The report of the Royal Commission into the Robodebt debt recovery scheme makes 57 recommendations including referring certain individuals for civil and criminal prosecution.

The names are included in a sealed chapter of the report, Royal Commissioner Catherine Holmes says.

“I have provided … an additional chapter of the report which has not been included in the bound report and is sealed. It recommends the referral of individuals for civil action or criminal prosecution,” she says.

Commissioner Holmes has described the lengths that public servants were prepared to go to in order to “oblige ministers on a quest for savings” as “remarkable” in her preface to the three-volume report released on Friday.

She’s also criticised the apparent lack of interest in ensuring the scheme’s legality, how rushed its implementation was, and how little thought was given to how it would affect welfare recipients.

The Commissioner has also described the “dishonesty and collusion to prevent the Scheme’s lack of legal foundation coming to light” as “truly dismaying”, and has slammed the ineffectiveness of the government bodies that were supposed to provided institutional checks and balances.

“Equally disheartening was the ineffectiveness of … the Commonwealth Ombudsman’s Office, the Office of Legal Services Coordination, the Office of the Australian Information Commissioner and the Administrative Appeals Tribunal – in presenting any hindrance to the Scheme’s continuance,” she says.

“Whether a public service can be developed with sufficient robustness to ensure that something of the like of the Robodebt scheme could not occur again will depend on the will of the government of the day, because culture is set from the top down.”

Senior public servants criticised

The then head of DHS, Kathryn Campbell, who now holds a position within Defence advising the AUKUS program, in among a number of public servants criticised in the report.

Ms Campbell was the secretary of DHS from March 2011 to 17 September 2017 and the secretary of DSS from 18 September 2017 to July 2021.

“Ms Campbell had been responsible for a department that had established, implemented and maintained an unlawful program,” the report says.

When exposed to information that brought to light the illegality of income averaging, she did nothing of substance. When presented with opportunities to obtain advice on the lawfulness of that practice, she failed to act.

Royal Commissioner Catherine Holmes

“When exposed to information that brought to light the illegality of income averaging, she did nothing of substance. When presented with opportunities to obtain advice on the lawfulness of that practice, she failed to act.”

Government News has sought confirmation of media reports that Ms Campbell is currently on leave.

Professor Renee Leon took over as DHS secretary in October 2018.

The Commission found some of her actions were designed to prevent the scheme from coming under public or political scrutiny, that she provided misleading information about it, and delayed providing information to appropriate people.

Commissioner Holmes said some of Professor Leon’s actions were partly “symptomatic of a culture at Services Australia and DSS that discouraged the conveying of adverse information”.

DHS General Manager Business integrity Mark Withnell, the report says, knew of and understood legal advice obtained in 2014 that the use of income averaging to work out welfare payments was unlawful, but ”engaged in deliberate conduct designed to mislead cabinet.”

Recommendations

The report’s recommendations cover a number of areas including government data matching, automated decision making, lawyers and legal services, improving the public service and reinforcing the capability of oversight agencies.

They include calls for an immediate review of Services Australia and for the Commonwealth to consider establishing a body with the power to monitor and audit automate decision-making processes, as well as considering legislative reform to establish a legal framework for automation in government services.

Services Australia should also put in place processes for “genuine and receptive consultation” with frontline staff when new programs are being designed and implemented, the Commissioner recommends.

Lesson for public servants

Prime minister Anthony Albanese described Robodebt as a gross betrayal and a human tragedy which unlawfully raised $1.76 billion in alleged debts against vulnerable members of the community.

“It was wrong, it was illegal, it should never have happened  and it should never happen again,”  he told a media conference.

Mr Albanese said the sealed chapter containing names of people referred for prosecution was in the hands of agency heads including his departmental head Glyn Davis, who have the power to stand down public servants.

“They are empowered to take action including the potential suspension as an act to ensure proper processes,” Mr Albanese said.

But he said he wouldn’t be immediately releasing any names, in line with the Commissioner’s Holmes desire not to prejudice any potential prosecutions.

Government services minister Bill Shorten said the report “shows the previous government and senior public servants gaslighted the nation … for four and a half years”.

“This is a lesson for the public service of Australia one which I hope resonates for the next generation,” he told reporters.

He paid tribute to the frontline staff of Services Australia who spoke up despite being forced to implement “unconscionable propositions”.

Government ignored warnings of illegality of scheme

The Robobdebt automated debt recovery program ran between 2015-2019 and sent incorrectly calculated debt notices to more than 400,000 people.

The scheme used automated income averaging to match data from the ATO with social security data to work out if recipients were being overpaid.

The Royal Commission heard that lawyers warned against the legality of the scheme in 2014 but the scheme was allowed to continue.

It was suspended in 2019 and the Commonwealth settled a class action in 2020 for $1.8 billion.