In two month’s time, 10 years would have passed since the Robodebt scheme was introduced into Australia via a flawed cabinet submission in April 2015 and the federal budget of that year. Robodebt was described in a 2023 BBC article as a “costly failure of public administration” within which “extensive, devastating and continuing” wrongdoing was perpetrated on Australian citizens.
Between the years 2016-2019, around 800,000 mostly low-income Australian social security recipients received debt notices for overpayment. Of those notices, about 470,000 were false debts, some for many thousands of dollars. The letters demanded immediate payment; the onus was on the recipient to prove the debt was invalid, and debt collectors were assigned to pursue slow payers. One government minister, Alan Tudge, gave evidence under oath that he knew just 0.1% of debts were fraud related, yet he called the letter recipients welfare cheats and made media statements threatening them with jail time. Most had neither the resources to prove the debts false, nor the means to pay them.
The Online Compliance Intervention scheme, otherwise known as Robodebt, was declared illegal in November 2019. By the time the Federal Court made that decision many letter recipients had become crushed by anxiety and trauma after hearing they were being publicly labelled welfare cheats and finding debt collectors at their door. An unknown number, by some estimates as many as 2000, ended their lives by their own hand.
In 2021, the Federal Court ordered that the government set aside $1.8 billion to refund payments for false debts that letter recipients had paid. That sum did not include reparation for pain and suffering or for opportunities lost.
The incoming Albanese Government honoured an election promise to establish a royal commission into Robodebt, and on 6 July 2023 Commissioner Holmes SC concluded her commission by sending a sealed referral to the new National Anti-Corruption Commission. It contained the names of six individuals that she recommended be investigated for potential criminal offences. Five are the names of senior public servants, and one is a politician who served in the Morrison Government.
Eleven months passed in silence. Then, on 6 June 2024 an unnamed NACC Deputy Commissioner issued a surprise one-page announcement by media release which stated that the NACC would not pursue an investigation into the six individuals referred by Commissioner Holmes, and no correspondence would be entered into about the decision. The announcement ended with a line that the commissioner had delegated the decision to a deputy commissioner in order to avoid a potential conflict of interest.
On learning of this announcement, more than 1200 citizens promptly submitted formal complaints to the NACC Inspector, Gail Furness SC. Furness’s role is to assess whether complaints about the performance of the commission have substance, and if they do, to investigate them. Having invited and received a submission from the NACC, she made a finding in October 2024 of misconduct by the NACC Commissioner, Paul Brereton, centring on the deputy commissioner’s media release.
In addition to the deluge of complaints from members of the public, the NACC decision also prompted expressions of astonishment at the NACC decision by the chair of the Centre for Public Integrity, Anthony Whealy KC, and special counsel Geoffrey Watson SC.
The troubling issue at the centre of the decision was crystallised by Furness as involving “the management of the commissioner’s declared conflict of interest in relation to one of the referred persons (Referred Person 1)”. Numerous observers have joined the dots and named that person as Kathryn Campbell, the former secretary of the Department of Human Services who, with the Minister for Social Services at the time, Scott Morrison, oversaw the flawed conception of Robodebt.
The scheme used tax office income averaging to automatically generate debt notices without human intervention. Campbell allegedly colluded with Morrison to avoid stating in the cabinet proposal that legislative amendment was required to ensure the scheme was lawful, a factor that would have scotched the scheme at its inception.
Like Brereton, Campbell was an active senior officer in the Australian Army Reserve, and they were well known to each other in that capacity.
Furness makes clear in her report that “agency maladministration” and “officer misconduct” were the relevant issues. The NACC officers consist of a commissioner, three deputy commissioners, and a chief executive to whom six general managers have a direct reporting line.
In drilling down to the notion of “officer misconduct”, it’s clear that the charge could apply to any of the people holding those positions. Furness defines the notion as “conduct engaged in by a staff member of the NACC, which, if engaged in by the NACC, would amount to agency maladministration”.
This seemingly circuitous definition appears to imply that while there are a number of individuals who make up the staffing allocation of the anti-corruption commission, there is also a body called the NACC which exists as an abstract entity in its own right.
In the case before the inspector, the staff member who officially engaged in officer misconduct is the commissioner himself. As the head of the body set up to uphold standards of integrity, a finding of misconduct by the commissioner is arguably more reprehensible than if it were misconduct by an officer down the pecking order. That is because misconduct at the very top potentially contaminates the conduct of officers reporting down the line, directly or indirectly, it being a part of human nature in a hierarchical organisation to do the bidding of the person at the top. The finding of misconduct therefore touches centrally on the standing of the NACC as an entity charged with upholding the integrity of government administration.
Furness did not simply rely on the resources within her own office to arrive at a perspective on Brereton’s alleged misconduct, but instead engaged the services of senior counsel, Alan Robertson, to provide her with a report on the Robodebt decision.
The wording of the unsigned NACC deputy commissioner’s media release stated that “in order to avoid any possible perception of a conflict of interest, the commissioner delegated the decision in this matter to a deputy commissioner”.
