Robodebt and the APS

Jul 13, 2023
Male hands against Australian flag.

The Robodebt scandal reflects badly on the Australian Public Service generally, and not just on those immediately responsible.

The main focus of the Report by the Royal Commission into Robodebt and subsequent publicity and comment has been on the illegality of the scheme. But as has been observed by some Liberals, the illegality could readily have been fixed by legislative amendment.

What concerns me, as much or more, is the unfairness and cruelty of Robodebt and the flawed conceptual thinking by Ministers and public servants that led to the adoption of this fundamentally flawed scheme. In particular, I worry about the quality of the policy judgement and advice from the Australian Public Service (APS) under Morrison, and not just in the relevant departments, but also in the key central agencies.

As I previously wrote in Pearls & Irritations last year, the purpose of income support payments is to assist the recipients to maintain a minimum standard of living. Obviously, these payments should be reduced by a proportion of any private income which a recipient receives during the fortnight covered by that payment, and which can therefore be used to support their living standard during that fortnight.

What Robodebt did, however, was to assume that people receiving income support have a stable and continuing private income stream. On that basis, Robodebt took the fortnightly average of the recipient’s annual income in the previous year, as recorded by the Tax Office, and used that to calculate that person’s current income this fortnight.

But as I previously wrote, “everyone from the most junior officer to the Head of the Department and the Minister (Morrison) should have recognised that this assumption [of income stability] was fundamentally flawed.” We all know that for most people on welfare their income fluctuates considerably during the course of a year.

Most obviously, unemployed people will work some of the year, and their earnings are by design higher than their income when they are not working and receiving government income support through Newstart. But the same is true of people receiving youth or parenting payments or Austudy. Thus, for those recipients deemed to have a private income, their average income last year is irrelevant.

Indeed, I have since discovered that Professor Peter Whiteford, in a report for the Royal Commission, using data from the Department of Social Security, found that:

  • More than 93% of those with earnings while receiving youth payments did so unevenly,
  • As did 95% of those receiving income while on Newstart or Austudy, and
  • 90% of those receiving income while on parenting payments.

In my view, public servants had a duty to make this information available to ministers and to advise against Robodebt accordingly.

As the Royal Commission found there were:

“repeated failures by members of the Australian Public Service (APS) to discharge their professional obligations and to adhere to the values and standards that applied to their roles.”

Furthermore, these failures were not limited to senior officers in the then departments of Human Services and Social Security. The Royal Commission reports that “Equally disheartening was the ineffectiveness of what one might consider institutional checks and balances – the Commonwealth Ombudsman’s Office, the Office of Legal Services Co-ordination, the Office of the Australian Information Commissioner and the Administrative Appeals Tribunal – in presenting any hindrance to the Scheme’s continuation.”

While these organisations should arguably have been more active in pointing out the difficulties being experienced by people on welfare as a result of Robodebt, I suspect that they were seriously under-funded themselves. Furthermore, there are other departments that have escaped notice and which must bear some responsibility for not pointing out the flawed conceptual basis of Robodebt.

In particular, the two key coordinating departments, Prime Minister & Cabinet (PM&C) and Finance (both of which I once headed) have staff who are meant to monitor the programs of the relevant line departments and agencies and advise Cabinet on all new policy proposals accordingly. In my time the experts in the relevant divisions in PM&C and Finance were largely recruited from the line departments precisely because of their subject-matter expertise, and because it was considered that a few years at the centre of government would be good for their career development.

To me it is therefore inexplicable how these staff in PM&C and Finance also failed to spot and brief on the inherent flaws in Robodebt before it was even approved.

It may be that these officers will seek to excuse their failure by saying that the cabinet submission covering the Robodebt proposal was inadequate. According to the Royal Commission, the final version of that cabinet submission was changed by the Department of Human Services to “remove any reference to ‘smoothing’, ‘averaging’, apportioning or the need for legislative change.”

Nevertheless, I would argue that the Finance officers in particular are charged with the responsibility to check all the costings in every cabinet submission involving money. Indeed, given the obvious incentives for spending departments to exaggerate the savings from proposals to save money and under-estimate the costs of new spending policy proposals, these checks are essential.

That means however that if Finance was doing its job, it should have demanded access to all the details of how the proposed savings would be realised.

Finally, as an aside, my recollection is that when I was the Cabinet Secretary it was a long-standing requirement that every Cabinet submission had to address the question of whether the recommendations in the submission would require legislation. Apparently that requirement has disappeared, and the Royal Commission has recommended that it be reinstated. But I wonder why it ever was taken out and by whom?

In sum, it seems that the task for the Albanese Government in restoring public service capability is much bigger, than just getting rid of a few rotten apples who used to work in the Department of Human Services. The quality of professional advice needs to be lifted across the public service, if it is to do its job. And not just in the spending departments, the coordinating departments need to improve significantly as well compared to their performance during the Robodebt saga.

As Commissioner Holmes said in her Preface to the Royal Commission Report, first, we need a culture change if we are to ensure that something of the like of the Robodebt scheme could not occur again, and because culture is set from the top down, that culture will depend upon the will of the government of the day.

Second, Holmes has said that “politicians need to lead a change in social attitudes to people receiving welfare payments”. As Ross Gittins also wrote in implicit support of that conclusion – “most of us knew – or certainly could have known – what was going on, but weren’t too bothered by it.”

The truth is that we are happy to blame ‘dole bludgers’ for their predicament, and too many of us despise those people Joe Hockey memorably describes as ‘leaners’ not ‘lifters’ like us.

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