not received justice".
In May 2022, the sixth and final report from the second Senate inquiry into the scheme recommended a Royal Commission, "to completely understand how the failures of the Income Compliance Program came to pass, and why they were allowed to continue for so long despite the dire impacts on people issued with debts".
In November 2022 it was disclosed that legal advice before the scheme started was that it did not comply with legislation. Commissioner Catherine Holmes asked DSS lawyer Anne Pulford, "You get an advice in draft, and if it's not favourable you just leave it that way?"; Pulford responded "Yes, Commissioner".
The final report of the Royal Commission was released on 7 July 2023. Along with 57 recommendations, a sealed section referred several unnamed individuals for further investigation or action, to four separate bodies.
Colleen Taylor, a former employee of the department, received a 2024 King's Birthday Honour for her efforts to expose the scheme. Taylor had tried to raise concerns internally in 2017, and had testified at the Royal Commission.
The NACC's decision received over 1200 complaints, sparking an independent inquiry into the decision by the Inspector of the NACC, Ms Gail Furness SC. The Inspector obtained documents relating to the decision, and requested submissions from the NACC by October. The Inspector found that Commissioner Paul Brereton had a perceived conflict on interest due to a "close association" with one of the individuals involved, and should have recused himself from the decision. The NACC appointed an independent person to reconsider the decision not to investigate.
Following the findings of public service misconduct, lawyers representing the class action announced they would appeal their previous $1.8B settlement, seeking compensation for the further breaches uncovered.
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