Robertson, however, found the deputy commissioner’s statement to be false. His report to Furness made it abundantly clear that “the commissioner’s involvement in the decision making under section 41 was comprehensive, before, during and after the 19 October meeting at which the substantive decision (on Catherine Holmes’ sealed referral) was made”.
While Robertson found that the commissioner’s misconduct amounted to agency maladministration, he also determined it was “conduct that is not unlawful but arose from a mistake of law”, a mistake that was so strikingly apparent that Whealy was “startled” to discover that Brereton had not seen it.
Furness reports that Deputy Commissioner Jaala Hinchcliffe knew Referred Person 1 and had therefore recused herself from matters relating to the Robodebt referral. Deputy Commissioner Dr Ben Gauntlett also knew Referred Person 1 but only slightly, and so did not recuse himself. The deputy commissioner who issued the unsigned decision expressed in the June 2024 media release was therefore, on process of elimination, the third Deputy Commissioner Nicole Rose.
Rose is not a lawyer, but has academic qualifications in governance and corporate ethics, and had earned herself a public service medal for her regulatory work as the hief executive of AUSTRAC under the Morrison Government. In announcing her AUSTRAC re-appointment in October 2022, Attorney-General Mark Dreyfus drew particular attention to her work in the banking and casino sectors which eventuated in civil penalties to organisations in the order of $1.3 billion for money laundering and counter-terrorism offences.
Taking regulatory actions against big organisations with the capability to pay large corporate fines is not the same as singling out senior officials to be investigated personally for potential criminal liability, as Justice Holmes had done when she referred the six individuals under seal for that purpose. Corporate offenders who are not personally penalised can go on living in relative contentment, often buttressed by handsome salaries that add an element of opulence to their contentment.
Rose aside, the other deputy commissioners and possibly the NACC general manager of legal, Rebekah O’Meagher, would have possessed the lawyerly capability to have seen what it seems Brereton could not see about his own conduct with respect to his ongoing involvement in the Robodebt referral.
But they didn’t. Or if they did, they did nothing about what they saw happening in plain sight.
That said, Furness made no findings against any deputy commissioner, though it might reasonably be suggested that Brereton could not have done what he did without their connivance. The deputy commissioners professional allegiance was to the entity called the NACC, not to Brereton, a mere individual commissioned by the government to captain the NACC ship on its inaugural voyage.
The only scheduled potential for action of any sort is now in the hands of Geoffrey Nettle KC, who was tasked by the inspector with assessing the Holmes’ sealed referral, and deciding what, if anything, the NACC should do about any issues arising from it. As a former High Court Judge, Nettle fits the definition of an eminent person possessing the capability to make an independent assessment, but his appointment raises an issue that might best be explicated by asking how many lawyers are required to change a light globe.
Having been through the initial Royal Commission that culminated in the sealed referral by Catherine Holmes SC, followed by 11 months of deliberations by the NACC commissioner and deputy commissioners, followed by an investigation by Gail Furness SC into the flawed outcome of those deliberations, which in turn included a report by Alan Robertson KC, the saga is possibly about to culminate in an assessment and recommendation by Nettle.
Once the conga line of legal titans have changed that bulb, the question remains as to whether it will ever shed sufficient light to illuminate what might appear a no-brainer by ordinary citizens engaged in what politicians like to call a pub test. They might well see a bleedingly obvious solution that amounts to scrapping what has become a farcical commission and starting again with a more robust model and a more astute set of appointments.
That said, the recommendation by Nettle will be made to the NACC commissioner, a person who has shown little interest to date in a solution that assists in restoring the standing of the institution that his misconduct has brought into disrepute, a solution which could best be served by his resignation.
If ever there were a time for the government to intervene, it may come when the Nettle recommendation is made public, but you wouldn’t want to bet on it.
In saying that, it’s worth being mindful that the Albanese Government gave free passes to the former Governor-General David Hurley and Home Affairs Secretary Michael Pezzullo, each of whom was seen to have engaged in untoward partisan behaviour. Hurley’s involvement in Morrison’s six secret ministries was described by the solicitor-general as actions “not consistent with responsible government”. Pezzullo was well known to be partisan, but was dismissed only after being exposed by two investigative journalists who produced incontrovertible evidence of his improper relationship over many years with a Liberal Party operative.
Other senior public servants and agency heads whose partisan reputations were well known also managed to retain their jobs or get re-appointed, presumably because Albanese stated his disinclination to sack senior public servants.
It’s safe to say that an incoming Liberal Government would not return the favour and that reprisals against Labor ministers would be likely if Tony Abbott’s 2014 pink batts and union royal commissions are anything to go by. Peter Dutton has had nothing to say about the NACC malaise, but then he opposed the idea of a NSW ICAC model from the get-go, and has labelled the Robodebt Royal Commission a “witch hunt”.
The mystery remains as to why Albanese has delivered an impotent NACC that suits his Coalition opponent while seemingly content to haemorrhage votes from his supporter base over his failure to fulfil a key 2022 election promise to establish an effective anti-corruption commission.
Paul Begley
Paul Begley has worked in public affairs roles for three decades, the most recent being 18 years as general manager of government and media relations with the Australian HR Institute.